Keeping Current-Property

Keeping Current-Property offers a look at selected recent cases, rulings and regulations, literature and legislation. The editors of Probate & Property welcome suggestions and contributions from readers.


  • BANKRUPTCY: Installment land sale. Under Idaho law, an installment land sale contract is a security device and thus is not an executory contract that the debtor must assume or reject. In re Heward Bros., 210 B.R. 475 (D. Idaho 1997).
  • BANKRUPTCY: No strip-down of residential mortgage. Although there was no value left after deducting all senior liens, the junior mortgagee's interest could not be stripped down to an unsecured claim. In re Shandrew, 210 B.R. 829 (E.D. Cal. 1997).
  • COVENANTS: Residential/recreational use. Owners who trained sled dogs were conducting a hobby; therefore, use was recreational as permitted by the covenants. Also, a bed and breakfast was held a permitted incidental use. Persson-Mokvist v. Anderson, 942 P.2d 1154 (Alaska 1997).
  • LANDLORD AND TENANT: Covenant of continued operation. On a question of first impression in Connecticut, the court of appeals held that a percentage lease may be deemed to contain an implied covenant to continue to operate and generate sales for the duration of a lease. Pequot Spring Water Co. v. Brunelle, 698 A.2d 920 (Conn. Ct. App. 1997).
  • LANDLORD AND TENANT: Negligence; invitees. Relying on French doctrine underlying the Louisiana civil code, the court of appeals held that a tenant's liability to her landlord extends to negligence of cotenants and social invitees. United States Fidelity & Guar. Co. v. Hurley, 698 So. 2d 482 (La. Ct. App. 1997).
  • LIFE ESTATES: Fire insurance proceeds. A life tenant who paid premiums and insured property for its full value was entitled to all of the insurance proceeds absent an express duty to insure for the benefit of the remainderman. The court rejected arguments that only the life tenant's interest should be paid to the life tenant and that the proceeds must be used to repair and replace. Ellerbusch v. Myers, 683 N.E.2d 1352 (Ind. Ct. App. 1997).
  • LIFE ESTATES: Gifts. Unless the creating document provides otherwise, a life tenant who sells property pursuant to a broad power of disposition does not acquire fee simple title to the proceeds and to the property acquired with those proceeds; rather, the proceeds and subsequently acquired property are subject to the life estate. Caldwell v. Walraven, 490 S.E.2d 384 (Ga. 1997).
  • LIFE ESTATES: Cotenant's interest devisable. A decedent devised property to two cotenants for "their lifetime." After the death of one cotenant, the deceased cotenant's interest passed to his heirs as a life estate measured by the life of the surviving cotenant. Briggs v. Briggs, 950 S.W.2d 710 (Tenn. Ct. App. 1997).
  • MORTGAGES: Faulty notice voids foreclosure sale. Under Missouri law, a foreclosure sale pursuant to a private power of sale in a deed of trust was set aside in a Chapter 13 bankruptcy when the lender extended the date to cure a default beyond the date set for the foreclosure sale. In re Keith, 211 B.R. 355 (W.D. Mo. 1997).
  • MORTGAGES: Foreclosure; notice to contingent remaindermen. Decedent devised property to "LaFont, and her bodily heirs, in fee simple." Under Missouri law, LaFont had a life estate and her bodily heirs a contingent remainder. She mortgaged the property and then defaulted. The mortgagee foreclosed by private power of sale but did not give notice to LaFont's presumptive heirs (remaindermen). Upon LaFont's death, her bodily heirs were entitled to possession. The decision appears to rely on the failure to give notice to the contingent remaindermen as "owners." Williams v. Kimes, 949 S.W.2d 899 (Mo. 1997).
  • MORTGAGES: Maturity date of mortgage set by maturity date of note. When a mortgage's maturity date was not stated in the recorded instrument but the mortgage recited that it was security for a note, the due date of the note controlled and started the statute of limitations for enforcing lien debt running. Off-record extensions of the due date between the mortgagor and mortgagee did not put subsequent judgment lien creditors on notice of the extension. Judgment lien creditors whose liens were recorded after the statute had run had priority over the mortgage (which was presumed to have been paid four years from original maturity). Cadle Co. v. Butler, 951 S.W.2d 901 (Tex. Ct. App. 1997).
  • RECORDING ACTS: Torrens Act, estoppel by deed. On a question of first impression after adoption of the Torrens Act, the Minnesota Court of Appeals held that the doctrine of estoppel by deed is inconsistent with the Torrens Act. In re Petition of Willmus, 568 N.W.2d 722 (Minn. Ct. App. 1997).
  • RECORDING: Subsequent purchaser; inquiry notice. When a deed to a prior purchaser is unrecorded but the prior purchaser is in possession, a later purchaser cannot be a "bona fide purchaser" when a reasonable investigation would reveal the possessor's interest. Such a reasonable investigation does not, however, require an inquiry of the possessor if the records indicate that the possession is consistent with the rights of the record owner. Grose v. Sauvageau, 942 P.2d 398 (Wyo. 1997).
  • SELLER AND BUYER: Lawyer approval clause; con-tinuing negotiations. When the five day period within which lawyers for the seller or buyer could disapprove the contract expired, the contract became final despite negotiations for modifications during the five day period. Hubble v. O'Connor, 684 N.E.2d 816 (Ill. Ct. App. 1997).
  • WASTE: Damage to trees and shrubs. The defendant had conveyed a 40 acre tract to the plaintiff reserving, in effect, a life estate in the residence and surrounding yard. When the life tenant let the water pump fall into disrepair with a resulting loss of lawn, shrubs and trees, the life tenant was assessed damages for waste. Kimbrough v. Reed, 943 P.2d 1232 (Idaho 1997).
  • ZONING: Due process. A zoning board violated the plaintiff's due process rights by failing to inform him that his request for a variance would be presented at the meeting in question. In re Petition of Carpenter, 699 So. 2d 928 (Miss. 1997).
  • ZONING: Nuisance. A public nuisance can always be abated; thus a valid nonconforming use, regardless of its duration, may be prohibited or restricted when it also constitutes a public nuisance or is harmful to the public health, safety or welfare. Delafield v. Sharpley, 568 N.W.2d 779 (Wis. Ct. App. 1997).
  • ZONING: Mobile home ban. The court upheld a ban on mobile homes in certain residential districts. The federal laws setting construction standards for manufactured homes did not preempt a local ordinance governing the location of mobile homes. The court also held that the ordinance did not violate the due process or equal protection clauses and did not require "stricter scrutiny" under the commerce clause because of its limited effect on interstate commerce. Texas Manufactured Housing Ass'n, Inc. v. City of LaPorte, 974 F. Supp. 602 (S.D. Tex. 1996).
  • ZONING AND PLANNING: Land survey not equivalent to subdivision plat. Filing a land survey in 1985 did not start the one year statute of limitations running on misdemeanor charges of illegally subdividing land. The court distinguished between a land survey and a subdivision plat. State v. Bilbao, 943 P.2d 926 (Idaho 1997).
  • ZONING AND PLANNING: Local plan must track master plan. When a local vicinity plan was inconsistent with the master plan's industrial classification of an area, the local plan's disallowance of industrial use was tantamount to an improper amendment of the master plan. Ash Grove Cement Co. v. Jefferson County, 943 P.2d 85 (Mont. 1997).
  • ZONING AND PLANNING: Vesting. An owner filed an application for a short plat subdivision to create three lots for duplex use and disclosed the intended use. The owner's right to such use vested at the time of the application, pursuant to statute. Noble Manor Co. v. Pierce County, 943 P.2d 1378 (Wash. 1997).
  • LOW-INCOME HOUSING CREDIT. The Department of the Treasury issued final regulations concerning the low-income housing tax credit when a building is occupied by individuals whose incomes increase above 140% of the income limitation applicable under Code 42(g)(1). T.D. 8732, 1997-42 I.R.B. 4 (Oct. 20, 1997) (promulgating new Treas. Reg. 1.42-15). The Treasury also issued final regulations concerning the low- income housing tax credit relating to the application of 42(d)(5) to certain rental assistance programs under 42(g)(2)(B)(I). T.D. 8731, 1997-42 I.R.B. 6 (Oct. 20, 1997) (promulgating new Treas. Reg. 1.42-16).
  • Bankruptcy: Dewsnup "dissected." In The Immovable Object Versus the Irresistible Force: Rethinking the Relationship Between Secured Credit and Bankruptcy Policy, 95 Mich. L. Rev. 2234 (1997), Lawrence Ponoroff and F. Stephen Knippenberg examine the Dewsnup case in the context of current legislative and judicial developments relating to the treatment of undersecured creditors in bankruptcy. The authors offer some valuable insights into the current situation and propose an alternative characterization of security interests in bankruptcy.
  • Private property regimes: Protecting the minority. Noting that millions now live in condominiums, cooperatives and properties controlled by homeowners' associations, Stewart E. Sterk analyzes the effect of majority rule prevalent in such regimes on the rights of the minority members and develops a model for minority protection in community associations in Minority Protection in Residential Private Governments, 77 B.U. L. Rev. 273 (1997) .
  • Property tax exemption: Land conservation. In Weighing the Costs and Benefits of Property Tax Exemption: Nonprofit Organization Land Conservation, 49 Me. L. Rev. 399 (1997), Kirk G. Sieel analyzes real estate tax exemptions under Maine law for nonprofit organizations holding land for conservation purposes. He also proposes methods for taxing conservation and other exempt land more fairly.
  • Regulatory takings. In Regulatory Takings, Private Property Protection Acts, and the "Moragne Principle:" A Proposal for Judicial-Legislative Comity, 49 S.C. L. Rev. 83 (1997), Bruce Burton decries what he perceives as confusion, obscurity and illogic permeating the current state of takings doctrine. He proposes that private property protection laws being considered by many state legislatures can provide a more rational and predictable problem solving structure.
  • Valuation without appraisers. John F. Shampton explores the use of nonappraisal, objective statistical real estate valuation models. In Statistical Evidence of Real Estate Valuation: Establishing Value Without Appraisers, 215 Ill. U. L.J. 113 (1996), he briefly discusses the present "battle of experts" approach and then reviews statistical models, their possible extensions and the probability of their admissibility.
  • Brownfields; environmental audits. Two new books from the Section of Natural Resources, Energy and Environmental Law address matters of interest to Section members. Brownfields: A Comprehensive Guide to Redeveloping Contaminated Property (1997), edited by Todd S. Davis and Kevin D. Margolis, examines the broad spectrum of legal, business and financial issues associated with brownfields development. A series of chapters on state voluntary cleanup programs should be of particular interest to lawyers seeking comparative information. A Complete Guide to Environmental Audits (1997), by Elizabeth Glass Geltman, is a thorough overview, from both federal and state perspectives, of this emerging practice area. Both books are available from the ABA's Service Center, (800) 285-2221.
  • Kansas enacts the Voluntary Clean Up and Property Redevelopment Act. 1997 S.B. 276.
  • Louisiana enacts regulations of agency relationships in real estate transactions. La. Rev. Stat. Ann. 3891.
  • Maine decrees that community living arrangements are considered single-family uses for zoning purposes. Me. Rev. Stat. Ann. Tit. 30-A 4357.
  • New York adopts the Rent Regulation Reform Act of 1997. 1997 N.Y. Laws Ch. 116.
  • North Carolina adopts the Uniform Fraudulent Transfer Act. N.C. Gen. Stat. 39-23.1 et seq.
  • Oklahoma authorizes municipalities to create zoning classifications regulating the location of adult novelty shops. Okla. Stat Ann. Tit. 11 22-109.1.
  • Rhode Island immunizes operators of gun ranges from prosecution for creating public nuisances due to noise or noise pollution. R.I. Gen Laws 11-47-62.
Readers interested in a comprehensive review of current developments in real estate law are encouraged to subscribe to the ABA Real Estate Quarterly Report, which is prepared by the Real Property Division's Decisions Committee. For more information on this publication, contact LaPrica D. Mims at the Section office, (312) 988-6233.

Keeping Current_Property Editor: Nicholas L. White, School of Law, University of Memphis, Memphis, TN 38152. Contributing editors: Ralph Brashier, Lars Gustafsson and David A. Thomas.

Probate & Property Magazine is published six times annually and is included in section members' annual dues.