2.1 Estates, Ownership Forms, Rights, and Interests
Key Takeaways
- Fee simple absolute is the largest, most complete estate; defeasible fees can be lost on a condition — "so long as" reverts automatically, "but if" requires the grantor to act.
- A life estate gives use without waste; on the measuring life's end it passes to a remainderman or reverts to the grantor.
- Joint tenancy carries the right of survivorship (four unities, PITT) that always overrides a will; tenancy in common has no survivorship and allows unequal, freely transferable shares.
- Selling a joint tenant's share severs that share into a tenancy in common; remaining joint tenants keep survivorship among themselves.
- Condominium = unit deed + common-element share; cooperative = corporate stock + proprietary lease; the bundle of rights (DEEPC) sticks transfer independently.
Estates in Land
An estate describes the degree, quantity, nature, and extent of a person's ownership interest in land. Exams sort estates into two large families: freehold estates (ownership of indefinite duration) and leasehold estates (possession for a fixed or determinable term). The single most-tested distinction is that a freehold owner holds title, while a leasehold tenant holds possession under a lease while title stays with the landlord.
The strongest freehold estate is the fee simple absolute — the largest bundle of rights the law recognizes, inheritable, of indefinite duration, with no attached condition. When a question says an owner holds the most complete interest available, the answer is fee simple absolute.
Defeasible Fees and Life Estates
A defeasible fee is a fee estate that can be lost if a stated condition is violated. Two sub-types appear on exams:
| Estate | Trigger language | What happens on violation |
|---|---|---|
| Fee simple determinable | "so long as," "while," "during" | Title reverts automatically to grantor (possibility of reverter) |
| Fee simple condition subsequent | "but if," "on condition that," "provided that" | Grantor must act to retake (right of re-entry) |
A life estate lasts for the life of a named person. The holder (life tenant) may use and profit from the property but commits waste if they damage it. When the measuring life ends, the estate passes to a remainderman (named third party) or reverts to the grantor. A life estate pur autre vie is measured by the life of someone other than the holder.
A deed conveys land "to the City so long as it is used as a public park." If the city builds offices on it, what is the most accurate result?
Forms of Co-Ownership
When two or more people hold title together, the form of co-ownership controls survivorship, transferability, and division. The four core concurrent estates tested nationally are tenancy in common, joint tenancy, tenancy by the entirety, and community property.
- Tenancy in common (TIC): Default form for unrelated co-owners. Each owner holds an undivided fractional interest (shares can be unequal, e.g., 70/30). No survivorship — a deceased owner's share passes by will or intestacy to heirs. Each tenant may sell, mortgage, or devise their share freely.
- Joint tenancy: Equal shares with the right of survivorship; on death, the share passes automatically to surviving joint tenants outside probate. Requires the four unities (PITT): Possession, Interest, Time, Title.
- Tenancy by the entirety: Joint tenancy limited to a married couple treated as one legal person; neither spouse can convey alone, and survivorship applies.
- Community property: In community-property states, most assets acquired during marriage are owned 50/50 regardless of who earned them.
Worked Example: Severance and Distribution
Scenario: Three friends — A, B, and C — own land as joint tenants with right of survivorship, each holding one-third. Owner A sells their interest to D. Then owner B dies, leaving a will to a niece.
- When A sells to D, A's transfer breaks the four unities for that share. D becomes a tenant in common holding a 1/3 interest. B and C remain joint tenants with each other for the other 2/3.
- When B dies, the right of survivorship between B and C controls B's share — it passes to C, not to the niece. A will cannot override survivorship.
- Final result: C owns 2/3 as the surviving joint tenant; D owns 1/3 as a tenant in common. The niece receives nothing from this property.
Trap: Candidates often assume a will distributes a joint tenant's share. Survivorship beats a will every time — the interest never enters probate.
Other Ownership Vehicles and Bundle of Rights
Property may also be held in severalty (sole ownership by one person or one legal entity) or through ownership structures:
| Vehicle | Key feature |
|---|---|
| Condominium | Fee-simple title to a unit plus an undivided share of common elements |
| Cooperative | Owner holds stock in a corporation plus a proprietary lease (no deed to a unit) |
| Townhouse / PUD | Fee title to lot and structure; HOA owns or manages common areas |
| Timeshare | Time-limited right to use; may be deeded (interval) or contractual (right-to-use) |
| Land trust | Title held by trustee; beneficiary directs and benefits, often anonymously |
The bundle of rights describes ownership as a set of separable rights — commonly remembered as DEEPC: Dispose, Encumber, Enjoy, Possess, Control. Each stick can be transferred independently; for example, granting an easement gives away part of the "control/use" stick without giving up title.
Exam Strategy: Reading Co-Ownership Fact Patterns
When a question describes multiple owners, work the analysis in a fixed order so you do not miss the tested twist:
- Identify the form. Look for trigger words: "right of survivorship" signals joint tenancy; "married couple" with survivorship signals tenancy by the entirety; unequal shares or "to A and B" with no survivorship language defaults to tenancy in common.
- Check for survivorship. If an owner dies, decide whether the share passes to surviving co-owners (joint tenancy/entirety) or to heirs/devisees (tenancy in common). Survivorship always defeats a will.
- Watch for severance. A sale, mortgage in some states, or court partition can break a joint tenancy into a tenancy in common for that share.
- Apply partition rights. Any co-owner may sue for partition to divide the property physically or by forced sale, except a tenancy by the entirety, which neither spouse can partition alone.
A final trap: the word "undivided" appears in both tenancy in common and joint tenancy. It means each owner has the right to use the whole property, not a fenced-off portion — it does not tell you whether survivorship exists, so never pick an answer based on "undivided" alone.
A buyer purchases a residence and receives shares of stock in a corporation along with a proprietary lease, but no deed to a specific unit. What form of ownership is this?