PROPERTY OUTLINE

BY JOSH AGEN, CHRISTOPHER CARLISLE, AND YASSER MUSEITIF (Consisting in a Rough Overview of Property by Jesse Dukeminier and James E. Krier, as Covered in Professor Dagan’s Class, and as Supplemented by the Memory of Mr. Agen, the Inspiration of Mr. Museitif, and the Interpretation of Mr. Carlisle)

Chapter 1: First Possession The Principle of First-in-Time Labor theory (Locke) Pierson v. Post Majority: In wild animals, at least mortal wounding is required for possession Dissent: (a) the trade practices of hunters should govern (b) possession should be based on reasonable certainty of capture Ghen v. Rich Where the externalities of a decision do not affect people outside the industry, custom is an appropriate standard of property rights (parties’ expectation). Keeble v. Hickeringill Even when a competitor might legitimately deprive a constructive owner of possession, a malicious interferer may not (Duck Decoy Case). First-in-Time-First-in-Right encourages exploitation of natural resources Natural Resources: Demsetz: Toward a Theory of Property Rights Private property rights increase efficiency by internalizing externalities: The inherent limitation on private property is transaction costs. Therefore, private property originates when the increase in efficiency exceeds the transaction costs of instituting private property, i.e. when a) the benefits of efficiency increase (beaver example), or b) the transaction costs decrease (barbed wire example). Acquisition by Creation Cheny Brothers v. Doris Silk Giving intellectual property rights does more than give a chattel to a party, because the usefulness intellectual property is not limited. Therefore, granting intellectual property rights diminishes the overall usefulness of a resource, and can only be done by the legislature.

International News Services v. Associated Press Holding limited to its facts by Cheny. Moore v. Regents of the University of California The Right to Exclude Jacque v. Steenberg Homes There are punitive damages for trespass, even without actual damages. State has policy in favor of enforcing right to exclude, perhaps because it increases certainty and efficiency. (Mobile Home Company Case). State v. Shack Either: The policies of the state may override individual property rights, Or: A property owner may not invite persons onto his property and deny them necessary services. Chapter 2: Subsequent Possession Armory v. Delamerie Diamond Ring Case. Finder has property right against everyone but the true owner. Baliment: A possessor, whether true or wrongful, has a right of recovery against all subsequent possessors except the true owner. (Courts sometimes prefer an honest later possessor to a dishonest prior possessor, however.) In baliment, the true owner has no cause of action against last possessor after the bailee has already won an action of replevin (cheapest cost avoider). Finders Hannah v. Peel Constructive possession of found chattels is limited to cases where the owner of the locus has actual control over the locus, as by being in actual possession. (Owner never occupied house where brooch was found.) McAvoy v. Medina Owner of store is entitled to mislaid (as opposed to lost) property. Treasure Trove: In U.S., money, gold, silver and sometimes other valuables buried underground, and money hidden above ground: generally awarded to finder. Marine salvage is generally subject to law of finders’ fee. Adverse Possession Ballentine

Adverse possession encourages (a) efficiency of land use and (b) eliminates transaction costs associated with title. Holmes Adverse possession is reasonable because long possession makes property part of oneself, in some way. Van Valkenbergh v, Lutz Adverse possession requires that the adverse possessor use the property in roughly the same manner as a true owner (e.g., by enclosing, cultivating or improving). Elements of adverse possession: Actual entry giving exclusive possession, which is Open and notorious, and which is Adverse and under claim of right, Continuous for the statutory period Manillo v. Gorski Overstepping the bounds of one’s property is generally not “open and notorious,” but if done and relied on in good faith, may require equitable forced transfer. Adverse Possession of Chattels O’Keefe v. Snyder Adverse possession of chattels has problem with respect to openness and notoriety. Adverse possession will begin when the true owner should reasonably know of the adverse possessor’s claim, by the use of measures to make theft known. Chapter 3: Possessory Estates in Land Magic words creating freehold estates: Fee Simple To X and his heirs Fee Tail To X and the heirs of his body Life Estate To X for life

Fee Tail interest as construed by modern jurisdictions To A and the heirs of his body, remainder to B, creates: 1. Life estate in A followed by a fee simple in his issue (minority) 2. Fee simple in A 3. Fee simple with a gift over to B if A dies without issue 4. Fee Tail (in states which have not abolished it), which is subject to disentailment.

White v. Brown (crotchety old lady case) Presumption against intestacy. Presumption in favor of fee simple. No restraints on alienability of fee simple. Baker v. Weedon If equitable intervention is necessary to further the interest of all parties, a court may force sale of future interests for the benefit of life tenants. Defeasible estates determinable subject to condition subsequent subject to executory limitation Marenholz v. County Board of School Trustees Some courts hold right of entry and possibility of reverter to be inalienable Some courts hold that a form of conveyance may be interpreted to convey an interest outside its usual meaning if required by the grantor’s “meta-intent” Mountain Brow Lodge v. Toscano Absolute restraints on alienability are void (if repugnant to the estate conveyed). Restrictions on land use are valid. Dissent: Restrictions on land use may be de facto restrictions on alienability. Defeasible life estates: Restraints on marriage are void if intended as a punitive measure, but valid if intended to support grantee until marriage (rights of entry generally punish, possibilities of reverter usually support). Chapter 4: Future Interests Future interests give rise to actual legal rights in the holder In Grantor Reversion: The interest created in a grantor when he conveys an estate of lesser quantum than he holds. Possibility of reverter: The interest created in the grantor when he conveys a defeasible estate of the same quantum as he holds. Right of entry:

Interest remaining in the grantor when he conveys an estate but retains the right to enter and retake. In Grantee Remainder: Interest in a grantee which is capable of becoming possessory upon the termination of the prior estate. Vested remainders: remainders which a) are created in definite people, and b) are certain of becoming possessory upon termination of the preceding estate. Executory interests: Interest in grantee which terminates the preceeding estate, rather than waiting patiently for it to end. Springing executory interests divest grantors. Shifting executory interests divest grantees. Trusts: Grantor conveys to a trustee in fee simple for the benefit of a grantee. Beneficiary takes ony an executory interest. Unreachable by creditors. Rules furthering marketability Rule against perpetuities: “No contingent future interest in a grantee is valid unless it must vest, if at all, within 21 years after some life in being at the creation of the interest.” Executory interests in grantees are subject to RAP. Chapter 5: Concurrent Interests 1. Tenancy in common: Separate but undivided interests in same property 2. Joint tenancy: Right of survivorship 3. Tenancy by the entirety: Requires the unity of marriage Unities for joint tenancy: Time Title Possession Interest Joint tenancy has the benefit of avoiding probate, by the right of survivorship.

Riddle v. Harmon There is no need for a straw man in order to sever a joint tenancy. Harms v. Sprague Under lein theory of mortgage, right of survivorship prevents a mortgage from continuing to encumber an estate after the death of the party who took the mortgage. Relations among concurrent owners Delfino v. Valencis Courts generally prefer partition in kind to partition by sale; partition by sale requires showing of (a) impracticability of partition in kind, and (b) benefit to both parties (Garbage dump case). Spiller v. Mackereth Co-tenants may not require rents from their co-tenants, unless they have been “ousted”, or prevented from using the premises. Swartzbaugh v. Sampson Co-tenants do not have the right to invalidate leases taken by their co-tenants. Co-tenants must pay their co-tenants a pro rata share of any rents collected. Co-tenants are generally liable for their share of necessary expenses, such as property tax, but not for unnecessary expenses, such as repairs. Marital property Sawada v. Endo Marital property jurisdictions: I. Husband has sole governance, wife has only right of survivorship II. Either spouse has independent governance III. Both spouses must act together in any governance IV. Either spouse may convey his/her contingent right of survivorship, but not the profits or use during marriage. Hawaii adopts Group III. Termination by divorce: Equitable division of property is customary in most states. Alimony is no longer for life. Degrees and increased earning capacity as marital property: Colorado: no compensation In Re Marriage of Grahm New Jersy: restitutionary compensation Mahoney v. Mahoney New York: spouse acquires portion of future earnings Elkus v. Elkus Community property:

Occurs only in marriage Is not subject to inter-vivos conveyance by one spouse Gives the right to convey ½ interest at death In the case of intestacy, some states give property to surviving spouse, others give it to heirs. Chapter 6: Leasehold Estates 1. Term of years 2. Periodic tenancy 3. Tenancy at will Periodic tenancy: Renews automatically unless either party gives notice. Common law limits period of notice to 1 year. Tenancy at will: Garner v. Garrish It is possible to create a tenancy at will terminable only at the will of the lessee, but not of the lessor. Restatement of Property: Tenancy at will may be created which gives either party sole power of termination. Common law: Tenancy at will must be terminable at the will of both parties. The lease Leases for 1 year or more require written contract (statute of frauds). Unlawful discrimination Fair Housing Act: No discrimination based on race, gender or national origin (later amendment, on physical handicap or familial status). §3603: FHA does not apply, except in the prohibitions on advertising, to single-family homes owned by landlords who own three or less houses, and to multiple unit dwellings of four units or less where the owner lives in one of the units. §3604: Prohibits refusal to sell, discrimination in terms, and discrimination in advertising. Handicapped persons are also awarded a right to “reasonable accommodations.”

Civil Rights Act: not subject to any of the limitations of the FHA, but applies only to race. Soules v. U.S. Department of Housing Plaintiff in FHA case need only show discriminatory effect to make a prima facie case of housing discrimination. Defendant than must rebut with a showing of non-discriminatory reason. Duties of tenants Courts generally try to discourage self-help against defaulting tenants. Duties of Landlords Covenant of quiet enjoyment: Tenant’s remedy for landlord’s interference, by act or omission, with a tenant’s use or enjoyment of things contracted for in the lease. If interference is substantial enough to amount to eviction, it will void the tenant’s duties under the lease, if the tenant vacates the premises in consequence. Illegal lease: Contractual remedy for housing which does not comply with applicable housing codes. Implied warranty of habitability: Judicially created quasi-contractual doctrine whereby the court imposes a standard of habitability on leased residential premises, and awards damages to a tenant who leases “uninhabitable” premises, without the requirement that the tenant vacate. Damages Hilder v. St. Peter: damages measured by taking the terms of the lease and diminishing rent in light of the fact that the premises are deemed to be “uninhabitable”. Kline v. Burns: damages determined by subtracting the fair market value of premises in their current state from the rent actually contracted for (prevents gouging). Chapter 10: Servitudes Easements Created by: 1. Express grant (Willard v. First Church of Christ, Scientist) 2. Estoppel (Holbrook v. Taylor) 3. Implication (use) (Van Sandt v. Royster) 4. Necessity (Othen v. Rozier)

5. Prescription (like adverse possession) (Othen v. Rozier) All easements are coextensive with the conditions which occasion them (Chris’s editorializing). Fiction of the lost grant. Public easement Public easements are, like prescriptive easements, created by long use by the public. Prescriptive (few courts) Public use Customary use Public trust (Matthews v. Bay Head Improvement Association) Scope of easements: Brown v. Voss 1. Intent of the parties governs interpretation of easement by express grant 2. Misuse of easement constitutes trespass 3. Courts have broad discretion in fashioning remedies Owner of servient estate may make reasonable modifications to easement, but not alter location. Uses of a prescriptive easement (as opposed to other types of easement) may not be modified. Termination of an easement: Presault v. U.S. When a party ceases to use and exhibits intent not to use an easement for the purposes for which it was granted, then the easement is deemed to be abandoned. Covenants running with the land Shelly v. Kramer Enforcement of a covenant constitutes state action for purposes of the 14th Amendment. Western Land Co. v. Truskolaski As long as the original purpose of a covenant may still be effected, it is enforceable. Rick v. West

Restatement Third of Property: When the purpose of a covenant is made impossible, as a practical matter, to accomplish, a court may alter a covenant to permit the use to be accomplished. Massachusetts rule: When the circumstances surrounding a covenant change, the courts must enforce it by damages rather than injunction. Common interest communities Nahrstedt v. Lakeside village Condominiums Chapter 12: Eminent Domain and Regulatory Takings Hawaii Housing Authority v. Midkiff Loretto v. Teleprompter Manhattan CATV Corp. Hadacheck v. Sebastian Pennsylvannia Coal Co. v. Mahon Penn Central Transportation Co. v. City of New York First English Evangelical Lutheran Church of Glendale v. County of Los Angeles Nollan v. California Coastal Communication Dolan v. City of Tigard Lucas v. South Carolina Coastal Council

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