chapter 3. georgia real estate an introduction to the profession eighth edition chapter 3 rights and...

Chapter 3

Georgia Real Estate An Introduction to the Profession

Eighth Edition

Chapter 3

Rights and Interests in Land

Key Terms• chattel• easement• eminent domain• encroachment• encumbrance• escheat

• estate• fee simple• lien• police power• qualified fee estate• title

© 2015 OnCourse Learning

Government Rights in Land

In the allodial system, land is owned to the benefit of the people. It is still necessary for the government to retain the rights of police power, eminent domain, taxation and escheat.


Police Power

The right of government to enact laws and enforce them for the order, safety, health, morals and general welfare of the public is called police power.

This includes zoning laws and building codes.


Eminent Domain

The right of government to take ownership of privately held real estate is called eminent domain.

1. The property MUST be for public purpose

2. The property owner MUST be paid a fair and just compensation.


Eminent Domain

The process of eminent domain is condemnation.

An inverse condemnation is a proceeding brought by property owners demanding that their land be purchased from them.


Taxation

Land is impossible to hide, making it easily identifiable for taxation.

Real property tax is a major source of government revenue. It provides money for schools, fire and police protection, parks and libraries.


Escheat

When a person dies and leaves no heirs and no instructions as to how to dispose of real property, or when property is abandoned, the ownership of that property reverts to the state through a process called escheat.


Fee Simple

The fee simple bundle of rights can be held by a person and his or her heirs forever.

Estate refers to one’s legal interest or rights in land.


Fee Simple

Title = rights Rights = estate


Fee Simple

Fee simple is the largest estate someone can hold in land.

Title refers to the ownership of something.

All other lesser estates are created from the fee estate.


Encumbrances

Impediments to title are called encumbrances.

An encumbrance is any claim, right, lien, estate or liability that limits the fee simple title to property.


Encumbrances

Common encumbrances are easements, encroachments, deed restrictions, liens, leases, and air and subsurface rights.


Easements

An easement is a right or privilege one party has to the use of land of another for a special purpose consistent with the general use of the land.

Easements are given to telephone and electric companies to erect poles and run lines over private property.


Easements

Easements can be given to people to drive or walk across someone else’s land.

Easements can also be given to gas and water companies to run pipelines to serve their customers.


Easements

A landowner can grant an easement in writing.

An owner can reserve an easement in the deed when granting property to another party.

An easement can also be created by government condemnation.


EasementsA buyer cannot be landlocked by the seller. This is known as an easement by necessity. This can occur without a written document.

If a person acts as though they own an easement, and the use is open, obvious and without permission, they can obtain an easement by prescription.


Easements

Easements can be created in 5 ways:

1. Grant2. Reservation3. Condemnation4. Necessity5. Prescription


Easement Appurtenant

Appurtenant means to “belong to” or is a “part of”.

An appurtenant easement always requires at least two properties: servient and dominant.


Easement in Gross

An easement in gross is a servient estate, but no gross estate. Telephone, electricity and gas line easements are all easements in gross.

All future owners of the property will be bound by these easements.


Easement in Gross

An example of a personal easement in gross would be an easement to hunt or fish on someone else’s property.

Personal easements in gross terminate with the death of a party or the transfer of the property.


Easement in Gross

Commercial easements in gross do not terminate on death or transfer.

Commercial easements in gross may be assigned to another person, while personal easements in gross cannot.


Party Wall Easement

Party wall easements exist when a single wall is located on the lot line that separates two parcels of land.

A party wall is an easement appurtenant.


Easement Termination

Easements may be terminated when the necessity no longer exists, when the dominant and servient estates are combined, by release from the easement holder to the servient estate or by lack of use.


Commonly Found Easements


Encroachments

The unauthorized intrusion of a building or other form of real property onto another person’s land is called an encroachment.


Commonly Found Encroachments


Deed Restrictions

Private agreements that govern the use of land are known as deed restrictions.

Violation of a deed restriction can result in a civil court action brought by other property owners who are bound by the same deed restrictions.


Liens

A hold or claim that one person has on the property of another to secure payment of a debt or other obligation is called a lien.

A lien does not transfer title to property.


Voluntary and Involuntary Liens

A mortgage lien is an example of a voluntary lien.

Property tax liens, judgment liens and mechanic’s liens are examples of involuntary liens.


Property Tax Liens

Property tax liens are always superior to other liens.

Property tax liens result from the right of government to collect taxes from property owners. If they are not paid, the lien gives the government the right to force the sale of the property to collect the unpaid taxes.


Mechanic’s Liens

Mechanic’s lien laws give anyone who has furnished labor or materials for the improvement of land the right to place a lien against those improvements and the land if payment has not been received.


Mechanic’s Liens

A lien statement must be filed in the county where the property is located within 90 days of the last date labor or material was furnished.

The person filing the lien must then file suit against the responsible party within one year.


Judgment LiensJudgment liens arise from lawsuits for which money damages are awarded.

If the debtor does not repay the lien voluntarily, the creditor can ask the court to issue a writ of execution that directs the sheriff to seize and sell the debtor’s property to pay the debt and expenses of the sale.


Mortgage Lien

A mortgage lien is created when property is offered by its owner as security for the repayment of a debt.

If the debt secured by the mortgage lien is not repaid, the creditor can foreclose and sell the property.


Qualified Fee Estates

A qualified fee estate is a fee estate that is subject to certain limitations imposed by the person creating the estate.

They are rather uncommon.



A fee simple determinable estate key words are “for so long as”.

For example: Mr. Smith sells a piece of land to a church so long as the land is used for religious purposes. The church has all the rights of fee simple ownership so long as the land is used for religious purposes.



If some other use is made of the land, it reverts back to the grantor (Mr. Smith) or someone else named by Mr. Smith, called a remainderman.

Termination of the estate is automatic if the land is used contrary to the limitation stated in the deed.



A fee simple subject to condition subsequent gives the grantor the right to terminate the estate.

Mr. Smith would have the right to reenter the property and take it back if it was no longer being used for religious purposes.


Life Estates

A life estate conveys an estate for the duration of someone’s life. The duration of the estate can be tied to the life of the life tenant or to a third party.

Someone must be named to acquire estate upon its termination.


Life Estates

If you want it back, you would want a reversion for yourself.

If you want it to go to someone else, you would name them as the remainderman.


Life Estates

A life estate pur autre vie is created for the life of another.

For example: I will deed this property to Jim for the life of his mother. Upon the death of the mother, the life estate would revert to the grantor or the remainderman, according to the terms of the life estate.


Prohibition of WasteThe life tenant must not commit waste by destroying or harming the property.

The life tenant is required to keep the property in reasonable repair and to pay any property taxes, assessments and interest on debt.

The life tenant may sell, lease, rent or mortgage the interest in the property.


Dower

The dower right grants the wife legal ownership to one-third of the family’s real property for the rest of her life.

Georgia does not recognize the rights of dower.


Curtesy

Curtesy gives the husband benefits in his deceased wife’s property as long as he lives.

Georgia does not recognize the rights of curtesy.


Community PropertyCommunity property rights arise upon marriage and terminate upon divorce or death.

Upon the death of one spouse, community property passes to the heirs and surviving spouse.

Georgia does not recognize community property.


Homestead ProtectionHomestead protection laws provide some legal protection for the homestead claimants from debts and judgments that might result in the forced sale and loss of the home and provides for a home for a widow.

Homestead protection laws do not protect people from being foreclosed on.


Freehold Estates

Georgia considers leasehold estates as real property.

A freehold estate must be of unpredictable duration and there must be actual ownership of the land.


Leasehold Estates

A leasehold estate is of definite or indefinite duration and there is only possession of the land, there is no ownership.

Under a leasehold estate, the user is called the lessee or tenant.


Leasehold Estates

The person for whom it is leased is the lessor or landlord.

The owner cannot occupy the property until the lease has expired.

During the lease, the owner holds a reversion.


Leasehold Estates

The owner has a right to recover possession at the end of the lease period.

The lease is an encumbrance against the property.


Estate for Years

As estate for years has a specific starting and ending time. It can be for any length of time.

An estate for years does not automatically renew itself. Neither the landlord nor the tenant must submit notice to terminate it.


Periodic Estates

A periodic estate is also called an estate from year to year. It has an original lease period with a fixed length. When it runs out, unless terminated, it renews automatically for another period.

Month-to-month apartment rentals are an example of a periodic estate.


Periodic Estates

Advance notice must be given if either the tenant or the landlord wishes to terminate the tenancy.

• Tenants must give 30 days notice.• Landlords must give 60 days notice.


Estate at WillAn estate at will may be terminated by either the lessor or the lessee at any time. An estate at will is for an indefinite period of time. It is usually not in writing.

The rights of the parties terminate automatically with the transfer of the property or the death of one of the parties.


Tenancy at Sufferance

A tenancy at sufferance occurs when a tenant stays beyond the legal tenancy without the consent of the landlord.

The tenant is called a holdover tenant.


Tenancy at Sufferance

The landlord is entitled to evict that person and recover possession of the property, provided the landlord does so in a timely manner.

If the tenant pays rent and the landlord accepts it, the tenancy at sufferance changes to a tenancy at will.


Rights and Interests in Land


License

A license is a personal privilege given to someone to use land.

A license can be given verbally and it can be revoked by the person who issues it.

A license is not an encumbrance.


Chattel

A chattel is an article of personal property.

A chattel mortgage is a mortgage against personal property.


chapter 3. georgia real estate an introduction to the profession eighth edition chapter 3 rights and...

Documents

oncourse learning slide

land slide

fee simple fee simple

fee simple title

easements easements

taxation land

use of land

fee simple bundle of