1. You have a total of 2 hours to complete this exam. You may allocate your
time as you see appropriate.
2. This exam is CLOSED book.
3. This exam consists of:
4. Please complete your multiple choice answers on the separate “ParSCORE TEST FORM” using pen or pencil and following the instructions on that form. If you change your answer, place a clear X through the wrong answer and mark the correct answer. A machine will score the exam and any ambiguities will be counted as a wrong answer.
5. Your essay answer should demonstrate your understanding of the law as applied to the facts presented. Conclusions without analysis will not receive credit.
6. Please answer the essay question in the blue books provided to you. Write only on the right hand side of the page (skipping a page each time) and double-space your work. Please write legibly.
7. Write your exam number on your exam envelope. Put student exam # at the top of this page, each page of questions, each blue book and ParSCORE answer form. Do not use your name, student ID number, Social Security Number, or in any other way identify yourself on any exam materials.
8. 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. Students who do not return all exam materials at the end of the exam may not be graded. Failure to return the materials will result in a failing grade.
GOOD LUCK!
ESSAY QUESTION (50 Points)
When Franco died in 1990, his will devised a 300 acre parcel of undeveloped
land to his three daughters: Abby, Bea, and Camille. In accordance with their
father’s dying request, the three sisters agreed to use the property for
residential purposes only and signed an agreement to that effect. The agreement
was never recorded.
In 1992, low interest rates and a high demand for real property created an increase in real property prices. Abby, Bea, and Camille executed deeds from themselves as cotenants to each separately, so they could independently make decisions on their respective 100 acre parcels. None of the deeds made any reference to the agreement signed in 1990 and none of the deeds contained any residential restriction as to use. The deeds were duly recorded.
In 1993, Abby executed a mortgage to Max to secure a $15,000 loan. Max recorded the mortgage but the mortgage was misindexed. Later that year, Abby sold her 100 acres to Big Rig Development who intended to develop an amusement park on the property. Big Rig Development obtained a construction loan of $500,000 from National Bank, secured by a mortgage on the property that was duly recorded. Big Rig Development later defaults on the construction loan.
Bea leased her 100 acre parcel to Nero for a term of five years. Under the terms of the lease, Nero was required to grow crops on the land and pay Bea fifty percent of his revenue or $50,000 each year, whichever was greater. Bea also agreed to convey to Nero a fee simple absolute to the property at the expiration of the lease, if Nero had complied with the terms of the lease throughout the five years. In 1996, in the third year of the lease, Nero failed to make his annual payment of $50,000, and Bea began eviction proceedings.
Camille subdivided her 100 acres into 10 lots with 10 acres in each lot. When Camille sold the first 9 lots, she carefully included the residential restriction in each general warranty deed. The deed for the 10th lot failed to make any mention of the residential restriction and was sold to Xavier. When Xavier tried to sell his lot to Zoe, she refused to complete the transaction, claiming that Lot 10 was subject to a residential restriction. Xavier refused to return Zoe’s earnest money deposit of $20,000.
Discuss the respective rights and claims of the following parties: Max, National Bank, Nero, Xavier, and Zoe.
Can the nine homeowners who purchased from Camille enforce the residential restriction for the original 300 acres? Discuss their legal claims.
END OF EXAM