Property II
Professor Todd Brower
Spring 2003
Final Exam

General Instructions

1. You have two (2) hours to complete this exam.

2. This is a closed book exam.

3. There are seven (7) pages to this exam including the Instruction page.

4. There are two (2) parts to this exam.

5. Using a #2 pencil, darken the letter corresponding to the correct answer on the ParScore answer sheet. If you change your answer, please be sure that your erasures are complete. The exam will be scored by a machine and any ambiguities will be counted as a wrong answer.

6. Write your exam number on your exam envelope, at the top of the exam question packet, and on the ParScore form. Also, write your exam number on the Blue Book and any other exam materials used. Do not use your name, student ID number, or Social Security Number on any exam materials.

At the conclusion of the exam, return all exam materials to the exam envelope and submit it to the proctor. Do not seal the envelope.


Essay Question

You know that Koellefornia is a race-notice jurisdiction in which the statute of limitations on suits for breaches of real estate contracts and their terms, and for title covenants are all limited to one year. Please advise Bette by a complete and concise answer to the questions.

On January 1, 2003, Sally and Bette signed a written contract for the $150,000 sale of Blackacre, a vacant tract of land in Koellefornia. The contract specified that on April 1, 2003, Sally would transfer title to Blackacre by a general warranty deed with title to be held in fee simple absolute. Bette did not record that contract. On April 1, 2003, Sally transferred and Bette accepted a general warranty deed in fee simple absolute to Blackacre; that deed was unconditional on its face and did not mention any easements, mortgages or other interests in the property. On March 3, 2003, Bette purchased a policy of title insurance from the Full Coverage Title Insurance Company of Koellefornia dated on that date. That policy included the following language: “Policyholders under this policy of insurance are limited to the rights and remedies available to them for non-disclosure of all instruments of public record available as of the date of the policy. No other warranties express or implied are given by the Insurer.”

On February 16, 2003, Bette made a written contract for the $175,000 sale of Blackacre by special warranty deed in fee simple absolute to Carlos. That contract was recorded March 5, 2003. The deed and title transfer from Bette to Carlos was to take place on May 1, 2003. Unknown to Bette or Carlos, on March 1, 2003, Sally mortgaged Blackacre to the First National Bank of Koellefornia in exchange for a loan of $100,000. The Bank recorded its mortgage the following day.

On May 1, 2003, Carlos learned of the March 1 mortgage to the Bank and refused to accept the deed to Blackacre tendered by Bette. On that same day, Carlos also instructed his agent not to provide the $175,000 check for the purchase price to Bette.

It is now May 2, 2003. Bette has come to your office as Koellefornia’s leading expert in real estate matters. Bette wants to know the answers to the following questions: