978-1285770178 Solution Manual BL ComLaw 1e SM-Ch29

in whole or in part.

CHAPTER 29

REAL PROPERTY AND

LANDLORD-TENANT LAW

in whole or in part.

CHAPTER 29: REAL PROPERTY AND LANDLORD-TENANT LAW 3

in whole or in part.

to a natural gas pipeline provides a direct benefit to the community. As the court noted, the

potential for cheaper natural gas may spur growth and provide the city with an advantage in

recruiting industries to the area. These benefits may be substantial and obviously would justify

the condemnation. But what happens if Midland never actually acquires gas through the

pipeline? Then the city has condemned property without providing a benefit to its citizens. The

court dismissed this argument because the agreement gave Midland a right to access the

pipeline, and presumably this means that the city intends to do so at some point.

3A. The town of Midland—and its taxpaying citizens—had to pay fair value to fifteen

property owners for property it acquired through eminent domain. Is it right to make the

citizens of one town pay for a pipeline constructed for another town? Explain. In times of

recession, the people of Midland would likely complain about footing the bill for a pipeline

expansion that will not provide them with any financial benefit in the short term. Even if the

properties involved had a relatively low value, such as $100,000 each, Midland would still have

to pay the fifteen owners a substantial amount (for the $100,000 example, $1.5 million). While it

does not seem right to make Midland residents pay for the costs of acquiring property for a

pipeline to run to another town, it is an investment in Midland’s future. If, indeed, the availability

of gas through the pipeline spurs Midland’s growth and brings more industry to the area, the

entire town of Midland will benefit financially. It is always expensive to invest in infrastructure

necessary to develop natural resources. But the end result may pay off in cheaper natural gas (if

Midland does tap into the pipeline) and increased growth (if it brings new industries to the town).

Moreover, there was no discussion in the opinion of how much Monroe was paying to construct

the pipeline, and that amount could have greatly exceeded the cost of acquiring the fifteen

properties. In that event, it may have been a bargain for Midland to pay for the properties and

receive the associated benefits.

4A. Suppose that Midland had used its eminent domain authority to acquire property

for the town to lease to a private resort that would provide a large number of jobs and

bring tourist dollars into the community. What are the arguments for and against this use

of the power of eminent domain? Under the U.S. Constitution, the government has the right to

acquire possession of real property for public use. The power of eminent domain is limited to the

taking of property for public use, though the United States Supreme Court has allowed the

taking of private property to further economic development in blighted, or distressed, areas. The

idea is that allowing the government to take private property and give it to private developers

benefits the public by revitalizing the community. Many people and courts, however, feel that it

is unfair for the government to take one person’s property and give it to another.

In favor of this action, it might be argued that promoting economic development is a

traditional and long accepted function of government. When economic development benefits a

community, there is almost no way to distinguish it from other public purposes. Condemning a

blighted area so that it can be redeveloped commercially, for example, is a mix of private use

and public benefit.

Against this use of the power of eminent domain, it might be argued that a local

government body could then use the power to replace a business that it does not favor with

4 UNIT SEVEN: PROPERTY AND ITS PROTECTION

in whole or in part.

some other business that it regards more favorably, notwithstanding the owner’s right and desire

to use the property as he or she sees fit. The beneficiaries are likely to be citizens with

disproportionate influence and power in the local political process, including large corporations

and real estate development firms.

ANSWERS TO QUESTIONS IN THE REVIEWING FEATURE

AT THE END OF THE CHAPTER

1A. Citizens’ right

Here, the right conveyed by the deed is nonpossessory and gives citizens a limited right to

travel on a trail over Shoepke’s land. Therefore, it is an easement.

2A. Deed’s covenants

A warranty deed conveys the most covenants, or promises of any other deed. The seller

promises that he or she has title to the property, the power to convey it, that there are no

encumbrances against the property, and that the buyer will not be disturbed in her or his

possession (i.e. quiet enjoyment).

3A. Homeowners’ agreement

A promise between a group of landowners protecting the interests of individuals who come onto

the land and the interests of the owners of nearby land is called a restrictive covenant. The

agreement may “run with the land” even if Shoepke was not a party to it.

4A. Tenant’s responsibility

When Slater sublet the apartment, she remained liable under the lease agreement. If a

subtenant fails to pay the rent or causes damage to the premises, the landlord can still hold the

original tenant financially responsible for the rent payments or cost of repairing the damage.

Hence, Slater can be held liable for the damage Indalecio caused (beyond ordinary wear and

tear).

ANSWER TO DEBATE THIS QUESTION IN THE REVIEWING FEATURE

AT THE END OF THE CHAPTER

Under no circumstances should a local government be able to condemn property

in order to sell it later to real estate developers for private use. The Constitution’s Fifth

Amendment is clear about giving the power of condemnation to government. Such power can

only be used to take private property for public use (and with appropriate compensation, of

course). When a local government uses this taking power to condemn property that it later sells

to private developers for a shopping mall development or nicer houses and apartments, that

government is acting in violation of our Constitution.

CHAPTER 29: REAL PROPERTY AND LANDLORD-TENANT LAW 5

in whole or in part.

Sometimes, local governments face tough economics times and must do what they can

to raise more taxes. If a blighted area is never going to “upgrade” itself, then local governments

should be able to step in and speed up the process by a taking, as provided for in the Fifth

Amendment to the U.S. Constitution. The public good will be served in two ways: the blighted

area will be transformed for the better and the local government will obtain more taxes revenues

from the businesses located in this area.

ANSWERS TO ISSUE SPOTTERS IN THE EXAMPREP FEATURE

AT THE END OF THE CHAPTER

1A. Bernie sells his house to Consuela under a warranty deed. Later, Delmira appears,

holding a better title to the house than Consuela has. Delmira wants to have Consuela

evicted from the property. What can Consuela do? . This is a breach of the warranty deed’s

covenant of quiet enjoyment. The buyer can sue the seller and recover the purchase price of the

house, plus any damages.

2A. Grey owns a commercial building in fee simple. Grey transfers temporary

possession of the building to Haven Corporation. Can Haven transfer possession for

even less time to Idyll Company? Explain. Yes. An owner of a fee simple has the most rights

possible—he or she can give the property away, sell it, transfer it by will, use it for almost any

purpose, possess it to the exclusion of all the world, or as in this case, transfer possession for

any period of time. The party to whom possession is transferred can also transfer his or her

interest (usually only with the owner’s permission) for any lesser period of time.

ANSWERS TO BUSINESS SCENARIOS AND BUSINESS CASE PROBLEMS

AT THE END OF THE CHAPTER

29-1A. Property ownership

(Chapter 29—Page 570)

land. When Rafael properly recorded the quitclaim deed, it served as notice to all future pur–

chasers of her interest in the property. Thus, Madison could not transfer any interest in the land

29-2A. Eviction

(Chapter 29—Page 578)

in whole or in part.

8 UNIT SEVEN: PROPERTY AND ITS PROTECTION

in whole or in part.

free lease of the property under the garage ended. Mansell never notified the previous owner or

Hunter that she was claiming adverse possession so that the hostile possession time would

begin. Hunter had objected to the possession in 2003. So Mansell’s garage was trespassing on

Hunter’s property. Hunter may agree to sell Mansell the property, but need not do so, in which

case the garage must be removed to end the continuing trespass.

29-8A. SPECIAL CASE ANALYSIS—Eminent Domain

Case No. 29.3

Town of Midland v. Morris

Court of Appeals of North Carolina, 2013.

agreement, Midland could—if it chose—tap the line at a discounted price. Midland used its

eminent domain authority to condemn the property. Fifteen property owners challenged the

action in a North Carolina state court. The court ruled in Midland’s favor. The owners appealed,

claiming that Midland’s condemnation was not for public use or benefit, because the town had

CHAPTER 29: REAL PROPERTY AND LANDLORD-TENANT LAW 9

in whole or in part.

The public use test asks whether the public has a right to a definite use of the

condemned property. The public benefit test asks whether some benefit accrues to the public as

a result of the desired condemnation.

(c) Applying the Rule of Law: How did the court apply the rule to the facts in this

case? The court broadly interpreted the relevant state statutes to find that a city has the power

to establish a public utility when it plans to develop the infrastructure and capability even if it has

no plan to furnish the service.

In applying the public use test, the court noted that “there was nothing to indicate that gas

services—were they to be provided by Midland—would be available to anything less than the

spur growth and provide advantages to the city in attracting industry. “These opportunities must

be seen as public benefits accruing to the citizens of Midland, such that Midland’s

condemnations are for the public benefit.”

(d) Conclusion: What did the court conclude? Why? The trial court in the Town of

growth, as well as provide the town with an advantage in attracting new industries. These

opportunities were for the public benefit of the citizens of Midland.

29-9A. A QUESTION OF ETHICS—Seller’s duty to disclose

(a) The court concluded that Armstrong was not required to disclose Ring’s failure to

pay rent, because that was not one of the “conditions affecting the property or transaction,” and

dismissed the suit. The Kailins appealed to a state intermediate appellate court, which reversed

the physical real estate,” but include those that have an “effect on the value of the property.” As

to whether Ring’s delinquency and default affected the value of the property, the court explained

“that failure significantly reduces the income received from the property while Ring Karate

remains a tenant without meeting its obligation; an expenditure of funds is likely required to evict