North Carolina Law School 1L Study Guide for Property

North Carolina Law School 1L Study Guide for Property

I. Introduction to Property Law

A. Definition of Property

Property law governs the relationships between individuals and things, both tangible and intangible. Property can be divided into two categories: real property (land and things attached to it) and personal property (movable items and intangible rights).

B. Property Rights

Property rights include the right to transfer property, the right to exclude others, the right to use property, and the right to destroy property.

II. Possession and Ownership

A. Acquisition by Discovery

In North Carolina, as in other U.S. jurisdictions, the discovery of previously unowned property can lead to ownership. This principle is based on the European discovery doctrine applied during colonization.

B. Acquisition by Capture

The rule of capture states that a person who captures a wild animal (ferae naturae) on their property generally becomes the owner of that animal.

C. Acquisition by Creation

Intellectual property is a key example of acquisition by creation. North Carolina’s laws protect the rights of creators through copyright, patent, and trademark laws.

D. Acquisition by Find

The finder of lost property may have rights against everyone except the true owner. The case of Armory v. Delamirie (1722) demonstrates the finder’s right to possess the found property against all but the rightful owner.

E. Acquisition by Gift

Gifts are transfers of property made voluntarily and without consideration. There are two types of gifts: inter vivos (between living persons) and causa mortis (in contemplation of impending death).

F. Acquisition by Adverse Possession

In North Carolina, adverse possession requires actual, open, notorious, exclusive, hostile, and continuous possession for a statutory period of 20 years (N.C. General Statute § 1-40). The case of Mannillo v. Gorski (1969) addresses mistaken belief concerning boundary lines and adverse possession.

III. Estates in Land

A. Freehold Estates

Freehold estates are interests in land that are of uncertain duration. This includes fee simple absolute, fee simple determinable, fee simple subject to condition subsequent, and life estates.

B. Non-Freehold (Leasehold) Estates

These are possession interests in land for a certain period. They include tenancy for years, periodic tenancy, tenancy at will, and tenancy at sufferance.

C. Concurrent Estates

Concurrent ownership of property is where two or more persons hold title to the same property. Types include tenancy in common, joint tenancy with right of survivorship, and tenancy by the entirety (a form of joint tenancy available only to married couples in North Carolina).

D. Future Interests

The holder of a future interest has the right to possession in the future. Common types include reversion, remainder (vested and contingent), and executory interests.

IV. Land Use Controls

A. Easements

An easement is a non-possessory interest to use land for a specific purpose. Easements can be created by express grant or reservation, implication, necessity, or prescription.

B. Covenants

Real covenants are written promises to do or not to do something with the land. They are binding on subsequent owners if they “run with the land.”

C. Equitable Servitudes

Equitable servitudes are similar to covenants but are enforced in equity. They require a written instrument, intent for the servitude to run, notice, and must touch and concern the land.

D. Zoning

Zoning laws regulate land use. North Carolina has a state zoning enabling act which grants local governments the authority to enact zoning ordinances.

V. Landlord-Tenant Law

A. Lease Agreements

Leases are contracts between landlords and tenants. North Carolina law requires certain lease agreements to be in writing under the Statute of Frauds.

B. Tenant’s Rights and Duties

Tenants have the right to habitable premises and the duty to pay rent. Landlords have the duty to maintain the premises and the right to receive rent.

C. Landlord’s Remedies

If a tenant breaches the lease, remedies available to landlords in North Carolina include eviction and damages.

D. Fair Housing

The Fair Housing Act prohibits discrimination in housing. North Carolina law also prohibits housing discrimination based on race, color, religion, sex, national origin, handicap, or familial status.

VI. Sales of Real Property

A. Contracts for Sale

Sales of real property must be in writing to satisfy the Statute of Frauds. The contract includes terms such as price, description of the property, and any contingencies.

B. Marketable Title

Sellers must provide buyers with marketable title, meaning free from significant defects. In North Carolina, title issues can be resolved through a “quiet title” action.

C. Deeds

The deed is the legal instrument of transferring title. Types of deeds include warranty deeds, special warranty deeds, and quitclaim deeds.

D. Closing

Closing is the final step in the sale where the deed is delivered, and funds are exchanged. In North Carolina, closings are typically conducted by attorneys.

VII. Real Property Financing

A. Mortgages

A mortgage is a security interest in land provided by the borrower to the lender. North Carolina allows for both judicial and non-judicial foreclosure.

B. Deeds of Trust

In North Carolina, a deed of trust involves three parties: the borrower (trustor), the lender (beneficiary), and a trustee. The trustee holds the legal title until the loan is paid off.

C. Deficiency Judgments

If a foreclosure sale does not satisfy the debt, the lender may seek a deficiency judgment against the borrower for the remaining amount.

VIII. Review of Key North Carolina Cases

A. Sharp v. Norwood (2011)

Issue: Whether a party claiming adverse possession under color of title must prove actual, continuous possession of the entire tract described in the deed.
Rule: In North Carolina, the claimant must prove actual possession for the statutory period, which may not necessarily cover the entire tract.
Analysis: The court held that the claimant need only show possession of a significant, clearly defined portion of the property.
Conclusion: The claimant was entitled to the portion of the property possessed under color of title.

B. State v. Shack (North Carolina variant)

Issue: Whether an individual’s property rights can restrict access to government or aid services for tenants.
Rule: Property rights are not absolute, and access cannot be unreasonably denied.
Analysis: The court balances property rights with the right of tenants to receive information and aid.
Conclusion: The property owner cannot unreasonably deny access to services meant for the tenant’s benefit.

IX. Conclusion

This study guide provides an overview of key property law concepts, North Carolina-specific statutes, and relevant case law. For a successful exam, students should thoroughly understand each topic, review statutory provisions, and analyze the given cases using the IRAC method.

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