Property Ownership and Land Use Controls and Regulations

Estates and how title is held

Start with the estate, then the vesting. A freehold estate is ownership: fee simple absolute is the largest, a fee simple defeasible carries a condition that can end it, and a life estate lasts for a life. A leasehold estate is possession without ownership, and the four kinds are estate for years, periodic tenancy, tenancy at will and tenancy at sufferance.

Vesting is the separate question of how co-owners hold it. Joint tenancy requires the four unities, remembered as TTIP: time, title, interest and possession. The joint tenants take at the same time, by the same instrument, in equal shares, with an equal right to possess the whole. Breaking any one unity severs the joint tenancy as to that share and converts it into a tenancy in common, which is exactly what happens when a joint tenant conveys their interest.

Right of survivorship operates outside the will entirely. A joint tenant's interest is extinguished at the moment of death rather than becoming part of the estate, so a will has nothing to give. This is why a vesting decision made casually at closing can override an estate plan made carefully, and why it appears on the exam so often.

Encumbrances: money and non-money

Every encumbrance falls into one of two families, and sorting them correctly answers most questions in this topic immediately. Money encumbrances are liens, and they affect title and value: mortgages and deeds of trust, judgment liens, mechanic's liens, tax liens. Non-money encumbrances affect physical use: easements, encroachments and deed restrictions.

Priority normally follows the recording order, first in time first in right. Two exceptions matter. Property tax and special assessment liens take first priority by statute regardless of when they were recorded. And a mechanic's lien relates back to the date work commenced on the project as a whole, not to the date the individual lien was recorded, which can put it ahead of a deed of trust recorded after work began. That relation-back rule is why construction lenders record before any visible work starts and why title companies inspect the site.

Easement appurtenant

Benefits a neighbouring parcel and runs with the land. A dominant tenement benefits, a servient tenement is burdened.

Easement in gross

Benefits a person or a company rather than land. A utility easement is the standard example.

Easement by necessity

Arises where a parcel is landlocked and the two parcels were once under common ownership, because access is presumed to have been intended.

Prescriptive easement

Five years of open, notorious, continuous, hostile use under a claim of right. No tax payment is required, which is the difference from adverse possession.

Licence

Revocable permission to use land. It is not an interest in land at all, which is why it can be withdrawn.

Encroachment

An unauthorised physical intrusion, such as a fence over the line. It is a defect rather than a right, and it is one of the off-record matters an extended title policy covers.

The four government powers, and where the line falls

PETE: police power, eminent domain, taxation, escheat. Only eminent domain requires just compensation, because only eminent domain is a taking of the property itself for public use.

Police power is the power to regulate land use for public health, safety, morals and general welfare, without compensation. Zoning, building codes, subdivision regulation and rent control all rest on it. Because no compensation is due, the line between a valid regulation and a compensable taking is one of the more litigated questions in property law.

Where a regulation deprives an owner of all economically viable use, it can amount to a regulatory taking requiring compensation even though no title changed hands. The action an owner brings to establish that is called inverse condemnation, because the owner rather than the government initiates the proceeding. Escheat is the reversion of property to the state when an owner dies with no will and no locatable heirs.

Zoning, variances, and the two subdivision acts

A legal nonconforming use existed lawfully before an ordinance changed and may generally continue, though it usually cannot be expanded and may be lost if abandoned or if the structure is destroyed. A variance is administrative permission to deviate from a dimensional requirement because of a hardship unique to the parcel, such as an unusual shape or slope. A conditional use permit allows a listed use subject to conditions. Downzoning is a reduction in permitted intensity, and spot zoning is a small parcel zoned inconsistently with its surroundings, which is often challenged.

The hardship for a variance must arise from the land, not from the owner's preference and not from a situation the owner created. Financial advantage is expressly not a hardship, and neighbour consent may help politically but is not the legal test.

The two subdivision acts are the classic California confusion. The Subdivision Map Act is the local physical control, administered by cities and counties, governing how land is divided and mapped. The Subdivided Lands Act is the consumer protection statute administered by DRE, requiring a public report before lots may be marketed. The shorthand worth holding is that the Map Act divides and the Lands Act sells.

The public report

Issued by the Real Estate Commissioner and given to every prospective purchaser before any binding sale or acceptance of purchase money. The buyer's receipt is retained for three years.

CEQA

The California Environmental Quality Act requires a public agency to evaluate a project's environmental effects, producing a negative declaration or an environmental impact report. It is a procedural requirement, and its power lies in the delay and disclosure it forces.

The Coastal Act

Development in the coastal zone requires a coastal development permit, administered by the Coastal Commission or a local government with a certified local coastal program. It is a genuinely distinct California control.

Environmental hazards and the disclosure zones

The federal lead-based paint rule covers target housing, which is residential property built before 1978, the year lead paint was banned for residential use. The seller must disclose known lead-based paint and hazards, provide any available records and reports, give the buyer the EPA pamphlet, and allow a ten-day opportunity to conduct an inspection unless the buyer waives it in writing.

CERCLA liability is strict, joint and several, and retroactive. Strict means fault is irrelevant. Joint and several means one party can be pursued for the whole cost. Retroactive means it reaches conduct that was entirely lawful when it occurred. The innocent landowner defence requires appropriate inquiry before purchase, which is the commercial reason Phase I environmental site assessments exist at all.

Alquist-Priolo establishes earthquake fault zones and prohibits building structures for human occupancy across the trace of an active fault, requiring a geologic investigation before development within a zone. It is one of the six zones on the Natural Hazard Disclosure Statement, alongside a special flood hazard area, an area of potential flooding from dam failure, a very high fire hazard severity zone, a state fire responsibility area, and a seismic hazard zone.

Asbestos

Common in pre-1980 construction. Generally safe when intact and undisturbed, hazardous when friable. Disturbance during renovation is the risk event.

Radon

A naturally occurring radioactive gas. Levels vary sharply by location and California is generally lower risk than parts of the country, but testing is the only way to know.

Underground storage tanks

A common source of contamination on former commercial and agricultural sites, and a standard Phase I search item.

Mold

California requires disclosure of known mold conditions that affect health, and the Toxic Mold Protection Act frames the obligation.

Water rights, where California differs most

Riparian rights attach to land bordering a flowing watercourse such as a river or a stream, and they run with the land. Littoral rights attach to land bordering a static body such as a lake or the ocean. Appropriative rights are acquired by permit for beneficial use and may serve land nowhere near the water. California recognises riparian and appropriative rights side by side, which is unusual and is why this topic carries real weight here.

The boundary-change vocabulary is small and reliably tested. Accretion is the gradual deposit of soil along a watercourse, and the soil deposited is alluvion. The riparian owner takes title to it. Erosion is gradual loss. Reliction is the gradual withdrawal of water exposing land, which also benefits the owner. Avulsion is a sudden change, such as a river jumping its bank in a flood, and it does not move boundaries at all.

Percolating groundwater, meaning water beneath the surface not in a defined channel, is governed by the correlative rights doctrine in California: overlying owners share a reasonable and correlative right to the common supply rather than one owner being free to draw without limit.

Land descriptions and the arithmetic worth memorising

Three methods appear. Metes and bounds traces the perimeter using distances and compass bearings and must return to the point of beginning to close. Lot, block and tract refers to a recorded subdivision map and is the most common residential description in California. The rectangular or government survey system uses townships and sections. An assessor's parcel number is a taxation reference and is expressly not a legal description, a point the exam likes to test.

A township is six miles by six miles, containing thirty-six sections. Each section is one square mile, which is 640 acres. Section 1 sits in the north-east corner and the numbering runs right to left, then left to right on the next row, ending at section 36 in the south-east corner.

To read a fractional description, work from the end backwards and multiply the denominators. The NW 1/4 of the SE 1/4 of a section is 640 divided by 4 divided by 4, which is 40 acres. Equivalently, 640 divided by 16.

Private controls and common interest developments

Public and private controls operate together, and the more restrictive of the two governs. Zoning sets an outer limit on what government permits, and a private covenant may impose a tighter one. A private restriction is not void merely because it is stricter than the ordinance.

Racially restrictive covenants are void and unenforceable, and California provides a Restrictive Covenant Modification process allowing an owner or a homeowners association to have the offending language struck from the recorded document. A title company must also notify an owner when such language appears in a chain of title. The language is now removable, not merely dormant.

In a common interest development, a condominium owner holds the unit's airspace in fee plus an undivided interest in the common area as a tenant in common. A planned development normally includes the lot itself. A stock cooperative is different: the resident owns shares in a corporation that owns the building and holds an occupancy right rather than a fee. The Davis-Stirling Common Interest Development Act governs association governance, and a seller must deliver the governing documents to a buyer.