Essay Question 1 . (60 minutes estimated time) Alice and Brad owned adjoining 80-acre tracts of rural land. In 1985, Alice installed a wire fence between the two parcels to separate her land, a vegetable garden, from Brad's land, on which he kept cattle. In 1986, without discussing his actions with Alice, Brad cut the fence, installed a gate in it, and began driving across Alice's land to reach the nearest public highway. This saved Brad about ten miles on each trip to the nearest town. Brad used the road consistently, at least once each week.
By 1988 Brad's trips had worn tracks across Alice's land. One day in 1988, Alice said to Brad, "Nice road. If you don't mind my using it as well, I'll give you an easement for it." Brad (who was always rather laconic) replied, "I guess."
Alice had her lawyer prepare a deed, granting to Brad "a twenty-foot wide easement for a road along the existing pathway." She signed the deed and made a photocopy, which she mailed to Brad. Along with the deed she sent a note, which said, "If this is OK, I'll send you the original." Brad read the deed and put it in his desk drawer, but he never contacted Alice about it. Alice kept the original deed in her desk.
In 1989, Brad spent $10,000 to have the road graded and to have gravel put on it. He continued to use it at least once a week.
In 1992 Alice became concerned because Brad sometimes left the gate open when he drove on the road. When this occurred, his cattle wandered onto Alice's land and damaged her crops. She put a padlock on the gate, but did not give Brad a key. About a week later Brad broke the padlock off. Alice then put a sign near the gate that read, "Close the gate or I will sue you." Brad has continued to use the road, but has been careful always to close the gate since that time.
This year Brad has announced plans to subdivide his land into ten residential lots. He plans to pave the road and wants to install buried water, phone, and electrical lines under the pavement. Alice strongly objects to Brad's plans, and would like to have him discontinue use of the road altogether.
The applicable time period for adverse possession is 10 years. Discuss the rights of Alice and Brad with respect to the road.
Essay Question 2 (50 minutes estimated time). Larry Lawton was a real estate investor. In 1997 he purchased a small office building, which contained two suites of offices. He used one of them himself, and leased the other on May 1, 1997 for a 5-year term (ending April 30, 2002) to Tina Taylor, who ran a management consulting business. The rent was $1,000 per month, which was reasonable for this office suite at that time. The lease was on a printed form that Larry bought at an office supply store (since Larry knew little about leases). It provided, "Tenant shall not assign her rights under this lease without Landlord's prior written consent," and contained the clauses on other topics usually found in form leases.
Property rental values in the area shot up sharply during 1997 and 1998. Two years after the lease commenced, Tina decided to sell her business to one of her employees, Ursula Ulm. Tina entered into the following agreement with Ursula:
May 1, 1999. Tina Taylor hereby assigns her interest in Office Suite 2 of the building owned by Larry Lawton to Ursula Ulm. Ulm agrees to pay all rent owed under the lease, and in addition, to pay Taylor the sum of $500 per month for the remainder of the lease term. In the event Ulm fails to make any payment she owes, Taylor shall have the right to re-enter, terminate this agreement, and take possession of the premises.
[Signed: Tina Taylor] [Signed: Ursula Ulm]
Neither Tina nor Ursula discussed this transaction with Larry in any way. After Ursula moved in, she paid directly to Tina both the $1,000 rent and the additional $500 mentioned in their agreement, and Tina remitted the $1,000 each month to Larry, while retaining the $500. All payments were made on time. Larry did not know that Tina had turned possession of the office suite over to Ursula, but instead assumed that Ursula was merely managing the office for Tina.
All went well until last month, when the State of Grace, in which the property was located, decided to condemn the building because it was in the path of a proposed freeway. The state is planning to take the entire property in fee simple absolute, and will (of course) pay its appraised fair market value to whoever is entitled to compensation. The proposed condemnation date is May 10, 2000.
Tina Taylor has consulted you and asked you the following questions:
1. Is Larry entitled to the entire condemnation award from the State of Grace, or must he share it with Tina or Ursula? If he must share it, about how much (you needn't be mathematically precise) and with whom?
2. Is Tina entitled to continue receiving the $500 per month from Ursula after the condemnation occurs?
3. Can Larry take any action prior to the date of the condemnation that will change these results?
Please answer Tina's questions, discussing all relevant legal issues. NOTE: You do not need to answer these questions in the order stated above. Analyze the facts in a logical order, and answer the questions as you get to them.