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McInnes/Kerr/VanDuzer: Managing the Law: The Legal Aspects of Doing Business, Fourth Edition
Chapter 15: Real Property: Interests and Leases
True/False Questions
1) Rio bought a piece of land from Bill. Although she now owns that property, the doctrine
of privity of contract means that Bill is the only person against whom she can enforce her
property rights.
a. True
b. False
2) The right of expropriation allows the government, for emergency purposes only, to take
a piece of land from a person without payment.
a. True
b. False
3) Dulcy has an estate in a piece of land called Blackacre. That means that she must own
that land, though not necessarily as the holder of a fee simple.
a. True
b. False
4) Malia owns the fee simple in a piece of land called Blackacre. She wants to create a life
estate in favour of Gordon. However, she also wants to ensure that the duration of that life
estate is measured by her own life rather than Gordon’s life. She is entitled to do so.
a. True
b. False
McInnes/Kerr/VanDuzer: Managing the Law: The Legal Aspects of Doing Business, Fourth Edition
Chapter 15: Real Property: Interests and Leases
5) Selina owned a large piece of land called Blackacre. She sold the west half to Arvid and
the east half to Geoff. Geoff and Arvid therefore share ownership of Blackacre as either
joint tenants or co-tenants.
a. True
b. False
6) Téa and David are co-tenants of Blackacre. There are no other co-tenants. Blackacre has
been leased to the Bland Corp for $50 000. That profit does not necessarily have to be split
equally between Téa and David.
a. True
b. False
7) As a general rule, the common areas in a condominium complex are held under co-
tenancy, rather than joint tenancy, by all of the owners of the individual units.
a. True
b. False
8) In the context of an easement or a restrictive covenant, the servient tenement is the
property that is beneficially served by the easement or restrictive covenant.
a. True
b. False
McInnes/Kerr/VanDuzer: Managing the Law: The Legal Aspects of Doing Business, Fourth Edition
Chapter 15: Real Property: Interests and Leases
9) The main difference between an easement and a licence is that a licence must be an
interest in land, while an easement may or may not be an interest in land depending upon
the circumstances.
a. True
b. False
10) There is an important similarity between a mineral lease and a profit à prendre. In
neither case does the person who holds the interest have an automatic right to the subject
matter of the interest (such as the minerals in a mineral lease).
a. True
b. False
11) Kiana owned the fee simple in a piece of land called Blackacre. She entered into an
agreement to create a lease with Brian that was to last for “99 years or until I get married.”
That lease satisfies the requirement regarding the duration of a lease.
a. True
b. False
12) A sublease does not have to contain exactly the same terms as the head lease.
a. True
b. False
13) Sofia owned the fee simple in a piece of land called Blackacre. She purported to create
a contract for a commercial lease in favour of Roman. That agreement said that Roman was
McInnes/Kerr/VanDuzer: Managing the Law: The Legal Aspects of Doing Business, Fourth Edition
Chapter 15: Real Property: Interests and Leases
required to pay a “reasonable amount” in rent. A lease has not actually been created
because the price must be stated with more precision.
a. True
b. False
14) Aaliyah owned a piece of land that she rented to Rudy under a commercial lease.
Because Rudy consistently failed to pay the rent, Aaliyah exercised the right of distress.
That means that she placed Rudy under pressure, or “in distress,” by changing the locks on
the premises as a way of encouraging him to pay the rent.
a. True
b. False
15) Because it is aimed at the imbalance that can exist between landlords and tenants,
residential tenancy legislation generally applies only if the landlord is a corporation, rather
than an individual.
a. True
b. False
Multiple Choice Questions
1) Land is called “real” property
a. because it is impossible to fake the existence of land.
b. after the word “res,” which means “thing” in Latin.
c. because the usual remedy for a trespass to land is compensation, which provides the
plaintiff with an effective remedy.
d. after the word “reus,” which means “action” in Latin.
McInnes/Kerr/VanDuzer: Managing the Law: The Legal Aspects of Doing Business, Fourth Edition
Chapter 15: Real Property: Interests and Leases
e. after the word “real,” which means “royal” in Latin.
2) The “giant carrot theory” is used to describe
a. the fact that the owner of a piece of land is entitled to any profits made on that land.
b. the fact that a person who owns a profit à prendre is allowed to harvest natural products
from a piece of land.
c. a theory that is used in civil law systems, such as Quebec, but that has never been
recognized in the common law.
d. the manner in which profits are divided between co-tenants.
e. the fact that, in theory, a person who owns a piece of land has rights from the centre of
the Earth and up through the heavens.
3) Benjiro has an “estate” in a piece of land called Blackacre. As described in the text, that
terms indicates that he
a. inherited Blackacre from his father.
b. has the right to determine who will acquire the property after he dies.
c. enjoys the right to exclusive possession for some period of time.
d. is a lawyer.
e. must hold the reversionary interest in connection with a life estate.
McInnes/Kerr/VanDuzer: Managing the Law: The Legal Aspects of Doing Business, Fourth Edition
Chapter 15: Real Property: Interests and Leases
4) Midori has an “estate” in a piece of land called Blackacre. As described in the text, that
term indicates that she
a. may have either a fee simple or a life estate, but not a lease.
b. may have a fee simple but not a life estate or a lease.
c. may have a life estate, a reversion, or a remainder, but not a fee simple.
d. may have a fee simple, a life estate, or a lease.
e. acquired Blackacre through a contract of purchase and sale.
5) Akhenaten has the fee simple in a piece of land called Blackacre. This means that he
a. is, in a technical sense, the absolute owner of the property.
b. acquired Blackacre directly from the government through a Crown grant.
c. paid sufficient consideration when he purchased Blackacre.
d. is entitled to occupy Blackacre even if he creates a life estate in favour of someone else.
e. is entitled to possess it for an indefinite time.
6) Ashoka has the fee simple in a piece of land called Blackacre. Blackacre is about to be
expropriated. This means that
a. Ashoka has voluntarily agreed to sell his land to his neighbour.
b. Ashoka has died, leaving a will that gives Blackacre to his eldest son.
c. the government will take Blackacre from Ashoka in exchange for the payment of a fair
price.
d. Ashoka is about to renovate the buildings that are located on Blackacre.
e. Ashoka is about to legally divide Blackacre into two separate properties, probably for the
purpose of commercially developing them.
McInnes/Kerr/VanDuzer: Managing the Law: The Legal Aspects of Doing Business, Fourth Edition
Chapter 15: Real Property: Interests and Leases
7) Bhagiratha has the fee simple in a piece of land called Blackacre. She is about to create
two new interests in that property. Gallahad will receive a life estate. Adeline will receive
the remainder. Which of the following statements is TRUE?
a. The doctrine of waste will impose an onerous obligation on Adeline.
b. Bhagiratha will eventually receive the reversion.
c. Adeline will not receive any benefit if Bhagiratha dies before Gallahad.
d. Gallahad will receive an estate in Blackacre.
e. Adeline and Gallahad must be related.
8) Which of the following statements is TRUE with respect to “reversions” and
“remainders,” as those terms were discussed in the text?
a. The doctrine of waste imposes an obligation on a person who has either a reversion or a
remainder.
b. A remainder is used only if one life estate is followed by another life estate.
c. If a life estate is followed by a reversion, the right to sue for waste belongs to the person
who created the life estate.
d. Reversions and remainders are far more common in a business context than in a family
context.
e. A reversionary interest exists only if a person has paid to buy back a piece of land that he
or she previously sold.
McInnes/Kerr/VanDuzer: Managing the Law: The Legal Aspects of Doing Business, Fourth Edition
Chapter 15: Real Property: Interests and Leases
9) Qadir has the fee simple to a piece of land called Blackacre. Patricia wants to acquire an
interest in that property. Which of the following statements is TRUE?
a. Patricia’s interest in Blackacre necessarily will last for a shorter period of time if she
acquires a lease rather than the fee simple.
b. Patricia’s interest in Blackacre necessarily will last for a shorter period of time if she
acquires a lease rather than a life estate.
c. Patricia’s interest in Blackacre necessarily will last for a shorter period of time if she
acquires a life estate rather than a lease.
d. At least initially, Qadir will retain an interest in Blackacre if Patricia receives a lease or a
life estate, but not if she receives the fee simple.
e. At least initially, Qadir will be liable for waste if Patricia receives a lease of a life estate,
but not if she receives the fee simple.
10) Jamilah and Corbin share ownership of a piece of land called Blackacre. A profit of
$5000 was obtained when blueberries were harvested from Blackacre. Which of the
following statements is TRUE?
a. If Jamilah and Corbin are joint tenants, they must each receive $2500 from the blueberry
harvest.
b. If Jamilah and Corbin are co-tenants, they must each receive $2500 from the blueberry
harvest.
c. Even if Jamilah and Corbin are joint tenants, one of them may have the exclusive right to
$5000 from the blueberry harvest.
d. Unless there is a contract to the contrary, the $5000 profit from the blueberry harvest
belongs to the person from whom Jamilah and Corbin acquired their interests in Blackacre.
e. The profits from the blueberry harvest belong to either Jamilah or Corbin, depending
upon which party individually owned the section of Blackacre that contained the blueberry
patch.
McInnes/Kerr/VanDuzer: Managing the Law: The Legal Aspects of Doing Business, Fourth Edition
Chapter 15: Real Property: Interests and Leases
11) Chinthaka, Karissa, and Dora are “joint tenants” of a piece of land called Blackacre. As
explained in the text, that must mean that
a. they each pay an equal amount of rent to their landlord.
b. They have a right of survivorship.
c. if Karissa dies first, her interest will be acquired by either Chinthaka or Dora, depending
upon which party is named in Karissa’s will.
d. they are all related.
e. each person has the right to exclude the other two from at least one section of Blackacre.
12) Jaron and Golda plan to acquire shared ownership in a piece of land called Blackacre.
Which of the following statements is TRUE?
a. They should entirely avoid shared ownership if they are opposed to the concept of
survivorship.
b. They can be joint tenants even if they acquire individual ownership over separate halves
of Blackacre.
c. They may be tenants in common even if Jaron receives a 75 percent undivided share in
Blackacre.
d. They should probably acquire Blackacre as joint tenants if they intend to use it for
business purposes.
e. If they become joint tenants, they cannot later decide to become co-tenants instead.
13) Itzhak and Eleni are joint tenants of a piece of land called Blackacre. Which of the
following statements is TRUE?
a. If Itzhak and Eleni grant a lease to Damian, then he will join them in a joint tenancy.
McInnes/Kerr/VanDuzer: Managing the Law: The Legal Aspects of Doing Business, Fourth Edition
Chapter 15: Real Property: Interests and Leases
b. Although their shares are undivided, Itzhak may own a 60 percent interest in the joint
tenancy.
c. If Eleni sells half of her interest to Eduardo, then there will be a joint tenancy between
Eleni and Eduardo, but a tenancy in common between Eduardo, Eleni, and Itzhak.
d. If Itzhak dies and his widow inherits his interest in Blackacre, then Eleni and the widow
will own the property as joint tenants.
e. If Itzhak sells his interest to Rosie, Rosie and Eleni will be co-tenants of Blackacre.
14) Which of the following statements is TRUE with respect to a condominium?
a. The word “condominium” is derived from two Latin words meaning “tricked” (“con”)
and “control” (“dominium”), because the member of a condominium complex appears to
own more than they really do.
b. The various areas contained in a condominium complex are usually split between life
estates and common tenancies.
c. The individual units in a condominium complex are owned by the condominium
corporation.
d. The expenses associated with running a condominium complex are funded by an
assessment on the owners of the units that is imposed by the condominium corporation.
e. In most jurisdictions, the individual units within a condominium complex must be used
for residential purposes.
15) Angus and Kirsty have some form of ownership in separate units within a
condominium complex. Which of the following statements is TRUE?
a. The concept of “flying fees” describes the fact that Angus and Kirsty must contribute to a
fund that is used by their condominium corporation.
b. Angus and Kirsty must be joint tenants, along with the owners of the other condominium
units.
McInnes/Kerr/VanDuzer: Managing the Law: The Legal Aspects of Doing Business, Fourth Edition
Chapter 15: Real Property: Interests and Leases
c. Angus and Kirsty must live in a building that is at least five stories high.
d. Angus and Kirsty can vote for directors for the condominium corporation only if they
buy separate shares in that corporation.
e. Angus and Kirsty may both be joint tenants with other people.
16) Ganesh and Madonna own neighbouring pieces of land. One of those parties owns
Blackacre and the other owns Whiteacre. Ganesh has a property interest that allows him to
drain his reservoir into Madonna’s field once a year and prohibits Madona from erecting
any impediment to the drainage ditch. Which of the following statements must be TRUE?
a. Ganesh probably enjoys the benefit of a restrictive covenant.
b. Ganesh must have personally paid for the right to drain his reservoir into Madonna’s
field.
c. If Whiteacre is the dominant tenement, then it must belong to Madonna.
d. If Whiteacre is the servient tenement, then it must belong to Madonna.
e. Madonna has granted a licence to Ganesh.
17) Bogdan has the fee simple in a piece of land called Blackacre, which is located in a
remote forest. He has not visited it in nearly 25 years. Tina claims that she has acquired a
property interest in Blackacre as a result of the process of “prescription.” Louise claims that
she has acquired a property interest in Blackacre as a result of the process of “adverse
possession.” Which of the following statements is TRUE, assuming that the terms
“prescription” and “adverse possession” are used in the same sense that they appear in the
text?
a. Tina claims that she is entitled to a restrictive covenant.
b. Tina claims that she is entitled to an estate.
c. Louise claims that she is entitled to an easement.
McInnes/Kerr/VanDuzer: Managing the Law: The Legal Aspects of Doing Business, Fourth Edition
Chapter 15: Real Property: Interests and Leases
d. Louise claims that she is entitled to an estate.
e. Louise’s claim is valid only if she previously held a lease over Blackacre.
18) Which of the following statements is TRUE?
a. An easement and a licence are both non-possessory interests in land.
b. A restrictive covenant is a non-possessory interest in land.
c. An easement and a restrictive covenant are possessory interests in land, but a licence is
not.
d. An easement is a non-possessory interest in land, but a profit à prendre is not.
e. An easement, a licence, and a restrictive covenant all require the existence of dominant
and servient tenements.
19) Ace and Loretta were neighbours. He owned Blackacre and she owned Whiteacre.
They purportedly created a restrictive covenant under which she promised that she would
not build a pool in her backyard, and that she would prune her trees on an annual basis.
Loretta sold Whiteacre to Moira. Moira wants to build a pool in her backyard and she
refuses to prune her trees. Which of the following statements is TRUE?
a. Because a restrictive covenant runs with the land, Moira cannot build a pool and must
prune her trees.
b. Moira is bound by the restrictive covenant, at least in part, even if she did not have any
way of knowing about it when she bought Whiteacre from Loretta.
c. Moira may be prohibited from building a pool, but she cannot be required to prune her
trees.
d. Ace cannot possibly enforce the restrictive covenant against Moira because she was not a
party to the contract that created the restrictive covenant.
McInnes/Kerr/VanDuzer: Managing the Law: The Legal Aspects of Doing Business, Fourth Edition
Chapter 15: Real Property: Interests and Leases
e. Ace can enforce the restrictive covenant against Moira only if he provided consideration
to her after she purchased Whiteacre from Loretta.
20) Janet and Tad were neighbours. She owned Whiteacre and he owned Blackacre. They
created a restrictive covenant that prohibited Tad from building a fence around his property.
Janet gave Whiteacre to Helene as a gift. Tad gave Blackacre to Bentley as a gift. Which of
the following statements is TRUE?
a. Bentley can be prohibited from building a fence around Blackacre only if he knew of the
restrictive covenant when he acquired Blackacre.
b. Helene can enforce the restrictive covenant as long as she knew of the restrictive
covenant when she acquired Whiteacre.
c. The restrictive covenant is valid only if it was notarized by a member of the law society.
d. There is no possibility of enforcement because a restrictive covenant must deal with
benefits rather than burdens.
e. When the restrictive covenant was created, Janet owned the dominant tenement and Tad
owned the servient tenement.
21) Teppo has the fee simple to a piece of land called Blackacre. Laila has a mineral lease
that allows her to extract oil from beneath Blackacre. Which of the following statements is
TRUE?
a. Since the courts no longer apply the “giant carrot theory,” Laila did not really need a
lease in order to legally extract oil from beneath Blackacre.
b. Laila probably acquired her lease from the Crown.
c. Teppo can prevent Laila from extracting oil from beneath Blackacre unless he already
held the fee simple when she first acquired her lease.
d. Laila owns the oil in question even if she has not yet built an oil well.
e. A mineral lease cannot apply to oil, which is not a mineral.
McInnes/Kerr/VanDuzer: Managing the Law: The Legal Aspects of Doing Business, Fourth Edition
Chapter 15: Real Property: Interests and Leases
22) Pedrag has the fee simple in a piece of property called Blackacre. Trish acquired a
profit à prendre with respect to the annual crop of canola that grows on Blackacre. That
interest will last for five years. Which of the following statements is TRUE?
a. The term “profit à prendre” is derived from words that mean “profit from” (“profit à”)
and “hard work” (“prendre”) in French.
b. Trish almost certainly acquired her interest from the Crown, rather than Pedrag.
c. A profit à prendre is a type of mineral lease.
d. Trish owns the canola crop that grows every year, even before she actually harvests it.
e. Trish may hold the profit à prendre even if she does not have title to a dominant
tenement.
23) Bart leased a piece of land called Blackacre to Aida for two years. Which of the
following statements is TRUE?
a. Bart and Aida both have estates in Blackacre.
b. Aida is the landlord.
c. Aida has a non-possessory interest in Blackacre.
d. The lease is void unless it is evidenced in writing.
e. Bart must have the fee simple in Blackacre.
McInnes/Kerr/VanDuzer: Managing the Law: The Legal Aspects of Doing Business, Fourth Edition
Chapter 15: Real Property: Interests and Leases
24) Kuan-yin rented a commercial property to Roger for one month. Which of the
following statements is TRUE?
a. The lease may be for either a fixed term or an indefinite duration.
b. If the lease is a fixed-term tenancy, it will automatically be renewed at the end of one
month unless either Kuan-yin or Roger provides notice to quit.
c. If the lease is a periodic tenancy, it will expire at the end of one month unless either
Kuan-yin or Roger provides notice to renew.
d. The parties must set the minimum term of the lease, but they may leave the maximum
term open-ended.
e. Roger may be liable to pay rent even if the lease did not specify the monthly price.
25) Darius rented a commercial building to Kylie under a monthly periodic tenancy. The
lease took effect on June 1. As soon as Kylie took possession of the building on that day,
she realized that she would be happier elsewhere. Consequently, she gave notice to quit on
June 1. Assuming that the general rules apply, which of the following statements is TRUE?
a. Kylie must pay rent for June and July.
b. If Kylie stays in the premises during July, she will be a trespasser.
c. If Kylie stays in the premises for June, she will do so under a tenancy at sufferance.
d. Kylie has breached the contract and Darius therefore has the right to evict her
immediately.
e. Kylie merely has to provide one week’s notice to quit.
26) Which of the following statements is TRUE?
a. A tenancy at will usually has a fixed duration of one month.
b. A tenancy at sufferance does not require a contractual agreement of any sort between the
parties.
McInnes/Kerr/VanDuzer: Managing the Law: The Legal Aspects of Doing Business, Fourth Edition
Chapter 15: Real Property: Interests and Leases
c. The usual notice period for a tenancy at sufferance is one week.
d. A specific amount of money, technically known as “rent,” must be paid under every type
of lease, including a periodic tenancy, a tenancy at will, and a tenancy at sufferance.
e. If land is subject to a life estate, then a lease may be granted by the person who owns the
remainder or the reversion, but not the person who owns the life estate itself.
27) Ansell rented a commercial property to Eleanor for a five-year term. After two years,
she decided that she no longer needed the premises. Her friend, Kiki, however, is eager to
use the premises for three years. Which of the following statements is TRUE?
a. If the lease is assigned, Eleanor may still be liable to Ansell if Kiki does not pay the rent.
b. If a sublease is created, Eleanor’s obligations to Ansell will be automatically terminated.
c. If the lease does not address the issue of assignment, then Ansell has the right to prevent
Eleanor from assigning her interest to Kiki.
d. If Eleanor wants to use the premises during the fifth year of the lease, she can assign her
rights pertaining to the third and fourth years to Kiki.
e. Because the relevant period is three years or less, Ansell cannot prevent an assignment
even if the original lease requires the landlord’s permission for an assignment.
28) Which of the following statements is TRUE?
a. A commercial lease is always granted to a corporation and a residential lease is always
granted to an individual.
b. If the duration of a lease is three years or less, the parties must set a specific rent at the
outset, and that amount cannot be altered during the term of the lease.
c. The covenant for quiet possession may apply even if both parties are deaf.
d. The right of distress is used more often for residential leases than for commercial leases.
McInnes/Kerr/VanDuzer: Managing the Law: The Legal Aspects of Doing Business, Fourth Edition
Chapter 15: Real Property: Interests and Leases
e. If a residential tenant commits a breach of contract, the landlord is not expected to
mitigate its losses.
29) Which of the following statements is TRUE?
a. The common law refuses to recognize non-possessory interests in land.
b. True property rights can only be acquired through contract.
c. Land cannot be expropriated if it is subject to a fee simple.
d. A fixed-term tenancy can be terminated only through a notice to quit.
e. As a general rule, a person who holds a life estate has no obligation to spend money to
keep the property in good condition but has an obligation to prevent waste.
30) Which of the following statements is TRUE?
a. Ownership of land generally does not include ownership of things attached to the land.
b. A building scheme can be used to create easements but not restrictive covenants.
c. To say that an easement runs with the land means that the easement applies to the entire
property rather than just a part of it.
d. The concept of “prescription,” as explained in Chapter 15, refers to the fact that the
owner of a life estate must avoid acts of waste.
e. The Crown ultimately owns every piece of land in Canada.
