Question 1: Recommended Time 1 hour
Seymour and Edna are the proud parents of Nelson. Just last year Nelson and Manjula
married and the two have been living with Seymour and Edna in the state of
Rockport since the wedding. One day
Seymour and Edna announce that they want to move to
All four parties sign this contract. Seymour and Edna then take both the contract and the deed to their family friend Monty. Seymour and Edna tell Monty:
“Hold onto this contract and deed; when Nelson and Manjula finish making the mortgage payments, then go ahead and give them the deed.”
About six months later, Nelson and Manjula start having financial problems. They quit making the monthly payments and go to see Monty about whether he might be willing to release the deed early. Monty, feeling badly for this couple, gives them the deed, and immediately Nelson and Manjula take the deed and record it at the county office.
Nelson and Manjula then put up the house for sale and within a day they find a buyer, Milhouse. Milhouse agrees to pay $100,000 for the house and the parties sign a purchase contract, with the final closing to be held ninety-days later. In the contract between Manjula/Nelson and Milhouse, there is a provision that states:
“Sellers agree to tend marketable title to buyer at the closing, free and clear of all encumbrances.”
During the ninety-day period between the signing of the
purchase contract and the closing, Milhouse’s title
inspector discovers that Nelson and Manjula have
defaulted on their monthly contract with Seymour and Edna. The title inspector also discovers that the
house is eight feet from the sidewalk.
The city ordinance states that:
“Unless otherwise approved by the city commission, all homes must be set back at least ten feet from the sidewalk.”
Feeling nervous about closing on this deal, Milhouse informs Nelson and Manjula that he does not want to go through with their agreement. Nelson and Manjula come to you for advice on what to do. They really want to complete the closing because they are in desperate need of the money.
What legal options can you provide to Nelson and Manjula if they decide to sue Milhouse? Explain all the likely legal arguments that Milhouse will raise in response. Finally, please explain to Nelson and Manjula what are all the legal arguments that Seymour and Edna might raise in a lawsuit against them for defaulting on the contract-for-deed. What are the possible legal arguments that Nelson and Manjula might make in response to Seymour and Edna?
(For these questions please base your responses only on the
property law we covered during the second semester.)
Question 2: Recommended Time 1 hour
The year is 2003. Homer and Ned are neighbors who live in the city of Springfield. They have bordering lots, and each has a residential home on their respective parcel. Even though Ned views Homer as a bit of an oaf, the two are still friends. Although in many ways Homer and Ned are very different people, one thing they have in common is that they both share a strong dislike for vegetables. At every meal, they do whatever they can to get out of eating vegetables. For these two friends, it is meat all the way.
On
“As of
Homer and Ned sign the agreement and then walk over to Agnus’s home to have her notarize the document. Agnus has been a notary for years; everyone in town knows and respects her. However, lately Agnus has been having trouble getting her notary-sealing device to work properly. When Homer and Ned stop by, the device is still not functioning, so in order to save them time she signs her name as a witness to the document and tells them that her signature should be enough for the county recorder to record the agreement. Later that evening Homer and Ned go to the county recorder’s office, but they arrive after the office is closed. They thus slip the agreement under the office door and place a post-it-note on it saying: “if there are any problems with this agreement, please let us know.”
In March 2003, Ned learns that his job is transferring him
to
Soon thereafter, Homer decides that living in
One night after a long day’s work, Moe comes home and wants to go straight to bed. However, when he walks into his house he finds that the strong smell of curry is present in every room. (Moe always keeps his windows open, even when he leaves.) He looks outside and sees Apu cooking up a grand Indian meal. Moe then confronts Apu and tells him that the smell is driving him crazy and orders Apu to stop cooking. To Moe’s shock he notices that Apu is using only vegetables in preparing these Indian dishes. Apu informs Moe that because he is a pure vegetarian, he only eats non-meat foods. In fact, as Apu tells Moe most of the vegetables used in these Indian dishes come from a lavish vegetable garden that Apu has developed in his own backyard.
Moe storms out of Apu’s house and calls you, his attorney, for legal advice. Moe tells you that his main goal is for Apu to stop growing those “darn vegetables.” Please state the claims Moe might have against Apu, and what Apu’s counter-arguments are. Please explain all other relevant legal arguments that might be raised in this lawsuit between Moe and Apu. And do not assume that Moe is familiar with legal terms of art.
Assume also that this is a race-notice jurisdiction and that the recording office only maintains a grantor-grantee index. Moreover, this jurisdiction is governed by a recording statute requiring that all deposited documents must be acknowledged with a notary’s seal, and that the contracting parties’ signatures be on the document as well.
(For these questions please base your
responses only on the property law we covered during the second semester.)
Question 3: Recommended Time 1 hour
The year is 2003, and U.S. President Barney Gumble already is well into planning his re-election strategy. Unfortunately for President Gumble, the public views him as just another elected official who has difficulty relating to the poor and the needy.
In an effort to show the voters that indeed he really does
care about the less fortunate, President Gumble
organizes a national conference to address the growing problem of homelessness
in
Of course the guest theoretically is entitled to her deposit back (with interest), once she has checked out and settled her bill with the hotel. However in many cases, the guest has incurred charges during her stay that are greater than the deposit amount. When this occurs, hotels often will retain the deposit as well as the interest earned on that money, and only require the guest to pay the remaining balance.
President Gumble proposes that for interest earned on those deposits that are not returned to guests, hotel owners should contribute this interest to the main homeless shelter in their respective states. If hotel owners throughout the country engaged in this practice, an estimated 100 million dollars per year could be raised on behalf of homeless shelters.
Perhaps not surprisingly, President Gumble’s suggestion is met with resistance from hotel owners and representatives of HOGAA – Hotel Guests Association of America. However, state politicians throughout the country applaud this proposal, and within a month of the conference’s conclusion every state in the country has passed legislation adopting President Gumble’s program.
Assume that: in the
Explain the legal rationale for why states might justify adopting President Gumble’s proposal. Who might oppose such a proposal, why, and on what specific legal grounds? How likely is it that a state law that has statutorily codified President Gumble’s proposal would survive judicial scrutiny? When you are considering these questions, be sure to take into account how the doctrines used by the Supreme Court have changed over the years. (See next page)
Also many legal theorists have written on the broader issue of governmental seizure of property, ranging from Ackerman, Epstein, Michaelman, Sax, Heller and Krier, Rubenfeld, and Fischel. Briefly discuss any two of these scholars’ points of view on this issue and how they might come out on President Gumble’s proposal.
(For these questions please base your responses only on the property law we covered during the second semester.)
Answer Key - Question 1:
I. Seymour/Edna v. Nelson & Manjula
A. Contract for deed
i. Definition
ii. How is it applicable here
B. Escrow – Commercial v. Death – discuss and define
i. Commercial:
· relates back rule –
· enforceable contract needed; not able to recall
· what happens if conditions not met
ii. Death:
· Grantor places it beyond her control
· No K required – gratuitous okay
· If valid, passes immediately to custodian
C. Delivery by Moe to Nelson & Manjula – before payments are up – effective delivery?
-need to discuss and evaluate this point fully
D. Does escrow delivery by Seymour and Edna relieve Nelson and Manjula of any responsibility – do they own property in fee simple because they have deed and they have recorded it
· Remember, with delivery the rules of law include:
- a deed that actually needs to be delivered
- role of intent / express v. implied
- presumptions are present, including one that is rebuttable when deed is in possession of grantee; another rebuttable presumption is that there is non-delivery when ded is in possession of grantor; and there is a rebuttable presumption when grantor has notarized or recorded deed
- what about the distinction between inter vivos conveyance, requiring delivery of a signed doc, and a transfer at death, requiring the comporting with the Stat of Frauds.
E. What about agreement Nelson and Manjula signed with Seymour and Edna
F. Rules of Mortgage may come in here as well – 60/3 day windows, foreclosure – perhaps also discuss what happens in MN
G. What about rules of estoppel – how do they play into this
-Need to then apply fully these various points to the facts at hand
II. Nelson/Manjula v. Milhouse
A. Discovery by Milhouse of default by Nelson and Manjula – enough to make title unmarketable? -- pretty much yes, right? – what about I.D.?
B. Zoning violation – is this equivalent to a bldg code violation?
---------> only violation (not simply mere presence) of public restriction makes title unmarketable, whereas mere existence of private restriction makes title unmarketable (is K for deed, a private restriction; Lohmeyer)
----------> what about ability of seller to repair
C. What about Nelson/Manjula claiming that Milhouse can get an exception (explain about variance v. special exception) – which one would apply?
--seemingly the former – cases that are relevant?
--distinguishing between the variance and special exception would be key
D. Does Nelson/Manjula have duty to disclose their default – relate this to, say, Stambovsky case ---
E. what about the lack of a “time is of essence clause”
F. Other points to discuss:
§ General warranty v. special warranty deeds
§ Present/Future covenants that are relevant
§ Obtaining specific performance v. gaining damages
§ Merger clause issues
§ Cases to consider: Frimberger, Lohmeyer, Sweeny
§ Need to consider as well: Equitable v. legal title –
--Then would need to apply these points fully to the facts
at hand
Question 2:
I. Legal cov v. E.S. – this is E.S. – elements needed to satisfy E.S. – what is the relevant cov?
- Did burden run to bind Apu – Elements:
i. cov must be enforceable – S/F most juris – CAULLET case
ii. intent – what is rebuttable presumption
iii. is H.P required
iv. is V.P required
v. Touch and Concern – different interpretations
vi. Role of notice – how does principle of equity come into play here – what type of notice – Actual, Inquiry, Record – define and explain
vii. was value given by the successor – is this important
- Did benefit run to the advantage of Moe?
i. cov must be enforceable – S/F most juris – CAULLET case
ii. intent – what is rebuttable presumption
iii. is H.P required
iv. is V.P required
v. Touch and Concern – different interpretations
vi. Role of notice – how does principle of equity come into play here – what type of notice – Actual, Inquiry, Record – define and explain
-how to figure out whether E.S. or L.C. applies? – damages v. injunctive relief
-Then each of these points would need to fully apply to facts at hand
Other issues:
* Agnus’ notarization of this agreement – is it okay? – is her signature patent or latent defect
* Clancy – BFP, presumably – can anyone take shelter from him? – would need to explain purpose and role of shelter
- Apu might be able to take shelter under Clancy – explain Shelter Rule
- Relates to roman numeral I above, but need to explain in particular about whether Apu is a BFP, arguably not – because of where he works / is he on constructive notice of Homer and Ned’s agreement – depends on if the defect is patent or latent – Lohmeyer
- What about recording act that this jurisdiction is governed under – race notice – why is this important – how is shelter principle and constructive notice on potentially defective notary affected?
* Nuisance issue Moe might be able to sue under?
- what about “coming to the nuisance”
- case law that is relevant?
* What is role, if any, regarding the rules on neighborhood restrictions – consider that in this hypo we are talking about 2 neighbors (Homer and Ned) entering into an agreement, who live in a neighborhood – or do the rules not apply – why not?
Question III:
Relevant points of law to consider and discuss thoughtfully:
*In terms of the policy the states have enacted regarding the hotel funds:
- law must be rationally related to purpose
- is this a leg or judicial question?
*then would need to apply these points, to the legislation at hand
II. Is this a taking? What’s the law on this?
A. physical invasion principle – define – Loretto & Hadacheck
B. Regulatory takings – various tests – Older tests
i. nuisance – nuisance measures are not takings
ii. Dimunition in value – define
iii. Balancing (Penn Coal)
III. More Present Day Tests:
-Case law is important here – consider:
*Penn Central (substantial public purpose / unduly harsh impact)
*Lucas (claims to follow P.C. – but addition of common law element)
*Palazzolo
*
IV. Is this an exaction measure? – Consider closely the cases of Nolan and Dolan – what is required for an exaction analysis to take place
V. Principles of Just compensation – what is the investment-backed expectation of the parties involved?
Other relevant points – how, if at all, do other past case
law apply to the Gumble proposal? – (e.g.,
-Academic Perspectives:
-Sax, Michaelman, Ackerman, Epstein, Fischel, Rubenfeld, Heller & Krier, etc.
-Then would need to apply all of this fully to the facts at hand