Multistate Bar Exam Real Property 5 — Questions and Answers
Question 1: A buyer has an enforceable contract to purchase land. Before closing, the seller conveys the same land to a third party who records. The buyer seeks specific performance. Under equitable conversion, the buyer:
- Has no remedy because the third party recorded first
- May obtain specific performance and the third party is not a bona fide purchaser as against the buyer's equitable title (Correct answer)
- Must accept money damages because specific performance is unavailable against recorded deeds
- May only obtain rescission and refund of the purchase price
Correct answer: May obtain specific performance and the third party is not a bona fide purchaser as against the buyer's equitable title
A buyer under contract holds equitable title; a subsequent purchaser with constructive notice of the contract does not qualify as a bona fide purchaser and takes subject to the buyer's equitable claim.
Question 2: A tenant holds a commercial lease for five years. The landlord conveys the leased property. The tenant has not recorded the lease. Under a notice recording act, the new owner:
- Takes free of the lease if the new owner had no actual or constructive notice (Correct answer)
- Is always bound by the lease regardless of notice
- Takes free of the lease because leases cannot be recorded
- Must offer the tenant a new lease at market rate
Correct answer: Takes free of the lease if the new owner had no actual or constructive notice
Under a notice recording act, a subsequent purchaser without actual or constructive notice of a prior unrecorded interest takes free of it.
Question 3: A covenant to maintain a party wall will bind successors when it is found to:
- Touch and concern the land and be supported by privity of estate (Correct answer)
- Appear in a title insurance policy
- Be independently recorded in the county zoning records
- Be ratified by both local governments
Correct answer: Touch and concern the land and be supported by privity of estate
Real covenants run with the land at law when the parties intend to bind successors, there is privity of estate, and the covenant touches and concerns the land.
Question 4: A seller conveys property with a general warranty deed. A subsequent claimant asserts a superior title through an interest created before the seller ever owned the property. The covenant that protects the buyer is:
- Covenant of seisin
- Covenant against encumbrances
- Covenant of warranty (general warranty) (Correct answer)
- Covenant of further assurances
Correct answer: Covenant of warranty (general warranty)
The general warranty covenant obligates the grantor to defend the grantee's title against all claims, including those arising from defects that predate the grantor's ownership.
Question 5: A mortgagee forecloses and sells the property at a foreclosure sale. The sale proceeds are insufficient to satisfy the debt. The mortgagee may seek:
- Forfeiture of the mortgagor's personal property only
- A deficiency judgment against the mortgagor for the remaining balance (Correct answer)
- Immediate re-foreclosure on adjacent property
- Punitive damages for the mortgagor's default
Correct answer: A deficiency judgment against the mortgagor for the remaining balance
After a foreclosure sale, a mortgagee may pursue a deficiency judgment against the mortgagor for the difference between the debt owed and the foreclosure sale proceeds.
Question 6: A landlord claims a tenant has constructively evicted herself by abandoning the premises. For constructive eviction to be established, the tenant must show:
- The landlord entered the premises without permission
- Substantial interference with use and enjoyment caused by the landlord, and actual vacation by the tenant (Correct answer)
- The landlord failed to make any repairs for 30 days
- The rent was increased above fair market value
Correct answer: Substantial interference with use and enjoyment caused by the landlord, and actual vacation by the tenant
Constructive eviction requires that the landlord's act or omission substantially interfere with the tenant's use and enjoyment, and the tenant must actually vacate within a reasonable time.
Question 7: Under the doctrine of merger, an easement is extinguished when:
- The dominant estate owner sells the property
- The same person acquires ownership of both the dominant and servient estates (Correct answer)
- The easement is not used for the statutory period
- The servient owner erects a fence blocking the easement
Correct answer: The same person acquires ownership of both the dominant and servient estates
Merger extinguishes an easement when the same person comes to own both the dominant and servient estates, eliminating the need for the easement.
Multistate Bar Exam Real Property 5
A buyer has an enforceable contract to purchase land.
Before closing, the seller conveys the same land to a third party who records.
The buyer seeks specific performance.
Under equitable conversion, the buyer: