C H A P T E R - 7 - INTERESTS IN REAL ESTATE

LEARNING OBJECTIVES
When you've finished reading this Chapter, you should be able to:
► identify the kinds of limitations on ownership rights that are imposed by government action and the form of conveyance of property.
► describe the various estates in land and the rights and limitations they convey.
► explain concepts related to encumbrances and water rights.
► distinguish the various types of police powers and how they are exercised.
► define the following key terms: accretion; encroachment; license; appurtenant easement; encumbrance; lien; avulsion; erosion; life estate; condemnation; escheat; littoral rights; deed restrictions; estate in land; party wall; easement; fee simple; police power; easement by; fee simple absolute; prior appropriation; condemnation ; fee simple defeasible; remainder interest; easement by necessity; fee simple determinable; reversionary interest; easement by prescription; freehold estate; riparian rights; future interest; taxation; easement in gross; homestead; eminent domain; leasehold estate.

REAL ESTATE PRACTICE & PRINCIPLES KEY WORD MATCH QUIZ --- CLICK HERE ---
I would encourage you to take this “Match quiz” now as a pre-chapter challenge to see how many of these key words or phrases you are familiar with. At the end of each chapter I recommend that you take the quiz again to reinforce these important keywords. Each page contains four words or phrases and you need to drag and drop the correct definition into the puzzle key. Each page is considered as a question, but there is no scoring and you can return to each chapter quiz as many times as needed to reinforce your memory.

► WHY LEARN ABOUT... INTERESTS IN REAL ESTATE?
As discussed in Chapter 2, an extensive bundle of rights goes along with owning real estate. However, there are many different interests in real estate that can be acquired, and not all of them convey the entire bundle of legal rights to the owner. Licensees must take great care to ensure that prospective buyers understand exactly what interests a seller wishes to transfer. While only a lawyer can accurately (and legally) identify and interpret legal issues, a savvy licensee will be aware of any potential problems and address them in a timely manner.

► LIMITATIONS ON THE RIGHTS OF OWNERSHIP
Ownership of real estate is not absolute, that is, a landowner's power to control his or her property is subject to other interests. Keep in mind that a landowner's power to control his or her property relates to the landowner having title of the property and the bundle of legal rights that accompanies the title. Even the most complete ownership the law allows is limited by public and private restrictions. These are intended to ensure that one owner's use or enjoyment of his or her property does not interfere with others' use or enjoyment of their property or with the welfare of the general public. Licensees should have a working knowledge of the restrictions that might limit current or future owners. A zoning ordinance that will not allow a doctor's office to coexist with a residence, a condo association bylaw prohibiting resale without board approval, or an easement allowing the neighbors to use the private beach may not only burden today's purchaser but also deter a future buyer.

This Chapter puts the various interests in real estate in perspective—what rights they confer and how use of the ownership may be limited.

► GOVERNMENT POWERS
Individual ownership rights are subject to certain powers, or rights, held by federal, state, and local governments. These limitations on the ownership of real estate are imposed for the general welfare of the community and, therefore, supersede the rights or interests of the individual. Government powers include police power, eminent domain, taxation, and escheat.

Police Power
Every state has the power to enact legislation to preserve order, protect the public health and safety, and promote the general welfare of its citizens. That authority is known as a state's police power. The state's authority is passed on to municipalities and counties through legislation called enabling acts.

Of course, what is identified as being "in the public interest" varies widely from state to state and region to region. Generally, however, a police power is used to enact environmental protection laws, zoning ordinances, and building codes.

Regulations that govern the use, occupancy, size, location, and construction of real estate also fall within the police powers.

Police powers may be used to achieve a community's needs or goals. A city that deems growth to be desirable, for instance, may exercise its police powers to enact laws encouraging the purchase and improvement of land. On the other hand, an area that wishes to retain its current character may enact laws that discourage development and population growth.

Like the rights of ownership, the state's power to regulate land use is not absolute. The laws must be uniform and nondiscriminatory; that is, they may not operate to the advantage or disadvantage of any one particular owner or owners. See Chapter 19 for more on police power.

Eminent Domain
Eminent domain is the right of the government to acquire privately owned real estate for public use. Condemnation is the process by which the government exercises this right, by either judicial or administrative proceedings. The proposed use must be for the public good, just compensation must be paid to the owner, and the rights of the property owner must be protected by due process of law. Public use has been defined very broadly by the courts to include not only public facilities but also property that is no longer fit for use and must be closed or destroyed.

Generally, the states delegate their power of eminent domain to quasi-public bodies and publicly held companies responsible for various facets of public service. For instance, a public housing authority might take privately owned land to build low-income housing; the state's land-clearance commission or redevelopment authority could use the power of eminent domain to make way for urban renewal. If there were no other feasible way to do so, a railway, utility company, or state highway department might acquire farmland to extend a railroad track, bring electricity to a remote new development, or build a highway. Again, all are allowable as long as the purpose contributes to the public good.

Ideally, the public agency and the owner of the property in question agree on compensation through direct negotiation, and the government purchases the property for a price considered fair by the owner. In some cases, the owner may simply dedicate the property to the government as a site for a school, park, library, or another beneficial use. Sometimes, however, the owner's consent can-not be obtained. In those cases, the government agency can initiate condemnation proceedings to acquire the property.

Taxation
Taxation is a charge on real estate to raise funds to meet the public needs of a government.

Although escheat is not actually a limitation on ownership, it is an avenue by which the state may acquire privately owned real or personal property. State laws provide for ownership to transfer, or escheat, to the state when an owner dies leaving no heirs (as defined by the law) and no will that directs how the real estate is to be distributed. In some states, real property escheats to the county where the land is located; in others, it becomes the property of the state. Escheat is intended to prevent property from being ownerless or abandoned.

► ESTATES IN LAND
An estate in land defines the degree, quantity, nature, and extent of an owner's interest in real property. Many types of estates exist. However, not all interests in real estate are estates. To be an estate in land, an interest must allow possession (either now or in the future) and must be measurable by duration. Lesser interests such as easements (discussed later in this Chapter), which allow use but not possession, are not estates.

FOR EXAMPLE Bob owns a movie theater. Bob's ownership interest is an estate because Bob has the right to all the income from the theater, the right to change the theater into a restaurant, the right to tear down the theater and build something else on the land, and the right to sell the theater to someone else—in short, the theater belongs to Bob. When Matt buys a ticket and sits down to watch a movie in Bob's theater, Matt has an interest in the property, but it is not an estate. Matt's interest is limited to the temporary use of a limited part of the theater.

Historically, estates in land have been classified as freehold estates and leasehold estates. The two types of estates are distinguished primarily by their duration.

Freehold estates last for an indeterminable length of time, such as for a lifetime or forever. They include fee simple (also called an indefeasible fee), defeasible fee, and life estates. The first two of these estates continue for an indefinite period and may be passed along to the owner's heirs. A life estate is based on the life-time of a person and ends when that individual dies. Freehold estates are illustrated in Figure 7.1.

Leasehold estates last for a fixed period of time. They include estates for years and estates from period to period. Estates at will and estates at sufferance are also leaseholds, though by their operation they are not generally viewed as being for fixed terms.

Fee Simple Estate

An estate in fee simple (or fee simple absolute) is the highest interest in real estate recognized by law. Fee simple ownership is absolute ownership: The holder is entitled to all rights to the property. It is limited only by public and private restrictions, such as zoning laws and restrictive covenants (discussed in Chapter 19). Because this estate is of unlimited duration, it is said to run forever. Upon the death of its owner, it passes to the owner's heirs or as provided by will. A fee simple estate is also referred to as an estate of inheritance or simply as fee ownership.

Fee simple defeasible. A fee simple defeasible (or defeasible fee) estate is a qualified estate—that is, it is subject to the occurrence or nonoccurrence of some specified event. Two types of defeasible estates exist: those subject to a condition subsequent and those qualified by a special limitation.

A fee simple estate may be qualified by a condition subsequent, which means that the new owner must not perform some action or activity. The former owner retains a right of reentry so that if the condition is broken, the former owner can retake possession of the property through legal action. Conditions in a deed are different from restrictions or covenants because of the grantor's right to reclaim ownership, a right that does not exist under private restrictions.

FOR EXAMPLE A grant of land "on the condition that" there be no consumption of alcohol on the premises is a fee simple subject to a condition subsequent. If alcohol is consumed on the property, the former owner has the right to reacquire full ownership. It will be necessary for the grantor (or the grantor's heirs or successors) to go to court to assert that right, however.

A fee simple estate also may be qualified by a special limitation. The estate ends automatically on the current owner's failure to comply with the limitation. The former owner retains a possibility of reverter. If the limitation is violated, the former owner (or his or her heirs or successors) reacquires full ownership, with no need to reenter the land or go to court. A fee simple with a special limitation is also called a fee simple determinable because it may end automatically. The language used to distinguish a special limitation— the words so long as or while or during—is the key to creating this estate.

The right of entry and possibility of reverter may never take effect. If they do, it will be only at some time in the future. Therefore, each of these rights is considered a future interest.

FOR EXAMPLE A grant of land from an owner to her church "so long as the land is used only for religious purposes" is a fee simple with a special limitation. The church has the full bundle of rights possessed by a property owner, but one of the "sticks" in the bundle—the "control" stick, in this case—has a string attached. If the church ever decides to use the land for a nonreligious purpose, the original owner will, in effect, "yank the string," causing title to revert to him or her (or to his or her heirs or successors).

Life Estate

A life estate is a freehold estate limited in duration to the life of the owner or the life of some other designated person or persons. Unlike other freehold estates, a life estate is not inheritable and cannot be devised. It passes to future owners according to the provisions of the life estate.

A life tenant is entitled to the rights of ownership, that is, the life tenant can enjoy both possession and the ordinary use and profits arising from ownership, just as if the individual were a fee owner. The ownership may be sold, mortgaged, or leased, but it is always subject to the limitation of the life estate.

A life tenant's ownership rights, however, are not absolute. The life tenant may not injure the property, such as by destroying a building or allowing it to deteriorate. In legal terms, this injury is known as waste. Those who will eventually own the property could seek an injunction against the life tenant or sue for damages.

Because the ownership will terminate on the death of the person against whose life the estate is measured, a purchaser, lessee, or lender can be affected. The life tenant can sell, lease, or mortgage only his or her interest— that is, ownership for a lifetime. Because the interest is obviously less desirable than a fee simple estate, the life tenant's rights are limited.

Conventional life estate. A conventional life estate is created intentionally by the owner. It may be established either by deed at the time the ownership is transferred during the owner's life or by a provision of the owner's will after his or her death. The estate is conveyed to an individual who is called the life ten-ant. The life tenant has full enjoyment of the ownership for the duration of his or her life. When the life tenant dies, the estate ends and its ownership passes to another designated individual or returns to the previous owner.

FOR EXAMPLE Alex, who has a fee simple estate in Blackacre, conveys a life estate to Peter for Peter's lifetime. Peter is the life tenant. On Peter's death, the life estate terminates, and Alex once again owns Blackacre. If Peter's life estate had been created by Alex's will, however, subsequent ownership of Blackacre would be determined by the provisions of the will.

Pur autre vie. A life estate also may be based on the lifetime of a person other than the life tenant. This is known as an estate pur autre vie ("for the life of another"). Although a life estate is not considered an estate of inheritance, a life estate pur autre vie provides for inheritance by the life tenant's heirs only until the death of the person against whose life the estate is measured. A life estate pur autre vie is often created for a physically or mentally incapacitated person in the hope of providing an incentive for someone to care for him or her.

FOR EXAMPLE Alex conveys a life estate in Blackacre to Peter as the life tenant for the duration of the life of Dale, Alex's elderly relative. Peter is still the life tenant, but the measuring life is Dale's. On Dale's death, the life estate ends. If Peter should die while Dale is still alive, Peter's heirs may inherit the life estate. However, when Dale dies, the heirs' estate ends.

Remainder and reversion. The fee simple owner who creates a conventional life estate must plan for its future ownership. When the life estate ends, it is replaced by a fee simple estate. The future owner of the fee simple estate may be designated in one of two ways:

1. Remainder interest: The creator of the life estate may name a remainder-man as the person to whom the property will pass when the life estate ends. (Remainderman is the legal term; neither the term remainderperson nor the term remainderwoman is used.)

2. Reversionary interest: The creator of the life estate may choose not to name a remainderman. In that case, the creator will recapture ownership when the life estate ends. The ownership is said to revert to the original owner.

FOR EXAMPLE Alex conveys Blackacre to Peter for Peter's lifetime and designates Rick to be the remainderman. While Peter is still alive, Rick owns a remainder interest, which is a nonpossessory estate; that is, Rick does not possess the property but has an interest in it nonetheless. This is a future interest in the fee simple estate. When Peter dies, Rick automatically becomes the fee simple owner.

On the other hand, Alex may convey a life estate in Blackacre to Peter during Peter's life. On Peter's death, ownership of Blackacre reverts to Alex. Alex has retained a reversionary interest (also a nonpossessory estate). Alex has a future interest in the ownership and may reclaim the fee simple estate when Peter dies. If Alex dies before Peter, Alex's heirs (or other individuals specified in Alex's will) will assume ownership of Blackacre when Peter dies.

Legal life estate. A legal life estate is not created voluntarily by an owner. Rather, it is a form of life estate established by state law. It becomes effective automatically when certain events occur. Dower, curtesy, and homestead are the legal life estates currently used in some states.

Dower and curtesy provide the nonowning spouse with a means of support after' the death of the owning spouse. Dower is the life estate that a wife has in the real estate of her deceased husband. Curtesy is an identical interest that a husband has in the real estate of his deceased wife. (In some states, dower and curtesy are referred to collectively as either dower or curtesy.)

Dower and curtesy provide that the nonowning spouse has a right to a one-half or one-third interest in the real estate for the rest of his or her life, even if the owning spouse wills the estate to others. Because a nonowning spouse might claim an interest in the future, both spouses may have to sign the proper documents when real estate is conveyed. The signature of the nonowning spouse would be needed to release any potential common-law interests in the property being transferred.

Like Tennessee, most states have abolished the common-law concepts of dower and curtesy in favor of the Uniform Probate Code (UPC). The UPC gives the surviving spouse a right to an elective share on the death of the other spouse. Community property states never used dower and curtesy. (Community property is discussed in Chapter 8.)

2010 Tennessee Code Title 31 - Descent And Distribution Chapter 2 - Intestate Succession

31-2-102 - Dower and curtesy abolished.

Dower and curtesy, as formerly known, are abolished. This section shall neither abridge nor affect rights that have vested before April 1, 1977.

[Acts 1976, ch. 529, § 1; 1977, ch. 25, §§ 4, 5; T.C.A., § 31-202.]

A homestead is a legal life estate in real estate occupied as the family home. In effect, the home (or at least some part of it) is protected from creditors during the occupant's lifetime. In states that have homestead exemption laws, a portion of the area or value of the property occupied as the family home is exempt from certain judgments for debts such as charge accounts and personal loans. The homestead is not protected from real estate taxes levied against the property or

a mortgage for the purchase or cost of improvements, that is;- if the debt is secured-by the property, the property cannot be exempt from a judgment on that debt.

In some states, all that is required to establish a homestead is for the head of a household (sometimes a single person) to own or lease the premises occupied by the family as a residence. In other states, the family is required by statute to file a notice. A family can have only one homestead at any given time.

How does the homestead exemption actually work?
In most states, the home-stead exemption merely reserves a certain amount of money for the family in the event of a court sale. In a few states, however, the entire homestead is protected from sale altogether. Once the sale occurs, any debts secured by the home (a mortgage, unpaid taxes, or mechanics' liens, for instance) will be paid from the proceeds. Then the family will receive the amount reserved by the homestead exemption. Finally, whatever remains will be applied to the family's unsecured debts.

FOR EXAMPLE Greenacre is Tim's homestead. In Tim's state, the homestead exemption is $25,000. At a court-ordered sale, the property is purchased for $60,000. First, Tim's remaining $15,000 mortgage balance is paid; then Tim receives $25,000. The remaining $20,000 is applied to Tim's unsecured debts.

Of course, no sale would be ordered if the court could determine that nothing would remain from the proceeds for the creditors. If Greenacre could not be expected to bring more than $40,000, the priority of the mortgage lien and homestead exemption would make a sale pointless.

► ENCUMBRANCES

An encumbrance is a claim, charge, or liability that attaches to real estate. An encumbrance does not have a possessory interest in real property; it is not an estate. Simply put, an encumbrance is a right or an interest held by someone other than the fee owner of the property that affects title to real estate. An encumbrance may lessen the value or obstruct the use of the property, but it does not necessarily prevent a transfer of title.

Encumbrances may be divided into the following two general classifications:
1. Liens (usually monetary charges) and
2. Encumbrances such as restrictions, easements, and encroachments that affect the condition or use of the property.

Liens

A lien is a charge against property that provides security for a debt or an obligation of the property owner. If the obligation is not repaid, the lienholder is entitled to have the debt satisfied from the proceeds of a court-ordered or forced sale of the debtor's property. Real estate taxes, mortgages and trust deeds, judgments, and mechanics' liens all represent possible liens against an owner's real estate. Liens are discussed in detail in Chapter 10.

Deed Restrictions
Deed restrictions, also referred to as covenants, conditions, and restrictions, or CC&Rs, are private agreements that affect the use of land. They may be imposed by an owner of real estate and included in the seller's deed to the buyer. Typically, however, restrictive covenants are imposed by a developer or subdivider to maintain specific standards in a subdivision. Such restrictive covenants are listed in the original development plans for the subdivision filed in the public record. Deed restrictions are discussed further in Chapter 19.

Easements
An easement is the right to use the land of another for a particular purpose. An easement may exist in any portion of the real estate, including the airspace above or a right-of-way across the land.

An appurtenant easement is annexed to the ownership of one parcel and allows this owner the use of a neighbor's land. For an appurtenant easement to exist, two adjacent parcels of land must be owned by two different parties. The parcel over which the easement runs is known as the servient tenement; the neighboring parcel that benefits is known as the dominant tenement. (See Figure 7.4 and Figure 7.5.)

FOR EXAMPLE Kim and Larry own adjoining parcels of land near a lake. Kim's property borders the lake, and Larry's does not. Kim grants Larry an easement, established by a deed properly delivered, accepted, and recorded. The easement gives Larry the right to cross Kim's property to reach the lake. This is an easement appurtenant. When Kim sells the lakefront property to Mike, the easement is automatically included, even if Kim's deed fails to mention it. Larry's easement has become a limitation on the ownership rights of Kim's land.

An easement in gross is an individual interest in or right to use someone else's land. For instance a railroad's right-of-way is an easement in gross. So is the right-of-way for a pipeline or a high tension power line (utility easements). Commercial easements in gross may be assigned, conveyed, and inherited.

However, personal easements in gross usually are not assignable. Generally, a personal easement in gross terminates on the death of the easement owner. An easement in gross is often confused with the similar personal right of license, discussed later in this chapter.

Creating an easement. An easement is commonly created by a written agreement between the parties that establishes the easement right. It also may be created by the grantor in a deed of conveyance, where the grantor either reserves an easement over the sold land or grants the new owner an easement over the grantor's remaining land. An easement may be created by longtime use, as in an easement by prescription; by necessity; and by implication, that is, the situation or the parties' actions imply that they intend to create an easement.

The creation of an easement always involves two separate parties, one of whom is the owner of the land over which the easement runs. It is impossible for the owner of a parcel of property to have an easement over his or her own land.

Party wall easement. A party wall can be an exterior wall of a building that straddles the boundary line between two lots or it can be a commonly shared partition wall between two connected properties. Each lot owner owns the half of the wall on his or her lot, and each has an appurtenant easement in the other half of the wall. A written party wall agreement must be used to create the easement rights. Expenses to build and maintain the wall are usually shared. A fence built on the lot line is treated the same as a wall. A party driveway shared by and partly on the land of adjoining owners must also be created by written agreement, specifying responsibility for expenses.

Easement by necessity. An appurtenant easement that arises when an owner sells part of his or her land that has no access to a street or public way except over the seller's remaining land is an easement by necessity. An easement by necessity is created by court order based on the principle that owners have the right to enter and exit their land (the right to ingress and egress)—they should not be landlocked. Remember, this form of easement is called an easement by necessity; it is not of merely for convenience and is not imposed simply to validate a shortcut.

Easement by prescription. When the claimant has made use of another's land for a certain period of time as defined by state law, an easement by prescription, or a prescriptive easement, may be acquired. The prescriptive period may be from 10 to 21 years. The claimant's use must-have-been continuous, exclusive, and without the owner's approval. The use must be visible, open, and notorious, that is, the owner must have been able to learn of it.

The concept of tacking provides that successive periods of continuous occupation by different parties may be combined (tacked) to reach the required total number of years necessary to establish a claim for a prescriptive easement. To tack on one person's possession to that of another, the parties must have been successors in interest, such as an ancestor and his or her heir, a landlord and a tenant, or seller and buyer.

FOR EXAMPLE Judy's property is located in a state with a prescriptive period of 20 years. For the past 22 years, Frank has driven his car across Judy's front yard several times a day to reach his garage from a more comfortable angle. Frank has an easement by prescription.

For 25 years, Lester has driven across Judy's front yard two or three times a year to reach his property when he's in a hurry. He does not have an easement by prescription because his use was not continuous.

For 15 years, Eric parked his car on Judy's property, next to Judy's garage. Six years ago, Eric sold his house to Nick, who continued to park his car next to Judy's garage. Last year, Nick acquired an easement by prescription through tacking.

Easement by condemnation. An easement by condemnation_ is acquired for a public purpose through the right of eminent domain. The- owner of the servient tenement must be compensated for any loss in property value.

Terminating an easement. An easement may be ended

► when the purpose for which the easement was created no longer exists;

► when the owner of either the dominant or the servient tenement becomes the owner of both—the properties are merged under one legal description (also known as termination.by merger);

► by release of the right of easement to the owner of the servient tenement;

► by abandonment of the easement (the intention of the parties is the deter-mining factor);

► by nonuse of a prescriptive easement;

► by adverse possession by the owner of the servient tenement;

► by destruction of the servient tenement (for instance, the demolition of a party wall);

► by lawsuit (an action to quiet title) against someone claiming an easement; or

► by excessive use, as when a residential use is converted to a commercial purpose.

Note that an easement may not automatically terminate for these reasons. Certain legal steps may be required.

Licenses

A license is a personal privilege to enter the land of another for a specific purpose. A license differs from an easement in that it can be terminated or canceled by the licensor (the person who granted the license). If a right to use another's property is given orally or informally, it generallyy is considered to be a license rather than a personal easement in gross. A license ends on the death of either party or the sale of the land by the licensor.

FOR EXAMPLE Peter asks Harry for permission to park a boat in Harry's drive-way. Harry says, "Sure, go ahead!" Peter has a license, but Harry may tell Peter to move the boat at any time. Similarly, a ticket to a theater or sporting event is a license: The holder is permitted to enter the facility and is entitled to a seat. But if the ticketholder becomes rowdy or abusive, he or she may be asked to leave.

An encroachment occurs when all or part of a structure, such as a building, fence, or driveway, illegally extends beyond the land of its owner or beyond the legal building lines. An encroachment usually is disclosed by either a physical inspection of the property or a spot survey. A spot survey shows the location of all improvements located on a property and whether they extend over the lot or building lines. As a rule, a spot survey is more accurate and reliable than a simple physical inspection. If a building encroaches on adjoining land, the neighbor may be able to either recover damages or secure removal of the portion of the building that encroaches. Encroachments that exceed a state's prescriptive period, however, may give rise to easements by prescription.

Because an undisclosed encroachment could make a title unmarketable, an encroachment should be noted in a listing agreement and the sales contract. An encroachment is not disclosed by the usual title evidence provided in a real estate sale unless a survey is submitted while the title examination is being made.

► WATER RIGHTS

Whether for agricultural, recreational, or other purposes, waterfront real estate has always been desirable. Each state has strict laws that govern the ownership and use of water as well as the adjacent land. The laws vary among the states, but all are closely linked to climactic and topographical conditions. Where water is plentiful, for instance, many states rely on the simple parameters set by the common-law doctrines of riparian and littoral rights. Where water is more scarce, a state may control all but limited domestic use of water according to the doctrine of prior appropriation.

Riparian Rights

Riparian rights are common-law rights granted to owners of land along the course of a river, stream, or similar body of water. Although riparian rights are governed by laws that vary from state to state, they generally include the unrestricted right to use the water. As a rule, the only limitation on the owner's use is that it cannot interrupt or alter the flow of the water or contaminate it in any way. In addition, an owner of land that borders a non-navigable waterway, that is, a body of water unsuitable for commercial boat traffic, owns the land under the water to the exact center of the waterway. Land adjoining commercially navigable rivers, on the other hand, is usually owned to the water's edge, with the state holding title to the submerged land. Navigable waters are considered public highways in which the public has an easement or right to travel.

Littoral Rights

Closely related to riparian rights are the littoral right of owners whose land borders commercially navigable lakes, seas, and oceans. Owners with littoral rights enjoy unrestricted use of available waters but own the land adjacent to the water only up to the mean (average) high-water mark. All land below this point is owned by the government.

Riparian and littoral rights are appurtenant (attached) to the land and cannot be retained when the property is sold. The right to use the water belongs to who-ever owns the bordering land and cannot be retained by a former owner after the land is sold.

Accretion, Erosion, and Avulsion

The amount of land an individual owns may be affected by the natural action of water. An owner is entitled to all land created through accretion increaes in the land resulting from the deposit of soil by the water’s action. (Such deposits are called alluvion or alluvium) If water recedes, new land is acquired by reliction.

On the other hand, an owner may lose land through erosion. Erosion is the gradual and imperceptible wearing away of the land by natural forces, such as wind, rain, and flowing water. Fortunately, erosion usually takes hundreds or even thousands of years to have any noticeable effect on a person's property. Flash floods or heavy winds, however, can increase the speed of erosion.

If erosion is a slow natural process, avulsion is its opposite. Avulsion is the sudden removal of soil by an act of nature. It is an event that causes the loss of land much less subtly than does erosion. An earthquake or a mudslide, for instance, can cause an individual's landholding to become much smaller very quickly.

In states where water is scarce, ownership and use of water are often deter-mined by the doctrine of prior appropriation. Under this doctrine, the right to use any water, with the exception of limited domestic use, is controlled by the state rather than by the landowner adjacent to the water.

To secure water rights in prior appropriation states, a landowner must demonstrate to a state agency that he or she plans a beneficial use for the water, such as crop irrigation. If the state's requirements are met, the landowner receives a permit to use a specified amount of water for the limited purpose of the beneficial use. Although statutes governing prior appropriation vary from state to state, the priority of water rights is usually determined by the oldest recorded permit date.

NOTE: Once granted, water rights attach to the land of the permitholder. The permitholder may sell a water right to another party.

Issuance of a water permit does not grant access to the water source. All access rights-of-way over the land of another (easements) must be obtained from the property owner.

► SUMMARY

An individual's ownership rights are subject to the powers held by government. These powers include police power, by which states can enact legislation such as environmental protection laws and zoning ordinances. The government may also acquire privately owned land for public use through the power of eminent domain. Real estate taxes are imposed to raise government funds. When a property becomes ownerless, ownership of the property may transfer, or escheat, to the state.

An estate is the degree, quantity, nature, and extent of interest a person holds in land. Freehold estates are estates of indeterminate length. Less-than-freehold estates are called leasehold estates, and they involve tenants.

A freehold estate may be a fee simple estate or a life estate. A fee simple estate can be absolute or defeasible upon the happening of some event. A conventional life estate is created by the owner of a fee estate; a legal life estate is created by law. Legal life estates include curtesy, dower, and homestead.

NOTE: Encumbrances against real estate can be liens, deed restrictions, easements, licenses, or encroachments.

An easement is the right acquired by one person to use another's real estate. Easements are classified as interests in real estate but are not estates in land. There are two types of easements. Appurtenant easements involve two separately owned tracts. The tract benefited is known as the dominant tenement; the tract subject to the easement is called the servient tenement. An easement in gross is a personal right, such as that granted to utility companies to maintain poles, wires, and pipelines.

Easements may be created by agreement, express grant or reservation in a deed, necessity, prescription, or condemnation. An easement can be terminated when the purpose of the easement no longer exists, by merger of both interests, with an express intention to extinguish the easement by release, or by abandonment of the easement.

A license is permission to enter another's property for a specific purpose. A license is usually created orally; it is temporary and can be revoked. An encroachment is an unauthorized use of another's real estate.

Ownership of land encompasses not only the land itself but also the right to use the water on or adjacent to it. Many states subscribe to the common-law doctrine of riparian rights, which gives the owner of land adjacent to a nonnavigable stream ownership of the stream to its midpoint. Littoral rights are held by owners of land bordering large lakes and oceans and include rights to the water and ownership of the land up to the mean high-water mark. In states where water is scarce, water use is often decided by the doctrine of prior appropriation. Under prior appropriation, water belongs to the state and is allocated to users who have obtained permits.

As a reminder, watch this short video about PETE -- Police Power, Eminent Domain, Taxation, and Escheat. Which is an individual's ownership rights that are subject to the powers held by government. These powers include police power, by which states can enact legislation such as environmental protection laws and zoning ordinances. The government may also acquire privately owned land for public use through the power of eminent domain. Real estate taxes are imposed to raise government funds. When a property becomes ownerless, ownership of the property may transfer, or escheat, to the state.