Real Estate Law BLAW 434/534 Professor Whitney Johnson. Today’s Class Introductions Syllabus Introduce Real Estate Law Sources of Law and Examples. Chapter 1: Introduction and Sources of Real Estate Law. What is property?. - PowerPoint PPT Presentation
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Real Estate Law BLAW 434/534Professor Whitney JohnsonTodays ClassIntroductionsSyllabusIntroduce Real Estate LawSources of Law and Examples
12Chapter 1:Introduction andSources of Real Estate Law
IntroductionsName (Whitney Johnson) Personal real estate connection (I have done three real estate development projects)Something personal to share (I like to ski and wakeboard)3Is it ethical to allow individual ownership of land?English Feudalism HistoryFeudal System of Land Ownership (Alnwick Duke)King owns the landKing granted rights to the land to others termed vassals. Vassals paid rent and sometimes provided men for armies as payment.US did not follow feudalism (our escheat laws are still based on a feudal concept).Peru situationGiving property title to 1.2 million squatters. What would this change? Native Americans
4What other systems exist to manage property? Are they better? Why?What is property?Real Personal What rights should property ownership allow?5Differences between the two? Problems caused in sale of property deprecation, what goes with sale, security for mortgage, etc.Why is one real is the other not realShould we give different rights to real property owners? Do different laws apply? (tax, sales, remedies, estate, etc.)Do we give more rights to real property owners? The right to vote?Ethics and PropertyOkay to sell organs?What about frozen embryos? Are they property? Strip mining? Racial restrictions on land?Give land to future generations? Forever? Example of laws to enforce ethics?
6Benefits to Society of Recognizing Property RightsStudy found countries with greater property rights grow faster and are wealthier.Of 100 countries with dataThe 24 with the strongest property rights averaged $25,716 in annual per capita incomeThe 21 with the weakest property rights averaged $3,0947Extra Slides8
Walk through syllabusMost Frequently Asked Real Estate Law QuestionsIf I move out of my apartment before the lease expires, do I still owe rent? What if the landlord rents the apartment? If a seller backs out of the sale of property, does she still owe the broker the commission? If a buyer backs out of the purchase of property, does the broker still get his commission? What happens to the earnest money? Do all real estate contracts have to be in writing? What if I buy a home and the general contractor has not paid all the subcontractors? Will I have to pay them?If I die without a will, does my property got to the state?If I own a house before I am married, does my spouse own it after we are married?What happens if the value of my property falls below my mortgage amount? Can I walk away?How long does it take to foreclose on a property mortgage? If people cut across my property for a path, am I liable if they are hurt? Can they claim any interest in my property? If the fence on my property is in the wrong place, do I own the property that was accidently included? Can the EPA require me to clean up or pay for the clean up of toxic waste on that I just bought? Is my broker working for me or the buyer? What happens if my property deed is not recorded? If a property has two mortgages, which mortgage has priority? 9Start here
Sources of Real Estate Law10Federal and State Laws Federal Interstate Land Sales Full Disclosure ActReal Estate Settlement Procedures ActAmerican Recovery and Reinvestment Act Comprehensive Environmental response, Compensation and Liability Act.StateUCC ActsUniform Marital Property ActUniform Probate CodeModel Residential Landlord/Tenant Act
Examples of Private LawsContract termsLandlords rules on use of laundry room and exercise facilitiesEmployer rules on use of work computer for personal businessDeed restrictions (condos/gated neighborhoods, etc.)Example of Federal LawMcLain v. Real Estate Board of New OrleansUS Supreme Court, 444 US 232 (1980)Facts. Alleged price-fixing by brokers to set commissions on the sales of residential property. Used fixed rate commissions.Issue/Law. Are real estate sales (local by nature) interstate commerce?Analysis. Apply law to facts. The law applies to interstate commerce. What facts demonstrate this? Funds raised from out-of-stateMortgage obligations traded out-of-stateTitle insurance secured out-of-stateHolding. Likely involves interstate commerce Chapter 12. Will return to this issue somewhat in Chapter 12 The Brokers Role
13How to brief a case Also good organization for presenting your cases Warranty of Habitabilityexample of state lawImplied Warranty of Habitability.Premises are fit for human habitation.Premises are fit for the uses reasonably intended by the parties.That the occupants will not be subjected to conditions that are dangerous, hazardous, or detrimental to their life, health or safety.Real Property Law 235-b Warranty of HabitabilityLease. Whats the purpose of a lease? Contract law? a lease for? Uses as Reasonably Intended. What does this mean? What does this include? Does it matter how much the tenant pays? What was promised? Or does this just set the minimum standard?Uniform Standard for Habitability or Flexible. Is the standard for habitability uniform or does it adjust based on level of rent paid and services promised?
14Extra Slides15Constructive eviction?Tenant refused to pay rent because a neighboring tenant walked around nude in his apartment with no drapes and the landlord did not stop this.Constructive Eviction? Habitable?
Warranty of Habitability HypotheticalsLease Clause: Landlordshall not be liable for any damages to property resulting form fallingwater which may leak from any part of said building or from pipes, appliances or plumbing works unless caused by or due to the negligence of Landlord nor shall Landlord be liable for any such damage caused by other tenants. i.e. can a tenant waive the warranty?
Water leak onto restaurant grill.Broken doorbells and buzzers in apartment.
Exercise MEAD, SAMUEL & CO. v. DYAR622 P.2d 512 (Ariz. 1980)
Apartment Rented. Mead, Samuel, and Company (landlord/appellee) leased an apartment to Randall Dyar (tenant/appellant). Side Deal to Clean Carpets. Dyar contracted with the landlord's agent to clean carpets in the apartment complex for $10 per apartment. Tenant Withheld Earnings from Carpet Cleaning. Dyar cleaned eight apartments and withheld $80 from his rent payment under the claim that the landlord owed him that amount. After an argument between Dyar and the landlord's agent, the landlord filed charges of breaching the peace with the city of Phoenix police. As a result of these charges, Dyar was arrested and imprisoned for one night and then released upon the police determination that Dyar had not breached the peace as the landlord had alleged.Landlord Sued to Evict. Landlord sued for: (1) Possession of apartment, (2) Payment of rent in the amount of $121.47, and (3) Costs and attorney's feesTenant Countersued for $80 plus False Arrest. Dyar counterclaimed in the suit for an offset of the $80.00 in wages against the $121.47 and for false arrest and false imprisonment caused by the landlord's actions and sought $2500 in compensatory damages for the night he was forced to spend in jail.18LAW Can Argue Claims to Offset Rent Due: Model Residential Landlord Tenant Act on nonpayment of rent by a tenant as adopted by Arizona - A.R.S. Section 331365. Under this section the tenant is entitled to present claims and reasons for not paying rent in the event the landlord brings suit for nonpayment of rent. Law Cannot Argue Claims to Offset Rent Due: However, another procedural statute, an older one, provides that a tenant may not present such claims or defenses (counterclaims) when a landlord brings an action for rent (A.R.S. Section 121177A). The court decided that the new law should be construed narrowly and only allow counterclaims directly related to the eviction. Older model law passed to avoid time consuming counter claims.Exercise Additional QuestionsTom George rented an apartment from Big Sky for $575 per month. Tom agreed to act as night manager for a salary of $375 per month. For three months, Tom has paid only $200 rent. In a forcible detainer action brought by Big Sky, can Tom properly counterclaim for the $375 salary for three months?Alfreda Gulusko rented an apartment from Big Sky for $325 per month. The apartment was located in Boston, and during December, Alfreda's heater would not work. The temperatures in Boston averaged 25 degrees that month. In spite of Alfreda's repeated requests, Big Sky did not repair the heating problem. Alfreda had the heating repaired at a cost of $325 and then withheld payment of her January rent. In a forcible detainer action by Big Sky, can Alfreda counterclaim for cost of the repair?Jane Smith leased an apartment from Big Sky, Inc. in the Big Sky Villas for six months at a rental rate of $325.00 per month. Jane shared the apartment with Sue Jones, a tenant already located at Big Sky who was recommended to Jane by Big Sky's manager. After Jane moved in, she noticed that she seemed to be spending cash more quickly and that some of her jewelry had disappeared. Jane complained to management because she suspected Sue. In spite of ongoing complaints during the twomonth period, the manager did not switch Jane's roommate. Eventually, Jane returned home from work one day only to find all of her belongings and Sue gone. Jane stopped paying rent to Big Sky and it brought a forcible detainer action. Jane counterclaimed for the value of her property because Big Sky had recommended Sue as a roommate and because of the failure to take action on Jane's complaints. Big Sky knew of Sue's prior conviction for burglary at the time the recommendation was made to Jane. Does Jane have a proper counterclaim under the Mead standard?