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Recording Acts

Thursday, December 17, 2009


2:47 PM

Recording Acts
Incentivize A to record ownership (can lose your land otherwise)
Prevent B from being innocent (can check the record)
Create less of a sense of risk to the general public (provides land market stability)
Common law said first in time taker = O
Race Statute - bright line rule - first to record is the owner - the gov't administrator puts a time stamp
on it, so it is undisputed - very few jurisdictions follow this
Notice Statute - two requirements:
1) Paid valuable consideration (first in time will stand over someone who received Black acre as a
gift)
2) Must have been without notice of the previous transaction
***Note: there is no recording requirement in this jurisdiction***
Race Notice Statute - three requirements:
1) Must be a purchaser for value
2) Without notice of previous owners
3) Duly recorded

NOTE: if you have land that covers more than one


county, then you must record in all of the counties
where your land lies
* None of the recording acts apply to subsequent
takers who receive Black acre as a gift
BUT, first in time takers can receive black acre as a
gift, because they received it when there was still
something to give

Ambiguous Terms:
Value - even black acre as collateral for a loan can be sufficient
Notice
Actual notice - B sees the previous deed or recordation or someone tells B about it
Constructive notice - A's deed was recorded - had B looked for it, B would have
seen it
Inquiry notice - sufficient evidence of someone else occupying black acre to make B
ask questions - ex - A is living there - who are you? I own this place, but A hasn't
yet recorded
Recordation
Can mean taxes paid, sealed, notarized, etc
If the notary's seal is expired and everything else is OK, A can still be seen as
nothing but a trespasser
Hypotheticals:
OA, no record
In a race
OX, has notice of OA
jurisdiction, as
X records
soon as X
A records
recorded, X won
XZ, Z has no notice (actual, inquiry or constructive) of OA
(Z checked after X recorded and before A recorded? Or only checked for X in grantee index - the
search is expensive and not necessarily always comprehensive - we are assuming that this jurisdiction
had a Morse search requirement)
Z records
Race jurisdiction: Z wins (Z took from X, who recorded first)
Race/Notice: Z wins - X recorded first, and Z had no notice (depends also on when Z records)
Notice:

OA, no record
OX, no notice
X records
A records
XC, C has actual notice of OA
C records
C gains protection based on X's innocence
C will still get it in a contest between A and C
This is the shelter rule - C is being sheltered by X's good
faith because we want to give X the benefit of the power of
transfer, b/c he satisfied all the requirements
This is an example of the relativity of innocence and the
concept of ownership

Note* Z is not punished for X's bad faith


Woods search - search each grantor from the time of recordation of their ownership until the
present, to make sure that that no grantor double conveyed the property before it was duly
recorded - more expensive and disincentivizes timely recordation, but is more complete
Morse search - search each grantor until the first instance of a transfer and then switch to the person
sold to as the next grantor - still timely and expensive, but less so, but less complete
A wild deed - someone changes their name after taking title in property and sells under the new
name - makes it impossible to follow the chain of title
Out of chain of title is often taught through this casesomeone named Lowry lives in Alaska and files
for acquisition of land held by the US gov't, so he files for a patent (gets a FSA from the gov't), seeking
ownership (he has met all of the requirements to secure a patent from the US for that land), but he
conveys this land to the Horvaths this land before he acquires it, showing them that he is going to get
the land. Then, the gov't conveys the patent to Lowery, who then conveys his interest to the Sabos.
Did Sabo take without notice of the prior conveyance to the Lowerys?
LH, recorded
OL

Property Outline Page 1

OL
LS
Who recorded first? Was recordation sufficient to find it?
Court decided that C was not charged with searching A as a grantor before A became a grantee
C would have had to have looked at A as a grantor before A got black acre, which is
outside the chain of title.

- At the time that Lowery was applying for the patent, a utility company was applying for easements to
hang wires across the property - they approached Lowery directly, and he said okay. Lowery then
conveys the underlying fee simple absolute to Sabo - does C have the encumbrance of the easement?
Did Sabo have notice? Sabo could not have known - the utility company may have to pay C and go
back to try to get its money back from A
- What can B do? RERECORD - the Horvaths should rerecord the LH record after OL promptly to
prevent the second in time scenario in both race and notice jurisdictions (B seems less innocent than
C, because B could have prevented this)

Property Outline Page 2

Copyright, Trademark, Patent


Thursday, December 17, 2009
2:55 PM

Copyright Law - protection for original works of authorship - published and unpublished - literary,
dramatic, artistic
- Cannot control derivative works
- Protects 70 years past the death of the author
Trademark Law - the longest protection - allows consumers to identify a product as from a specific
company (to avoid confusion)
- Can be limited (ex - can't trademark the color that is used to mark euthanasia for safety reasons)
- Must renew every 10 years to ensure that you are still using it, but you get perpetual protection
- Can prevent dilution of trademark by someone else (McDonald's was able to get McSleep hotels
to change their names, b/c could reflect poorly on McDonald's trademark)
- Can't trademark something that is functional - just an end run around patent law, and we want to
eventually allow for competition and innovation
Patent Law - the shortest - 20 years
- Rewards the creativity of the original innovator, but eventually allows for imitation and
competition

Property Outline Page 3

Lost, Mislaid and Abandoned Property


Thursday, December 17, 2009
2:57 PM

Damages can be measured in the value of the chattel at the time of conversion or the value of the
plaintiff's interest, taking into account the odds of the true owner coming back and trying to get the
possession back (this is a lower value usually).
Bailment - the rightful possession of goods by a person (the bailee) who is not the owner. (The owner of
the good is known as the bailor.) E.g. giving your car to the valet - you are the bailor and they are the
bailee. If someone steals the bailment from the bailee, and the bailee gets damages for it, the true
owner (bailor, you, in this case) cannot have an action against the present possessor (because they
already paid damages).
Replevin - a lawsuit to obtain the return of goods, not just damages for their value.

Right to Exclude
Lost, Mislaid and Abandoned Property
Abandoned - then, it's up for grabs (property), but it's hard to know when someone has abandoned a
legal right
Finders have a property right against everyone else except the original owner
Separate lost an mislaid as conscious v. unconscious act - probability of someone coming back for it is
greater in mislaid, b/c may remember where it was left

Property Outline Page 4

Adverse Possession
Thursday, December 17, 2009
3:06 PM

Adverse Posession
1) Actual entry
2) Exclusive i. AP says they have a right to exclude - putting up a fence, running after trespassers with a
pipe, etc
3) Open and notorious
i. Open - if the owner drove by, he would notice and come it to see who was occupying his
land
1) What the owner subjectively would think
ii. Notorious - the community at large is aware of the occupation by the AP - acting like an
owner (not just a visitor)
1) What the community objectively would think
This is all w/ reference to standard uses of the land in that area
But the AP might have to do more than a standard person in the community to show that
they are acting like an owner (most ppl might not develop/build more, but the AP has to do
something to show that he is an AP)
Some jurisdictions require the APer to pay taxes (this can get rid of mistakes on titles,
although some jurisdictions have clean up rules for that) - also, shows "sweat equity"
Some hold that if possession is unequivocal and visible, then there is a presumption of open
and notorious; others say if an encroachment is small (less than several feet), then there is
no presumption
4) Adverse and under a claim of right
i. Adverse
1) Does not have to mean hostility - just adverse to the owner's right
2) A tenant who pays rent is not adverse
3) A tenant who stops paying rent can be held to be adverse, but some jurisdictions hold
that if you entered under permission, then you can never be adverse
ii. Claim of right
1) Focused on the intention of the AP, not the owner
2) BUT, the AP's intention does not necessarily matter as much as the actions the AP
takes - depends on the jurisdiction whether mindset matters (see prescriptive
easement below)
3) Also, this depends on whether we care about the AP making improvements (and
taking the risk of being ejected) or if we care about owners sleeping on their rights
5) Continuous for the statutory period
i. Statute of limitations - begins at time of actual entry
ii. Also depends on the status of the owner
If the owner dies and passes the land on to a 2 yr old, the heir, the ownership will not
begin until the heir reaches the age of the majority. If the AP entered before the
original owner's death, then the SOL begins at entry, but if the AP enters after the
death and before the heir reaches majority, then the clock won't start running until
the heir reaches the age of majority
iii. Numbers 1-4 are all part and parcel to actual entry - you can't start the clock until you've
established all 4
iv. APs can tack their time together
1) Can record through a quitclaim deed (which does not say that the title is clear, but
shows the extension of the AP)
2) If another AP runs the first AP off the land, the time does not tack (unless you are in
England, who cares more about owners sleeping on their rights than about the APers)
a) In this case, both O and AP1 can sue AP2 - no privity b/w AP1 and AP2 and AP1
has a relativity of claim to possession over AP2 (and O is the owner)
v. Continuous - depends on what is normal for that area (if it's summer homes and AP lives
there only during the summers, that is sufficient - owner should be checking during normal
living times, even if they don't normally live there during those times - conversely, if AP lives
there during winters, the AP will not be able to claim continuous, b/c not the normal
occupancy period)
1) What if 50% are summer occupiers and the rest live there all year?
2) Must know the nature of the community - this is very fact specific
Color of title
This is a deed that shows that you have some right to be there (does not have to be
recorded - that is just to prevent confusion with future purchasers)
Different jurisdictions:
1) Color of title is required in order to be an APer
2) Color of title will shorten the SOL for APs if they have it

Property Outline Page 5

For tacking and disability problems, see class notes


9/17/09 and class notes 9/21/09

For color of title problems, see class notes 9/15/09

2) Color of title will shorten the SOL for APs if they have it
3) There will be less onerous requirements on the AP if they have it
Allows APer to show the exact extent of the claim (so will not have to occupy every square
inch that they claim to own, because they have the dimensions in writing)
If there is color of title to the land and the APer does not occupy all of it, then they can claim
the rest under constructive adverse possession
AP and Prescriptive easement
This is only a right of way (like in Manillo v. Gorsky and the stairs over the property line), not
an FSA
Do not have to exclude the owner, just everyone else (exclude owner to get ownership )
If just an easement and you rip up the steps, you can't put them back in, but if you get an
FSA, then you can reconfigure the steps
From the owners perspective, this can be just as damaging as an FSA, b/c now they will have
to try to sell the land with this encumbrance on it - lowers property value
Does knowledge of a small encroachment matter? Depends on the jurisdiction
Mistake does not create AP
Objective acts = claim of right as long as those acts reveal intent
Open and notorious? Depends
If possession is unequivocal and visible, then presumed O&N
If encroachment is less than several feet, no presumption of O&N
Then, the APer would have to prove actual knowledge
In a court of equity, if ripping out the steps is too high of a burden, they could convey and
prescriptive easement, but require the APer to pay for it
AP for Chattels
See O'Keefe Case
Discovery rule - SOL only begins when the lost chattel is found, as long as the original owner
is giving due diligence to finding it
Some jurisdictions hold that you must find it, request it and then be rebuffed before SOL
begins
Europe - if a painting is sold on the open market, where anyone can buy it, then the
subsequent purchaser (not the thief) can keep the painting, and the artist can sue for
damages

Property Outline Page 6

Gifts
Thursday, December 17, 2009
3:09 PM

Gifts
Require:
1) Intent
i. This is a matter of fact to be determined by a jury
ii. Things to look at:
1) Dominion and control over the gift
2) The relationship of the giver and receiver (legally special relationships might create a
greater presumption of intent)
2) Delivery
i. This is a matter of law
1) Actual - manual
2) Constructive
3) Symbolic
For a gift causa mortis, only actual delivery will be allowed, unless that is impractical, and
then constructive delivery must still be made (symbolic will not be sufficient)
Can delay delivery of entire inter vivos gift (can have a present title interest and a future
possessory interest)
3) Acceptance (which is generally assumed based upon the delivery)

Inter vivos gift


Gift causa mortis
Generally only has to be one witness (b/c done on deathbed), but will be construed more
narrowly and strictly because of the lower standards
Testamentary gift or transfer

Property Outline Page 7

Estates, Lands and Future Interests


Thursday, December 17, 2009
3:22 PM

Estates, Lands and Future Interests


Language:
Remember, modern presumption is when language is
FSA: To A and his heirs
ambiguous, interpret to give the largest estate possible
To A and successors and assigns (when giving to an organization)
Life estate: to A for life, then to B and his heirs.
Remember, gaps are called reversions, and during that time,
This is a life estate to A with a remainder to B.
O (or O's estate if O is dead) is responsible for the land
To A for life.
This would be interpreted as a life estate to A with a reversion in an FSA to O.
Remainders:
1) Vested remainders
i) Absolutely vested remainder (AKA indefeasibly vested remainder)
CA does not distinguish b/w FSD w/ PoR and FSSCS - both
to A for life, then to B and his heirs
have a SOL of 5 years upon breach of condition
1) B is an ascertained person
2) There are no conditions precedent to B taking interest upon A's
death
ii) Vested remainder subject to open (AKA vested remainder subject to
If you need more help, see Estates System: Freehold
partial divestment)
Interest Handout
To A for life, then to A's children
A has a child, B, but A is still alive and could have more children
B has a vested remainder subject to open or partial divestment b/c it
could be partially divested by future siblings
The open class must close w/in the RAP period or B could lose everything
For state of title practice, see class notes 10/1/09
iii) Vested remainder subject to complete divestment
To A for life, then to A's children, BUT IF C passes the CA bar, then to C
Remember, if there is a gap between a life estate and
A's children hold a vested remainder subject to partial divestment and
the next future interest holder (with a reversion to O
complete divestment
in between), then it is not a remainder - it is an
C holds an executory interest subject to a divesting interest
executory interest.
2) Contingent remainders
Either:
Typically, in the event of forfeiture, if there is a
1) there is a condition on the remainder or
vested remainder, it will go to that person (rather
2) there is an unascertained person
than a reversion to O), unless there is language that
Note: you can have alternative contingent remainders, but it is not called that if
indicates otherwise.
there are two contingent remainders and one can vest and then be divested by
the other
Subject to open only applies to vested remainders
Defeasible fee simple can be destroyed or forfeited by a condition broken
(not contingent remainders or executory interests)
1) Fee simple determinable with a possibility of reverter (to O): To A AS LONG AS [condition], AND IF
NOT, then shall revert to O and his heirs
NOTE: SOL clock on AP starts running as soon as the condition is broken, so O must monitor,
otherwise can become FSA to A b/c of AP
2) Fee simple subject to condition subsequent: To A, BUT IF/PROVIDED THAT [condition], then O or
heirs has the right to re-enter and reclaim
This creates a right of re-entry - SOL does not start as soon as the condition is breached only when O re-enters and re-claims and is rebuffed
Note: some jurisdictions will only allow the possibility of reverter to be transferred to a third party
and not the right of re-entry - it depends
3) Fee simple subject to an executory interest
The future interest is held by a third party (can be applied to either of the two above)
To A AS LONG AS [condition], AND IF NOT, then to B
This is a fee simple subject to an executory interest plus a future interest held by B in a FSA.
Note: fee simple DETERMINABLE means it reverts to the grantor
To A, BUT IF/PROVIDED THAT [condition], then to B
This is a fee simple subject to an condition subsequent and the right of entry is held by a
third party executory interest - usually, this is not allowed - generally, the right of entry is
only allowed to be held by the grantor
Springing executory interest - the future interest divests the grantor
For details and practice questions on fee tail, see
Shifting executory interest - the future interests divests a grantee
pages 188-9 in the text book.
Fee Tail
Only allows the land to pass to future heirs - basically each owner only has a life estate with
the remainder to future family heirs
Most jurisdictions today no longer allow it
DE, ME, MA and RI are the only states that still do allow it, and they allow someone to
disentail it during their lifetime, by conveying to a strawman and then buying back as a FSA
Interpretation of ambiguous language
Try to follow the intent
BUT, if ambiguous, go with the largest possible estate (see White v. Brown)
Remember, all invalid language will be stricken
Property Outline Page 8

Remember, all invalid language will be stricken


Inalienability is not valid
When a restriction limits marketability to the point that no one would logically buy, then it is
also not valid
EXCEPT to nonprofits (some say only charities)
Requirements for illegal activity are invalid
Requirements against public policy (affecting autonomous rights, etc) are invalid
If a current interest holder is putting your future interest at risk, then you could use a waste cause
of action to intervene
Affirmative waste - actual deterioration (can be required to get to the point where you can
no longer pay taxes)
Ameliorative waste - the current interest holder is doing something the future interest
holder doesn't like (some jurisdictions will allow this claim, even if the change is
economically profitable) - decided on a case by case basis by the state
Sometimes a trust is your best bet
Give the trustee everything in FSA w/ the provision that they will act in the best interests of
the beneficiaries - the trustee can sell, rent, etc - whatever is w/in the testator's intent - may
avoid a lot of litigation costs and the risk of the court ruling differently than what the actual
intent was
Executor does not have a duty to notify recipients - just to pay off debts, make account of all
assets
Condemnation and just compensation when there are present and future interests
Could say all payment goes to present interest holder
Could argue that the burdens on the present interest holder make the land actually cost
them money (not make them money), so everything should go to the future interest holder
Could argue that the possibility of it ever getting to the future interest holder was very
small, so the money should stay with the present interest holder
Or could argue that the future interest is in a FSA, which is very valuable, so the future
interest holder should get the money
Rule against perpetuities - no interest is good unless it must vest if at all, not later than 21 years
past a life in being at the creation of an interest
Present possessory interests are already vested, so the RAP does not apply
Does apply to executory interests, open classes and contingent remainders
If it is not valid at the time of the creation of the interest (when an inter vivos gift is given or
when a testator dies), then it will be struck from the document
We don't need to know that it will vest, just if it will vest or fail w/in the period
NOTE: just has to VEST, not be completely transferred!
If there is an open class and the class will not definitely close w/in a life in being plus 21
years, then it is completely invalid and no one in the class gets the conveyance
RAP does not apply when all parties are charities
A right of first refusal (preemptive right) generally does not have the RAP against it, even
though it could be argued that it is a restraint on alienation
If you are in a wait and see jurisdiction, you can use an unrelated measuring life (of a
person, like a baby who is likely to live a long time, but not a Galapagos turtle or a redwood)
Saving statute will assume that you did not intend to violate RAP where language is
ambiguous, BUT, if there is a clear violation w/ no ambiguity, it won't help - some courts will
use their equity to reform the document, so cut off the part that violates the RAP (without
striking the entire interest)
Sometimes, you can write a savings clause into the document, but again, this only helps with
ambiguous language
Some jurisdictions have the uniform use statutory RAP, which says that if it violates the
common law RAP, it will give you 90 years to wait an see if the interest vests or fails instead
(if after 90 years, it still hasn't vested or failed, then it is invalid)

Property Outline Page 9

If you don't remember this, see example here

When going through a conveyance, bracket each interest


holder to determine which to flag as subject to the RAP

Co-Ownership
Wednesday, December 16, 2009
11:40 AM

Co-Ownership
1) Tenancy in common - this is the modern presumption, unless stated to the contrary
i. Separate but undivided interests in property
ii. Interest is descendible and may be conveyed (separable) by deed (inter vivos), will or
intestacy - NO SURVIVORSHIP RIGHTS (when one dies, the other doesn't get the entire
property)
iii. Each has a right to divide the interests and have the property partitioned by the court
2) Joint tenancy
i. Each owns the undivided whole, so each has survivorship rights - if one dies, the other gets
it all
ii. 4 unities:
1) Time - must have acquired or vested the interest at the same time
2) Title - must have it under the same title or by the same AP
3) Interest - must have equal, undivided and identical interests, even if they contributed
unequal amounts to the purchase, maintenance, etc
4) Possession - must have a right to possession of the whole (although, one is allowed to
give exclusive possession to the other)
iii. Each has a right to divide the property if they choose by contract or court
1) Can make a request not to divide (against the other's wishes) if it is a reasonable
restraint on alienation - e.g. I want it to be held for 5 years until the market value goes
back up
iv. Can convey interest ONLY during life, and can be done w/o consent or even notice to the coowner (which will create a tenancy in common)
v. Creating a joint tenancy
i. Since there has to be unity in title, if one of the joint tenants owned first and then
wanted to share, it used to be that the original owner had to convey to a straw who
would then convey back to both, so there would be a unity in title, but that is
generally no longer required (you can just write a grant to yourself and your coowner)
ii. Joint tenancy can never arise by intestate succession - if someone gets property
through intestacy, it will be a tenancy in common unless specified otherwise in a will
vi. Severing a joint tenancy
i. By Unities
1) Used to be the same way with severing - if one wanted to sever (which you do
not have to give notice to your co-owner), then they had to convey to a straw
who would re-convey back - broke the unity of title, but now, some courts allow
you to convey to yourself directly
i) May still require conveyance to a straw
ii) Or conveyance in the form of a trust to someone who promises to convey
it back (or to whom you choose) upon your death
iii) Some require recordation (b/c otherwise, I could convey to myself to
break the tenancy, but destroy the conveyance if I hadn't recorded it if my
co-tenant dies first, so that I still get everything - these jurisdictions say
you can't have it both ways)
iv) If the jurisdiction does not allow these, and it's not discovered until your
death, then your co-owners will maintain their survivorship rights and get
everything if you die first
2) If there are three joint tenants, and A conveys his interest to another party, this
breaks the joint tenancy w/r/t A, but B and C according to common law still
have a joint tenancy w/ right of survivorship between them
i) A's grantee will have 1/3 interest and B and C will own 2/3 equally and
indivisibly - this is fine - tenancies in common do not have to have equal
shares
3) Does a mortgage break the unity of title?
i) Title theory - some jursidictions hold that a mortgage is like handing over
your title - in that case, the mortgage would break the unity - however,
some courts have still held that you still hold the title against everyone
else except the creditors, so it does not sever the joint tenancy
ii) Lien theory - the title remains in the owner's hands until the end of the
expiration period, so unless the expiration period ends and the debt is still
not paid, the joint tenancy has not been severed - this is what was held in
Harms v. Sprague
4) Does a lease break unity of title?
i) Generally, no - see Swartzbaugh v. Sampson
ii) Remember, during life the joint tenants have the same rights as a tenancy
in common - but renters from a joint tenant should be aware of the risk of

Property Outline Page 10

To A and his heirs.


To A - words of purchase - whom the land is going to
And his heirs - words of limitation - to clarify the type
of estate being conveyed

A habendum clause will only overrule granting


language if the language is ambiguous.

in common - but renters from a joint tenant should be aware of the risk of
partition or death, but the lessee during his term of years has the same
rights as the co-tenant, unless the contract limits them
iii) BUT, if a co-tenant leases the whole of the property and does not allow
the other co-tenant the right of enjoyment, that co-tenant can recover a
reasonable value for the loss
ii. By intent
1) The court can ignore all of the unities arguments above and look at whether the
co-tenant intended to sever joint tenancy
vii. Granting language
i. To A and B as joint tenants for their joint lives, remainder to the survivor.
1) This is a life estate with a contingent remainder in a FSA
2) They could release their future interests to the present possessory holder,
merging the interests and creating a FSA. This would destroy the grantor's
intent, but it would prevent one from taking unilaterally, which is more likely to
happen in the language below.
3) It is harder to destroy the right of survivorship here than below.
ii. To A and B as joint tenants, with a right of survivorship, and not as tenants in common
1) This is a FSA
2) Remember that courts err on the side of larger ownership
3) Tenancy by the entirety
i. Only between a husband and wife
ii. Cannot unilaterally pass the interest to anyone else - no right to divide (w/o divorce)
iii. Has all of the unities of joint tenancy PLUS the unity of marriage (if you divorce, then it
becomes a joint tenancy)
iv. If people buy before marriage w/ intention of tenancy by entirety and then get married soon
after, some courts have a clean-up rule to allow this, but strictly speaking it will not be more
than a joint tenancy
v. Hawaii extends this to parent/child holders
4) Creditor reach
i. If something can be conveyed during life, then creditors can reach it
ii. Tenancy by the entirety is out of the reach of creditors unless both tenants are held for
whatever loan/credit it is
iii. Joint tenancy
i. Common law rule - creditors can reach half (if one out of two tenants is in debt)
ii. Fractional rule - creditors can reach up to the fraction that the tenant in debt
contributed to the purchase
iii. Intent rule - creditors can reach only the amount that the joint tenant intended to
own (ex - mom and daughter - intended to give to daughter - mom's intent was 0), but
not so simple - must show intent
1) Objective intent? Contribution plus language of the conveyance
2) Some jurisdictions hold that there must be unequal contributions PLUS intent
iv. Carve out rules - some jurisdictions have held that debts will survive the death, so that
loaners get their money, even if there was a joint tenancy
v. See above re: mortgages - if it is held to sever the unity of title, then the creditors can
reach it upon debtor's death - if it did not, then the creditors are out of luck
1) Some courts hold judgment liens (imposed by the court, ex b/c of a tort) should
survive the joint tenant's death, but contract liens (like through a mortgage)
should not
5) Partitioning a joint tenancy
i. Joint tenants always have a right to partition - not allowing that right would be an
unreasonable restraint on alienation
i. There can be a reasonable restraint on alienation (ex. Waiting until they get rid of
certain clouds on the title, like an APer, etc)
ii. By sale
i. Only if physical attributes of the land make it impracticable or inequitable AND it will
better promote the interests of the owners
ii. Usually, this is done through an auction
1) If the court fears that the co-tenant will be the only bidder and this is cheaper
than buying the other co-tenant out, they can set a minimum bid
iii. In kind
i. If the partition in kind cannot be done evenly b/c of the nature of the land, it can still
be done in kind with the co-tenant receiving more being required to pay an owelty - a
one time cash-out for the difference
ii. An in-kind order can set out the bargaining chips for a settlement, but once a by sale
order is made, there is no turning back
iii. In equity, the court can divide as they see fit, while trying to incentivize the parties to
work it out between themselves.
iv. When deciding how to partition, courts consider
i. Who is occupying the land (if it is occupied at all)
ii. The sentimental value of the land
iii. If partition in kind will diminish the value of the land as a whole
iv. Some courts will make ppl draw lots (can't necessarily keep the land you are living on)
Property Outline Page 11

If you need a more detailed example on joint tenancy


and creditor reach, see class notes 10/8/09.

Remember, creditor reach during life is not creditor


reach after death

Courts prefer in kind partition

iv. Some courts will make ppl draw lots (can't necessarily keep the land you are living on)
v. Partitioning a lease that was created in a joint tenancy
i. In kind
1) Partition the land owned jointly over the period of time of the lease
ii. By sales
1) Sell the lease through an auction (which anyone, including the lessee, can bid
on)
i) THEN, the original lessee gets back all of the money spent on
improvements
ii) THEN, the remainder is split between the lessee and the unhappy cotenant
BUT, the lessee, must still pay out the remaining rent owed to the
lessor
6) Ouster
i. Through adverse possession
i. Must show that the co-tenant is preventing the other co-tenant from use/enjoyment
of land
ii. Through liability of occupying co-tenant for rent to other co-tenants
i. Only allowed if preventing entry and use
ii. Majority - absent an ouster, the co-tenant in possession does not owe rent to the cotenant out of possession - could say that this encourages occupation
iii. Minority - even without ouster, the co-tenant in possession owes rent to the cotenant out of possession - you owe for the part that reflects their possessory interest
(1/2, 2/3, etc)
1) So, when would it be fair? Courts look at
i) Intent of the parties
ii) Whether the space is commercial or residential - although rental
residential properties blend the two
iv. If rent is owed, ousted or non-occupying co-tenant should look at the amount of rent
being received - if it appears to be FMV, then they should demand rent from the cotenant, but if it appears to be half of that, then they should demand rent from the
person paying the rent in the first place
7) Improvements upon the land
i. Generally, the occupying co-tenant is required to do the repairs, but whoever puts them in
can get a cash-out during the partition
ii. If improved, there are two options:
1) Improving co-tenant gets the value added of the improvement, and then the original
value is split equally between the co-tenants
2) Improving co-tenant gets the cost expended of the improvement, and then the
remaining value is split between co-tenants
Jurisdictions who follow this generally don't like the risk of major changes
iii. If the "improvement" turns out to lower the value, generally, the only who made the change
will get half MINUS the value lost (so if it's worth $50,000 less, then they will get half minus
$50,000, which will then go to the co-tenant who did not make the change)

Property Outline Page 12

Easements
Wednesday, December 16, 2009
11:50 AM

Easements
Affirmative easements - the right to go onto someone else's land which cannot be revoked,
unless a time period expires
If you say that you can change your mind, then this is a license, and that is a contract
interest, not a property interest
Negative easements - a right to constrain another person's land
1) From blocking your windows
2) From interfering with air flowing to your land in a defined channel
3) From removing support for your building
4) From interfering with the flow of water in an artificial stream
Appurtenant easement attaches to the land (whoever is my neighbor can cross), while an
easement in gross goes to a specific person (the railroad company can cross) generally, courts don't like personal in gross easements (where it is burdened by a
bunch of ppl), b/c it is a restraint on marketability, and if it is hard to track down
everyone who has access to that easement, it will be hard to buy it out
But, in a commercial in gross easement, you know exactly who to go to to buy out the
easement
Easements should be granted expressly in writing to avoid the statute of frauds - all
easements shown below are exceptions, but not ideal.
Granting language: To A as owner of Purple Acre, a right to cross Black Acre to get to
highway one.
Should list:
Grantee
What the right is
Where it is located
How long it should last if not indefinite
Be sure to not make this look like a FSA!
Can clarify which you mean by a statement of intent
Some courts will consider intent, but it must be on BOTH the grantor AND
the grantee side
Others won't if the granting language is not ambiguous
It is okay to grant an easement in FSD - so long as A maintains the road used for
the easement
Quasi easement - you cannot have an easement across your own land for yourself, but when
you burden one part of your land (quasi servient tenement) for the benefit of another part
of your land (quasi dominant tenement), this is a quasi easement, which can turn into a real
easement if you subdivide the land
Generally, if the easement is being held by the grantor upon the subdivision, it has to
be expressly stated in the grant, b/c the grantor is aware of it
Granting language: To A and his heirs, subject to an easement of right of way
reserved for the grantor to cross Black Acre to get to highway one
If it is not there, it will go to equitable servitudes - implied reservation (which is
frowned upon), and they must show that it was so open and obvious, that they
assumed it would be continued and/or they just forgot to include it or it must be
held to be STRICTLY necessary
If the easement is being given to the grantee, the courts are less strict about it being
expressly written, since the grantor was aware of it when selling, and it can be
presumed that it was going to continue
There is an implied grant as long as it is apparent, continuous and necessary in
character
Granting an easement to a third party:
This is sticky - some courts do not allow it, b/c it breaks privity of contract - see
picture to the right
If O owns all of the land and sells Black Acre to A, and then wants to sell
Maple Acre to B with an easement across Black Acre to get to Highway
One, what can O do?
Some courts will allow a reservation to a third party if it is justifiable
Others require a two step process:
1) If O has not yet sold to A, O can sell Black Acre to B, who can then
re-sell to A with a reservation for the easement for B
2) OR, before O sells Black Acre to A, O can include a pre-existing
easement in the grant as an exception, making it an appurtenant
easement to the land (so it will go to whomever live on Maple Acre)
(or can then sell the easement to B)
Property Outline Page 13

When ambiguous language, court prefer an


easement to a tiny FSA strip (which hurts
marketability)

Highway One
Black
(A)

Maple
(B)

Purple
(O)

easement to the land (so it will go to whomever live on Maple Acre)


(or can then sell the easement to B)
Easement v. irrevocable license
If they are working under the servient tenement's permission and nothing else,
that is a revocable license
Sometimes, courts will grant an irrevocable license instead of an easement what is the difference?
With an easement, it lasts indefinitely unless there is some express time
limitation on the easement
An irrevocable license only lasts as long as the conditions remain the same
which maintain its purpose - if the house burns down, the conditions have
changed and the irrevocable license will disappear
How can one grant an easement?
1) Expressly in writing - this is best
2) Prescription
i) Like adverse possession, but most (not all) jurisdictions do not require
exclusive use
1) Actual Entry
2) Open and Notorious
3) Adverse and Under a Claim of Right
4) Continuous for the statutory period
3) Estoppel
i) Elements:
1) Permission
2) Reasonable reliance on that permission
3) Improvement, relying on that permission that would create
4) Injustice to now require it in writing
Note - there is no SOL here - the permission can be made and the
improvement can happen the next day
4) Implied from prior use
i) Elements:
1) Use must be apparent - knowledge on both sides (actual or
constructive)
a. The buyer is said to have inquiry notice, b/c if he checks the
records, he will see that it was previously one plot that was
subdivided
2) Intent on both parties' parts
3) Prior use of the easement
4) Necessity
a. If the use is being held by the grantor, must be STRICT
necessity
b. If the use is being held by the grantee, must be REASONABLE
necessity
c. The necessity must have existed at the time of the creation of
the easement, does not have to exist now (but if someone rebuys all of the plots and then re-divides, they will have to recreate the easements)
d. Other jurisdictions instead hold that there only must be
reasonable necessity, but they will weigh the following
factors:
1) Whether the claimant is the conveyor or the conveyee
2) Terms of the conveyance
3) Money paid for it
4) Whether the claim is made against a simultaneous
conveyee
5) How necessary it is
6) Whether there are reciprocal benefits to the conveyor
and conveyee
7) How the land was used prior to the conveyance
8) Whether the prior use was known or could have been
known to the parties (actual/constructive knowledge)
5) Implied by necessity
i) If implied for grantor, then there must be:
1) Unity of ownership b/w dominant and servient estates
2) Necessity (not mere convenience) - if the necessity goes away, so
does the easement
3) Necessity which existed at the time of the severance
ii) Landlocked by virtue of subdivision
Scope of easements
1) Subdivision of the easement or assignment (servient tenement can complain
that there is an increased burden)

Property Outline Page 14

that there is an increased burden)


i) Generally, you should try to foresee any potential changes/increases and
expressly limit it in the grant of the easement itself
ii) However, courts will still usually limit it to the extent that was granted by
the original parties
2) Extension of an easement (Brown v. Voss)
i) Generally, an adjacent piece of land cannot be bought and then claim to
have rights to the easement next to it - cannot extend in that way
1) Usually, the courts will view this as a misuse of an easement, which
is a trespass - trespasses are ENJOINED
2) If it is only seen as a scope problem, then damages can be awarded
3) If you need that easement for the neighboring property, condemn a
private right of way and pay for it
3) Change in the use of an easement (Presault)
Termination of Easements:
1) Release by the owner of the easement - this is usually required in writing
2) Expiration - at the end of a stated period that the easement was allowed for
i) Also, can occur at the breach of a condition of a defeasible easement
ii) Also, if the necessity changes for an easement implied by necessity, then
it will no longer be held to have that easement (although this is not
technically a termination)
3) Merger - if the easement owner also becomes the owner of the servient estate
4) Estoppel - if the easement owner reasonably relies on statement from the user
5) Abandonment - if the user takes active steps to show they are leaving it (this can
happen overnight)
i) Prescriptive easement of abandonment - for non-use over the SOL
6) Condemnation - the gov't takes the land through eminent domain and no longer
can allow the easement - this generally will require just compensation
7) Prescription - owner wrongfully and physically prevents use for the SOL
Note: a tax foreclosure will not terminate an easement on the land foreclosed
Arguments for termination: easements are burdens, so it hurts
marketability
Arguments against: would be unfair to the dominant tenement who is
relying on it, even if the land had been sold, they could still maintain their
easement
For the benefit/burden to run
All you need is notice for an easement, b/c it is a contract embedded in a
property right
If there is a breach, remedies include:
1) Injunctive relief
2) Specific performances
3) Monetary Damages
How does one create a NEGATIVE easement
1) Usually by express grant
Granting language: have to be careful to not make this look like a
covenant
2) Implied by prior use (ex - solar panels)
3) Estoppel (neighbor says don't worry, I won't block your view and you build
relying upon that promise, etc)

Property Outline Page 15

Covenants that run with the land


Wednesday, December 16, 2009
6:47 PM

Covenants that run with the land - a contracted promise that will continue to bind any future owners of
the same land
Granting Language: For the consideration of $x, Grantor A covenants to Grantee B, his heirs and
assigns, that A will keep the trees trimmed on Black Acre (A's property)
Heirs and assigns also implies and intent to run, but better to expressly say that
Sometimes, you can make a covenant that benefits a third party, but it depends upon the
jurisdiction
Remedies for a breach of a covenant that runs with the land:
1) Injunction
2) Specific performance
3) Monetary damages
1st Restatement
Benefit to run
1) Intent to run
2) Notice
3) Touch and Concern
a) Has to deal with something physically on the land
b) Only worthwhile if it creates more economic value than not burdening at all
c) Generally, obligations to pay money for maintenance are not direct enough to
T&C, but some jurisdictions hold that they are
d) Won't usually allow tying arrangement - homeowners assoc that require money
for gyms, golf course, etc that are in the communal area
4) Vertical Privity - relaxed (an AP only after quieting title)
Burden to run
1) Intent to run
2) Notice - much more important on the burden side
3) Touch and Concern (see above)
4) Horizontal Privity - strict
This is usually established by a developer creating the burden and then
conveying to neighboring plots or by a grantor selling part of his land and
putting the covenant in the grant to the grantee
If neighbors want to create a covenant, they must convey to a straw who will
convey back to them if they want it to run with the land
5) Vertical Privity - strict (whoever is being sued owns the exact estate that was
burdened)
An AP even after quieting title might not be held to have strict VP here, but you
don't want to go against the original intent, so it might be held that the AP is
responsible for the burden
Restatement 3rd
1) Intent to run - if you don't do convey to a straw, you should make intent explicit in the grant
2) Notice
3) Relaxed vertical privity (AP, tenant, etc could sue)
a) Divides Between:
1) Negative (restrictive) covenants - VP just has to be that you are connected to
the covenant in some way (not an arbitrary person suing)
Have to refrain from doing something
2) Affirmative covenants - must have VP (at least relaxed)
Have to actually do something - these are more onerous, but they can get
Property Outline Page 16

Have to actually do something - these are more onerous, but they can get
blurred
What about an AP before quieting title - can they sue? ONLY when
1) The covenant was to repair, maintain or render services to the
property OR
2) If the benefit could be enjoyed by the AP without diminishing the
value to the owner in title and without increasing the burden on the
burden side
b) As long as it is fair for the burden to run
1) Tenant from a lease - might make sense to have the burden run on things that
otherwise the landlord would have to invade the tenant's privacy to maintain,
but not for major, expensive maintenance
2) Life tenant - is liable for the burden but only up to the value of the life estate, so
O or the remainder may have to deal with super expensive changes
3) APer - if is in possession, will be liable for affirmative covenants
4) Can still run, even if the benefit is in gross, as long as it is fair
4) Valid
a) Can't be arbitrary, spiteful or capricious
b) Can't unreasonably burden a fundamental constitutional right
c) Can't be an unreasonable restraint on alienation
d) Can't be an unreasonable restraint on trade or competition (can be found sometimes
in no compete clauses)
e) Can't be against public policy
f) Generally, obligations to pay for maintenance and tying arrangements to homeowners
associations are OK b/c there is notice
g) Even if it puts a slight, but not complete restraint on alienation, this can be ok
Termination of covenants
1) By expiration (can expressly state in the grant that it is only good until a certain time or must
be renewed and re-recorded at that time)
2) Release - usually done for payment to the benefit side
3) Abandonment - where the benefit holder makes unequivocal acts w/intent to abandon
4) Merger - if the burdened side buys up the benefit side
5) Estoppel
6) By prescription (AP the burden and let SOL run, and you'll clear it out)
7) By abandonment/waiver of right to enforce - if a benefit holder does not enforce a
covenant, the burdened side can claim that they waived their right to enforce (this doesn't
have to be over SOL)
Ex - prop owner's assoc does not enforce against A - next week B can claim that they
waived/abandoned right to enforce it against entire tract
This tends to make these associations more assertive to enforce, so that there won't
be a claim of waiver/abandonment of a right to enforce
8) Condemnation - eminent domain
9) Through the consent of all interested parties
a) Sometimes does not even have to be unanimous - if a homeowners assoc says only a
certain percentage vote - can show the power of a holdout if it does have to be
unanimous
10) Changed circumstances - this is HIGHLY limited - must show that change has occurred w/in
the covenanted tract and that the benefit no longer remains at all
a) Restatement Third says:
1) If changes have made the intention of the servitude impossible, then the court
can change the servitude to re-assert the original intent (and if it can't be
modified, then the court can reward compensation to the beneficiaries who lost
out)
2) If changes can still maintain the benefits, but the location of the servitude is no
Property Outline Page 17

2) If changes can still maintain the benefits, but the location of the servitude is no
longer suitable, they can modify the servitude as long as they don't take away
the benefits
Federal Fair Housing Act
Only helps protected classes
Disability - something that prevents an individual from carrying out ADLs
Race
Class
Family status
NOT marriage status, viewpoints, sexual orientation
If you are protected, there is:
1) Discriminatory intent - nothing will be valid that was made with the intent to
discriminate against a protected class
2) Disparate impact - even if it was not the intent, but the outcome is discrimination, it
will not be allowed as long as there can be...
3) Reasonable accommodations - this is very fact sensitive, looking at the people and
places on a case-by-case basis
Remember, all of these requirements are only SUPER important if you want monetary damages otherwise, if you fall short, you can go to equitable servitudes and still get injunctive relief or specific
damages
In first restatement, if the benefit is in gross, the burden will not run
Covenants generally cannot create a property interest in a third party
When ambiguous, courts favor not burdening land
If you don't remember changed circumstances, see Western Land Co. v. Truskolaski

Property Outline Page 18

Landlord/tenant Covenants
Wednesday, December 16, 2009
6:47 PM

Covenants w/r/t landlords and tenants


Note: landlord/tenant is considered sufficient horizontal privity (like grantor/grantee)
Question:
Assignment? New tenant completely replaces old tenant
Novation - an explicit contractual release from the obligation - note, only a landlord
can release the tenant, not the replacing subtenant
Then the landlord can only sue the new tenant for any breaches - under privity of
estate
OR Sublease? There is an incomplete taking
Then the landlord could sue the new tenant OR the old tenant for breaches
The T1 tenant can be sued under privity of contract
Depends on the jurisdiction - can look at:
Intent (modern rule)
What did you transfer? (Common law rule)
Anything less than everything = sublease (ex. Hold back one day)
Everything = assignment
If there is no express reversion or right of re-entry, the majority will find an
assignment, but a growing minority will find a sublease
Note: even in jurisdictions that don't recognize third party beneficiaries, there will still be
held an obligation to pay rent, b/c too important and can adversely affect all of the other
tenants (but might not uphold affirmative covenants, like to fix things on the property
Can a landlord unreasonably withhold consent to sublease or re-assign?
The law favors alienability
Especially important public policy now in an increasingly urban society
But this might not be held to be AS important in residential dealings
But sometimes there is a leniency for residential contracts, assuming that they are less
sophisticated
Common law: lessor are permitted to have contractual restrictions, including a right to
withhold consent
Majority: Can arbitrarily refuse if it is in the contract
But this is often overridden by estoppel or waiver
Minority: cannot arbitrarily refuse
Restatement second: cannot withhold arbitrarily unless that was a freely negotiated part of
the contract
Mitigation requirements - if a landlord is going to make it hard to replace a tenant, they
must help look for a tenant, and the tenant will be liable for the cost of the search and rent
until they are replaced
For residential properties, it usually ends up being one of the following:
1) Arbitrary refusal + no mitigation - all tenant's responsibility - old rule
2) Arbitrary refusal + mitigation requirement (tenants don't know how to pick tenants)
3) No right of arbitrary refusal + no mitigation requirement (similar to #1 - puts
responsibility on tenant)
4) No arbitrary refusal + mitigation - most tenant-friendly, but could be seen as
paternalistic - also, is most likely to keep the land in use, which is good

Property Outline Page 19

Equitable Servitudes
Wednesday, December 16, 2009
6:47 PM

Equitable servitudes - a promise that does not meet all of the technical requirements of a covenant that
runs with the land
- Can be protected by injunction or specific performances, but NOT monetary damages
- Requirements:
1) Intent
2) Notice
3) Valid

Property Outline Page 20

Incompatible Uses
Wednesday, December 16, 2009
7:37 PM

Incompatible Uses
1) Nuisance
2) Trespass - only allowed for a physical invasion
Why choose trespass over nuisance?
Importance of the right to exclude
You will get damages if you can show the mere fact of an invasion, regardless of intent
Nuisance requires much more balancing and might end up not getting relief
3) Zoning - often can preemptively avoid incompatible uses
4) Environmental regulatory agency rules
5) Covenants - best only for small things between private parties

Property Outline Page 21

Nuisance
Wednesday, December 16, 2009
7:38 PM

Nuisance
Remedies:
Damages
Can require ongoing damages until harm stops - can induce nuisance to modify
their actions
Permanent damages may be like licensing a wrong and may not induce behavior
change, or it could be that the damage was done and the permanent pay -out
will suffice b/c no one will live there anymore
Injunction
If there is social utility, this might not be the best option, but it does create a
bright line rule, which may prevent future litigation, or you could just feel that
the harm is too great or the nuisance is too rich that monetary damages would
have no effect or this could just be the jurisdictional rule in certain situations
and this is the only option
Although it can be a start to bargaining if you allow
Nuisance to pay harmed party for the injunction
But, this is like licensing a wrong
Parties can also choose to do this privately, and that would not be
licensing the wrong w/o their consent, but their can be transaction
costs, holdouts that put the nuisance out of business, etc
Or say that the injunction is only until they can negotiate a tolerable level
b/w the parties
Or say injunction is only until they can come up with technological
advances that eliminate the problem
Also, could incentive ppl to complain to the legislature, which would get
regulatory agencies to take over, which is good
Combination
Complaining party must pay the nuisance to move
How to decide? Weigh
Social utility
Ability to prevent the harm and still operate
Who is a nuisance?
Social utility - balance to see which use has more social utility
Although this might not be the best starting point, b/c then it will be weighed
twice - here and in the remedies
Also, tends to favor big business and disfavor private landowners, etc.
Coming to the nuisance argument
Sometimes this is reflected in the property values at the time of moving towards
the nuisance
Substantial, intentional, unreasonable - this is usually the starting point - see decision
tree
Substantial - frequency of occurrence, degree of harm, some jurisdictions say
$100 worth of harm
Is this a highly sensitive complainant?
Intentional
Some jurisdictions say acting with the purpose of creating the harm
(narrow)
Others say acting knowingly, even if there was not harmful intent (broad)
Unreasonable - this is
1) only looking at the degree of harm to the plaintiff - no cost/benefit
analysis
So, the harm gets weighed doubly - here and in substantial
2) Balancing the degree of harm with
a) Benefits provided by the defendant
b) Cost to the defendant of preventing the harm
c) Plaintiff's role in reducing the harm
Remember, if there is a ramping up, then there is a new nuisance claim

Property Outline Page 22

1. Substantial ?

Yes

Unintentional

Intentional

Reckless or negligent?
(or ultrahazardous) could look at moving to
the nuisance or poor
site choice
No

Yes

Unreasonable?

No

Yes - maybe poor


location choice,
among other
reasons

Remedies
No liability, so
no remedies

No liability, so
no remedies

Remedies

Trespass
Wednesday, December 16, 2009
7:38 PM

Trespass - a physical invasion


Remedies:
Damages
Injunction - this is most likely if something is characterized as an intentional trespass

Property Outline Page 23

Zoning and Eminent Domain Claims


Wednesday, December 16, 2009
7:38 PM

Zoning and Eminent Domain Claims


Cumulative zoning began in Village of Euclid v. Ambler Realty Co - allowed, even though property
value decreased by 75%
Variance - an allowance to get a lower use in a higher use area
Zoning can be unconstitutional if:
1) There is no authority to engage in the taking at all - not a public use/purpose
a) Generally, zoning is considered a public purpose, so it's allowed
2) Gov't won't pay just compensation for it
a) Generally, zoning is characterized as nuisance control, which does not have to be
compensated (as opposed to the provision of a benefit)
Also, look at the standard of judicial review
Generally, there is a lot of deference to the legislatures on zoning and eminent domain to
maintain separation of powers
But, maybe there should be stricter scrutiny, b/c of legislators' tendency to act w/ a shortsightedness b/c of voting cycles
Hadachek - entirely devalued his property and business, which were specific to THAT land - still
not considered a taking

Property Outline Page 24

Eminent Domain
Wednesday, December 16, 2009
8:59 PM

Eminent Domain
1) Public use/purpose
2) Was there a taking?
i. Categorical rule of characterization of the taking - if there is a permanent, physical
occupation by a third party, then it is a taking - hurts the right to exclude
1) BUT, permanent can be ambiguous
ii. Was the area already open to the public? If so, generally you can't exclude, but you can
regulate time, place and manner (Pruneyard, State v. Shack)
iii. Distinct investment backed expectations?
iv. Conceptual Severance v. property as a whole?
v. Extent of diminution?
vi. Is it land or coal/clay?
vii. Is there an unfair burden on a private party on behalf of the public?
viii. Is it 100%?
ix. Did the gov't go too far?
1) If the gov't had to pay for everything, we wouldn't be able to afford to provide
anything
x. Are there reciprocal benefits and burdens?
xi. Did the regulation take away 100% of its value, even if there is no actual taking? Consider:
1) Degree of harm to public land and resources or adjacent private property by
claimant's activities
2) Social value of these activities and their suitability to that location
3) The relative ease w/ which harm can be avoided by actions taken by claiment, gov't or
neighbors
4) THEN - if it is 100% - nuisance only = common-law nuisance
3) Just Compensation
i. Preventing a nuisance/w/in police powers? - no compensation required
ii. Providing a good? - then, must compensate
iii. Fair Market Value
1) AT THE TIME of the announcement of the taking (not after all the litigation, when the
market value will have already dropped) - although, even the announcement will drop
the value
iv. Replacement value - how much would it cost you to come back and buy the same square
footage? - no standard, b/c hard to take into account indiv. characteristics, sentimental
value, etc - ppl who willingly sell w/o litigation are likely to get more $
v. Transferrable Development Rights (TDRs)
4) Standard of review
i. Generally, it is a reasonable basis review/rational review (coupled with the deference to
lower courts provides a LOT of leeway to gov't)
ii. If it were higher, it could work back around and help gov't to hold promisors accountable
1) Although, corporations are liable to their shareholders - not reasonable to expect
them to stay at a loss to their shareholders
Cases
Kelo (Pfizer in New London)
Loretto (cable lines)
Causby (overflight)
Kaiser Aetna (dredged lagoon)
Pruneyard Shopping Center (annoying pamphleteers)
Yee v. City of Escondido (rent control - can't evict to raise the rent - no taking b/c not
permanent - you can stop renting or they can move out)
Andrus v. Allard (eagle feathers - right to sell was not so valuable a right that removing it
was considered a taking)
State v. Shack (migrant farmworkers)
City of Euclid v. Ambler Realty (75% loss to zoning - no taking)
Hadacheck (loss of brick making - no taking)
Pennsylvania Coal (conceptual severance - taking 100% of support estate)
Kestone Case (overrules PA Coal - says regulating a nuisance)
Penn Central (landmarks and TDRs)
Lucas (SC island restricted bldg)

Property Outline Page 25

Remember that the gov't has the right to eliminate


nuisance w/o paying, but private actors do NOT

Nuisance?

Yes

100% loss?

Yes

No - no taking no
compensation

What type of
nuisance is it?
(redefinition at
this point)

A nuisance that
does not violate
any prior
common law
nuisance
regulation compensation

A nuisance that
violates
common law
nuisance
regulation - no
compensation

Regulatory takings

Physical Invasion

Third party/gov't invasion?


Yes - this is like taking land
Kaiser Aetna
Causby
Loretto

Yes, BUT, you invited them


in - this is not a taking
Pruneyard Shopping
Center - said you can't keep
them out b/c you invited
the public in, and they are
part of the public, but you
will be allowed to regulate
time, place and manner

Non-nuisance regulation not a common law nuisance


in the 100% taking cases
(w/o physical invasion)
Penn Central Case
Then, you have to look at
factors:
Reciprocity of benefit
Diminution in value
What is the gov't seeking to
accomplish?
What is the burden on the
owner?
Reasonable investmentbacked expectations
Balancing test that doesn't
always win

Nuisance
(gov't will always claim they are
preventing a harm)
Is it less than 100% taking?
If it is less than 100%, and it truly is a
nuisance, then there is no taking
If it is 100%, then we look at
background law (common law rules),
and if it is a nuisance under the
common law rules, then there is no
taking
If it is 100% and it is not a common
law nuisance, then it goes back to the
Penn Central balancing test of nonnuisance regulation (Lucas)
There will also be pressure on the
definition of property (interests) in
determining %age of loss