Real Estate Transactions

Owners must continue to pay homeowners association fees to maintain private roads even after all other covenants terminate

/ Condominiums and Homeowners Associations, Consumer Protection, Easements, Real Estate Transactions, Servitudes

A Massachusetts court has held that owners in a homeowners association that have access to shared private roads must continue to pay fees to the association to maintain those roads even after all other covenants terminate. Meadowview Heights Homeowners Ass’n, Inc. v. Chosse, 2018 Mass. App. Div. 54, 2018 Mass. App. Div. LEXIS 14 (Mass. Dist. Ct. App. Div. 2018). The court found that the assessments were not covenants subject to a termination clause but were implied obligations to share in the burden of maintaining a common benefit in the private roads that arose as an equitable servitude and implied contract.

Court wrestles with the question of whether use of a pavement area without permission creates a prescriptive easement or adverse possession

/ Adverse Possession, Easements, Real Estate Transactions, Servitudes, Trespass

When an owner uses a driveway or pavement area owned by a neighbor, and does with openly and without permission for the statutory period, does the owner get a prescriptive easement to use the area for the specific purposes to which the property was devoted or does the owner acquire full title to the area by adverse possession? The problem arises because an owner who parks a car on a driveway that encroaches on neighboring land may be viewed as undertaking a limited use of the land (use for parking purposes) or may be viewed as acting as an owner with full control of the property being used. Often the question will turn on whether the use of the area was exclusive, i.e., whether the owner of record title was excluded from the property. If the record owner was excluded, adverse possession is likely to be awarded. If the parties …

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Doctrine of implied reciprocal negative servitudes only applies within the area intended to be covered by the general plan of uniform development

/ Real Estate Transactions, Servitudes

In Walters v. Colford, 900 N.W.2d 183 (Neb. 2017), a developer sold 14 lots with identical covenants restricting the property to one single-family two-story house and garage. The developer then solder a five-acre adjacent parcel without the covenants. The Nebraska Supreme Court held that the five-acre parcel was not part of the original common scheme and was not impliedly limited by the covenants. There was no basis for putting the future owners of that neighboring parcel on notice that they were part of a common scheme. Developers can avoid litigation about this issue by filing a declaration with a map that explicitly identifies the properties intended to be mutually restricted.

Legal questions about landlord liability when one tenant harasses another

/ Antidiscrimination Law, Consumer Protection, Leaseholds, Nuisance, Real Estate Transactions

Is a landlord liable for breach of the covenant of quiet enjoyment if one tenant harasses another and the landlord does not intervene in some way, either by trying to resolve the dispute or by evicting the harassing tenant? To answer this question we must distinguish two types of legal claims. In the first type of claim, the victim of the harassment claims “constructive eviction” and asks to be relieved of her rental obligations by moving out before the end of the term. In the second type of claim, the tenant sues the landlord for monetary damages for failing to protect her from the other tenant’s actions when the landlord had the legal power to evict the harassing tenant for causing a nuisance or otherwise violating the lease terms by disturbing the quiet enjoyment of the neighbor. Traditionally, the landlord has been held not to be responsible for actions of …

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Courts debate whether short term rentals (like Airnbnb) violate restrictive covenants limiting property to “residential uses”

/ Condominiums and Homeowners Associations, Real Estate Transactions, Servitudes

Some courts hold that short term rentals (such as Airbnb rentals) violate covenants that restrict the property to “residential use,” finding short-terms rentals to be closer to hotel use and thus commercial in nature. Vonderhaar v. Lakeside Place Homeowners Ass’n, 2014 WL 3887913 (Ky. Ct. App. 2014) Other courts find short term rentals to be compatible with “residential use” and not a violation of such restrictive covenants at all. Wilkinson v. Chiwawa Communities Ass’n, 327 P.3d 614 (Wash. 2014); Santa Monica Beach Property Owners Ass’n v. Acord, 219 So.3d 111 (Fla. Dist. Ct. App. 2017)

Option to purchase property valid if exercised within the USRAP 30 year period

/ Real Estate Transactions, Servitudes, Title Issues

The Massachusetts Land Court has held that a commercial option to purchase property may be exercised nine years after the right to exercise the option ripened (because of failure to fulfill a condition by a set date). Pinewood Road, Inc. v. Kuntz, 2017 WL 361172 (Mass. Land Ct. 2017). The court noted the traditional rule that an option to purchase real property “that does not supply a time limit for it exercise must be acted on within a reasonable period of time.” This modern rule softens the strict rule against perpetuities which traditionally invalidated options that had no time limit as executive interests that could vest too far into the future. Massachusetts adopted the Uniform Statutory Rule Against Perpetuities which requires an option to be exercised within 30 years, but since this option was created after the effective date of the statute, the option was valid and could be exercised.

Prescriptive easement denied because longstanding use of neighboring land was presumed to be permissive

/ Adverse Possession, Easements, Real Estate Transactions, Trespass

When one occupies property belonging to a neighbor, most courts presume the occupation is adverse (meaning non-permissive), and this “possession” will ripen into ownership through adverse possession law after the statutory period runs out. Most states use the same presumption for prescriptive easements but a minority presume use is permissive rather than nonpermissive when limited use — rather than full occupation or “possession” — is at issue. In such cases, permissive use will be revocable and not ripen into a prescriptive easement. The Massachusetts Land Court applied the presumption that use if permissive in the absence of statements or actions that show that it is nonpermissive and found no prescriptive easement in the case of DiNino v. Newman, 2016 Mass. LCR LEXIS 179 (Mass. Land Ct. 2016).  The court purported to apply the Massachusetts presumption that use is adverse (nonpermissive) and found that facts overcame that presumption. However, the only facts that …

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Supreme Court rejects regulatory takings challenge to zoning merger provision

/ Eminent Domain, Real Estate Transactions, Takings, Zoning

In Murr v. Wisconsin, 2017 WL 2694699 (U.S. 2017), the Supreme Court held that a zoning law that treated two contiguous parcels owned by the same persons as one parcel to determine minimum developable lot size was not an unconstitutional taking of property without just compensation. The merger law provided for variances that might allow development for lots that contained less than one acre of developable space but did not provide for such a variance if two lots were merged. One lot had a house on it and the other was vacant. The owners claimed that the vacant lot had no economically beneficial use since it could not be separately developed. However, the Supreme Court held that the denominator to determine the economic impact of the regulation was the “parcel as a whole” and that in this case that meant the merged parcels. Moreover, even if the two lots could be developed separately, …

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Part performance as exception to the statute of frauds

/ Leaseholds, Real Estate Transactions, Statute of Frauds, Title Issues

The Idaho Supreme Court reaffirmed the traditional rule that part performance of a real estate agreement can constitute an exception to the statute of frauds. If that is the case, a contract that would otherwise be unenforceable because it does not comply with the statutory writing formalities may be enforced nonetheless. Hoke v. NeYada, 387 P.3d 118 (Idaho 2016). The case involved a lease with an option to purchase. Because the “buyer” had already entered into possession of the property and needed only to make the required payments, the agreement was enforceable despite the fact that the land description was not sufficiently precise to satisfy the statute of frauds.

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