SPECIAL INSTRUCTIONS
This is a closed-book and closed-notes Property I examination consisting of three 1-hour questions. Each answer will be graded separately and so must stand alone. Thus, in writing any single answer, please do not refer to anything in any other answer. You may refer to statements made within the same answer.
Each answer will be weighted in proportion to the time allowed for it. Thus, it may be unwise to spend more than the recommended time for any single answer.
Discuss all issues reasonably presented, even if resolution of any particular issue would by itself dispose of the problem. Specify all reasons supporting your conclusions, including alternative grounds and possible contrary arguments.
If you believe that, with respect to any particular issue, there are insufficient facts to warrant drawing any conclusion, indicate what additional facts would be relevant and why.
If you believe that any of the statements of facts is ambiguous, resolve the ambiguities for yourself, indicating their nature and your method of resolution.
Please write on only one side of each page. Please use complete sentences. Thank you and good luck.
QUESTION I (one hour)
Tract X was a 1000-acre tract of land located in the State of Mitchell. A was the record owner of Tract X. The northern four-fifths of Tract X was heavily forested; the southern one-fifth was largely prairie grass mixed with a few trees. A lived in a cabin in the north-eastern corner of Tract X. The cabin was the only building on Tract X. A used the forested part of X for trapping mink, fox, and rabbits. A did not use the southern one-fifth of X, except for an occasional stroll with his dog.
On March 1, 1988, B purchased Tract Y from M, Y=s record owner. Tract Y was a 500-acre parcel adjacent to the southern boundary of Tract X. The deed (drafted by M) by which B took title to Tract Y contained a drafting error - the description of the land conveyed included not only Tract Y, to which M had record title, but also Tract X as well, to which M did not have record title. B realized that M had made an error, but did not mention it to M. On April 1, 1988, B moved onto Tract Y and began farming operations.
There was no fence or road marking the boundary between Tract X and Tract Y. B decided to use the northern half of Tract Y for a corn field and also decided to build a fence around the corn field. Having already noticed that A was not using the southernmost portion of Tract X on a regular basis, B decided to build the northern fence line of her corn field 50 yards to the north of the true boundary line between Tracts X and Y, with the result that a strip of land measuring 2000 yards by 50 yards of B=s corn field would actually be located on Tract X. B began building the northern fence line on August 1, 1988. Thereafter, B planted corn in the field every May and harvested it every October. B did not use the field during the months from November through April of each year. A noticed B=s fence-building activities, but did not realize that the fence was located north of the true boundary line between Tracts X and Y.
On May 1, 1994, A died, leaving a will which devised Tract X to C for life, remainder to C=s son, D, who was 10 years old at the time. (The age of majority in Mitchell is 18 years.) C moved into the cabin in which A had been residing. C hired a surveyor to survey Tract X. On November 1, 1994, the surveyor gave C a written report which stated that a portion of B=s corn field was located on Tract X. The next day C sent a letter to B, demanding that B remove that portion of the fence and corn field which were encroaching upon Tract X. B refused to vacate. C made no further efforts to get B to vacate.
On October 1, 1995, B died intestate, leaving E as her heir. E moved onto Tract Y and began regularly planting corn in the corn field just as B had done. At the time E moved onto Tract Y, she did not realize that the northern portion of the corn field was located on Tract X. On July 1, 2000, C died and D=s remainder interest thereby became possessory. In examining C=s files, D discovered the surveyor=s report. On October 15, 2000, D brought an ejectment action against E, requesting an order requiring E to remove that portion of the corn field which was encroaching upon Tract X. In her answer, E alleged that she owned all of Tract X. Mitchell Statute 500 provides: AAn action to recover the title to or possession of real property shall be brought within 10 years after the cause thereof accrued, but if a person entitled to bring such action, at the time the cause thereof accrues, is within the age of minority, of unsound mind, or imprisoned, such person, after the expiration of 10 years from the time the cause of action accrues, may bring such action within 10 years after such disability is removed.@ Discuss and resolve the issues of Property Law which might reasonably arise in this lawsuit.
QUESTION II (one hour)
On May 1, 1994, A and B purchased a 300-acre farm as tenants in common. On June 1, 1994, B moved onto the farm and began growing corn and soybeans. A did not move onto the farm. She continued residing in a nearby city, practicing securities law for a large law firm.
On August 1, 1994, A and C got married. Two weeks later, C entered medical school. A continued to work as an attorney, earning $250,000 per year. All of A and C=s living expenses, including C=s medical school tuition of $35,000 per year, were paid out of A=s salary.
On June 1, 1995, A sent a letter to B, demanding that B pay A one-half of the reasonable rental value of the farm. B refused.
On May 1, 1999, B moved off the farm and began leasing it to D on a month-to-month basis. The lease provided that the rental payments were equal to the fair rental value of the farm. A did not join in the lease.
On June 1, 1999, C graduated from medical school, intending to specialize in heart surgery. Five days later, C filed a divorce action against A. In the divorce proceeding, A alleged that C=s increased earning power, resulting from his acquisition of a medical degree, was marital property subject to division under the applicable Dissolution of Marriage Act. She alleged that she had a right to 50% of the present value of that increased earning capacity. She made no claim for alimony or maintenance and made no claim to any other assets. They had no children. A and C had not entered into a contract concerning the division of property in the event of divorce. C made no claim to any portion of A=s interest in the 300-acre farm.
On July 1, 1999, A sued B, seeking (1) a sum of money equal to one-half of the reasonable rental value of the farm for the period from June 1, 1994, through April, 1999, and (2) a sum of money equal to one-half of the rental payments B received from D for the period from May 1, 1999, to the present.
Discuss and resolve the issues of Property Law which might reasonably arise in A and C=s divorce proceeding, and in A=s suit against B.
QUESTION III (one hour)
Analyze the following under the Rule Against Perpetuities in its traditional form. Assume that the jurisdiction in question does not have the Destructibility of Contingent Remainders Rule. In accordance with our classroom discussions, ignore the technological possibility of a person becoming a parent of a child conceived after that person=s death from sperm or ova deposited in an artificial insemination bank. Note that the word >devises= refers to a testamentary transfer, and that >conveys= refers to an inter vivos transfer.
Problem 1
T devises property Ato A for life, and on A=s death to A=s children for their lives, and upon the death of A and A=s children, to A=s grandchildren and their heirs@. {Assume that on the effective date, A is alive and has neither children nor grandchildren.}
Problem 2
O conveys property Ato A for life, then to such of A=s grandchildren and their heirs as reach the age of 21 years@. {Assume that on the effective date, O and A are alive and that A has neither children nor grandchildren.}
Problem 3
T devises property Ato my grandchildren and their heirs, born before or after my death, who are living at the time of final distribution of my estate following the completion of the probate process of this Will@. {Assume that on the effective date, T has one child, A, and one grandchild, B.}
Problem 4
O conveys property Ato A for life, then to B and B=s heirs if B attains the age of 65. {Assume that on the effective date, O and A are alive and that B is 5 years old.}
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Question I: Grading sheet
D=s Ejectment Action Against E
[A] Does E have adverse possessory title?
[1] Law
[a] Adverse possessory title requires: {1} actual entry, {2} exclusive possession, which is {3} open and notorious, {4} adverse, {5} under a claim of right, and {6} continuous for the statutory period.
[2] Application
[a] Actual entry?
{1} Law
{a} Must be a physical occupation.
{2} Application
{a} B entered on August 1, 1988.
[b] Exclusive?
{1} Law
{a} Possession must not be shared with record owner.
{2} Application
{a} A was not regularly using the area, but did occasionally walk his dog there.
[c] Open and notorious?
{1} Law
{a} Land must be used in way an average true owner would use it under circumstances such that observers would regard occupant as exercising exclusive dominion.
{b} Mannillo:
(1) AGenerally, where possession of the land is clear and unequivocal and to such an extent as to be immediately visible, the owner may be presumed to have knowledge of the adverse occupancy.@
(2) AHowever, when the encroachment . . is of a small area and the fact of an intrusion is not clearly and self-evidently apparent to the naked eye but requires an on-site survey for certain disclosure as in urban sections where the division line is only infrequently delineated by any monuments, natural or artificial, such a presumption is. . unjustified.@
(3) A. . no presumption of knowledge arises from a minor encroachment along a common boundary. In such a case, only where the true owner has actual knowledge thereof may it be said that the possession is open and notorious.@
{2} Application
{a} Under the general standard?
{b} Under Mannillo?
(1) Minor encroachment?
(2) Actual knowledge by A?
(3) Actual knowledge by C?
(4) Actual knowledge by D?
[d] Adverse?
{1} Law
{a} Occupant must not be in possession in subordination to record owner.
{2} Application
{a} B=s possession is arguably adverse. Although A did see the fence-building activity, A didn=t know of encroachment.
{b} Same for E=s possession.
[e] Claim of right?
{1} Law?
{a} Objective standard [maj.] : State of mind irrelevant.
{b} Good-faith standard: Required state of mind is AI thought I owned it@.
{c} Aggressive trespass standard: Required state of mind is AI thought I didn=t own it but intended to take it anyway@.
{d} Cases of mistake:
(1) Maine doctrine:
a] A mistaken encroachment doesn=t satisfy the hostility requirement unless the encroacher testifies that, even if she had known the truth of the matter, she would have trespassed anyway. [I.e., in cases of mistake, the intent must be unconditional.]
b] In contrast, if encroacher testifies that had she known the truth she would not have continued to trespass, the encroacher does not satisfy the hostility requirement. [I.e., in cases of mistake, if the intent is only conditional, the hostility requirement is not satisfied.
(2) Mannillo rule (modern): Hostility requirment should not be used as an invitation to inquire into subjective states of mind. If the act suggests an assertion of title (as it of itself almost always does) that is sufficient. Mistake is irrelevant.
{2} Application
{a} Objective standard?
(1) B? [Yes]
(2) E? [Yes]
{b} Good-faith standard?
(1) B? [No]
(2) E? [Yes]
{c} Aggressive trespass standard?
(1) B? [Yes]
(2) E? [No]
{d} Mistake?
(1) Maine doctrine?
a] B? [B knew. So strictly speaking, the mistake doctrine doesn=t apply. But presumably B would a fortiori have the requisite state of mind.]
b] [E didn=t know, but we don=t know what E would have testified to.]
(1) Under Mannillo?
a] B? [Yes]
b] E? [Yes]
[f] Continuous for the statutory period?
{1} Law
{a} Statute requires 10 years.
{b} Requires pattern of occupation one would see in acts of an actual owner.
{c} Abandonment stops clock.
{d} Interruption by true owner stops clock.
(1) Interruption can be accomplished by such acts as bringing successful ejection action or be re-entering.
(2) In latter case, re-entry must be open and notorious.
{e} Tacking between adverse possessors allowed if there is privity between them.
{f} Tacking Aagainst@ successive record owners: Once there is an adverse entry against a record owner, adverse possession begins and is not defeated or interrupted by subsequent transfers by record owner, whether by conveyance, will, or intestacy.
(1) This rule applies even where there subsequent transfer creates future interests.
{2} Application
{a} Ten years elapsed?
{b} Pattern of occupation sufficient?
{c} Abandonment?
{d} Interruption?
(1) Was C=s letter sufficient?
{e} Tacking [as between B and E]?
(1) Sufficient privity, given the intestate transfer?
{f} Tacking [as against A, C, and D]?
(1) Yes, given fact that entry occurred prior to transfer.
[g] Disabilities?
{1} Law
{a} Statute of limitations extended if specified disabilities are present [minority, unsound mind, imprisonment].
{b} A disability is immaterial unless it existed in record owner at time the cause of action accrued. Disabilities can=t be tacked together.
{c} After words >such persons= one should insert, as a result of judicial construction, the words >or anyone claiming from, by, or under such person=.
{2} Application
{a} D=s disability [minority] as a record owner did not exist on the first day of adverse possession. Hence, the disability provision doesn=t apply.
[h] Color of title?
{1} Law
{a} >Color of title= refers to a claim founded on a written instrument [deed, will] or a judgment or decree that is for some reason defective and invalid [as where the grantor does not own the land conveyed by deed, or is incompetent to convey, or the deed is improperly executed].
{b} In all states, entry with color of title may have an advantage where the adverse possessor enters into possession of only part of the property.
(1) Actual possession under color of title of only a part of the land covered by the defective writing is constructive possession of all that the writing describes.
(2) The advantage that one may gain from constructive possession is that the activities relied upon to establish adverse possession reach not only the part of the premises actually occupied, but the entire premises described in a deed to the claimant.
{c} Exception: But the above rule doesn=t apply where someone else is in prior possession of part of the tract. In such a case, the adverse possessor can acquire only that portion of the land which she or he actually occupies.
{2} Application
{a} A was in prior possession of part of Tract A. Hence, the color of title rule doesn=t apply.
[i] Other?
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Question II: Grading sheet
A=s Action Against B
[A] Claim for one-half the reasonable rental value of farm
[1] Law
[a] Majority rule: When a cotenant is in exclusive possession of concurrently owned property, unless there has been an ouster, the cotenant in possession does not have to pay a proportionate share of the rental value to the cotenants out of possession.
{1} A few jurisdictions take the view that a cotenant in exclusive possession must pay rent to cotenants out of possession even in the absence of an ouster.
[b] Re what constitutes an ouster for purposes of the majority rule:
{1} According to the majority rule (e.g., Spiller v. Mackereth), there must be a demand or attempt to enter, together with a refusal on the part of the occupying cotenant. That is, there must be a refusal of physical entry.
{2} According to the minority rule, there need be only a demand to vacate or pay rent.
[2] Application
[a] Under majority rule?
[b] Under minority rule?
[c] Assuming the majority rule, was there an ouster?
{1} Under majority rule?
{2} Under minority rule?
[B] Claim for one-half the rents received from D
[1] Law
[a] In all states, a cotenant who collects from third parties rents and other payments arising from the co-owned land must account to cotenant for the amounts received.
[b] Absent ouster, the accounting is usually based only upon actual receipts, not fair market value.
[c] The clearest case for such an accounting is one in which the agreed rent is equal to the entire fair market rental value. For, this is an indication that the lease signed by one cotenant purports to bind all of the cotenants.
[2] Application
[a] What about fact that the lease provided that the rental payments were equal to the fair rental value of the farm?
A and C=s Divorce Proceeding
[A] Is increased earning power, resulting from acquisition of a degree, marital property subject to division?
[1] Law
[a] In re Marriage of Graham
{1} Such increased earning power is not a marital asset subject to division.
{a} But it is a relevant factor in determining maintenance or division of other marital property.
{2} Rationale
{a} No objective exchange value on open market.
{b} Terminates on death of holder and is not inheritable.
{c} Can=t be assigned or pledged.
{d} Can=t be acquired by mere expenditure of money.
{e} Is simply an intellectual achievement which may potentially help in the future acquisition of money.
[b] Mahoney v. Mahoney (reimbursement alimony)
{1} The supporting spouse should be reimbursed for the financial contributions she or he made to the spouse=s successful professional training.
[c] O=Brien v. O=Brien
{1} Such increased earning power is marital property subject to division.
{2} Rationale
{a] Theory of spousal investment in human capital.
[d] Most courts have agreed with either Graham or Mahoney.
[2] Application
[a] Under Graham?
[b] Under Mahoney?
[c] Under O=Brien?
[d] Which is best resolution?
[B] Other?
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Question III: Grading sheet
Perpetuities Problems
[A] Law
[1] RAP: No interest is good unless it must vest, if at all, not later than 21 years after some life in being at the creation of the interest.
[2] RAP applies to Crs, CEIs, and Vrs subject to open.
[3] Class-gift rule.
[4] If any possibility of remote vesting, interest is void from outset.
[5] Effective date.
[6] Life in being.
[7] Measuring [validating] life.
[8] Contingent remainder.
[9] Executory interest.
[10] Effect of RAP on valid interests.
[B] Problem 1
[1] T devises property Ato A for life, and on A=s death to A=s children for their lives, and upon the death of A and A=s children, to A=s grandchildren and their heirs.@ {Assume that on the effective date, A is alive and has neither children nor grandchildren.}
[a] Eff. date? [date of T=s death]
[b] Potential measuring lives? [A]
[c] Ato A for life@
{1} Type of interest? [present LE]
{2} At risk under RAP? [No]
[d]