Legal Definitions - derivative conveyance

A derivative conveyance refers to the transfer of a property interest that originates from, or is dependent upon, a previously established property right or transfer. It is not the initial creation or transfer of the fundamental property ownership, but rather a subsequent transfer of a lesser, modified, or partial interest derived from that original right. Essentially, it's a "secondary" transfer that builds upon an existing legal claim to property.

• Example 1: Selling a Subdivided Lot

  Imagine a real estate developer who owns a large, undeveloped parcel of land. The developer then subdivides this large parcel into several smaller residential lots and sells one of these individual lots to a homebuyer. The developer's initial ownership of the entire large parcel is the primary property right. The sale of the smaller, individual lot to the homebuyer is a derivative conveyance because the homebuyer's interest in that specific lot is derived from the developer's larger, pre-existing ownership. The deed for the smaller lot conveys a right that "derives" from the original, larger property.

• Example 2: Granting an Easement

  Consider a situation where Maria owns a large property that includes a private access road. Her neighbor, David, needs to use a specific section of this private road to reach his own property. Maria grants David an easement, which is a legal right allowing him to use that particular portion of her road for access. Maria's full ownership of her land is the primary property right. The easement she grants to David is a derivative conveyance because it transfers a specific, limited right (the right to use the road) that is carved out of and dependent on her broader ownership. David's right to use the road derives from Maria's ability to grant it as the landowner.

• Example 3: Subleasing Commercial Space

  A company called "Global Solutions" signs a five-year lease for an entire floor of an office building. After two years, they find they only need half the space and decide to sublease the unused portion to a startup company, "Innovate Now," for the remaining three years of their lease. Global Solutions' original lease agreement with the building owner is the primary conveyance of a leasehold interest. The sublease agreement between Global Solutions and Innovate Now is a derivative conveyance because Innovate Now's right to occupy the space is derived from and dependent upon Global Solutions' existing lease. Global Solutions cannot grant more rights to Innovate Now than they themselves possess under their original lease.