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Welcome Foundation Title School

York, Nebraska

June 17. 2019

NLTA’s Foundation Title School © Nebraska Land Title Association. All Rights Reserved.

Types of Ownership in Real Property Kenda D. Marler

Nebraska Title Company

Real Property vs. Personal Property

•  Real Property:

•  Is the land and anything affixed to the land

•  Home, buildings, garages, mobile homes that have been affixed-all examples of Real Property

•  Personal Property:

•  Long story short everything that is not affixed to the property. Pivots, farm equipment etc

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What is Ownership of Real Property

•  Ownership is an “Estate” in Land

•  Two Characteristics of an Estate

•  Possessory

•  Measured in duration

•  What is the meaning of possessory as it applies to real estate? •  The intent and right of a person to occupy and/or exercise control over a particular plot

land.

•  It should be noted that a possessory interest does not necessarily include the right to immediately occupy the property. Such as a Long Term Lease

Estates in Land Divided

•  Freehold

•  Is defined as exclusive right to enjoy the use of a parcel of land or other asset for an indefinite period. Freehold Estates are those involving ownership.

•  Non-freehold estates

•  While Freehold Estates involve ownership Non-freehold estates exist without seisin. Seisin is defined as an old feudal term for having both possession and title of real property. A tenants interest or easement interest in the property is considered non-freehold

Estates in Land Divided

•  Fee Simple Absolute

•  Most unrestricted estate of indefinite duration

•  Transferrable by Deed, will or intestacy

•  Presently, there is no specific language in a Deed or will to transfer. However, it must be apparent that there are no limitations or reservations placed on the ownership

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Estates in Land Divided

•  Defeasible (subject to a restriction)

•  Fee Simple determinable-lapses automatically if a contingent event occurs.

•  Fee simple on condition – grantor has the right to re-enter property and terminate the estate upon the happening of an event.

•  Fee simple subject to an executory limitation-the happening of a specified event results in the transfer of the ownership to a third person

Estates in Land Divided

•  Fee Tail

•  Conveyance restricted to the issue of the grantee so that the property would pass from generation to generation within a family (Unable to be conveyed to a third party)

•  Abolished by statute in Neb. Rev. 76-11

Estates in Land Divided

•  Life Estate-an estate lasting the lifetime of a person. •  Ordinary life estate terminates on the death of the owner. (note that there may be inheritance

tax due and owing, depending on the situation

•  Life Estate per autre vie- a life estate measured by the life of someone other than the grantee.

•  Non-Freehold Estates (no seisin) (landlord/tenant relationship •  Estate for years (term of years)

•  Periodic estate

•  Estate at will

•  Estate at sufferance

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Non-Possessory Estates-Easement

•  The right to use someone else's land for a specified purpose.

•  Appurtenant Easement: Benefits real property (i.e., drainage or access easements)

•  Easement in Gross: Benefits a person (i.e., utility easement)

Easements (cont)

•  Dominant Tenement: The property that benefits from the easement

•  Subservient Tenement: The property that is burdened with the easement

•  Distinction Between an Easement and a License

•  An easement can be in perpetuity or for a specified period of time and cannot be revoked by the owner of the servient tenement. A license may be revoked at any time.

Sole Ownership

•  Property owned entirely by one person / entity

•  “John Doe, a single man”

•  “John Doe, a married man as his separate property”

•  Spouse may still have a marital interest

•  “ABC Corporation, Inc.”

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Co-Ownership of Real Property

•  Tenancy in Common

•  Co-Owned Property is presumed to be a Tenancy in Common unless the Deed states otherwise.

•  Presumption of equal ownership unless the Deed states otherwise.

•  All owners have the right to possession of the property.

•  Any owner can convey their interest in the property.

•  Will normally have an agreement between owners including a right of first refusal

Co-Ownership of Real Property

•  Joint Tenancy

•  Title passes automatically to the co-tenant upon the death of the other co-tenant

•  The Deed must say “as Joint Tenants”

•  If the Joint Tenants die at the same time title reverts to a Tenancy in Common and each estate would own a ½ interest in the property.

Co-Ownership of Real Property

•  Tenancy in the Entirety

•  Some states have a special form of joint tenancy when the joint tenants are husband and wife, with each owning a one-half interest. Neither spouse can sell the property without the consent of the other. Words in the deed such as "John and Mary, husband and wife as tenancy in the entirety", establishes title in tenancy by the entireties.

•  Many Authorities are of the opinion tenancy by the entireties has been abolished in Nebraska

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Spousal Interest

•  The default position in Nebraska is if real property is acquired by a married person in their individual capacity that the non-titled spouse still owns an equal interest in the property.

•  Exception

•  If the property is received as a gift or inheritance by the titled spouse (or if a gift or inheritance is used to purchase the property)

Ownership By A Trust

•  Trusts cannot own real property

•  All property is technically owned by the Trustee

•  The must read “John Doe as Trustee of the Revolutionary Trust dated July 4, 1776”

Introduction to Land Titles and Transfers Session One

Part 2

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Land Transfers

Deed A legal Instrument used to transfer real property title during the grantor’s lifetime.

Requirements for a Valid Deed

• A Written Document

• The Grantor & Grantee must be named

• Grantee must be capable of taking title

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Requirements for a Valid Deed (Cont.)

• An Adequate Legal Description

• Signed by Grantor (and joined by spouse, if any)

• Delivered and Accepted

Types of Deeds

General Warranty Deed 1)  Grantor holds title 2)  Grantor has good title 3)  Grantor Promises to Defend Title

“Conveys After Acquired Interest”

Warranty Language

“Grantor does hereby covenant with the Grantee that Grantor is lawfully seized of such real estate; and that Grantor has legal power and lawful authority to convey the same; and that GRANTOR warrants and will defend the title to the real estate against the lawful claims of all persons whomsoever.”

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Types of Deeds

Special Warranty Deed

Only warrants title against claims arising during the Grantor’s ownership.

Special Warranty Language

“Grantor will Warrant and Defend the said premises against the lawful claims and demands of all persons claiming by, through, or under it.”

Types of Deeds

Quitclaim Deed

The grantor makes no representation that he has any interest in the property.

“No After Acquired Interest Conveyed”

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Other types of Deeds

•  Sheriff’s Deeds

• Master Commissioner’s Deeds

•  Trustee’s Deeds

•  Personal Representative’s Deeds

•  Referee’s Deed

Examine the Warranty Language on Each Deed

What to examine?

Examining Elements on Each Deed

1.  Grantor

2.  Grantee

3.  Ownership Interest

4.  Legal Description

5.  Granting and Conveying Language

6.  Execution of Grantor (Signature)

7.  Acknowledgment

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On to the Examples

Example 1

Example 2

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Example 3

Example 3

Example 4

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Example 5

Example 6

Example 7

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Example 8

Example 9

Example 9 (continued)

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Example 10

Example 10 (continued)

Example 11

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Example 11 (continued)

Example 12

Corp Seal

Example 13

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Example 13 (Continued)

Example 14

Questions Introduction to Land Titles and Transfers