Personal Property Gifts

Personal Property

• Personal property encompasses all property that is not real property, including objects, stock, and money.

Gifts

• A gift constitutes a voluntary transfer of property from one individual to another without any form of compensation.
• A gift requires three elements:
  • The donor's immediate intent to transfer ownership to the donee.
  • The donor's delivery of the property to the donee.
  • The donee's acceptance of the property.

Intention to Transfer Ownership

• The donor should intend to transfer ownership immediately.
• Promises to transfer property in the future are unenforceable unless supported by consideration, in which case they are not gifts.
• A revocable gift is contradictory, as the giver of a valid gift cannot maintain control over it.

Delivery

• Physical delivery is the typical method for delivering a gift.
• Constructive delivery involves transferring ownership without physically handing over the item.
• The donee is obligated to accept the gift for delivery to be completed.

Inter Vivos & Causa Mortis

• An inter vivos gift comes during life with no expectation of death and is valid upon meeting the basic conditions of a gift.
• A gift causa mortis is given in the expectation of imminent death.
  • To be valid, it must satisfy gift conditions, and the giver must die as expected.
  • The gifts are rescinded if they do not die as expected.

Found Property

• The main goal is to return lost property to its rightful owner if possible.
• Rewarding the finder is a secondary policy if the owner cannot be located.
  • The finder usually keeps abandoned property because the owner knowingly discarded it.
  • The finder may keep lost property if the original owner cannot be found after accidentally losing it.
  • Generally, the owner of premises keeps mislaid property if the true owner of the property cannot be found after setting it down and forgetting it.

Bailment

• Bailment is the rightful possession of goods by one who is not the owner.
• Parties usually create a bailment by agreement.
• A constructive, or involuntary, bailment lacks an agreement.
• Creating a bailment requires the bailee to assume physical control with the intent to possess.

Rights of the Bailee

• The bailee has the primary right to possess the property.
• Anyone who interferes with the bailee's rightful possession is liable to them.
• The bailee is typically permitted to use the property, though not always.

Duties of the Bailee

• Bailees are strictly liable to redeliver the goods to the bailor or the party they designate on time.
• Bailees must exercise due care.

Due Care

• The level of care required depends on who benefits from the bailment.
  • Extraordinary care is needed when the bailment is solely for the bailee's benefit (e.g., borrowing a neighbor’s tractor).
  • Ordinary care is needed in cases of mutual benefit (e.g., renting a car at a cost).
  • Only slight care is required when the bailor solely benefits, and the bailee is liable for loss only in gross negligence.

Burden of Proof

• Once the bailor proves the existence of a bailment and loss or harm to the goods, negligence is presumed.
• The burden then shifts to the bailee to prove they exercised adequate care.

Rights and Duties of Bailor

• For liability for defects, the bailor must notify the bailee of any known defects if the bailment is for the sole benefit of the bailee.
• In mutual-benefit bailments, the bailor is liable for known and unknown defects discoverable with reasonable diligence.
• If the bailor is in the business of renting property, the bailment may be subject to implied warranties.

Common Carriers and Contract Carriers

• Common carriers are generally strictly liable for harm to the bailor's goods.
• Contract carriers (those not serving the general public) do not incur strict liability.
• Innkeepers may act as bailees of their guests' property, and special statutes regulate their liability.

Nature of Real Property

• The grantor conveys the property, while the grantee receives it.
• Real property includes:
  • Land
  • Buildings
  • Subsurface Rights
  • Air Rights
  • Plant Life
  • Fixtures (objects permanently part of the property)

Estates in Real Property

• Rights in real estate usage and ownership vary from unrestricted use and the right to sell, to a lesser right of usage without the right to transfer it.
• The rights someone can hold are called estates or interests.

Freehold Estates

• The owner of a freehold estate has the present right to possess the property and use it in any lawful way.
• A fee simple absolute estate provides the owner with the greatest control.
• A fee simple defeasible estate may terminate upon the occurrence of some event.
• A life estate is an estate for the life of some named person.

Concurrent Estates

• A concurrent estate exists when two or more individuals own property simultaneously.
  • In tenancy in common, multiple people own the property, each with the right to convey their interests or pass them down to their heirs.
  • A joint tenancy includes the right of survivorship.
• All co-tenants have an absolute right to partition (division of property).

Types of Estates in Marriage

• In tenancy by the entirety, the husband and wife each own the entire property, and they both have a right of survivorship.
• Community property outlines that property brought into the marriage or given to one spouse may remain individually owned as separate property.
• Income or assets earned during the marriage constitute community property, which must be equally shared.

Condominiums and Cooperatives

• In condominiums, the apartment owner typically has a fee simple absolute interest in their particular unit.
• In cooperatives, residents generally do not own their particular unit. Instead, they are shareholders in a corporation owning the building.

Nonpossessory Interests

• These include easements, profits, licenses, and mortgages.
• An easement grants someone the right to enter land belonging to another for a limited use without taking anything.
  • An easement can be expressly granted or implied by the landowner or by reservation when an owner sells the land but retains the right to enter it.
• A profit grants the right to enter land belonging to another and take something away.
• A license grants temporary permission to enter another's property.
• A mortgage is a security interest in real property given to the institution loaning a buyer the money to buy real estate.

Sale of Real Property

• Most states impose an implied warranty of habitability on builders selling a new home.
• Sellers must disclose facts buyers cannot readily observe that materially affect the property's value.

Sales Contracts and Title Examination

• The Statute of Frauds requires that real property sales agreements be in writing.
  • Agreements must include names of all parties, a precise description of the property, the price, and signatures.
• After an agreement, the buyer's lawyer conducts a title examination to ensure the seller has valid title to the property.

Closing and Deeds

• Following the completion of the title examination and the arrangement of financing, the parties will schedule a closing. The seller will then turn over the deed (the document proving ownership of the property) in exchange for payment, paid either by the buyer or by a lender.
• If a lender contributes to the price, the buyer executes a mortgage as part of the closing.

Recording

• Recording a deed involves filing it with the official state registry.
• Filing a deed protects the buyer and gives notice to the public of the official landowner, preventing someone from selling land they do not own.

Adverse Possession

• To gain ownership of land, a user must prove:
  • Entry and exclusive possession.
  • Open and notorious possession.
  • A claim adverse to the owner.
  • Continuous possession for a statutory period.

Land Use Regulation

• Zoning: State laws enable local municipalities to regulate building and land use.
• Eminent Domain: Government (federal, state, or local) can take private property for public use with just compensation for former owners.

Landlord-Tenant Relationship

• A landlord-tenant relationship is created when a freehold estate owner allows another temporary, exclusive property possession.
• Three legal areas are combined:
  • An interest in real property is conveyed.
  • A lease creates a contract.
  • Negligence law may be involved.

Lease

• Most of the time writing is required by the statute of frauds for the lease.
• Short-term oral contracts might be enforceable as well, though it is preferable to have a written contract that is more unambiguous and secure.
• Usually, covenants (promises) from both the landlord and the lessee are included in a written contract; the parties decide these specifics.

Types of Tenancy

• Any lease for a fixed period of time is considered a tenancy for years.
• A periodic tenancy is created for a fixed period, then automatically continues for successive periods unless either party notifies the other of termination.
• There is no duration to a tenancy at will and either party may terminate it.
• A tenant’s continued possession of the premises against the desire of the landlord after the conclusion of real tenancy is known as a tenure at sufferance.

Landlord's Duties

• The landlords first duty is to deliver the tenant the possession of the premises.
  • Under the "English rule," the landlord must remove a previous tenant if he does not leave willingly.
  • Under the "American rule,” the new tenant can evict the old tenant, or collect rent from her if they do not leave willingly.

Quiet Enjoyment

• All tenants are entitled to use the property without the landlord's interference.
• Actual Eviction: If a landlord prevents the tenant from possessing the premises, he has actually evicted them.
• Constructive Eviction: If a landlord substantially interferes with the tenant's use and enjoyment of the premises, he has constructively evicted them.

Duty to Maintain Premises

• A landlord must deliver premises and maintain them in habitable condition.
• Building codes may have stricter requirements than those normally applied to rental property.
• The implied warranty of habitability mandates that landlords meet local building code standards or ensure premises are fit for human habitation.

Tenant Remedies for Defective Conditions

• Rent Abatement: A court-ordered rent reduction.
• Rent Withholding: The tenant refuses to pay part or all of the rent proportional to the defective conditions.
• Repair and Deduct: In some cases, the tenant may have repairs made and deduct costs from the rent.
• Suit for Damages: Tenants may file a lawsuit against the landlord in some cases.

Duty to Return Security Deposit

• Landlords must return security deposits to tenants after they vacate.
• Certain states need landlords to give tenants the interest received from the security deposit.
• If the deposit is to pay for damages, a damage description in writing is mandatory.
• Should landlords not comply, they must make up for the losses they have caused through monetary repayment to the person that they damage, and, in some instances, treble or double damages occur.

Tenant's Duties and Remedies

• Duty to Pay Rent: The tenant's foremost obligation.
• Landlord's Remedies for Nonpayment of Rent:
  • Apply security deposit to rent.
  • Sue tenant for non-payment.
  • Evict tenant.
• Landlord's Duty to Mitigate: Courts typically require landlords to seek new tenants to mitigate damages when a tenant is evicted.

More Duties and Remedies

• The tenant is obligated to use the property for said purposes.
• The tenant is obligated to not damage premises.
  • A tenant is liable to the landlord for any significant property damage caused.

Change in the Parties

• Sale of the Property: Generally, the sale of leased property does not affect the lease but substitutes one landlord (purchaser) for another (seller).
• Assignment and Sublease
  • In an assignment, the tenant transfers his legal rights and duties to a third party.
  • In a sublease, the original tenant remains responsible for the lease and the sublessee is responsible to the sublessor not to the landlord.

Injuries

• Tenant's Liability: A tenant is generally liable for injuries on the leased premises.
• Landlord's Liability:
  • A landlord is generally liable for injuries in common areas where the tenant has no control.
  • Common law holds landlords liable for latent defects and negligent repairs.
  • Landlords can be held liable for crimes committed on the property.