William Mitchell College of Law
FINAL EXAMINATION
PROPERTY II Professor Byrne
Spring 1998 Section 1
INSTRUCTIONS
Part 1. Question 1 25 pts.
Part 1. Question 2 25 pts.
Part 2. Question 3 30 pts.
Question 4 20 pts.
Question 5 25 pts.
Part 3 25 pts.
Part 4 25
pts.
Total 175 points
(1 pt. per minute, with 15 minutes extra)
4. There should be enough space for your answers on the exam
this time.
5. Please write your exam number on each page.
6. Have a great summer!
Part 1.
You just received the following memo from Senior Partner:
To: Associate
From: Senior Partner
Re: Clem Clematis
Our client, Clem Clematis, has asked us to advise him. The pertinent facts
follow:
About 100 years ago, Winifred Wisteria owned a large block of property on
the north side of Mulberry Street, on the north side of the city of Sweet Home
in the state of Euphoria, and her sister, Nancy Nepeta, owned a large block on
the south side of the street. Each had subdivided her property and had sold
some lots for residences. Sweet Home was growing pretty rapidly, and the
sisters expected to develop their properties into a pleasant residential
neighborhood. Closer to downtown, however, Mulberry Street was quickly becoming
commercial. Nepeta and Wisteria, concerned that the commercialization of
Mulberry Street would ruin the residential character of the neighborhood,
agreed in writing to limit their respective properties to non-business uses:
residences, churches, schools, etc.
During 1997, Denise Dandelion, who bought part of Nepeta's property fronting
on Mulberry Street a few years ago, rented several of the Mulberry Street
properties to small businesses. Over the years, the commercialization of
Mulberry Street had occurred, just as Wisteria and Nepeta anticipated. While
the residential areas one block away from Mulberry Street were still mostly
residential, the street itself was almost completely commercial except for the
stretch originally owned by Nepeta and Wisteria. Frequent bus and car traffic
made the street quite noisy. In fact, the City of Sweet Home is considering
routes for a new rapid transit system. One of the probable routes would involve
the construction of an elevated train down the middle of Mulberry Street. The
train would be owned and operated by a regional rail commission.
By renting to businesses, Dandelion was able to obtain at least three times
as much rent as she could have gotten renting the properties as residences.
Indeed, Dandelion had been unsuccessful in trying to sell the properties
subject to the restrictive covenant; her realtor told her she could probably
only get about one-third of her purchase price for the properties on Mulberry
Street if they were restricted to residential use. So over the past year,
Dandelion has rented to an insurance agent, a dry cleaner/tailor, a kite store,
a bicycle shop, and most recently, a skateboard outlet. Once the elevated train
goes through, the commercial value of Dandelion's property will be even higher;
the residential value, however, will be lower.
Winston "Clem" Clematis, has lived on Mulberry Street all his life
and who can trace his title back to Wisteria. For years, people have cut
through Clem's property to get from Mitchell Street to Mulberry Street. At
first, Clem did not mind, since there weren't all that many people, and it was
mostly neighbor kids that Clem knew. Since buses started running on Mulberry
Street, five years ago, however, members of the public regularly walk through
Clem's property to get to the station. Four years ago, Clem put in a crushed
rock pathway along the side of his property in order to get to his rose garden.
Clem also hoped that neighborhood kids on bicycles would at least stay on the
path and spare the flowers. Now, the neighborhood kids are noisy teenagers, and
Clem feels invaded by all the strangers who use the path. So last month, Clem put
up a gate with a sign that says Private Property.
One of the people affected is Gerry Geranium, who recently bought a house in
the next street. Geranium's realtor had pointed out the path and had emphasized
the convenience of the buses on Mulberry Street. Gerry is furious because it
takes an extra half hour of walking to get to a bus stop if Clem's path is not
available. Gerry has threatened to sue Clem if the path is not kept open.
Clem has consulted our firm. He is absolutely disgusted by the way the
neighborhood is going. He thinks he probably can't do anything about the train,
but he wants us to help him bring this rampant commercialism to a halt. He
didn't mind when there were just a couple of businesses, but he feels
threatened by all the teenagers in baggy shorts going in and out of the
skateboard shop. Sometimes they have the nerve to climb over his fence and cut
through his yard. He has found the gate open several times recently.
It seems to me that Clem's situation raises several issues. Please
thoroughly address the following aspects of Clem's problem.
Part 2. Exam No. ______
Charlie Brown owned Backyard Acres. Charlie had granted Snoopy a
"license" to use water from a spring on Backyard Acres. Charlie
believed the license was revocable. Snoopy didn't really think about it one way
or another, but did go to great expense to prepare a road in order to reach the
spring.
Lucy was interested in buying Backyard. While Lucy was viewing the property,
she saw Snoopy drive up and drink from the spring. When she asked Charlie Brown
about the arrangement, he said, "yeah, I let him use the spring, but we
don't have any agreement in writing or anything. Whether you let him use it
would be up to you." Lucy agreed to buy Backyard Acres.
Because Lucy wanted to close the deal right away but hadn't been preapproved
for financing, she and Charlie Brown agreed to use an escrow. Pigpen agreed to
serve as an escrow agent, so on March 3, 1998, Charlie Brown delivered a
general warranty deed to Pigpen with instructions to deliver the deed to Lucy
only when she tendered her loan check. At the same time, Lucy gave Pigpen her
down payment. On March 4, just as soon as Lucy got notice that her loan was
approved, she ran to tell Pigpen, who joyfully handed her the deed.
Lucy recorded the deed and took possession of Backyard Acres that same day. Unfortunately, the bank had made an error in assessing Lucy's creditworthiness. A bank employee called Lucy on March 5 to inform her that only 80% of the requested amount could be approved. This really put Lucy in a bind because she had no other potential source of funds. Snoopy showed up to get some water and Lucy, in an unpleasant mood, told him that she now owned Backyard Acres and he could not use her spring under any circumstances.
Lucy went to ask her good friend Schroeder for advice. Schroeder mentioned
that he might agree to buy Backyard Acres from Lucy for full price if she would
just leave him alone and let him practice the sonata he was working on. At
about the same time, Charlie Brown discovered that Pigpen had delivered the
deed prematurely. Furious, Charlie Brown called Lucy to demand full payment
immediately. Lucy told him she was working on a source of funds and that he
should expect payment soon.
As it happened, Charlie Brown's friend Felicia had always admired Backyard
Acres and came along just as Charlie Brown finished talking to Lucy. Charlie
Brown explained that Pigpen had prematurely transferred the deed to Lucy and
that she had recorded but that the sale to Lucy was void because she did not
come up with the purchase price. Felicia paid Charlie Brown the full purchase
price on the spot and he gave her a general warranty deed. Felicia recorded
immediately, just before the title office closed on March 5.
The next day, March 6, Lucy conveyed a general warranty deed to Schroeder,
who did not know that Snoopy had been using the spring for water. Schroeder
recorded his deed that day and made arrangements to have his piano moved to Backyard
Acres. When Lucy attempted to pay Charlie Brown the rest of the purchase price,
he told her it was too late; he had sold the property to Felicia.
The state has the following statute:
Every conveyance of real property or an estate
for years therein, other than a lease for a term not exceeding one year, is
void as against any subsequent purchaser or mortgagee of the same property, or
any part thereof, in good faith and for valuable consideration, whose
conveyance is first duly recorded, and as against any judgment affecting the
title, unless the conveyance shall have been duly recorded prior to the record
of notice of action.
Lucy has asked for your help. She has several questions she would like you
to address.
Part 3. Exam No. ______
Competent Living, Inc., recently bought a house in Munchkin City to set up a group home for mentally retarded persons. Opposition to the group home quickly developed in the neighborhood. In response to community pressure, the Munchkin City Council quickly amended the city zoning ordinance to require that all facilities housing more than four unrelated persons together have one parking space off the street for every two residents. The Munchkin City council justifies the ordinance by noting that unrelated persons are more likely to have more cars than family members who may share a vehicle and that residents in group homes need more parking for supervisors, visitors, and doctors. Moreover, the city is relatively built up and most houses do not have off-street parking. Streets are quite congested, and parking spaces are hard to find. The effect of the ordinance, however is to make it financially impossible to set up the group home in the city.
Competent Living, Inc., filed a petition against
the city arguing that the ordinance violates the Fair Housing Act. The city
responded with a motion to dismiss based on failure to state a claim. The judge
has asked for briefs from both parties and Competent Living has hired your firm
to prepare a brief explaining why it should be able to bring a claim under the
Fair Housing Act. Relevant portions of the Fair Housing Act can be found at
pages 441-444 of the Dukeminier and Krier casebook. Write the brief for
Competent Living. (25 pts.)
Part 4. Exam No. ________
Roger ("Rosie") D. Resht owns a
solar-heated house in a residential part of Sun City. The neighborhood is
fairly young, and the lots on both sides of Rose's are still undeveloped. The
subdivision restrictive covenants require each house to have a minimum of 1800
square feet, to be set back 30 feet from the street, and to be no more than two
stories above ground.
Although the lots on either side are undeveloped,
they have recently been purchased by Shade Dark, who intends to build duplexes
on them. Duplexes are permitted in residential zones, so Shade expected to have
no trouble getting a building permit approving his two-story design. After
Shade got his permit, but before his permit application was processed, however,
Sun City passed an ordinance intended to encourage use of solar energy. Among
other things, the ordinance prohibits building any structure that unreasonably
interferes with a neighbor's pre-existing solar collectors. Rosie has learned
about Shade's plans and wants to get an injunction. Shade's 2-story
construction will cast shade on Rosie's solar collectors. Rosie already went to
Shade and asked him to move his duplex 10 feet further away from the property
line, but Shade says that would ruin the view of the mountains from one of the
duplex units.
Please advise Rosie regarding his prospects for
stopping the construction. (25 pts.)
End of Exam