Smoke & Mirrors

Smoke & Mirrors

Let’s try this sample questions from one of the bar review course practice exam material from 2009: the dreaded subject of real property:

Thirty years ago, a power company constructed a power dam on a river. At the time the dam was constructed, the power company solicited easements from all of the landowners in the river valley, including a farmer. The power company paid fair value for the easements, which would allow the company to release water from the dam at certain times of the year, resulting in flooding of the land in the river valley.

In the 30 years since the dam was constructed, the farmer’s property has never been flooded, and the farmer has been using his land in the same way as he did 30 years ago. Now, however, the power company wants to substantially increase power production from the dam. All landowners in the valley were notified by the company that henceforth all 200,000 acres (including the farmer’s 200 acres) would be flooded in accordance with the company’s easement. The farmer reviewed the easement for his property and discovered that it lacked the requisite grantor’s acknowledgment and thus was improperly recorded. The state’s adverse possession statute requires hostile occupation for a period of 20 years.

May the power company properly flood the farmer’s land under the terms of the easements?

This is a prime example of many different principles of MBE preparation. First, note the multitude of issues raised by the language of this fact pattern:

— “solicited easements”; raising the issue of easements in general.

— “paid fair value”; raising the notorious bonafide-purchaser-for-value (BFP) specter.

— “farmer . . . using his land in the same way as he did 30 years ago” and coupled with the later phrase “state’s adverse possession statute”; raising the issue of termination of easement by prescription.

— “Now . . . power company wants to substantially increase power production”; raising the issue of surcharging the easement.

— “farmer reviewed the easement . . . discovered that it lacked the requisite grantor’s acknowledgment and thus was improperly recorded”; raising both a possible conveyancing signature issue and the statutory recordation issue.

And those issues with corresponding language are used in the answer choices.

This question illustrates why MBE takers should always read the call of the question first, as advised by review courses for both MBE and essay questions. By reading the question first, takers are alerted to the specific issue(s) involved and better able to focus. 

Failing to read the call first, an astute reader gradually becomes overloaded as he registers each of those distinct issues that could possibly be involved in the correct answer. If the test taker reads the call first, that narrows the correct answer choice as he reads to involving the validity of the easement. So armed, after reading first that there exists easements, the taker moves beyond issue No. 1, and quickly sees issue No. 2 of BFP as simply a gratuitous distractor. The taker does have to consider issues Nos. 3 and 4: whether the farmer terminated the easement sufficiently by prescription. But those issues only need to be considered if issue No. 5 is resolved positively; that is, if the easement was validly created in the first place.

So issues 1 through 5 are “smoke.” The “mirrors” come in on issues No. 1 and No. 5: and they're not simple mirrors, but ones more likely comparable to those in carnival funhouse, where appearance is distorted. And here, there’s not much fun in the distortion.

The only issue that matters, as indicated by the call of the question, is issue No. 5: the legal validity of the easement. The facts specifically state that Power Company “solicited easements” and “paid fair value,” so presumably, straightforward express easements in gross were created. Easements are an interest in land, so express easements must comply with the statute of frauds and be in writing and signed by the person to be charged — in the case of easement, the holder of the servient estate. So, to be valid, the easement granted to Power Company by the Farmer would have had to be signed by the Farmer.

But it’s important to note the fact that the indication that each landowner signed their respective grant of easement is perforce a supposition. The facts don’t indicate it specifically, which they might have done simply with language like “the easements were all properly executed” or similar. Such language would have definitively indicated that each landowner had signed the easement conveyance. So readers in this case don’t know definitively, but are left to suppose that the easements were validly executed by including the signatures of the grantors. 

This is a common tactic in MBE practice questions: readers are required to “fill in the blanks” through supposition. Make the wrong supposition, or fail to make any supposition, and the reader will quite understandably be led astray into choosing the wrong answer.

So, in this case, here comes that “funhouse” mirror distoring the appearance of the circumstances, and placed just before the question call: “The farmer reviewed the easement for his property and discovered that it lacked the requisite grantor’s acknowledgment and thus was improperly recorded.”

Where does that come from? What does “requisite grantor’s acknowledgment” mean? My Real Property course didn’t include any lectures on that requirement of a “grantor’s acknowledgment,” and I don’t remember any cases from the course work using that language. Could it be that “grantor’s acknowledgment” is a synonym for “signature”? As a matter of logic, common use and tradition, a person’s signature in a transaction is of course an acknowledgment that an agreement was made; an acknowledgment of the meeting of the minds, so to speak.

Ack! Confused? That, I regret, is the point.

The distortion is meant to confuse meanings, make test takers second-guess themselves and wonder what the words really mean, if anything.

The only clue here is that end phrase “improperly recorded.” Is there a recordation issue here such that the easement grant might be invalidated? Conveyances of interests in land do not have to be recorded to be legally valid. Recordation becomes an issue only when a party seeks the protection of the recordation statutes to prevail in ownership. Because the recordation issue is raised as part of this inexplicable “acknowledgment” issue, and there is no recordation issue, I surmise that this is a convoluted distractor, which is presented as an alluring answer choice.

Leveraging the recordation non-issue to eliminate that as a distractor, leaves the reader with the determination that the “solicited easements” were in fact validly executed, with the all necessary signatures. Therefore, the easement granted by Farmer is legally valid (mere nonuse insufficient to terminate), and the Power Company has the right to use the easement according its terms. It’s the simplest answer, and in this case was the first presented. 

But all that smoke, let alone the mirrors, made this a rather challenging example.

Disclaimer: The examples cited here are either from the National Conference of Bar Examiners or one of the private bar preparation providers, and are used here under the fair use safe harbor for nonprofit educational purposes outlined in 17 USC §107. BE ADVISED these examples are, perforce, outdated and are used only as illustrations of methodology in form and language that may be encountered on the MBE, and further be advised that the state of current law may not be accurately reflected.