| Nature of Ownership Interests in Land | | | | which possess a useful property giving them |
| By law, property falls into two categories -- real | | | | special value. An exception would be sand, gravel, |
| or personal. Real property includes land and | | | | limestone, etc which are normally considered part |
| whatever is permanently attached to land, found | | | | of the surface estate as is subsurface water. |
| on it either by nature, (water, trees, or minerals) | | | | Minerals are often severed from the surface |
| or by man (buildings, fences, bridges, roads). | | | | estate. Such severance is accomplished with a |
| Land is an inanimate thing which persons may, | | | | conveyance or reservation of the minerals in a |
| under the law, have different status to the land | | | | conveyance. This conveyance or reservation |
| and the things attached to the land. ie. You can | | | | includes minerals or such substances considered as |
| own the surface rights, but you sell the timber | | | | minerals. This is to include such things as natural |
| rights to farmer John for 25 years. | | | | gas, as it has been often asked by bemused |
| The nature of the status of the land is fixed by | | | | geologists "Is natural gas a mineral?" |
| law, and are distinguished as being either a | | | | Further, this conveyance or reservation includes |
| freehold estate or a non-freehold estate. Freehold | | | | royalties, bonuses, and rentals. |
| means ownership without limitations to duration. | | | | Determinable or Conditional Fee |
| Non-freehold would be like farmer John who | | | | This fee is the same as fee simple estate, but |
| bought timber rights, that only last 25 years. | | | | subject to an automatic termination triggered by |
| Freehold estates include estates in fee simple, | | | | an occurrence or act. Any estate in land may be |
| determinable or conditional fee, and life estates. | | | | granted with conditions or special restrictions. The |
| Fee Simple | | | | non-performance of the condition, or the |
| (note: Don't let the word "Fee" confuse you, it is a | | | | occurrence of the event will execute the |
| legal term, not a charge like a bank fee.) | | | | automatic forfeiture of the estate, but until that |
| Fee simple title is the highest form of estate | | | | happens, the owner enjoys the estate as if it |
| ownership. It is free of any condition or restriction. | | | | were fee simple. |
| Every estate conveyed is considered a fee simple | | | | An example of a determinable fee would be the |
| unless expressly limited. The owner of a fee | | | | sale from A to B "so long as the Klipsh |
| simple interest has the exclusive right of its use | | | | Synagogue still stands, then to C." Another |
| and sale. | | | | example is a mineral lease which is a determinable |
| So it is possible that someone owns the surface, | | | | fee interest in the mineral estate. |
| another owns the mineral rights, another the | | | | The owner of a determinable fee has all the rights |
| royalties to those minerals, another the timber, | | | | that a fee simple owner has, but there is always |
| etc. Each such fee simple owner has the exclusive | | | | the possibility that it may be terminated. If he |
| ownership free and clear of any condition or | | | | sells the estate, the buyer accepts the possibility |
| restriction. | | | | that of termination. |
| To contrast this case, we examine a deed in a | | | | Life Estates |
| subdivision that is burdened by a home owners | | | | Where property is granted to an individual for as |
| association. The homeowner would not have fee | | | | long as he lives, and upon his death shall pass to |
| simple ownership of his estate. It is burdened by | | | | another party, he is the owner of a conventional |
| the restrictions placed on his deed by the home | | | | life estate. He is called a life tenant of the |
| owners association. | | | | property, with the right of possession, use and all |
| Surface Estate | | | | income therefrom. |
| Often referred to as surface rights. It is the | | | | Statutory life estates are created automatically |
| ownership of the surface of the land. It implies | | | | upon the death, intestate, of husband or wife; and |
| the right that the owner may do whatever he | | | | the surviving spouse becomes a life tenant, with |
| wishes to the land as far as law permits. | | | | the right of possession, use and all income, to one |
| Mineral Estate | | | | third of the separate property of the deceased, |
| Often referred to as mineral rights. The mineral | | | | with the remainder to the legal heirs of the |
| estate of the land includes all unusual organic and | | | | deceased. |
| inorganic substances forming a part of the soil | | | | |