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.
ADVERSE POSSESSION: Boundary by acquiescence. When a boundary line is established by acquiescence but the two properties later come under common ownership, the boundary is extinguished unless the later conveyance adopts the previously accepted boundary line. Salazar v. Terry, 911 P.2d 1086 (Colo. 1996).
BANKRUPTCY: Post-discharge condominium fees. Under Massachusetts law, covenants to pay condominium fees "run with the land" and such post-petition fees therefore are not dischargeable. In re Whitten, 192 B.R. 10 (Bankr. D. Mass. 1996).
COVENANTS: Bed and breakfast prohibited. Because there is no significant difference between a bed and breakfast inn and a small motel, the inn is an on-going business that violates covenants intended to prohibit commercial uses. Robins v. Walter, 670 So. 2d 971 (Fla. Dist. Ct. App. 1995).
EMINENT DOMAIN: "Scope of project rule"; valuation date. Under the "scope of project rule," a landowner may not recover for enhanced value due to the planned project. In applying the rule, the date for valuation is the date when the project is announced to the public and it is reasonably foreseeable that the property might be taken. Metropolitan Gov't of Nashville v. Overnite Transp. Co., 919 S.W.2d 598 (Tenn. App. 1995).
FIXTURES: Priorities; UCC. A bank asserted that its perfected purchase money security interest in an in-ground swimming pool had priority over plaintiff's mortgage as to the entire fee, not just the pool. On this priorities question of first impression in Connecticut, the court noted the impracticality of removing an in-ground pool but concluded that the bank's interest had priority over that of the plaintiff only for the fixture itself. FGB Realty Advisors v. Bennett, 672 A.2d 545 (Conn. Super. 1995).
JOINT TENANCY: Severance by conveyance. On a question of first impression in the District of Columbia, the court of appeals adopted the generally applicable rules that either party to a joint tenancy may sever the tenancy by unilaterally disposing of its interest; that the consent of the other tenant is not required; and that the transfer converts the estate into a tenancy in common. Estate of Gulledge, 673 A.2d 1278 (D.C. 1996).
LANDLORD AND TENANT: Criminal acts; assumption of duty. A tenant who was attacked in her apartment by an unknown assailant claimed that because her landlord had represented that the premises had "security," the landlord had assumed a duty to exercise reasonable care. Reviewing Tennessee case law, a federal district court concluded that it does not permit the use of "assumption of duty" as an alternate means of imposing a duty on a landlord to protect against the criminal acts of a third party, in the absence of notice. Lord v. Saratoga Capital, Inc., 920 F. Supp. 840 (W.D. Tenn. 1995).
LANDLORD AND TENANT: Duty of care; risks inherent in natural body of water. A tenant's child fell down a steep embankment at a mobile home park and into a natural flowing stream. The court held the landlord was not exempt from exercising reasonable care to protect the invitee child from potentially dangerous conditions inherent in a natural body of water. Degel v. Majestic Mobile Home Manor, Inc., 914 P.2d 728 (Wash. 1996).
LANDLORD AND TENANT: Holdover tenant; res judicata. A landlord sued a tenant for back rent and obtained default judgment. Later, the landlord sued the tenant for double rent as a holdover. The tenant claimed the second suit was barred by res judicata. Citing authority from other jurisdictions, the Mississippi Supreme Court held that an action against a holdover tenant is separate and distinct from an action based on the lease agreement. Thus, the landlord was not barred from bringing the second action. Murphree v. Aberdeen-Monroe County Hosp., 671 So. 2d 1300 (Miss. 1996).
LANDLORD AND TENANT: Renewal option; lessee's default. A lessor may rely on a lessee's default in a payment term under the original lease as the basis for refusing to honor the lessee's right to exercise an option to renew the lease. Cowan v. Mervin Mewes, Inc., 546 N.W.2d 104 (S.D. 1996).
I Renewal option; waiver of defaults. The Mississippi Supreme Court ruled that a landlord's waiver of the right to object to the tenant's lease violations during the original term precludes the landlord from relying on those violations to deny renewal. Noting a split of authority, the court reasoned that when the lessor waives conditions or breaches of conditions during the term of the lease, they cannot be revived to prevent exercise of the renewal option. Vice v. Leigh, 670 So. 2d 6 (Miss. 1995).
LANDLORD AND TENANT: Retaliatory eviction. On a question of first impression in West Virginia, the state supreme court held that a residential tenant may state a cause of action for retaliatory eviction if the landlord's conduct is in retaliation for the tenant's exercise of a right incidental to the tenancy. The court agreed with California and Illinois cases refusing to limit retaliation to defensive use by the tenant. Murphy v. Smallridge, 468 S.E.2d 167 (W. Va. 1996).
MORTGAGES: Foreclosure; fire insurance proceeds. By purchasing the fire damaged, mortgaged property at a foreclosure sale for the full amount due, the mortgagee no longer had an interest in the property as an insured under the mortgagor's policy and could not collect, even though the fire loss occurred before the foreclosure. First Investment Co. v. Allstate Ins. Co., 917 S.W.2d 229 (Tenn. App. 1995).
MORTGAGES: Foreclosure; lack of notice. Makers of a promissory note secured by a mortgage were entitled to actual notice of foreclosure under Massachusetts law, even though the makers were not the mortgagors of record. Thus, a foreclosure sale without notice to the makers extinguished their liability. IAG Fed. Credit Union v. Laterman, 661 N.E.2d 945 (Mass. App. 1996).
MORTGAGES: Foreclosure sale price bid by mortgagee conclusive. Following a foreclosure sale at which the lender purchased for slightly less than the mortgage debt, the lender brought suit alleging fraud on the part of the borrower. For determining lender's damages in the fraud case, the amount bid by the lender is conclusive as to the mortgaged property's value. Penn Mutual Life Ins. Co. v. Cleveland Mall Assoc., 916 F. Supp. 715 (E.D. Tenn. 1996).
MORTGAGES: Sale "subject to"; mortgagor as surety. Although the purchaser of mortgaged property did not assume the mortgage but took "subject to," the mortgagor maker of the note became a surety and the property the source of repayment. When the lender, without notice, released the underlying security on partial payment, the borrower was released as surety for any deficiency. Chrysler First Business Credit Corp. v. Kawa, 914 P.2d 540 (Colo. App. 1996).
RESPA: Demand and reconveyance fees. In a class action suit by borrowers against mortgage lenders in California, the court held that failure to disclose or set forth demand and reconveyance fees in either the HUD Settlement Form or as part of the "good faith estimate" requirement does not violate RESPA. Bloom v. Martin, 77 F.3d 318 (9th Cir. 1996).
STATUTE OF FRAUDS: Facsimile transfer; imprint of sender's name. In an action by a subcontractor against a general contractor, the court held that the automatic imprint of the contractor's name on the facsimile transmission did not satisfy the statute of frauds. Parma Tile Mosaic & Marble Co. v. Estate of Short, 663 N.E.2d 633 (N.Y. 1996).
TENANCY BY THE ENTIRETY: Requirements. Under the Illinois Joint Tenancy Act, a conveyance to husband and wife does not create a tenancy by the entirety unless it is expressly stated that the grantees are husband and wife. Thus, a judgment creditor could reach husband's interest. Travelers Indem. Co. v. Engel, 81 F.3d 711 (7th Cir. 1996).
ZONING AND PLANNING: Fair Housing Act; group home for handicapped. The city of St. Louis limits group homes for the handicapped in a single-family zone to no more than eight unrelated persons. The federal court of appeals held that the Fair Housing Act applied but the eight person restriction was valid under the Act because it was reasonably related to the legitimate goal of relieving congestion. The court also noted that the property owner's claim was not ripe because no variance had been sought. Oxford House-C v. City of St. Louis, 77 F.3d 249 (8th Cir. 1996).
ZONING AND PLANNING: Group homes. An objector appealed a local zoning board's decision to permit a group home for not more than eight HIV-infected adults. The objector claimed the home would not be a "family" group home as contemplated by ordinance. Noting expert testimony that the adults would exhibit the characteristics of affection and companionship common to a traditional family, the court upheld the zoning board's conclusion that the group was functionally equivalent to a family. Eichlin v. Zoning Hearing Bd., 671 A.2d 1173 (Pa. Comm. Ct. 1996).
ZONING AND PLANNING: Vested rights. A land-owner who constructed a deck and hot tub without appropriate permits had no vested right to maintain the structure. Although the structure would have been permitted at the time of construction, a later ordinance enacted before the landowner made a proper application for a permit prohibited the structure. City of Aspen v. Marshall, 912 P.2d 56 (Colo. 1996).
Buyer and seller; disclosure. Ann J. Rosenthal and R. Stuart Phillips explore the duties of disclosure imposed on sellers of California real property in Tell It Like It Is Sellers' Duties of Disclosure in Real Estate Transactions Under California Law, 26 Golden Gate U. L. Rev. 473 (1996).
Environmental litigation. A new litigation newsletter, Gibby-Moon Report: Legal Actions Against Environmental Professionals, is published by E.P. Liability Management Corporation, 22 Sandpiper Road, Tampa, FL 33609.
Fair Housing Act. Eight contributors provide an interesting review of special problems in this growing area of the law in A Fair Housing Enforcement Symposium: A Focus on Special Issues Affecting the Disabled, Families with Children and the First Amendment, 29 J. Marshall L. Rev. 315 (1996).
Land use. A "festschrift" honoring the late Norman Williams Jr., author of the multi-volume American Land Planning Law, is presented at 20 Vt. L. Rev. 619 (1996). Among the authors discussing various land use topics are Daniel R. Mandelker, John M. Payne, Norman Williams and Anya Yates.
Landlord and tenant. Noting recent developments favoring landlords and the continued use of antiquated property rules in landlord-tenant cases, Robert H. Kelley argues for reform in Any Reports of the Death of the Property Law Paradigm for Leases Have Been Greatly Exaggerated, 41 Wayne L. Rev. 1563 (1995).
Malpractice and environmental law. J. B. Ruhl discusses issues relating to malpractice in the relatively new field of environmental law in Malpractice and Environmental Law: Should Environmental Law Specialists Be Worried?, 33 Hous. L. Rev. 173 (1996).
Regulatory takings. In Colonial Land Use Law and Its Significance for Modern Takings Doctrine, John F. Hart concludes that the historical assumption that there was minimal land use regulation is false and that there is an "utter lack of evidence that the Takings Clause was originally intended to apply to land use regulation." 109 Harv. L. Rev. 1252 (1996).
Title insurance. In More Than They Bargained For: All Title Insurance Companies Liable in Tort for Undisclosed Title Defects?, 45 Cath. U.L. Rev. 71 (1995), James Bruce Davis reviews the tort exposure of title companies.
Uniform Land Transactions Act. A symposium entitled, Whatever Happened to the Uniform Land Trans-actions Act?, 20 Nova L. Rev. 1017 (1996), offers an informative examination of the proposal, content and non-adoption of the Uniform Land Transactions Act. Authors include Ronald Benton Brown, Richard B. Amandes, Marion W. Benfield Jr., Gerald Korngold, Barbara Taylor Mattis, Patrick A. Randolph Jr., Norman Siebrasse, Catherine Walsh and James Charles Smith.
Arizona enacts new regulations of discretionary dedications and exactions. Ariz. Rev Stat. Ann. 9-500.12 et seq.
Arizona revises rules governing residential landlord-tenant relations. Ariz. Rev. Stat. Ann. 12-1178 et seq.
Colorado enacts tax breaks for land dedicated to conservation, habitat protection and recreation. Colo Rev Stat. 39-1-102.
Colorado enacts vesting protections for land affected by development moratoriums. Colo Rev Stat. 24-68-105.
Georgia revises its Land Sales Act and Time-Share Act. Ga. Code Ann. 44-3-4.1 et seq.; 44-38-160 et seq.
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 and David A. Thomas.Probate & Property Magazine is published six times annually and is included in section members' annual dues.