1.4 Land-Use Controls, Public & Private Restrictions, and Encumbrances
Key Takeaways
- Government land-use powers are remembered by PETE: Police power (zoning), Eminent domain, Taxation, and Escheat.
- An encumbrance is any claim or limitation on title; the two families are MONEY encumbrances (liens) and NON-money encumbrances (easements, deed restrictions, encroachments).
- An easement appurtenant runs with the land and involves a dominant and servient estate; an easement in gross benefits a person or entity (utility), not a neighboring parcel.
- Private deed restrictions (CC&Rs) that are MORE restrictive than zoning generally control, but neither can require illegal discrimination.
- A variance permits a use that violates a zoning rule due to hardship; nonconforming use ('grandfathering') protects a use that was legal before a zoning change.
Land-Use Controls and Encumbrances
Ownership is never absolute. Both government and private parties can limit how land is used. The national exam tests public controls, private controls, and the catalog of encumbrances.
Public controls: the four government powers (PETE)
| Power | What it allows | Example |
|---|---|---|
| Police power | Regulate use for health, safety, welfare | Zoning, building codes, environmental rules |
| Eminent domain | Take private land for public use, with just compensation | Condemnation for a highway |
| Taxation | Levy charges against real property | Ad valorem property tax; special assessments |
| Escheat | Take property when an owner dies with no heirs and no will | Land reverts to the state |
Eminent domain is the government's power to take; condemnation is the process used to exercise it. The Fifth Amendment requires just compensation. Inverse condemnation is when a property owner sues the government because a public action has effectively taken the property's value without a formal taking.
Zoning is the most tested police-power tool. It separates uses (residential, commercial, industrial, agricultural) and sets bulk standards (setbacks, height, density).
Zoning relief: variance, special-use, nonconforming use, spot zoning
- Variance — permission to deviate from a zoning requirement because strict application causes the owner undue hardship (e.g., a setback variance on an oddly shaped lot).
- Conditional/special-use permit — allows a use otherwise not permitted in a zone but compatible with it (a church or daycare in a residential zone).
- Nonconforming use ('grandfathering') — a use that was lawful before the zoning changed may continue, but usually cannot be expanded or rebuilt if destroyed.
- Spot zoning — reclassifying a single parcel inconsistently with surrounding zoning; generally improper.
Trap: A variance does NOT change the zoning classification; it grants a narrow exception. Nonconforming use protects a pre-existing use; a variance permits a new deviation due to hardship.
Private controls: deed restrictions and CC&Rs
Private parties limit use through deed restrictions and recorded covenants, conditions & restrictions (CC&Rs), typically imposed by a developer and enforced by an HOA or neighboring owners. When a private restriction and a public zoning rule conflict, the more restrictive one controls. However, no private restriction can lawfully require discrimination prohibited by fair-housing law; such covenants are void and unenforceable.
Adverse possession and prescriptive easements
Use of another's land can ripen into a legal right. Adverse possession can transfer ownership when the possessor's use is, for the statutory period, open, notorious, continuous, hostile, and exclusive (often remembered as "OCEAN" or "hostile, actual, open, continuous, exclusive"). A prescriptive easement uses the same elements but grants only a use right, not title, and need not be exclusive.
Worked scenario: A neighbor parks on the corner of an adjacent vacant lot, visibly and without permission, for the statutory 20 years. He may gain a prescriptive easement to keep parking — but not ownership, because his use was not exclusive (others could still use the lot). Had he fenced the strip, farmed it, and excluded everyone for 20 years, he could claim title by adverse possession.
Trap: Permission defeats both doctrines. If the owner granted permission to park, the use is a revocable license, not hostile, so no easement or title ever accrues.
Lien priority and the homestead exemption
When a property is sold or foreclosed and the proceeds cannot cover every claim, lien priority decides who is paid first. The general rule is "first in time, first in right" by recording date — except that property-tax and special-assessment liens take priority over all others, even an earlier-recorded mortgage.
| Priority (typical) | Lien |
|---|---|
| 1 (super-priority) | Real estate taxes & special assessments |
| 2 | Liens by recording order (mortgages, judgments) |
| Special | Mechanic's lien — priority often relates back to when work began |
Worked scenario: A property has a first mortgage recorded 2019, a judgment lien recorded 2022, and unpaid 2024 property taxes. At a foreclosure sale the taxes are paid first, then the 2019 mortgage, then the 2022 judgment — even though the mortgage was recorded years before the tax lien attached.
A homestead exemption protects a portion of a primary residence's equity from certain unsecured creditors; it does not block a mortgage or tax foreclosure, which are secured against the home itself.
A property's zoning permits buildings up to 45 feet tall, but the recorded subdivision CC&Rs limit homes to 30 feet. A buyer wants to build a 40-foot home. What is the controlling limit?
Encumbrances: liens versus non-money claims
An encumbrance is any claim, lien, charge, or limitation that affects title or limits use. They divide into two families:
Money encumbrances (liens) affect the owner's financial interest:
| Lien type | Notes |
|---|---|
| Mortgage / deed of trust | Voluntary, specific lien against the financed property |
| Property tax / special assessment | Involuntary, specific; generally takes priority over other liens |
| Mechanic's lien | Filed by unpaid contractors/suppliers; priority often relates back to start of work |
| Judgment lien | Involuntary, general lien against all of the debtor's property in the county |
Non-money encumbrances affect use or physical boundaries: easements, deed restrictions, licenses, and encroachments.
Easements: appurtenant vs. in gross
An easement is the right to use another's land for a specific purpose. An easement appurtenant runs with the land and involves two parcels: the dominant estate (benefits) and the servient estate (burdened). It transfers automatically when either parcel sells. An easement in gross benefits a person or entity rather than a neighboring parcel — the classic example is a utility easement for power or sewer lines.
Creating and ending easements; encroachments
Easements can arise by express grant, by necessity (a landlocked parcel needs access), by prescription (open, continuous, hostile use for the statutory period), or by implication. An easement by prescription is the easement cousin of adverse possession — but prescription grants a use right, while adverse possession can transfer actual ownership.
An encroachment is an unauthorized physical intrusion — a fence, eave, or driveway that crosses a boundary onto a neighbor's land. Encroachments are usually discovered by a survey and can cloud marketable title.
A license is mere permission to use land (a ticket to park), is personal, and is revocable — distinguishing it from an easement, which is an interest in land that is generally not revocable at will.
Putting it together
When an exam question presents a claim against property, classify it: Is it a money claim (lien) or a non-money claim (easement, restriction, encroachment)? Then ask whether it runs with the land (appurtenant easement, deed restriction, tax lien) or attaches to a person (easement in gross, judgment against the owner). That two-step classification answers most encumbrance questions.
Exam shortcut: Appurtenant = two parcels (dominant + servient) and transfers with sale. In gross = one parcel burdened, benefits a person/utility.
A power company holds the right to run transmission lines across the back of a residential lot. The lot owner sells the home; the easement remains. This is BEST described as: