INCIDENTS OF OWNERSHIP

1. RIGHT TO POSSESS/EXCLUDE OTHERS

2. THE RIGHT TO USE

3. THE RIGHT TO THE FRUITS AND PROFITS

4. THE RIGHT TO TRANSFER/ALIENTA

5. THE RIGHT TO DESTROY

6. THE DUTY TO PREVENT HARM

TWO CONCEPTIONS OF PROPERTY

Two conceptions of property

1. Absolute Right to Exclude (Penner/Essentialist View)

a. Property is a right to keep entire universe form something (in rem right)

b. Right to exclude gives power over other people

i. Trespass tangible, physical interference with exclusive possession and quiet enjoyment of land and other property whether or not the interference causes economic damage; its a right against the world

2. Bundle of Sticks (Grey/Skeptics View)

a. Property is a collection of rights with content that varies according to context and policy choices

Trespass to Land

Right to exclude

Jacque v. Steenberg Homes

Facts: D agreed to deliver mobile home to buyer. Easiest method of delivery was across Ps land. P refused to grant access to land. D still towed across Ps land. At trial, P awarded nominal damages of $1 (didnt actually hurt the land) and punitive damages of $100,000.

Held: Punitive damages were not excessive

Why: Harm of trespass consists of invading landowners right to exclusive use of land, NOT direct damage to land. Limiting relief to nominal damages would undermine this right, since any trespasser could infringe on land while incurring only slight penalty. Punitive damages deter trespass and encourage landowners to rely on courts rather than self help

Note: recognizes interest of landowner in right to exclude others as an essential property right.

Exceptions to right to exclude

Hinman v Pacific Air Transport

Facts: D regularly flew at altitudes of less than 100 ft over Ps land. P sued, arguing that ad coelum rule gave him right to prevent aircraft from flying above his land and that such flights were trespass

Held: Ad coelum rule does not confer unlimited right to restrict access to airspace above ones land

Why: Ad coelum was not meant to be taken literally. Interruption of ad coelum rule would result in absurd consequences because it would allow every landowner to prevent planes from flying above his land unenforceable. No actual or substantial damage will occur to Ps land.

1

Trespass/Nuisance Divide

Trespass invasions of land by large objects

Nuisance interferences with the use and enjoyment of land caused by some activity on neighboring land, like generating pollution or making excessive noise

Balance of reasonableness of two nuisances causing activities

Hendricks v. Stalnaker (balance of reasonableness of two nuisance causing activities)

Facts: Man rushed to put in a water well when he learned neighbor was seeking permit for septic tank. Balancing interests of the competing landowners

Held: Installation of water well by the landowner was not an unreasonable use of the land

Why: plaintiff failed to show well was private nuisance substantial and unreasonable interference with private enjoyment

Cavanaugh v. Corbin Copper

Facts: Residential area, P bought land and made house. D bought land started mining near P. P filed action to recover damages upon the theory that D was maintaining a nuisance which injuriously affected the health and comfort of the plaintiff and his family and the values of their property

Held:

Why: deed says that p isnt allowed to estop D from doing what theyre doing but he is allowed to complain if the particular mining ops disturb or interfere with quiet and peaceable enjoyment of his premises

Note: mining is not always a nuisance not a nuisance when it isnt in a residential area

Coase & Costs

Coase Theorem

Original allocation of property rights are irrelevant

Where transaction costs are very small (nonexistent) property owners will pay each other for certain property rights or refrain from exercising certain property rights that would interfere with others property rights

Assuming rational maximization is always the owners goal

LIMITS

Rational maximization assumption isnt true in practice (Jacque)

Could never exist in real world because it assumes low transaction costs; its unrealistic

Individuals choices may not be societys most efficient choice.

Costs

Transaction costs costs of doing business

Search and information costs anything that it takes to understand the nature of the trade or bargain the parties are going to strike

Bargaining costs any costs it takes to negotiate a deal; often legal fees

Enforcement costs any cost incurred to ensure the other party abides by the terms of the bargain

Repeated and Sustained Trespass

Hounds trespassing on land

Baker v Howard County Hunt

Facts: Hounds repeatedly run on to Ps land, bit his wife and mess with animals that he is conducting experiment on. After 5 yrs. Filed an injunction.

Held: Court determined there was no adequate remedy at law and approved the injunction

Why: damages incapable of calculation or evaluation calls for equity, threat of continued occurrences calls for equity.

Note: action at law is inadequate where D intends to persist unlawful acts

Elements for injunction

Damages inadequate

Clean hands of plaintiff

Building Encroachment

Pile v Pendrick

Facts: D hired surveyor to determine property line and built factory. Later surveyor concluded that first surveyor inaccurately placed line, so factorys foundation extended 1 inches onto Ps land

Held: D must remove intruding structure even though intrusion is slight and underground injunction shall issue upon showing of continuing trespass

Why: No individual may occupy land that he does not own. Since Ds foundation trespassed on Ps land, court must grant injunction

Good Faith (trespass) /Building encroachment

Golden Press, Inc. v. Rylands

Facts: Foundation of Ds building extended 3 inches on to Ps land

Held: Court should not issue injunction requiring removal of intruding structure, even though intrusion is slight and underground

Why: where trespass is unintentional (good faith) courts should balance nature of harm and cost of remedy to reach equitable solution

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Default Standard for Injunctive Relief in Federal Court Handout

What is a patent Intellectual property, they have attributes of personal property including the right to exclude others from making, using, offering for sale or selling the invention. Patent ownership of an idea or a way to create a thing.

Patent troll someone who owns a patent that is not using it and they just try and sue anyone who is using their patent so they can get money (problem with this prevents useful products form being brought to market, discourages innovation)

Injunctive relief v. Damages

eBay v. Mercexchange patent troll

Facts: Mercexchange owned patent sued Ebay for damages but they wanted permanent injunction

Held: SCOTUS says district court got it wrong in denying injunction, fed ct reverse trial courts ban on injunction but that was wrong because they assumed if you violate patent act an injunction is issued

Why: Established 4 factor test.

Injunction v. Damages

Four factor test to be weight for injunction over damages (Established by ebay) plaintiff seeking PERMANENT INJUNCITON must demonstrate that

1. it has suffered an irreparable injury

2. that remedies available at law, such as monetary damages are inadequate to compensate for that injury

3. the considering the balance of hardships between the plaintiff and defendant, a remedy in equity is warranted

4. that the public interest would not be disserved by a permanent injunction

Modes of acquisition, original acquisition principles

Producers Lumber & Supply Co. v. Olney Building Co. (Mistaken Improver/self help)

Facts: P bought land form D. D forgot sold land and built house on land under mistaken belief that it was still their land. D demolished the house, P sued D for value of house

Held: One who mistakenly builds and then demolishes such a house should be held liable.

Why: When you take the law into your own hands, equity is not on your side. You must not enter with unclean hands. Under normal circumstances, a court will grant equitable relief by allowing builder to remove building if such removal can be carried out without damage to the land or the building.

Olwell v. Nye & Nilsen Co.

ORIGINAL ACQUISITION

Principles of acquisition

First possession (capture)

Based on being the first to possess an unclaimed thing

Discovery

Based on being the first to discover some thing and hence having a unique claim to possess it

Creation

Involves being the first to possess some new or novel thing

Accession

Many of its applications appear to involve the perception that one things bears such a prominent relationship to another thing that possession of one thing is also possession of the other thing

Adverse possession

Based on someone possessing a thing for such a long period of time that the rights of the original owner are extinguished

Actual entry yielding

Exclusive, continuous possession that is

Open, notorious AND

Adverse under a claim of right

For the statutory period

Sequential possession

Suggests that prior possession is privilege in the law

Competing acquisition

Can be read as turning on which of two rival claims of possession the court finds more compelling in any given context

Condemnation

FIRST POSSESSION

First possession essentially the regulation of a competitive process of acquiring unowned resources. Requires that one be first ACTUALLY TO POSSESS an unclaimed thing

Wild Animals

Pierson v. Post

Facts: P in pursuit of fox on uninhabited land. D killed fox and carried it off.

Held: Purist of wild animal does NOT give rise to possession over animal

Why: Early authority stated that one does not possess animal until physically captured. Later authority stated that one does no possess animal until mortally wounded/physically trapped. Neither authority suggests that mere pursuit of animal establishes possession. Overturning the rule would allow any person who saw animal to claim possession. Since D reduced fox to ownership by killing it, he has title.

RULE: Capture = possession= title

Note: Mere pursuit is not possession. However, mortally wounding creates vested right and can be divested by another who intervenes and kills

Ghen v. Rich

Facts: P killed whale. Whale sinks so P could not gain possession. According to industry custom, finder of whale would report location to whaling company for salvage fee. Man found whale killed by P and sold it at auction where D purchased it.

Held: Wild animal that is marked property of particular individual even if 3rd party found and sold it whale belongs to P

Why: If they ruled for D it would change the whaling industry.

Reconciling Pierson and Ghen you have to do all that is possible within the norms of whatever you are doingwhoever kills the animal is the owner

Keeble v. Hickeringill

Facts: P owned decoy duck pond to catch ducks. D intentionally fired guns near pond to scare ducks.

Held: P may recover damages for disturbing his use of decoy pondno tortious interference.

Why: Owner of land may use land for any purpose he desires. P chose to profit form land by catching ducks using decoy pond. D cannot intentionally hinder Ps use of land. Damages should compensate P for disturbance, not loss of property, since P cannot prove how many ducks he would have caught if D had not interfered.

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Abandoned Property

is a sunken ship a commons?

No. it is a thing that someone builds and owned and then it sunk. Abandoned property is property without an owner.

Eads v. Brazelton

Facts: D trying to salvage boat that was on bottom of river, set up buoy and blazed trees, he left to go to another wreck, P came and salvaged ship

Held: P can keep the salvage ship

Why: One must have the salvage vessel over the site of the wreck before one can be said to be in possession of the wreck, Ds behavior didnt reflect desire to salvage ship.

Note: occupation of abandoned property must depend on actual taking of property with intent to reduce it to possession

Home run baseball example when ball is hit out of park, when it leaves the park it is abandoned property and up for grabs

COMMONS

Commons open access to resources where entry is free and users have no right to exclude

Tragedy of commons degradation of the environment to be expected whenever many individuals use a scarce resource in common (EX. GLOBAL WARMING)

SOLUTIONS:

Leviathanrecommendations that central government controls most natural resources

Privatization/propertization public resource that is helping a lot of people and only allow few to control it, we can portion it out/divide it amongst people (uneven distribution of resources within a commonscant figure out where an equitable allocation would be)

Anti-commons where all or too many of the users of the commons have a right to exclude; then, nobody is able to sue the resource

Tragedy of anti-commons too many individual rights will lead to inefficient utilization

Semi-commonswhen a right is subject to private exclusion for some users, but is freely open to all other uses

Commons, Anticommons and Semi Commons

Commons v. Anticommons

Difference is where right to exclude is placed

Underlying dynamic that creates tragedy of anticommons is similar to that which creates tragedy of commons

For each tragedy, individual has incentive to act in way that imposes costs on others, either by exercising right to access (to commons) or right exclude others (from anticommons)

For each tragedy, overcoming problem requires some kind of realignment of rights, which requires dealing with holdouts and free riders

EXAMPLE: each store has 4 diff. owners who have fractional shares of each store, entrepreneur has to get the agreement of each of the 4 owners hold out problem.

patent on gene fragments people were concerned that they would have to get a bunch of things but that was not the case, solution to problem of fragmented rights include licensing, inventing around, infringing, public disclosure and litigation

first possession from commons standpoint

is a sunken ship a commons?

No. it is a thing that someone build and owned and then it sunk. Abandoned property is property without an owner.

Eads v. Brazelton

Facts: D trying to salvage boat that was on bottom of river, set up buoy and blazed trees, he left to go to another wreck, P came and salvaged ship

Held: P can keep the salvage ship

Why: One must have the salvage vessel over the site of the wreck before one can be said to be in possession of the wreck, Ds behavior didnt reflect desire to salvage ship.

Note: occupation of abandoned property must depend on actual taking of property with intent to reduce it to possession

Home run baseball example when ball is hit out of park, when it leaves the park it is abandoned property and up for grabs

DISCOVERY

Establishes a unique right to possess a thing

Johnson v. MIntosh (two conflicting titles)

Facts: P inherited land that he originally purchased from Native Americans. D claimed he owned land because he purchased it from the U.S.

Held: P has no right to land

Why: Should not recognize land titled obtained form Native Americans prior to American indepdence. Instead, native Americans should be regarded as occupiers of land, no owners with right to sell. Ownership of land comes into existence only by discovery. US is true owner of land because inherited ownership from Britain (original discoverer)

Note: court framed issue narrowly no one can transfer that which one does not own. The native use and occupancy of the land did not count as possession in the western sense. Leads back to idea of root of title which is grantor. First transferee from common grantor is deemed to have better claim to title

Criticism: denies natural law and supposes that Native Americans conception of property was fundamentally incorrect however, Native Americans did not view property as commercial like Europeans

Creation: News as Property 130-43

CREATION

Misappropriation and the Quasi- property right in hot news

Hot News

News is a non-rival good its consumption by one party does not impact its ability to others

Gathering of news is never free (requires costly labor to some extent)

Affixing legal liability to the misappropriation of news will be a costly legal process that entails carefully delineating the entitlement

International News Service v. Associated Press

Facts: P gathered and sold news. Members prohibited form disclosing news to non-members. D was competing organization. D engaged in unauthorized distribution of news gathered by P by bribing employees, persuading P to disclose news, and gleaning Ps news from public bulletins and transmitting it to D for publication.

Held: One cannot hold property right over news itself right to publish news generally prohibits competing news organizations from profiting from that news.

Why: D engaged in unfair competition (misappropriation.) While P did not have monopoly right in news itself, it has quasi property right against competitors as long as news remained hot to prevail on claim of misappropriation

(1) P made substantial investment of time, effort, and money in creating thing that was misappropriated such that court can characterize that thing as kind of property right;

(2) D appropriated thing at little or NO cost such that court can characterize Ds actions as reaping where it has not sown

(3) Ds acts have injured P

Note: News is not your property it is common property that you have attempted to reserve. Policy justification, dont we want to

In rem right a right to a thing as against everyone

In personam limiting to a specific business as against ones competitor this is how we know the news is not property

NBA v. Motorola

Facts: NBA suing Motorola for going to basketball games and then paging out information, sports stats etc. sues alleging AP v. INS unfair business competition.

Held:

Why:

The quasi property right in Hot News a right against ones competitor who may be enjoined against using the news one gathers to the competitors commercial advantage in competition with the news-gatherers profitability

Five elements are necessary (plaintiff has to prove)

Plaintiff generates or gathers information AT COST

Information is time sensitive

A defendants use of the information constitutes free riding on the plaintiffs efforts

The defendant is in direct competition with a product or service

The ability of other parties to free ride on the efforts of the plaintiff or others would so reduce the incentive to produce the product or service that its existence or quality would be substantially threatened

Property in Ones Publicity 143-49

Right of Publicity

Copyright act secures the exclusive right for up to 70 years after the death of the author to all (1) expressions (2) original works (3) upon their fixation in any (4) tangible medium (some exceptions apply)

Midler v. Ford Motor Company

Facts: D wanted to hire P to sing in commercial but she decline. D, had license to use intended song itself, hired diff. singer to imitate Ps vice. Result was nearly indistinguishable from Ps voice. Commercial made NO explicit references to P, only voice was similar

Held: Singer may recover from party that uses voice similar to hers without permission

Why: Voice, just like face, is identifying feature protected by law. When distinctive voice of professional singer is imitated to sell product , sellers have appropriated what is NOT theirs and have committed tort

Note: Copyright law offers no protection against imitations of a particular singers rendition of song, so P cannot claim that D used identity improperly since commercial did not use name, voice, signature or other identifying features

Creation Intellectual Propertys Statutory Structure 149061

Novelty (149)

Trenton Industries v. A.E. Peterson Manufacturing Co.

Facts: P developed highchair. D examined chair with intention to potentially do business with P. D decided to return chair and do business with X who used same swiveling/collapsing attribute as Ps chair. P alleges that D infringed on patent and was unjustly enriched

Held: Breach of confidence Trenton entitled to royalties. Patent was not valid

Why: Patent was not valid because it was not an inventive item that the patent act would want to reward with a patent, it was just putting together past invention. HOWEVER, D was unjustly enriched by using plaintiffs idea that it disclosed to D in hopes of reaching a license agreement.

Nonobviousness requirement of the patent act

Patent may not be obtained if the differences between the subject matter sought to be patented and the prior are such that the subject matter as a whole would have been obvious at the time the invention was made to a person having ordinary skill in the art to which said subject matter pertains.

PRINCIPLE OF ACCESSION

The Principle of Accession Origins 161-71

Accession: using ownership of one thing to establish ownership of yet another thing. body of property rules that give rise to acquisition of new property that is intimately connected with the property the owner already posses

1. Increase

a. new born animals.

2. Accretion

a. the person whos land ownership grows from river movement is entitled to that growth

3. Commingled goods

4. Fixtures

a. Strain v. Green handout (fixtures in a house what do you get to keep?)

b. A fixture is defined as a thing which, although originally a movable chattel, is by reason of its annexation to, or association in use with land, regarded as part of the land

5. Ad coelum

Increase

Carruth v. Easterling

Facts: Ds cattle wandered on to Ps farm. R claimed D promised two cows for bringing cows back. One of cows had calf while on Ps land

Held: D gets the cow.

Why: Increase for tame, domesticated animals, offspring goes to the owner of the mother )except I cases where both the parents are well known, like a prize winning sire then things change)

Fixtures

Strain v. Green

Facts: P purchased house form D house had water heater, chandelier, blinds, mirrors. When P moved in, all fixtures were removed and replaced with inferior substitutes

Held: Items motioned above are fixtures and must remain with property

Why: When something becomes attached to property so that presumption is that intention was enrich property, it is a fixture. Ds replacement of original fixtures with inferior substitutes suggests his recognition that a house lacking them would be incomplete.

Doctrine of Accession

Doctrine of Accession when a person mistakenly takes (in good faith) up a physical object belonging to someone else and transforms it through substantial labor into a fundamentally different object CANNOT BE TRESPASS

Wetherbee v. Green

Facts: P thought he had permission to cut down trees belonging to D. P cuts down tress and makes them into barrel hoops. Tress work 25 dollars, Hoops worth $800

Held: D entitled to recover cost of timber, but not the cost of the hoops. (TROVER not REPLEVIN)

Why: Court relied on the increase in value of the material in holding that P could not seek replevin for the hoops.

Rule: one whose property has ben appropriated by another without authority has a right to follow it and recover possession; if, in the mean time, it has been increased in value by labor or money, the owner can still reclaim it as long as there is no substantial destruction of identity

Three Factors in Determining:

1. Mental state of appropriator D acted in good faith, did not know trespassing when cut down tree.

2. Destruction of substantial identity completely changed the character of the original property

3. Increase in value of converters label to give the P the hoops would be unfair because the diff. in value of original product and hoop is significant.

Common law actions to recover personal property

Replevin: common law action for the return of property wrongfully converted by a defendant to his or her own userecovery of chattel itself; even in altered state

Trover common law action in which an owner seeks money damages for property converted by a defendant to his or her own use recovery of the value of the chattel as it was to the original owner

Doctrines of Accession Ad Coelum 171-179

Ad Coelum Rule for whoever owns the soil it is theirs up to heaven and down to hell

Cave Cases

Edwards v. Sims (Lee owned other property, Sims order survey)

Facts: Edwards discovered cave entrance on his land and turn it into a profitable tourist attraction. Part of the cave was under Lees land. Pursuant to ad coelum Lee demanded a portion of the profits for the Edwards use of Lees property. Issue is is there a right to have a survey

Held: Yes, there is a right to have a survey

Why: Literally interpreted ad coelum to mean it included the land under

Reconcile Hinman and Edwards Hinman was a policy argument, to protect the airlines. Also you cannot develop the air but you can develop land

Chance v. BP Chemicals Inc

Facts

Held: Deep well injection of hazardous waste = no trespass

Why:

ADVERSE POSSESSION

190-208

Adverse possession:

If I have been in possession of the property long enough them it is mine.

When knowledge of lack of title is accompanied by knowledge of no basis for claiming an interest in the property good faith claim DOES NOT EXIST good faith claim of right cannot be established

Good faith makes it really difficult to bring a claim of adverse possession

Claim of rights in adverse possession

an entry by one man on the land of another, is an ouster of the legal possession arising from the title, or not, according to the intention with which it is done; if made under claim and color of right, it is an ouster otherwise it is a mere trespass in legal language and intention guides the entry and fixes its character

Detroit squatter example,

Elements of Adverse Possession

1. Actual entry yielding

2. Exclusive possession that is

3. Open, notorious and

4. Adverse under a claim of right

a. Means that the adverse possess subjectively but mistakenly believe he is legally entitled to the possession of the property, the AP is acting in good faith

b. The adverse possessor subjectively believes he is not legally entitled to possession of the property is acting in BAD faith

5. Intent to possess something as ones own

6. For the statutory period

Simple possession possession of a chattel, even without claim of title, gives the possessor a superior rights to the chattel against everyone but the true owner. The possessor has a special property interest in the chattel that only the chattels owner, or someone claiming under her, can dispute.

Cave Cases

Marengo Cave Co. v. Ross

Facts: D owned/operated cave tour. P and D originally though entire cave was on Ds land. After 40 years of Ds use, P discovered that portion of cave was actually below his land.

Held: D is not adverse possessor because possession was not OPEN ad NOTORIOUS

Why: Requirement that possession be open and notorious satisfied only where owner has actual or constructive notice of possession. On lands surface, satisfied by ownership claims and open and continuous use. On subsurface lands owner hired expert to determine if trespass is taking place. Owner must actually be aware of trespass secret trespass will not start statute running. Actual knowledge of caves existence is not knowledge it is part of property.

Purposes of adverse possession

Adverse possession against the government

Carpenter v. Ruperto

Facts: P purchased adjoining agricultural land. When P first moved in, corn extended to her property line. Following year, corn did not extend to property land, cleared unused area, planted grass, installed propane take, put in driveway. Knew that property did not belong to them because they looked at map of lots

Held: Person who knowingly makes use of adjoining property cannot claim adverse possession even after 30 years of use.

Why: In IA, party seeking to establish adverse possession must act in good faith. Courts have consistently ruled that squatters and other individuals who knowingly occupy land owned by another are not acting in good faith. P cannot claim adverse possession

Note: good faith v. bad faith. P was acting in bad faith. SEMI GOOD FAITH is not enough to begin using ds property as an extension of ps yard for a period of 30 years.

NOTE: One claiming title by adverse possession must establish hostile, actual, open, continuous and exclusive possession under a claim of right or color of title for at least 10 years by clear and positive proof.

Color of title: written instrument or other evidence that appears to establish title but does not in fact do so. Thus, if its not a claim of right, one must have permission form the owner

States differ in adverse possession Doctrinal approaches to the element of adverse and under a claim of right

1. adverse possession required state of mind is I thought I owned it

a. the person is acting in good faith plaintiff should also carry the burden of some factual circumstances that would indicate that the person actually acted in good faith

b. claim in equity (if youre seeking a remedy) you have to come in with clean hands

2. adverse possessor required state of mind is I thought I didnt own it but I intended to make it mine

3. Adverse possessors state of mind is irrelevant (majority)

Requirement of good faith is minority view, most courts hold that lack of permission from owner is sufficient regardless of the subjective state of mind of the adverse possessor. PLUS the claim of right requirement requires that a person have a REASONABLE BASIS to believe they had a right to the land.

THE LAW OF FINDS

Law of finds

The acquisition of property through possession of lost or abandoned objects

Simple possession

Physical control with intention to assume dominion, giving finder title of ownership of lost property AGAINST ALL BUT THE TRUE OWNER

***if property was abandoned by original owner, then finder has sole right of ownership

Finder of property has title of ownership against the owner of the land where its found EXCEPT:

When the landowner is the TRUE OWNER and not just the owner of the land

If the finder is a servant or agent of the landowner, he

Lost unintentionally parted with item (fell out of pocket) ; finder gets to keep it (usually)

Hannah v. Peel ( accession v first possession)

Facts: D owned mansion used by military during war but he never actually occupied the property while stationed there, p found a broach on a windowsill of which D claimed to be unaware. Dispute over who owned the broach;

Held: P was entitled to the broach

Why: Since p didnt quality as one of the 3 exceptions (servant, trespass, true owner) p was entitled to ownership unless claimed by the true owner (who wasnt D)

General rule Title is in the finder, Hannah is the finder, title is in Hannah

Note:

Analyze:

1. Possession of the land

2. Status and knowledge of the property

3. Circumstances of discovery

Armony V. Delamire

Fact: P found jewel and took it to D to be identified. D offered P $ for jewel but P refused. D gave P back socket but it did not contain jewel.

Held: P can recover Jewel

Why: Although finder of the jewel does not acquire absolute ownership, his rights are superior to everyone except the original owner.

Rule: A finder of chattel has title superior to all but the rightful owner upon which he may maintain an action at law or in equity.

Mislaid intentionally place somewhere but forgotten (left on bar)

McCavoy v. Medina

Pocketbook left at barbershop; shop owner kept it. More likely for item to be found by true owner in a place where he mislaid it; real property owner, thus, should keep the item.

Found

Bridges v. Hayworth

Found wallet on the floor inside the store, went to finder because it was lost property

South Staffordshire Water v. Sherman

Ring at bottom of pool real property owner has superior rights against non-owner who finds it (employee/employer) Possession of land includes things attached to or under the land, in the absence of better title

Elwes v. Briggs Gas Co.

Boat found embedded in soil went to landlord even in a 99 year lease. Where original owner is not ascertained, real property owner who finds things on his property has superior rights against all others (if it is abandoned)

Exceptions to the law of finds

Finder has to be there legally cannot be a trespasser cannot be a thief

A servant or agent finds something not for himself but for his employer (servant/agent = no title)

If the property owner is in possession of the property and the thing that is found, the finder does not get anything. (if the thing is attached to the propertymeteorite that landed naturally become property of the landowner)

RESOURCES OTHER THAN LAND THAT ARE OWNED

The Human Body 242-57

Values Subject to Ownership

HUMAN BODY

Moore v. Regents of the University of California

Facts: P consented to surgery to remove spleen, unknown to P surgeon used cells from spleen in medical research. Cells valuable because produced substance that was scared in normal cells. Ps surgeon granted patent on cell line and received substantial proceeds from licensing of cells. P sued upon discovering uses to which cells have been put

Held: P does not have property right over removed tissues BUT failure to notify P of uses of excised tissue constitutes failure to obtain informed consent

Why: Surgeon should disclose any intended uses of patients excised tissues since this might influence decision-making with regard to course of treatment. Patient, however, does not have property interest in excised cells. P cannot contend that taking of cells violates privacy rights over identity, since particular substance is structurally identical in all spleen cells. Liability for conversation should not be extended to cover these cases upholding liability would impose burden on scientists who would have to obtain permission from originator in use every cell line.

Conversion taking someone elses property and converting it to your own use

To establish conversion P must establish actual interference with his ownership right of possession

Policy issue, conversion is a strict liability tort

Hecht v. Superior Court ( sperm cannot be disposed of in the probate proceeding unless it is considered property)

Facts: Man leaves sperm for his girlfriend to impregnate herself, as state in will, then kills himself. Mans adult children sought injunction to prevent gf from obtaining sperm

Held: Mans frozen sperm cells are subject to control of probate court (sperm not destroyed)

Why: sperm is unique in its potential to create life, so it occupies category in property law. Man had interest in sperm insofar as he could decide whether to procreate using sperm. Decedents children have no provided legal or factual basis for argument that future children conceived by sperm would infringe on family integrity or burden society

Note: Distinguished from Moore on ground that sperm cells can be used for human reproduction which persons have particularly strong interest in

Water 324-38

Watercourses

Evans v. Merriweather

Facts: Ds mill was upstream from Ps. Drought reduced water supply so that it only supplied Ps mill. D constructed dam across stream to divert entire flow into his mill. Resulting reduction of water supply to Ps mill impaired its operation

Held: Owner of downstream mill may recover against owner of upstream mill who diverts stream in such way as to impair downstream owners ability to use water

Why: Natural wants are needs essential to life, such as use of water for drinking. Artificial wants are those that improve comfort or facilitate industry. Landowner may make use of water to any extent necessary to sustain natural wants and must leave rest for natural wants of person downstream

Note: Court adopted reasonable use doctrine to favor natural over artificial use. The water flows in its natural channel and out always be permitted to run through whose land it pursues its natural course.

Where all have a right to participate in a common benefit, and none can have an exclusive enjoyment, no rule, from the very nature of the case, can be laid down, as to how much each may use without infringing upon the rights of others

Each riparian is bound to make such as use of running water as to do as little injury to those below him as is consistent with a valuable benefit to himself; do as little injury as possible to those below

Appurtenant right means connected; goes with; cant sever a water right from a riparian estate bordering water

Ground water typically follows riparian usage; not first possession

Prior appropriation first in time, first in right to use of water; analogous to first possession doctrine regardless of whose land its on, the first to make use or take possession of the resource has the right of ownership; water user doesnt have to own land adjacent to water to use it

No superiority place on the type of usage but must be BENEFICIAL USE at time of diversion; only limitation is that the water must be used in a beneficial way

Earlier appropriator cannot expand his use if it will detrimentally affect later appropriators; if you want to increase your water usage, you must look at how other people use the same water

Coffin v. Left Hand Ditch Company

Facts: P had riparian property on a stream that D diverted by canal to irrigate ds property outside the streams watershedthis left no water for P so P broke down Ds dam

Held: Court should recognize priority of appropriation instead of ownership of riparian land, as basis for water rights

Why: Arid climate of west necessitates artificial irrigation to sustain agricultural land. Scarcity of water and its economic importance support rule that one who first appropriates water has superior title. Abolishing this rule would have disastrous results on settlement of region and would interfere with existing agriculture

Priority of appropriation: if the running water is appropriated through diversion, it becomes a vested right entitled to protectinvestment in the land (conversion), cannot divert if new detriment would be caused ex. X has diverted water and Y moves down stream after x diverts water OKAY.

Water rights as property = reasonable use. Pure tort system, use it until you harm someone else. You do have a duty to prevent your property from harming others.

As long as it is subject to beneficial use it is allowedbeneficial uses

Domestic use

Municipal use

Irrigation

Stock watering (usually no limit on number)

Power mills and factors

Soil retention

Airwaves & Cyberspace 346-60

Broadcasting and Cyberspace

Radio Signal

Sending broadcast signals across someones land is not violation of landowners property rights under ad coelom doctrine

Instead, spectrum is regarded as resource itself and has been object of either private property rights or administrative regulation

Increasing potential for interference between rival broadcasters led dept. of commerce to impose restrictions on radio broadcast licenses

Right to airwaves were bought and sold as part of package of rights associated with ownership of particular radio stations

Tribune Co. v. Oak Leaves Broadcasting Station, Inc.

Facts: P was broadcasting radio program to Chicago. 1 year later, D began broadcasting close to Ps frequency, resulting in interference between stations. P sued to enjoin D from causing interference

Held: D should be enjoined from interfering with Ps broadcast

Why: Priority of time creates superiority of right. P had been broadcasting longer and had expended resources in promoting its broadcasts. P had great deal to lose from interference. D had little to lose form changing to new frequency because it was new.

The Internet as a semi-commons

Copyright and Copyleft hand out

LIMITS ON THE RIGHT TO EXCLUDE

Criminal law or a civil action 361074

Owner Sovereignty and Its Limits

a. Protecting the right to exclude

a. Criminal Laws

Criminal Laws Protecting Person Property

i. Criminal Laws protecting personal property

Right to Exclude

Decisions about resources are delegated to owner who acts as manager/gatekeeper of resource

Law allows owner of resource to repel any and all intrusions that do not have owners consent

Exclusion likely to be favored where particular resources (i.e. land) have multiple potential uses and when we think it is desirable to give owners discretion to chose which use is most valuable

People v. olivo

Facts: Security guard observed P putting set of wrenches in his cloths. P began walking toward exit, passing cash registers, security guard confronted him

Held: Larceny can be complete even before shoplifter leaves store.

Why: Store owners only consent to customers possession of goods for LIMITED PURPOSE requisite taking of property is evidence by customers exercise of control over goods inconsistent with owners continued rights

Gasparik

Spatzier 367

Factors page 366

Civil Actions and Self Help 374 -399

Cyberspace

Intel Corporation v. Hamidi

Facts: D formed organization to disseminate info and views critical of Ps employment and personnel policiesD sent out mass email criticizing p to ps employees. P requested that e-mails stop but D continued. P sued D for trespass to chattel (trespass to personal property)

Held: Trespass to chattel does not encompass electronic communication that neither damages recipients computer system nor impairs functioning

Why: Electronic communication does not constitute actionable trespass to personal property because it does no interfere with possessors use of, possession OR protected interest in property itself. Consequential damages (loss of productivity) is NOT injury to companys interest in computers. To prevail, P must show injury to computer system (i.e. spam overloads system)

Note: Intruders cannot complain if owner takes defensive measures such as installing filters to keep emails out owner has a legally recognized right to exclude but no legal remedy to enforce that right. (self help)

Analysis

Trover?

No because he didnt take personal property

Replevin?

No because this is to recover propertyhe didnt take any property

Nuisance?

No because this only includes quiet reference to the enjoyment of REAL property

Trespass to chattel allows recovery for interferences with possession of personal property not sufficiently important to be classed as conversion and so to compel the defendant to pay the full value of the thing with which he interference

Only option they have because they want an injunction

Court says this isnt correct cuz actual property wasnt injured.

SELF HELP

Self help: taking an action in person or by representative outside the normal legal process with legal consequences, whether the action is legal or not.

Landlord Tenant Dispute

Berg v. Wiley

Facts: Lease agreed upon required permission from the landlord in order for the tenant to make any structural changes to the building, giving the landlord the right to retake possession of the premises if the lease was violated. Landlord sought to evict tenant by changing locks with police officer present

Held: Court rejected use of self help as an acceptable means of evictionrequired landlord to go through judicial proceedings, said that only reason it wasnt violent was because tenant wasnt present at lock changing

Why: when there are other methods available to achieve the same goal, one must not use self help.

Note: Overruled common law rule that landlord could use self help to retake premises landlord is not entitled to self help repossession no matter how perfect their title (goes against UCC Ar. 9-503)

Williams v. Ford Motor Credit Company

Facts: D repossessed Ps car after car went into default.

Held: D was allowed to repossess car as long as it was peaceably

Why: Unless otherwise agreed, a secured party has, on default, the right to take possession of the collateral. In taking possession a secured party may proceed without judicial process if it can be done without breaching the peace

Limits On Right to Exclude

DEFENSES

Necessity Defense to show that a trespass was required by the trespasser in order to protect human life or personal property when exigent circumstances beyond the trespassers control warrant the tress pass

Burden of proof is on the trespasser to show necessity; if not exigent, a party must first try to obtain consent from the owner

Custom a wide spread and prevailing custom may allow persons to enter upon private lands which would normally be deemed a trespass

Public Accommodation Laws more qualified right to exclude they are subject to a general duty of nondiscrimination against customers

Public Policy

Necessity

Ploof v. Putnam

Facts: Ds were in boat on lake when violent storm force them to anchor on Ps lakeside dock without permission.

Held: D allowed to dock on Ps lakeside

Why: Necessity is a defense to trespass especially when human life is at risk

Custom

McConico v. Singleton

Facts: P sued D for hunting on Ps unenclosed/unimproved land

Held: Hunting on unenclosed landed does not constitute trespass

Why: hunting on unenclosed/unimproved lands in custom and recognized as ok by legislature. Trespass requires injury passing through is not injurious. Hunting has high social utility (provides food), so right to exclude on private lands is considered less socially significant.

*** Majority still allows open access to hunters on unenclosed lands unless owners post No trespassing signs along the property

*** Modern trend moving away from allowing custom as a defense to trespass unless theres a special purpose for the trespass

Public Accommodation Laws/ Public Policy

State v. Shack

Facts: P worked with migrant workers. D wanted to speak with migrant workers. P only allowed limited passage on his property, but D did not agree to limited passage. D did not leave property and was fined.

Held: Ownership of real property does not include right to bar access to government services available to migrant workers

Why: P lost right to exclude when he allowed others (migrant workers) on property

Rule: If a stranger breaks the close of an owners property, then the owner can have the stranger ejected provided the owners interest in protecting his own autonomy is strong enough and the interest of other persons in abrogating the owners rights to exclude are not more important to society

Uston v. Resorts International Hotel (card counting)

Facts: P counted cards to win at blackjack. Because of ability to increase changes of winning, D excluded P from its casino

Held: Owner of property open to public does not have right to unreasonably exclude particular members of public

Why: Since P did not go to casino to disrupt activities and was not security risk, D had no legitimate interest in excluding him from place to which public was invited. Right to exclude is limited by competing right of reasonable access to public spaces.

Note: Modern rule disregards right of reasonable access to public spacesgrants absolute right to amusement places to exclude any person consistent with state and federal civil right laws

*** Common light right to exclude is limited by competing common law right for reasonable access to public places common law of amusements duty to serve

Constitutional protection

Shelley v. Kraemer

Facts: Covenant sought to keep a neighborhoods owners as whites only; by seeking to avail themselves of the judicial process to enforce the private covenant against D, the white owners had brought the power of the state (cts) to discriminate on race, triggering the 14a

Held: The courts could not enforce the racist covenants. Court ordered equitable remedy.

Why: 14th Amendment prohibits state action to enforce racist things, covenant couldnt be enforced.

Notes: Restrictive agreements, standing alone, cant be regarded as a violation of any rights guaranteed by the 14th amendment HOWEVER to enforce the covenants, the state would need to interfere and because the 14th amendment prohibits state action to enforce racist things, covenant couldnt be enforced

Civil Rights Act of 1964 Tile II: persons are entitled to full and equal enjoyment of places of public accommodation without discrimination and segregation on the grounds of race, color, religion or national origin; includes hotels, restaurants, places of entertainment, etc.

Fair Housing Acts, 42 U.S.C 3601-19: Prohibits discrimination in house rental, sale, publication, terms and conditions on the basis of race, color, religion, sex, familial status or national origin ***doesnt include age

Exceptions:

Single family homes rented or sold by the owner, as long as the owner doesnt possess 3 or more of those houses

Individual, single family apartment units

Religious organizations or private clubs as long as the rental or sale is not for commercial purposes

RACIALLY RESTRICTIVE COVENANTS ARE UNENFORCABLE

Use of trespass actions to exclude persons based on race

Fair housing act 435

Licenses 449064

Other powers of the Sovereign Owner

Licenses REAL PROPERTY, power to give permission to someone else to gain access to or entry to real property; licenses arent interests in the land, but merely privileges between persons, inherently revocable by the grantor; IF EVOKED, grantor may be liable for breach of contract but still revocable; atomically revoked at death of licensor or at attempt to alienate the license to another by the licensee

INHERENTLY revocable UNLES he has a grant

License

Wood v. Leadbitter

Facts: P had ticket to horse race, P is asked to leave without reason. P doesnt leave but they make him without force.

Held: Race track allowed to ask P to leave

Why: License IS NOT title to property

Note: You are getting permission to be on property for a specific purpose you are there with the owners permission

License with a grant good for the amount of time that it takes for the license to make good on the grant, not inherently revocable, AN EASEMENT,

Equitable enforcement of Licenses

ProCD v. Zeidenberg

Facts: P bought commercial software that D bought and turned around to sell for profit at price lower than P did, in violation of softwares license agreement

Held: Shrink wrap licenses are enforceable unless their terms are objectionable on general contract grounds one cannot agree to hidden terms, but one can agree to be subject to a license when purchasing software

Why: Copyright Act preempts only those limitations established by law.

EXCEPTIONS:

Estoppel if a licensee invests substantial money and labor in reasonable reliance upon the license continuation, then It can become an easement in estoppel which will bar the licensor form freely revoking the license.

Bailment PERSONAL PROPERTY power to transfer temporary custody or possession of personal property to a third party who would then be responsible for the absolute care and custody of the property

Elements of bailment

Intent to establish a bailment relationship

Bailors delivery of the property to bailee;

Bailees acceptance** of the property

* bailee must obtain possession of property and possession has two elements: exercise of physical control and intent to exercise physical control

** Bailors NOW beware: Common law rules of bailment are often displaced/rearrange by statute

bailees may have superior title to 3rd parties.

Example: innkeeper statuteallows innkeepers/common carriers to limit liability for lose, damages, or destroyed property to a specified amount

Gifting the power to donatively transfer title to property

an inter vivos gift requires (gift given during life)

donative intent

delivery

acceptance

a gift causa mortis requires

donative intent

delivery

acceptances AND is revocable at any time prior to death

a testamentary gift requires a valid will

_________________________________________________________________________________________________________

Abandonment & Destruction 485 -499

Abandonment and destruction

Abandonment of property owner must relinquish all right, title, claim and possession with the intention of terminating her ownership, BUT without vesting it in any other person AND with the intention of not reclaiming further possession or resuming ownership, possession or enjoyment

When you abandon property you are not vesting property in some third party, you are relinquishing title you are not vesting title in a 3rd partynot giving it to someone.

*** no abandonment of REAL PROPERTY because you still have perfect title because you have the deed and record of the land

Pocono Springs Civic Association v. MacKenzie

Facts: D had a negative value asset in land which D attempted to abandon by deserting it

Held: Cannot abandon land.

Why: For land, there is always a presumption of possession that there will be an owner of record, making it almost impossible to abandon real property

Note: CANNOT abandon real property UNLESS owner is able to completely relinquish perfect title to the land (almost impossible) COULD be possible to extend to titled items like cars, boats etc

Personal property common law normally allows for abandonment of personal property; the TRUE owner must manifest the INTENT to relinquish title to personal property and actually relinquish possession

Destruction normally an owner will have the right to destroy property they own BUT may be weighed against the public good of destruction on case-by-case basis

Eyerman v. Mercantile Trust Co.

Facts: in her will P requested that her house be razed to the ground upon her death; value of lot would be decreased by destruction of house and would substantially affect neighbors property values

Held: House cannot be destroyed

Why: Public policy reasons for keeping senseless destruction of house from occurring to outweigh owners right to destroy her own property after death

Rule allowing an executor of a will to raze a home is against public policy and wont be allowed when public policy concerns outweigh interest of decedents

***exception to general rule usually courts uphold decedents wishes

property owner can normally do what they want with property but a difference exists when between an executor of a will and a present property owner; had she been alive, there may have been a different result

public policy senseless destruction served no apparent good and was injurious to the interest of the estate and to property surrounding it.

_________________________________________________________________________________________________________

THE FORMS OF OWNERSHIP THE ESTATES IN LAND AND BEYOND

DIVISIONS BY TIME: THE estates and Future interests 500-517

THE FORMS OF OWNERSHIP

Divisions by Time pieces created must conform to a menu of possibilities called estates in land

Estates in Land type of property right and measure of a persons interest in the land in terms of duration freehold interests include the undivided fee simple and two types of lesser property rights that leave room for future intereststhe life estate and the defeasible fees

Interest

Present possession interest

Future interest

Present Possessory Estates

Fee Simple Absolute

Largest package of ownership rights

Indefinite in time, not natural end

If owner dies without will state statute will designate certain others who will then take the property in fee simple

Grantor is presumed to give all that she has, unless she indicates otherwise

***** courts interpret language against the grantor; if language isnt clear, it will be interpreted as a fee simple absolute by default

Life Estate

Holds natural end with death of named person, usually the holder of the estate

Alienable by gift or sale

Defeasible Fees inferior because they come with strings attached

Interests are like the fee simple absolute EXCEPT that they may end on the happening of a named contingency leaves room for future interest to become possessory when such a contingency occurs

Fee Simple Determinable ends automatically upon the occurrence of a named event, whereupon the grantor and the grantors successor takes the property

to Springfield Law School as long as it is used for instruction in the law, then to O

language of duration as long as, so long as, while, during, until LIMITATION rather than a condition

Fee simple subject to condition subsequent continues indefinitely except that, upon happening of the named event, the condition, the interest does not automatically end BUT CAN BE ENDED by action (self-help or lawsuit) by the grantor or the grantors successor

to springfield law school, BUT if it is not used for instruction in the law, then O has the right to reenter and take the premises

Fee simple subject to executory limitation potentially infinite; if x happens then ownership automatically transfers to third party, alienable devisable, descentable, third party has contingent executory interest

Future interests

Retained by grantors

Reversion

Possibility of reverter

Right of entry (power of termination)

Interests created in Grantee

Remainder

Indefeasibly vested

Contingent

Vested subject to complete divestment

Vested subject to partial divestment (or subject to open)

Executory interest

Present Interest

Examples

Typical Future Interest

Fee Simple Absolute

O grants B to M

O grants B to M in fee simple

O grants B to M and her heirs

None

None

None

Life Estate

To m for life

To m for life, then to N

To M for life, then to her adult children

To m for life, then to N if Condition occurs

To M for life, then to N, but if C occurs then to L

To M for life, then to her children (N was only child at the grant)

Reversion in O

Remainder; indefeasibly vested

Remainder: contingent *

Remainder contingent

Remainder (in N): vested subject to complete divestment

Remainder (in N) vested subject to partial divestment/subject to open

Fee Simple Determinable

To M as long as Condition occurs (Then to D)

Possibility of reverter (in O)

Fee simple subject to condition subsequent

To M but it C occurs then O has the right to reenter and take the premises

Right of entry/power of termination

Fee simple subject to executory limitation

To M as long as C occurs then to N.

To M but if c occurs then to N

Executory Interest in N

Present Possessory Interests

Free Simple Absolute

Largest package of ownership rights, from which others are carved

Fee simple absolute is only estate that continues indefinitely all others may end one way or another

In a transfer, transferor is presumed to give all that he has, unless he indicates otherwise

Heirs

One does not have heirs until death while alive, one has heirs apparent

If one dies with will (intestate) and without heirs, property will be given to state in which property is located

Life Estate

Life estate comes to natural end with death of named person, usually holder of estate

Ex. A grants Blackacreto C for life, then to D

C has life estate, followed by remainder in fee simple in D

Note: life estate ends with cs death

If C were to sell Blackacre during his life, new owner will lose property to D when C dies life estate involves Cs mortality risk and duration of right depends on when C will die

Defeasible Fees

Simliar to fee simple absolute, except may end on happening of named contingencythis leave room for future interest to become possessory when such contingency occurs

Future Interests

Freehold Interests (either vested or contingent)

Fee Simple Absolute

Life Estate

Defeasible Fees

Tend to be recorded in land registres

Non-Freehold Interests

Not recorded in land registries

Leases

Law has developed many forms of ownership, which permits divisions across time and among multiple persons at any one point in time

Division among multiple persons:

Any time asset is shared by multiple owners, collective action problem is created (i.e mini tragedy of commons)

To limit collective action problems associated with multiple owners and to keep information costs associated with complexity form spiraling out of control, law limits number/variety of ways in which co-ownership can be organized

Division by time:

Intervivos= between living people

When dividing property rights to land over time, pieces created must conform to estates in land

Estate= type of preoprty right, measure persons interest in land in terms of duration

Interest may be either present possessory estate or one that does not take possession until happening of some future event (future interest)

Heirs- people who take assets upon death wihtotu will under relevant state statute

No one has heirs until they die, only have heirs apparent

Future Interests Retained by Transferor

Reversion

Grantor has something left over after conveying present estate

Interest left in owner when he carves out of his estate a lesser estate and does not provide who is to take property when lesser estate expires

Uncertain whether it becomes possessory in future

Ex. O conveys Blackacre to A for life

O has reversion

Possibility of Reverter

Arises when owner carves out of his estate a determinable estate of same quantum

Generally involves caring free simple determinable out of fee simple absolute

Ex. O conveys Blackacre to Town library so long as it is used for Library purposes

O has possibility of reverter if Town Library doesnt use Blackacre for Library

Right of Entry

Power of termination/to call off deal

When owner transfers property subject to condition subsequent and retains power to terminate estate, transferor has right to entry

Ex. O conveys Blackacre to Town Library for library purposes. If Blackacres ceases to be used for library purpose O has right to reenter and retake premises

Future Interests Retained by Transferee

Remainder

Future interest that is capable of becoming possessory at termination of prior estate

Not required that future interest be certain of future possession

Follows a life estate, BUT NEVER a fee simple

Vested Remainder

Reaminder is vested if

It is given to KNOWN taker AND

It is NOT subject to condition precedent (other than natural termination of preceding estates)

Remainder may be indefeasibly vested

Remainder is CERTAIN to become possessory in future AND cannot be divested

Ex. O conveys to A for life and then to B and his heirs. If B dies before A, then Bs remainder passes to his devisees (if he has a will) or his heirs (if he does not have a will) B or Bs successor is certain to take possession after A.

B has vested remainder in fee simple absolute

Remainder = kind of future interest

Fee simple absolute = kind of estate held as remainder

O conveys to A for life = life estate

Then to B and her heirs = only know how many heirs someone has once they die

Remainder may be vested, but not certain of becoming possessory

Remainder is vested to open or vested subject to partial divestment if later-born children are entitled to share gift

Ex. O conveys to A for life, then to As children and their heirs. A has one child (B)

Remainder is vested in B subject to open to let in later-born children

Bs exact share cannot be known until A dies

Note: this could be second marriage o wants spouse to get property, but needs to make sure children get it after

Contingent Remainder

Remainder is contingent if

It is given to unknown person OR

It is made contingent upon some event occurring other than natural termination of preceding estates

When remainder is given to unknown person, it is a contingent remainder

Ex. O conveys to A for life, then to heirs of B. B is alive

Remainder is contingent because heirs of B cannot be known until B dies (you dont have heirs until you are dead)

Executory Interest

Takes effect only by divesting another interest

Executory interests are treated as contingent interests because they are subject to condition precedent and DO NOT VEST until they become possessory always contingent

Fee simple subject to executory limitation

Fee simple that, a certain event occurring, is automatically divested in executory interest in TRANSFEREE (Grantee)

Ex. O conveys to A and his Heirs, but if A dies without heirs, then to B and his heirs.

A has fee simple subject to executory limitation

B has executory interest if A has no heirs

Bs future interest can become possessory ONLY by divesting A

Ex. O conveys to A for life, then to B and his heirs, but if B dies under age 21, to C and his heirs. B is 15.

B has vested remainder in fee simple subject to executory limitation (of age 21) or subject to divestment by Cs executory interest (if B dies under age 21)

If transferor wants to create future interest in transferee after defeasible fee, it will be executory interest

Ex. O conveys to School Board, its successors and assigns, but if premises are not used for school purposes for next 20 years, then to B and his heirs

Board has fee simple subject to executory interest that will automatically divest Boards fee simple if condition happens

But if premises are not used for school purposes = executory limit

then to be and his heirs = b has executory interest that divest Boards interest in property

Ex. O conveys to Library so long as premises are used for library purposes, then to Hospital.

Library has determinable fee

Hospital has executory interest

Interest given to hospital is not divesting interest nor remainder (since remainder cannot follow vested fee simple)

Remainder v. Executory Interest

Remainder= taking possession as soon as prior estate ends

Executory interest= divesting prior estate

VESTED AND CONTINGENT REMAINDERS

Vesting remainder belong to an ascertained person AND there are no condition precedent that must be satisfied before the remainder becomes possessory

Ex. O to a for life then to B

B has vested remainder in fee simple absolute

A has life estate

O has nothing

Vesting in interest when party has a legally certain interest in property even if he cant posses it right away

Vesting in possessionwhen interest becomes possessory; actual possession

Ex. O to A in 2015

Vests interest NOW when conveyance is made

Vests in possession in 2015, when A gest possession

Indefeasibly vested remainders

Vested remainders subject to open or partial divestment

Remainder in a class of persons that may increase

Existing class members (those in the class who are alive at the time of the conveyance) have vested remainders subject to PD

Additional entries into class partially divest the existing class members remainders

Diminishablecan be made smaller with entry of more class members; more class members added, more vested interests

Ex. O to A for life, then to Children of B (B has 2 kids alive at time of conveyance)

A has life estate

Bs children (two alive at conveyance) have vested remainders in fee simple subject to partial divestment (more children may come

Rule of convenience when the court closes a class when remainder is given to a class that can increase in size, courts will close the class when any class members becomes entitled to possession (when future interest vests in possession in a class member)

Usually when the life tenant dies will the future interest vest in the class

Ex. O to a for life, then to bs children (c and d are children who are alive at time of Os conveyance)

A has life estate

C and D have vested remainders subject to partial divestment

Two conditions

Gift becomes available for distribution (a dies)

Someone qualifies for distribution (bs children = c or d are around)

Ex. When A dies, ct will close the class, so c and d and any other of bs children who exist at As death take their remainders; any of bs kids born after as death are shit out of luck.

Vested Remainder subject to total divestment

Total divestment, remainder is vested ascertained person and no conditions precedent, BUT vested remainder can be totally divested by some condition subsequent

Condition subsequentcondition on the vesting of the interest itself, which renders the future interest a contingent remainder

Ex. O to A for life, then to B, but if B drops out, then to C

A has life estate

B has vested remainder subject to total divestment

C has contingent executory future interest

How to spotCOMMAS ARE IMPORTANT

WASTE

Doctrine of Waste

Voluntary/affirmative waste actual overt conduct that causes a descrease in the value of the property, including exploitation of natural resources

Permissive waste neglect or waste occurring when the land is allowed to fall into disrepair and is not reasonably protected by the possessor; normally tenants have an obligation to make minor repairs to keep the premises in reasonable shape

Ameliorative waste acts that substantially change, but enhance property value is still waste unless all future interest holders know of it and consent to it

Waste

Brokaw v. Fairchild (NY Mansion)

Facts: Brokaw inherited life estate with mansion from decedent. Following termination of life estate, remainder interest in mansion was granted to P. After D took possession of premises, proliferation of apartment housing made it unprofitable to maintain property, which was difficult to rent in existing condition and could not be renovated to make it more appealing to prospective tenants. D proposed to demolish mansion and replace it with apartment building remainderman sued on theory that doing so would constitute waste

Held: Life tenant cannot alter estate if such alteration will do permanent injury to inheritance

Why: cannot demolish mansion because he holds life estate NOT FULL OWNERSHIP. Decedent specified in will that D was to take possession of residence, which can only refer to mansion itself. As holder of life estate, D had obligation not to modify mansion is such a way that would violate wishes of those with remainder interests. Putting up apartments would change inheritance so that it could not be delivered to remainderman this would constitute waste. Since neighborhood has not been rendered incompatible to present single-family residences, no valid reason to allow for alteration of estate

*** Modern courts typically allow changes to life estates that will improve the value of the property

Valuation of Interests

RESTRAINTS ON ALIENATION AND THE RULES AGAINST PERPETUITIES

Restraints on alienation and the rule against perpetuities 563078

Alienability transfer power and transfer arrangements

Restraints on Alienation

Morse v. Blood

Facts: Man leaves wife all his possession with the restraint that she cannot give one cent to any of her or his family.

Held: Restraint on a fee simple so it is void

Why:

Note: Todays court will allow a restraint on alienation of a fee simple for a limited time if it is reasonable related to some family estate planning objective. Even if she broke the condition, the heirs of the estate would have right of reentry, the power of alienation promotes not being a slave to property as well as economic efficiency

Mountain Brow Lodge No. 82 Independent Order of odd Fellows v. Toscano

Facts: Says S has to be used by the Odd Fellows and can NEVER be sold or transferred from the odd fellows. Fee simple subject to condition subsequent in the grant of property gave the D right of title ONLY so long as he used it for the specific purpose of a lodge and didnt try to sell it (habendum clause)

Held: restraint on alienation was invalid, but the restraint on use was still valid (which would ultimately have the same effect)

Why: ct rejected bar on the sale of the property because that was an absolute restraint on alienation

*** restricting the use of property allowed only when restriction is reasonable

*** courts will generally construe a restraint on alienation as a fee simple subject to condition subsequent instead of a fee simple determinable so that the right of possession will not automatically return to the grantor but will instead WAIT until the grantor initiates proceedings to retake the property

THE RULE AGAINST PERPETUITIES

Common Law certain future interests are void if there is any possibility that the given interest may vest more than 21 years after the death of a measuring life

Should be applied absolutely; consider any and all remote possibilities

Four step process

1. Determine which future interest has been created

a. RAP applies ONLY to contingent remainders, executory interest and some vested remainder subject to open/partial divestment

b. Never apply the RAP to future interests created in the grantor (possibility of reverter, right of entry, reversion)

2. Identify condition precedent to vesting of future interest

a. What perquisite must occur before the future interest holder may take possession?

3. Finding a measuring life

a. Person who is alive at the conveyance?

b. Must be a person whose life or death is relevant to the condition-precedents occurrence

c. Ex: O transfers a sum in trust for A for life, then to As first child to reach 21.

i. A is validating life

ii. Any child of As will necessarily reach 32 within 21 years of As death

iii. Remainder is valid

d. Ex: O transfers a sum in trust for A for life, then to As first child to reach 25. A has no child of 25 or older.

i. Cannot prove that As first child to reach 25 will do so within 21 years of As death

ii. Because contingent remainder is void, instrument leaves life estate in A, with reversion in O if invalidated, it will be subject to rule against perpetuities

4. Can future interest holder, with certainty, take possession or vest within 21 years of the death of the measuring life?

a. Yes = meets the RAP

b. No = conveyance is void

c. Person considered fertile at any age

Interest cannot violate rule if it is vested upon creation

Interest cannot become possessory for very long time, but this does not matter if it is vested

Ex: O conveys to A for life, then to As children for their lives, then to B.

Bs interest is valid because it is vested in interest now (B has vested interest)

Future interests retained by transferor are not subject to Rule Against Perpetuities

Ex: O conveys Blackacre to School Board as long as premises are used for school purposes.

O has possibility of reverter exempt from Rule because it can go back to original owner

Ex: O conveys Blackacre to School Board as long as premises are used for school purposes, then to A and her heirs.

As executory interest violates Rule it may not become possessory for centuries

This leaves fee simple determinable in School Board

Exception to Rule:

Rule does not apply when contingent property interest vests in a charity when property interest of another charity is divested

Ex: To Yale, but if not used for cinema, then to Harvard.

Rule not invoked because occurring between charities

Reforms

The RAP Today: Reform by Curtailment? 578-92

Symphony Space v. Pergola Properties Inc

Facts: x sold building to P for below-market and P leased back commercial property for $1/year so X could carry on commercial operations without tax burden of owning building itself. Deal, however, included repurchase option, which granted X power to force P to sell property back to X 1987 1993, 1998, 2003. D replaced X as owner. Property had appreciated considerably so D sought to exercise option. P refused on theory that final year specified in option fell beyond 21 year period set forth in Rule

Held: Rule invalidates option

Why: Rule applies against both corporations and individuals. Repurchase options tent to discourage improvement of property by current owners, who know the option holder can simply demand property back at any time. Here, original transaction expressly provided that option could be exercised at ANY time after 7/1/79 and provides NO help to D. Mere possibility that Ds interest would vest too remotely from date of agreement renders that interest void.

Rule: RAP applies to corporations

Co-Ownership and Conflict 594-615 n2

Concurrent and Marital Estates

Tenancy in common each cotenant has separate but undividable interest in property

interests of cotenants can be unequal

interest of each is fully alienable, devisable and descendible

no right of survivorship; when on dies, his interest passes to his heirs

needs unity of possession to create each tenant must have right to possession of whole property

creationpresumptive tenancy created by conveyance to more than one party

**** when in doubt, court will presume tenants in common

when cotenant dies interest passes to their estate; tenant in common gets nothing

Ex. O conveys Blackacre to A and B as TIC

A and B have TIC in fee absolute

If A conveys his interest to C, then B and C are TICs

If B dies intestate, Bs heirs will become tenants in common with A

Joint tenancy have right of survivorship, when on dies, his interest is immediately equally split and absorbed between surviving tenants

Not devisable or descendible (unless all agree OR only 1 tenant is left)

NOT favored by law; it will be TIC unless Right of Survivorship is expressly stated

Creation: 4 Unities

Time tenants must all take interests at the same time; vest interest simultaneously

Titleacquire title by same instrument; not by intestate

Interestall have equal undivided shared and identical interests measured by duration; identical or equal interest in whole property

Possessioneach tenant much have right to possession of whole property

ex. O conveys Blackacre to A, B and C as JT with Right of Survivorship

A then conveys his 1/3 interest to D

B and C each have 1/3 undivided interest as joint tenants with right of survivorship

D has undivided interest as Tenant In Common

IF B dies intestate, leaving H as an heir

C has 2/3 undivided interest as Tenant in common with D, who has undivided 1/3 interest as tenant in common

H gets nothing because of right of survivorship

Tenancy by the entirety only in marriage, like JT but with 5th unity of marriage, includes right of survivorship; no one can act alone, both owners considered as one person; tenancy by entirety presumed by any conveyance made jointly to a husband or wife; terminated upon divorce, cannot be unilaterally severed; immune form creditors of only one spouse

JT v. TIC

TIC is favored over JT

JT requires special language, some states have abolished JTs and any language that would otherwise create a JT is interpreted as a TIC

Advantages of JT v. TIC

Probate- judicial supervision of admin of decedents property that passes to another at death

At jts deathlike a will but probate of property is avoided; this is advantage for husband and wife bc probate is costly

Community property

Partition division of property held by co-owners, granting each sole ownership of his sharejoint tenant or tenant in common may demand partition of property at any time for any reason and court will order physical division of property OR sale and division of sale proceeds

Partition in kind: court will order partition in kind unless party can provide either that PHYSICAL partition is impossible/extremely impractical OR that physical partition is not in best interest of all parties **preferred methods by courts, BUT not most common

Partition by sale: generally impractical physically impossible to divide most real property (i.e. houses, condos) rural, undeveloped land is most likely candidate for physical division. After partition by sale, net proceeds are divided among co-owners in proportion to ownership interests

Partition

Delfino v. Vealencis

Facts: Property was held as tenancy in common. D lived on portion of property and operated garbage hauling business form there. P wanted to develop residential housing tract and sought partition by sale even though property was capable of partition in kind.

Held:

Why: Partition in kind would be difficult, it was possible and a partition in sale would materially damage D, depriving her of residence and business

Contribution and Accounting

Gillmoor v. Gillmoor

Facts: 2 brothers owner land in dispute. Upon death, interests passed in equal shares to children who became co-tenants. P sought to raise livestock, but D prevented her from doing so because D was grazing his livestock to max capacity of his property. P sued for accounting damages for Ds exclusive use of property and partition

Held: When co-tenant makes clear demand to use land that is in exclusive possession of another cotenant and that cotenant refuses to accommodate other tenants right to use land, tenant has established claim for relief

Why: co-tenant may sue for his share of rents and profits (during ousting) if he has been ousted from possession of common property. D exercises exclusive use/possession and excluded P from common properties, but this is NOT sufficienttenant in common has right to use and occupy entire property held in co-tenancy without liability to other co-tenants. BUT when a co-tenant ousts another co-tenant, he violates co-tenants rights. Co-tenant must show that other co-tenant used property to exclude himrequires act of exclusion/use that prevents him from exercising rights in property. P could not graze livestock on land with D because this would have led to overgrazing and depleted value of land.

Note: ouster = one co-owner precludes other from using. Usually insufficient to prove that one party has expanded through premises and left no room for othermust show that other party has taken affirmative step to keep other out i.e. failure to answer request to be let in

Accounting = cotenant has been ousted, so state must protect his property interest and hear grievances. Cannot just sue for accounting, must have cause preceding accounting.

Severance to destroy joint tenancy, there must be a transfer of title; JT can be severed if unity is destroyed; a JT can sell or transfer his interest in JT, which will break the unity of time; severance changes JT to TIC

Harms v. Sprague

Facts: Joint tenants, one mortgages his interest in his property before his death. Plaintiff cotenant claims ownership through right of survivorship, defendant claims right as tenant in common through mortgage lien

Held: Mortgages does not sever joint tenancy and the mortgage does not survive the joint tenants

Why: a lien on joint tenants property interest will not effectuate a severance of joint tenant, absent conveyance by a deed; when P died, mortgage on his interest wasnt collectable because his share of joint tenant disappeared and was absorbed by remaining cotenant

Mortgages: interest in real property used to secure debt;

Mortgager home purchases, person who borrows $

Mortgagee bank, lends $, holds security interest

Two theories

Title theory: minority, bank has title, not you, but the bank cant sell title; does destroy JT mortgage is conveyance of legal estate vesting title in mortgagee and creating TIC

Lien theory: majority claim on my assets but I retain legal title, legal claim on property interest.

Lien: right to force sale

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LEASES, COVENANTS, CONDOMINIUMS AND OTHER ENTITY PROPERTY

Is a lease Property or is it a contract? 646-60

Separating Management and Possessory Rights

Leases transfer of possessory right, including right to exclude, to a tenantleases convey property interest and contain a number of promises

independent v. dependent covenants

Independent : property, breach by one party of one covenant does not relieve the other party from fulfilling his end of the deal

Dependent: contracts, if one party breaches, the other does not have to fulfill its obligations

Distinctions among licenses, leases and life estates

License- allows you to act that otherwise would be a trespass

Leaselandlord/tenant relationship

Life estatefreehold interest

look to

intent what