1.4 Land-Use Controls, Public & Private Restrictions, and Encumbrances

Ownership is never absolute. The bundle of rights (possession, control, enjoyment, exclusion, and disposition) is limited from two directions: public controls imposed by government and private controls created by owners. Learn which is which, because the exam rewards correct classification.

Public Land-Use Controls (Police Power)

Government regulates land under its police power, the authority to protect public health, safety, and welfare without paying compensation.

• Zoning assigns districts (residential, commercial, industrial, agricultural) and sets density, height, and setback rules.
• Building codes govern construction safety and require permits and inspections.
• Subdivision regulations control how raw land is divided and platted.
• The comprehensive (master) plan is the long-range policy document zoning must follow.

Zoning Relief

When strict zoning creates problems, three tools provide relief:

• A variance permits a deviation (for example, a smaller setback) due to hardship while the use stays within the district.
• A special (conditional) use permit allows a use that is compatible but needs approval, like a church or school in a residential zone.
• Nonconforming use ("grandfathering") protects a lawful use that predates a zoning change; it may continue but usually cannot be expanded or rebuilt if destroyed.

Do not confuse police power with eminent domain, the government's power to take private property for public use, which requires just compensation through condemnation. Police power regulates without payment; eminent domain takes with payment.

Private Land-Use Controls

Private parties, not government, create these.

• Deed restrictions are limits a grantor places in a deed (for example, no commercial use).
• CC&Rs (covenants, conditions, and restrictions) are recorded by a developer to govern an entire subdivision and are enforced by the HOA or by neighboring owners through court injunction.

Rule of thumb: if the most restrictive rule wins, apply it. When zoning allows a 35-foot building but the CC&Rs cap height at 25 feet, the stricter private rule controls.

Encumbrances Overview

An encumbrance is any claim, charge, or right that another party holds against an owner's title. Encumbrances do not necessarily prevent transfer, but they limit use or value. They divide into two families:

• Liens are monetary claims securing a debt.
• Non-money encumbrances affect use or physical condition: easements, encroachments, deed restrictions, and licenses.

Liens

• Voluntary lien: the owner creates it, such as a mortgage or deed of trust.
• Involuntary lien: imposed by law, such as a property tax lien, judgment lien, or mechanic's lien.
• A general lien attaches to all of a debtor's property (judgments, IRS liens); a specific lien attaches to one identified property (mortgage, mechanic's, property tax).

Lien Priority

The default rule is first in time, first in right, set by recording date. Two important exceptions:

• Property tax and special assessment liens jump ahead of all private liens, even earlier-recorded mortgages.
• Mechanic's liens may relate back to the date work or materials first began, giving them priority over liens recorded after that date.

Subordination is a voluntary agreement in which a senior lienholder accepts a lower priority, common when a construction lender lets a permanent loan move ahead.

Easements

An easement is a non-money right to use another's land for a specific purpose. It limits the right of exclusion.

• Easement appurtenant benefits an adjoining parcel. The benefited parcel is the dominant estate; the burdened parcel is the servient estate. It runs with the land and transfers automatically to new owners.
• Easement in gross benefits a person or company rather than a parcel, such as a utility easement for power lines. There is no dominant estate.
• An easement by necessity arises when a landlocked parcel needs access; an easement by prescription arises from open, continuous, unauthorized use over the statutory period.

A license, by contrast, is mere temporary permission (like permission to park) and is revocable; it is not a true encumbrance that runs with the land.