Overview of Property Law
While Property law is a separate branch of the
law, it overlaps with contract law.
Any agreement to sell or lease involves a contract.
Yet, there are a lot of legal principles that are unique
to property ownership.
Property is classified as either Real Property or
Real Property—land and anything affixed to it, such
as a house or a tree
Personal Property—Everything else, including
money and intangible property rights, such as a
copyright or patent.
Owen Owns Blackacre. In his will he
leaves Blackacre “to my wife Lee for her
life and then to my son, Findley.”
Can he do this?
After Owen dies, Lee sells the land to Simon.
Can he? what will Simon get?
AfterOwen dies, but while Lee is alive,
Can he? What will Simon get.
Types of Ownership Interests
Types of Ownership Interests
Fee simple—an outright ownership in land. It means
nobody else has a claim to ownership now or in the
Life Estate— The right to occupy and use the land for
one’s lifetime. Owner might leave Blackacre to wife
for her life and then to oldest son. Wife had a life
estate. She couldn’t be ejected during her life, but
could not sell anything more than the right to occupy
during her life.
Future Interest—The right to possession of the
property in the future. Someone who takes after a
Life Estate would have a “future interest”
Ownership by two or more people with the right of survivorship.
Both own and have a right to use and sell the entire property
When one dies, the other automatically owns the whole. The
interest isn’t divisible. Each is an owner of the entire estate.
One owner can’t sell their half without the consent of the other,
which severs the joint tenancy.
While one joint tenant has the right to sell on their own and
purchaser gets clear title, they would have an obligation to
account to their co-owner for the proceeds.
Most joint bank accounts are set up this way automatically. Most
joint owners of real property have deeds set up this way.
Typically, this is how married couples own property.
Tenancy in Common
Ownership by two or more persons without a
right to survivorship.
Each owns a proportional share of the whole
and has a right to use the whole,
Can sell their share and leave their share to
Owen leaves Blackacre (an 80-acre farm) to his
two sons Cain and Able as joint tenants.
How many Acres does each son get?
Cain dies, who gets his share?
Cain sells Blackacre to David without telling Able. Is
the sale valid? What does David get?
Same as above, but Owen leaves it to them as
tenants in common.
Owen leaves Blackacre “to my sons Cain
and Able.” Does this create a joint
tenancy or tenancy in common?
Modern Rule: The law presumes a
tenancy in common unless a joint tenancy
is clearly intended by the words of the
devise or deed.
A fee simple owner owns the land from the
center of the earth to a reasonable space above
the land. Also has the right to exploit all parts of
Can sell or lease a part of those rights.
Common in Kansas to sell or lease the mineral
rights. Owner has right to use and exploit the
surface, but someone else has the right to
exploit subsurface oil, gas or minerals.
If alease, owner usually gets share of what comes
Owen wants to leave Blackacre to his
daughter Eve, but he doesn’t think she has
the experience or skill to manage the
property. So, he creates trust that allows
Eve and her heirs to use the property and
to keep all proceeds and other income
from the property. Adam will be the
trustee and manage the property.
Who owns the property?
Equitable Ownership Interests
In a number of different situations it is
possible to have an interest in property
that gives you legal rights that are not an
Equitable rights of a beneficiary in a trust.
Beneficiary is entitled to the use of the
property with conditions and restrictions,
but ownership is in trustee
A and B have adjoining property. A wants to
build a driveway to his house, but the most
convenient and inexpensive route requires that
the driveway go 4 feet onto B’s property. B says
that A can build the driveway, but refuses to sell
the land on which the drive will go. A is afraid
that B will sell his house and a new owner will
rescind permission to cross the land.
What to do?
A and B have adjoining property. 15 years ago A
built a driveway to his property which
inadvertently was 4 feet onto B’s property. B
discovers that the drive is on his property and
demands that it be moved. It can’t be moved
except at great cost.
Does A have to move the driveway?
Does A have to pay B any money?
What if the mistake was only 2 years ago?
The government wants to build sidewalks.
They tell homeowners that they are going
to build across the front of their properties.
Do they have to pay anything?
An easement is the right to use (usually to cross)
Many easements are created by deed or
Some easements are created by law out of
fairness. Proscriptive Easement. An
easement created by long use without objection
by the owner
Some easements are created by eminent
domain by government or by government as a
condition of allowing property to be developed.
Thus, the city has an easement on the first three feet
of property in most cities for sidewalks
Often has an easement to run water and sewer lines.
Paul borrows 100K from the First Bank of
Bling. The Bank takes a mortgage on the
house and files the mortgage with the
registrar of Deeds.
A year later Paul still owes 98K. He sells
to Brenda. Brenda writes him a check for
98K. Paul runs off to Rio with the money
and doesn’t pay back the bank.
What can the bank due?
Lien or Mortgage
A lien or mortgage secures a debt owned
to a person by a landowner.
Mortgage occurs when loan was to buy the
lien occurs where the borrower offers existing
property as security to purchase something
else; also a mortgage on personal property,
such as a car, is called a lien.
As long as the owner pays the debt, the creditor
has no claim to the property. However, if the
landowner defaults, the creditor can eventually
have the property sold to satisfy the debt.
In most states a lien must be filed with the deed so
that someone purchasing later will be aware of the
If lien is filed, purchaser must pay the lien amount to
lien-holder and the balance to owner.
Car titles also list lien-holders.
Transfer of Ownership
Deeds. Regardless of how title is held to real
property, title is usually manifested by a deed, which
is a document that describes the property and lists
The deed is recorded. When the deed is recorded it
puts everyone on notice regarding ownership of the
property, gives protection to the listed owners, and
prevents an original owner from conveying property
more than once.
Deeds are the document that accomplishes a legal
transfer of property. All states require that any land
sale be in writing.
Different types of deeds transfer different warranties
about what is owned.
The most common type of deed is a warranty deed. Such a
deed guarantees clear title to the property. If later it is
discovered that owner did not have clear title, purchaser can
recover from seller.
But, seller may not have money, hence title insurance.
Grant Deed—Represents that the seller has not sold to anyone
else, but does not make any promises about claims against the
property that predate the seller.
Quitclaim deed—Transfers whatever the seller owns. It makes
no representations about the existence of claims against the
While a deed does transfer owners, it should be
recorded to put others on notice of your assertion of
When buy and sell real property, it is common to have a
title company do a title search to ensure that there isn’t
anyone who has a claim, whether whole or partial to the
Typically, the seller is required to buy title insurance,
insuring the buyer against any claim to the property.
Mechanics of buying and selling a house
Listing the home for sale. Most people who sell their
home list their home with a Real Estate Agent.
In all states, real estate agents have to be licensed and take an
Real Estate Agents work on a commission and are hired by the
Seller. Thus, even if they are showing you the home, their duty
is to the seller.
Sometimes a house is listed with Agency “A” and the buyer
contacts Agency “B” to show them homes. If the buyer buys the
house, the two Agencies will split the commission. This is called
an open listing, meaning that any agency can show the house.
If you are a buyer using an agent that isn’t the listing agent, that
agent may owe duties to both you and the buyer.
Sam has listed his house with R.E. Andrews, a
real estate agent. Sam runs into his friend Brian
at the store and tells him that his house is for
sale. Brian is very interested and decides he
wants to buy it. Before they leave the store, they
have reached a binding contract to sell without
any help from R.E. Andrews. Is the agent
entitled to a commission.?
What if Sam and Brian keep their contract secret
and wait until the agency agreement expires to
execute the sale?
Mechanics of buying and selling a house
Typical commission is 5%. Sellers have to take
that out of what they get for the house.
Sometimes B and S will negotiate for the B to pay the
fee, but is really just an increase in the sell price.
Sometimes, but not often, a RE agent will agree to
reduce their commission to help get a house to sell.
Agent is entitled to commission regardless of
whether the agent played a role in the sale. If
Buyer found Seller or Seller contacted buyer
during the listing period, agent gets a cut.
Advantage of using a RE agent.
They will market the house
It will be listed with all other agents, so any
agent helping a buyer will know about it
They have expertise in the law of Real Estate
and RE valuation and will help the Seller
through the process to avoid legal problems.
Mechanical and Structural Defects
Most states require a seller to disclose any known
defects in the home that are not reasonably apparent
from an inspection of the home.
Some states require buyers to disclose the age of roof
and other major structural or mechanical problems of
which they are aware
Thus, if the basement leaks when it rains heavily and
you are selling in dry season, S must disclose.
Buyers are strongly encouraged to hire a professional
home inspector and to have a home inspected for
termites, radon and have roof inspected.
Often the contract will be conditioned on the home
passing all these inspections, although typical the
contract will give the seller the right to repair and keep
the contract in place.
Step 2—The Real Estate Contract
If the B agrees to buy the house and Seller
accepts the purchase price, they will negotiate a
contract for sale. (Probably don’t have a
“contract” if simply agree to price)
Contract will list the earnest money (down
payment that is forfeited if B reneges), purchase
price, closing date and any contingencies that
will allow one side or another to get out of the
House passing all necessary inspections
S agreeing to repair something
B selling their existing home within X date.
This contingency will be in place when the B hasn’t yet sold their
own home, but doesn’t want to buy until they know they will so they
aren’t making double payments. If the S thinks there is a strong
market for his own home, may not agree to this one. If the S is
having a hard time finding a B, they will be more likely to take this
B getting approved for a mortgage. This is standard. Often B
has been pre-approved for a mortgage, which makes them a
better prospect for an S. But, even so, the actual loan ON THAT
HOUSE must be approved by the mortgage co.
House passing a title inspection
Other things in the contract besides the obvious
Whether any furnishings or other moveable objects
stay with the house. (who gets the swing set?)
That buyer paying for title insurance
What happens to yearly expenses, such as property
taxes, already paid
Who pays for inspections.
Buyers should always have a lawyer read the
contract. The agent is working for the seller.
Step 3—Getting a Mortgage
Whether or not you can get a mortgage depends on
Price of the home related to income
How much you are willing to put down. You are less likely to
default if you have more of your own money in the home.
The usual reason can’t get a mortgage is bad credit or
trying to buy too much house for your income.
Note that when a bank forecloses, they have no
obligation to protect your equity. They simply want to
sell for enough to get THEIR money back. Thus, often
lose down payment and any accumulated equity.
Step 3—Getting a Mortgage
Types of Mortgages
Fixed Rate —The interest rate stays the same for the
entire length of the load.
Variable Rate —Interest rate starts lower than a fixed
rate, but it can go up if interest rates set by the Fed go
up. Riskier for buyers, but can be attractive to reduce
price of payments initially. Often people take these
loans out with the idea that they will re-finance to a
fixed rate later.
Graduated Payment —Fixed rate, but have lower
payments initially, which then go up after a few years
and then stay flat.
Step 3—Getting a Mortgage
Most mortgages are for 30 years. Other standard term is 15
Length of Mortgage effects monthly payments and the amount
paid over the life of a loan.
15 year mortgage is much more expensive per month, but it
allows you to pay much less over the life of the loan.
Most mortgages front-load the interest. Thus, over the first 5
years you build very little equity in a home (the amount of the
home you actually have paid for). Last 5 years almost all is
Mortgage payment calculator
Eminent Domain—The power of the
government to take property of citizens for
public use without their permission.
Under the Constitution (5th and 14th
Amendment) Government must pay just
Can only be done for a public purpose
Build or widen road
Build a school
Build a park
Which of the following will be a valid grounds for
challenging eminent domain
The property it taken for a park. The city already has
a lot of parks.
The property has been in the family for 200 years and
has great sentimental value, but the city only offers
compensation for the value of the land.
The city is building a road, but it could easily be built
elsewhere through an area where the land would be
The highway being built goes through sacred Indian
Court won’t second-guess the wisdom of the public
project. Can’t challenge eminent domain to build a park
by arguing that already enough parks. So long as the
purpose is public, courts won’t interfere.
Only requires compensation for a Taking
Taking ordinarily must be direct and deprive person to title and
can be only part of a parcel of property.
Taking is not simply regulating through zoning
Compensation—fair market value prior to the taking.
What the property would have sold for on the open
No additional compensation because of subjective value to
owner. Ultimately is determined by the courts.
Land use and zoning involves the regulation of the use
and development of real estate. The most common form
of land-use regulation is zoning
What are Zoning Regulations?
The basic purpose and function of zoning is to divide a
municipality into residential, commercial, and industrial districts
(or zones), that are for the most part separate from one another,
with the use of property within each district being reasonably
Within these three main types of districts there generally will be
additional restrictions that can be quite detailed.
Regulations may restrict areas to single-family homes or to multi-
family dwellings or townhouses. In areas of historic or cultural
significance, zoning regulations may require that those features
Regulation of Development
Land-use regulation is not restricted to controlling
existing buildings and uses; in large part, it is designed
to guide future development.
Municipalities commonly follow a planning process that
ultimately results in a comprehensive or master plan,
and in some states the creation of an official map for a
The master plan is then put into effect by ordinances
controlling zoning, regulation of subdivision
developments, street plans, plans for public facilities,
and building regulations.
Future developers must plan their subdivisions in
accordance with the official map or plan.
Limits on Zoning
Courts have held that a zoning regulation is
permissible if it is reasonable and not arbitrary; if
it bears a reasonable and substantial relation to
the public health, safety, comfort, morals, and
general welfare; and if the means employed are
reasonably necessary for the accomplishment of
Given the subjective nature of these factors,
there is obviously a lot of room for disagreement,
and on occasion litigation.
Applying for a Change of Zoning
If the zoning on a parcel of land is
inconsistent with the use the land owner
desires, the owner may apply to the local
jurisdiction for a change of zoning.
If the owner is unsuccessful in obtaining
the change, there may be a possibility to
appeal the action, either within the
administrative structure of the
governmental body or in a court of law.
A variance is a request to deviate from current
zoning requirements. If granted, it permits the
owner to use the land in a manner not otherwise
permitted by the zoning ordinance. It is not a
change in the zoning law. Instead, it is a specific
waiver of requirements of the zoning ordinance.
Typically, variances are granted when the
property owner can demonstrate that existing
zoning regulations present a practical difficulty in
making reasonable use of the property.
Non-Conforming, Pre-existing Uses
A nonconforming use is a permitted use of property
which would otherwise be in violation of the current
The use is permitted because the land owner was using
the land or building for that use before the zoning
ordinance became effective.
Nonconforming uses are often referred to as being
"grandfathered in" to a zoning code.
In order to qualify for nonconforming use, the property
almost always needs to have been continuously put to
the non-conforming use.
Thus, if the businesses closes and the use lapses for
any time, the permission for the nonconforming use
Usually based on a Lease—a contract
between the landlord and the tenant.
Relationship also governed by state law
which imposes obligations on the landlord
and limits what landlord can require of
Standard Lease Provisions
The names of the parties
A description of the rental property
The term, or length, of the lease
The amount of rent
The due date of the rent
The amount of the security deposit
Whether the tenant is subject to late fees
Options to renew
Termination notice requirements
When the landlord may enter the rental property
Rules concerning pets
Bert and Ernie are roommates and enter
into a lease with Oscar to rent an
apartment for $500 per month. Ernie
drops out of school and leaves town. How
much rent does Bert owe?
Same, but Ernie throws a fit, breaks a
window and trashes the carpet in his
room. Does Bert own anything if Ernie
doesn’t pay for the damage?
Unless the lease specifically states
otherwise, the tenants are jointly and
severally for the rent.
Unless the lease specifically states
otherwise, the tenants are jointly and
severally liable for any damages.
Term and Length of Lease
A lease over a year must be in writing.
Oral leases are month to month
Typically lease will provide for notice of
After the expiration of a lease, lease will
convert to month-to-month unless the
lease calls for an automatic renewal.
By law, security deposit is limited to 1-
month rent for unfurnished dwelling, 1.5
for furnished dwellings and 2-months rent
if there is a pet.
Purpose is to provide fund to pay for
damages to the property.
If a landlord wrongfully refuses to return
the deposit, are subject to statutory
Under most state and local laws, landlord
must offer and maintain housing that
satisfies basic habitability requirements,
such as adequate weatherproofing,
available heat, water and electricity, and
clean, sanitary, and structurally safe
Local building or housing codes typically
set specific standards.
Consequences of Not Making
When a tenant requests necessary repairs and the
landlord or property manager doesn't meet legal
responsibilities in providing them, a tenant usually has
several options, depending on the state. These options
withholding the entire rent until the problem is fixed
(some states require the tenant to place the rent in an
hiring someone to make necessary repairs and
deducting the cost from the next month's rent.
paying less rent
calling the local building inspector, who can usually order
landlords to make repairs, or
moving out, even in the middle of a lease.
Alex moves and won’t be able to fulfill the last 6
months of his 1-year lease. Tim is willing to take
over the lease as a sub-tenant.
If the landlord doesn’t like Tim, can he prevent
the sublease from happening?
If the sublease happens and Tim fails to pay the
rent or damages the apartment, does the
landlord have a claim against Alex?
Unless the lease gives the tenant the right to
sublease, can only do so with permission of the
If a sublease, the original tenant still owes duties
to the landlord.
The other option is for a third party to assume
the lease with permission of landlord. In that
case the third party would take over the duties of
tenant and the original tenant would be off the
Entry to Rental Property
Typically, after giving notice to tenants, LL can enter
rented premises in order to make needed repairs (or in
some states, just to determine whether repairs are
necessary), or to show the property to prospective new
tenants or purchasers.
States typically require LL to provide 24 hours' advance
notice before entering a rental unit.
Without advance notice, in most states a landlord or
manager may enter rented premises while a tenant is
living there only in an emergency, such as a fire or
serious water leak, or when the tenant gives permission.
Kansas Landlord-Tenant laws