A possessor without title can lease land to a tenant

/ Leaseholds, Real Estate Transactions, Title Issues, Trespass

The Alabama Supreme held that a possessor of land can lease it to another and that the lease is enforceable against by the tenant. Hembree Ins. Tr. V. Maple Indus., Inc., 2025 WL 1085479 (Ala. 2025). The lease in this case said that a lease in the name of an individual is valid even though the property was actually owned by a limited liability company (an LLC) owned by the individual. The court noted that “a party need not be the owner of a property to lease it to another. While the right to let property is an incident of the title and possession, a lessor may validly lease property to another, despite the fact that the title to the property is in a third person, if the lessor lawfully possesses the property.” This is arguably an application of the doctrine of relativity of title, which holds that a peaceable …

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Foreclosure price of 10% of market value not so unconscionable as to set aside the sale, given legal uncertainties about which mortgage had priority

/ Mortgages

Another court holds that a foreclosure sale at a very low value (10% of fair market value) is not a problem, does not “shock the conscience” and is not enough to set aside the sale. This case is by the District of Columbia Court of Appeals (the supreme court of D.C., not the federal court with a similar name). Flagstar Bank v. Advanced Fin. Invs., LLC, 333 A.3d 851 (D.C. 2025). The court approved a sale for $26,000 of property worth $256,632.00. The court explained its reasoning by noting that at the time of the foreclosure sale, the law was unclear as to whether the property was subject to an undischarged mortgage held by a third party. If that were so, the total debts of the homeowner would exceed the value of the property, and the homeowner would have been entitled to nothing in any event. In that light, $26,000 …

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Real property can be partitioned based on equitable factors even if only party’s name is on the deed

/ Concurrent or Common Ownership, Marital Property, Title Issues

North Dakota law allows partition of real property when two parties intend to share ownership of the house, and they both contribute to its purchase and/or maintenance, even if the deed is in the name of only one of the parties. Berger v. Repnow, 2025 ND 25, 16 N.W.3d 452 (N.D. 2025) (applying N.D. Cent. Code §32-16-01. The court explained that North Dakota law affirms that “although legal ownership of property is strong evidence of an intention to not share property, legal ownership is not dispositive when the person who is not the legal owner has financially contributed to the acquisition of the property.” However, the court held that the trial court erred in granting title to the house to one of the parties rather than dividing it between them by “determin[ing] the parties’ respective ownership interests based on their contributions to [the] property and any other relevant factors, and …

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Esthetic regulation of property may be a taking when not connected to historic preservation

/ Historic Preservation Law, Takings

The Fifth Circuit Court of Appeals held that esthetic regulation of the appearance of property may constitute a regulatory taking under the Fourteenth Amendment. Money v. City of San Marcos, 2025 WL 429980 (5th Cir. 2025). The façade of the home in an historic district had  the initial (a “Z”) of a prior owner who was associated with the Ku Klux Klan. The current owners wished to remove the emblem and sought permission to do so from the city’s historic commission. When the commission denied their request, they sued, claiming a taking of their property without just compensation. The home is in an historic district but the home itself is not designated as an historic home. The historic district regulations prohibit altering any visible portion of the property without consent of the historic commission, which it refused to give in this case. The homeowners argued that the ordinance requirement that …

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Joint tenancy not severed by tax lien before foreclosure

/ Concurrent or Common Ownership

States disagree about what acts are sufficient to sever a joint tenancy and end the right of survivorship. The Maine Supreme Judicial Court has held that a tax lien, by itself, does not sever a joint tenancy before foreclosure. Estate of Priest, 2025 ME 24, 331 A.3d 451 (Me. 2025). In this case the property owners paid the delinquent taxes before expiration of the 18 month redemption period, and that payment was confirmed by quitclaim deeds issued by the town. Because there was no severance, the surviving joint tenant became the sole owner of the property on the death of her co-owner husband.

Restraints on sale of tenancy in common interests are void even if intended to keep the property in the family

/ Concurrent or Common Ownership, Restraints on Alienation, Wills and Inheritance

A homeowner created a trust that would transfer title to her home to her three children at her death, but also provided that the children could not sell the property to anyone but their siblings and for an amount below fair market value. A state court in California held the restraint on alienation unreasonable and void both because it severely limited the class of potential buyers and denied the owners the fair market value of their interests. Godoy v. Linzer, 327 Cal. Rptr. 3d 323 (Ct. App. 2024). The court was applying a long-established California statute that provides that restraints on alienation are void when “repugnant to the interest created.” Ca. Civ. Code §711. That provision has been interpreted to allow restraints on alienation when reasonable, but the court found that there is a very strong presumption of invalidity of restraints on fee simple interests. Courts sometimes uphold restraints on …

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Impeding access to one’s land is a taking but changes in traffic patterns are not

/ Takings

The Indiana Supreme Court affirmed a well-established rule that, while it would a taking of property requiring compensation to block an owner’s established access to a public road, it is not a taking if a government entity alter roads or closes an intersection in ways that affect traffic patterns. That is so even if those changes in traffic patterns harm a business by reducing its customers. Indiana v. Franciscan Alliance, Inc., 245 N.E.3d 144 (Ind. 2024). The court reasoned that the owner has no property interest in traffic patterns while the owner does have an interest in using existing driveways and roads to get direct access the owner’s own land.

Covenants may not be enforced if neighbors have tolerated previous violations of those covenants

/ Condominiums and Homeowners Associations, Servitudes

The doctrines of waiver, estoppel, acquiescence, and abandonment may be triggered if owners benefited by a restrictive covenant failed to enforce violations of it in the past. Hood v. Straatmeyer, 18 N.W.3d 649, 2025 S.D. 12 (2005). The South Dakota Supreme Court held that restrictive covenants could not be enforced when the neighbors had tolerated widespread violations of that exact same covenant, and it would be impractical to require all properties to be brought into compliance with the covenant. In this case, both the plaintiff and many neighbors had violated setback requirements of 40 feet between the border and the structure, as well as a covenant prohibiting business activities on the property. Because violations of these covenants were “widespread, unchallenged violations of the restrictive covenant throughout the subdivision, some of which were perpetrated by the Plaintiffs,…the circuit court [correctly] determined that requiring [the Defendant] to conform their use of their …

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Seventh Circuit adopts a slayer rule for inheritance of ERISA benefits

/ Wills and Inheritance

common law preventing a son from inheriting pension benefit funds in a plan managed by ERISA (Employee Retirement Income Security Act of 1974) when he murdered his parent. Standard Ins. co. v. Guy, 115 F.4th 518 (6th Cir. 2024). The case seems to be replay of the famous opinion by the New York Court of Appeals in Riggs v. Palmer, 22 N.E. 188 (N.Y. 1889). The Riggs opinion has this famous quote: “But it never could have been [the lawmakers’] intention that a donee who murdered the testator to make the will operative should have any benefit under it. If such a case had been present to their minds, and it had been supposed necessary to make some provision of law to meet it, it cannot be doubted that they would have provided for it.” The Sixth Circuit viewed ERISA as “silent or ambiguous” on the question of whether a …

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Foreclosure presumptively invalid when foreclosure price is for 15% of fair market value

/ Mortgages

The Alabama Supreme Court has stopped the ejection of an owner by the mortgagee who bought the property at foreclosure because there was a serious question of whether the foreclosure was valid given the fact that the foreclosure price was only $1 more than the outstanding debt and was only 15% of the market value of the property. Martin v. Scarborough, 2024 Ala. LEXIS 195, 2024 WL 4863866 (Ala. 2024). The court cited Alabama precedents suggesting that a price less than one-third of fair market value is presumptively “grossly inadequate” and “shocks the conscience.”

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