Property Law

Peñalver, Spring 2010 OUTLINE Table of Contents

Acquisition of Property and an Introduction to Theories of Property Initial Acquisition of Property Rights
y DISCOVERY AND CONQUEST Johnson v. M¶Intosh, 1823: conquest p title in the U.S. > title of the Indians  FACTS: (Johnson) acquired title by purchase from Painkeshaw Indians; (M¶Intosh) acquired title to same land under grant from the U.S.  RULE: discovery of land in American by a European power gives absolute title subject only to the Indian right of occupancy o John Locke¶s Labor Theory: when a man mixes his labor w/ a parcel of land (e.g. cultivating it), he owns that piece of land o Haslem v. Lockwood, 1871: Possession & Abandonment  FACTS: left manure in public street, intending to carry it away the next day. found manure and carried it away first.  RULE: as abandoned property, it belonged to the first occupant ( ) who ³ had changed its original condition and greatly enhanced its value by his labor´ CAPTURE AND POSSESSION Pierson v. Post, 1805: hunter must either trap or mortally wound a wild animal before he acquires title to it  FACTS: (Post) discovered a fox on wild uninhabited land. In an attempt to capture the fox began to hunt and pursue the fox w/ his dogs. Even though (Pierson) knew that was hunting the fox, he killed the fox and took possession of it.  ISSUE: does mere pursuit of a wild animal vest title in the pursuer?  RULE: hunter must either trap or mortally wound a wild animal before he acquires title to it ³First in time rule´: he who occupies the animal first owns it y Issue: 1st to pursue or 1st to capture? o Established custom: hot pursuit vests a right of ownership in pursuer o Court: 1st to capture = ownership 2 justifications for rule that capture is required y advances society¶s goal of capturing wild animals (the desire to make ³efficient use´ of property) o society rewards the captor to foster competition

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o more competition p more hunters p more efficient capturing of wild animals y the rule is easy to administer o easy to determine who captured a wild animal o difficult to determine who was 1st to pursue  DISSENT: rule should be: a pursuer acquires title to a wild animal if he is in reach of the animal or if he has a reasonable prospect of capturing the animal foxes are a public nuisance p killing foxes is in public interest the rule the court should adopt should encourage the destruction of foxes Ghen v. Rich, 1881: title to a wild animal is acquired when the hunter apprehends the beast in accord w/ custom  FACTS: (Ghen) shot and killed a whale, which sank to the bottom of the sea. 3 days later, Ellis found the whale on the shore and sold it to (Rich)  RULE: title to a wild animal is acquired when a hunter apprehends the beast in accordance w/ custom Custom and acquisition y When custom embraces an entire industry, there is no need for the court to fashion a judge-made rule, custom is good enough y Local Cape Cod custom of killing whales: o Fishermen kill whales w/ bomb-lances, using a unique brand so killer is known o When whales are killed, they sink to the bottom an rise to surface 2-3 days later, then float ashore or to open sea o When whale is shored, finder sends word to killer, usually awarded a small finders fee y Custom is compelling in this case b/c: o Affects few people o Relied upon for many years o Finders fee o Necessary for the continuance of the industry Efficient capture of wild animals (a goal of property law) y Ghen v. Rich: o Custom: refined to fit the particular needs of the trade o It is more efficient to award the whale to the killer, even though he does not immediately capture it, b/c the killer ship can go off and look for other whales w/out waiting for the dead whale to rise y Pierson v. Post: o Custom: to award the wild fox to the man first in hot pursuit o This custom did not promote the efficient capture of wild animals (majority thought) Keeble v. Hickeringill, 1707: an individual may not maliciously prevent another from capturing wild animals in pursuit of his trade

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FACTS: when (Keeble) lured wild-fowl to his land w/ decoys, (Hickeringill) frightened the wildfowl away by firing a gun  RULE: a person may not maliciously prevent another from capturing wild animals in the pursuit of his trade Public Policy reasons y Every man should be able to enjoy the use of his land as he sees fit (so long as it is lawful) y The capture of wildfowl in pursuit of a trade is profitable²it creates wealth for the tradesman, for employees, and for the nation at large o Doctrine of Ratione Soli: an owner of land owns the wild animals on that land  May discourage efficient capturing of wild animals if the owner refuses to capture them  Discourages trespassing p protecting a landowner¶s constructive right to possession against a trespasser EXCURSUS: ³TRAGEDY OF THE COMMONS´ & ECONOMIC THEORY OF PROPERTY o Hardin, ³Tragedy of the Commons´(PPL): when the incentive structure is such that an actor would bear only a fraction of the costs of an action, but would simultaneously reap all of the benefits of that action, a ³Tragedy of the Commons´ is created.  This holds true from polluting manufacturers to child-bearing parents.  In short, and contrary to the laissez faire understandings of economics, rational self-interested actions can lead to socially undesirable effects.  Appeals to conscience are ineffective here, and eventually select for those without pangs of conscience.  The key is to remove free and independent choices in such areas (most pointedly in childbearing). o Acheson, ³The Lobster Gangs of Maine´ (PPL): in lobstering communities, the water and its lobsters are thought to be common property²but practice realities contradict legal theories.  Lobstering Practice Harbor gangs have dibs on certain portions of the fishable waters, and encroachments into other gangs¶ territories are not tolerated Unofficial enforcement of the access norms is highly effective, and every successful fisherman must respect the rules  This system increases efficiency and avoids the Tragedy of the Commons² even in the absence of private property That is, ³open access´²not ³common property´²causes problems. pTragedies of the Commons are not inevitable in the absence of private property o Fugitive Resources  Oil and Gas Rule of Capture: analogous to wild animals y RATIONALE: incentive to produce oil and gas y Rule does not protect negligent drillers 

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even if it causes harm y Cannot divert water to noncontiguous land if another would be harmed Surface Water Depends on whether the water is beneficial and wanted or not wanted Rule of Capture: but cannot unnecessarily harm owners below Expelling water y Common Enemy Doctrine: unqualified right to fend off waters as long as the interference w/ the neighbors is reasonable and not negligent y Natural Servitude Doctrine: a/k/a ³civil law doctrine´ followed in half the states o Lower lands are servient to the natural flow of surface waters and the owner cannot obstruct or change the flow so as to injure others above o PRO: predictability o CON: limits development and improvement of land Streams and Lakes Natural Flow Doctrine: English developed.   Unitization: most states have statutes regulating the number of acres required for a well and requiring apportionment of the drilling profits among the surface owners w/in the acreage unit Ground Water Rule of Capture: English rule applied in many Eastern states where underground water is plentiful Reasonable Use Doctrine: applied in most Western state and some Eastern states where water is scarce. y Can pump reasonable amounts for use on own property in unlimited amounts. one riparian owner can use the water but must return it to the stream in its natural condition y Can be used for domestic needs and commercial needs so long as it does not affect the quantity or quality of the water y LIMITS: not permitted to use water on non-riparian land and water storage is not permissible y CON: severely limits the use of water for irrigation and commercial use Reasonable Use Doctrine: followed by most American courts y Down stream owners cannot enjoin the owner or recover damages unless they are not receiving enough water for their needs or the upstream owner has substantially interfered w/ their needs y ECON: ad hoc balancing of interests has high judicial cots and costs of legal advice and litigation but it is economically better if a right passes to the user who values it most Rule of Capture: a/k/a ³prior appropriation doctrine´ used in arid Western states y Water can be used on land far away from the source 4 .

they internalized the externality (over hunting). gov¶t the power to regulate all navigation in navigable waters (build damns and interfere w/ the natural flow) o Harold Demsetz. it is an interest independent of the land (a ³water right´) and can be severed from the land and sold to another for use on other land y ECON: encourages development of water uses and is predictable.Once a right to water is established. how much each tribe member will hunt beaver) Private Ownership y Owner can exclude others y 5 . saving the beavers y But SW Indians hunted grazing animals with little commercial value (low benefit of internalization) and the animals wandered a lot (high cost of internalization--hard to keep track of which animals are "yours") no property rights  3 Ideal Types of Ownership: Communal Ownership y All members of community can exercise this right. expressed as laws.g.. or norms Main Allocative Function: the internalization of beneficial and harmful effects (externalities)  Emergence of Property Rights Because of the "emergence of new or different beneficial and harmful effects. customs.g." To "internalize externalities when the gains of internalization become larger than the cost of internalization." y E.: Indians in Quebec established property rights after the (beaver) fur trade picked up--thus. it is efficient in that it permits the transfer of a prior appropriation right to a user who puts a higher value on it and transaction costs are low Public Rights: a riparian owner may not exercise his rights so as to infringe on public rights in public waters y Most states can regulate the public rights under the police power y Constitution grants the fed. neither citizen nor state can interfere y Must negotiate over costs of externalities (e. ³Toward a Theory of Property Rights´  The Long Chain of Causation: Changes in technology or the opening of new markets p Changes in economic values which p Internalization pcreation of property rights  Property Rights An instrument that helps us form expectations about our dealings with others Socially constructed²they are expectations of how we can deal with others.

.y y Greatly reduces negotiation costs State: state can exclude anyone from using the property CREATION: INTELLECTUAL PROPERTY o Misappropriation and Copyright Int¶l News Service v. Since unprotected. 1918:newly printed news is protected from copying FACTS: (Associated Press) gathered news from several newspapers. (Doris) copied one of ¶s designs w/ knowledge of ¶s original design. (International News Service) copied news from one of the papers and published it RULE: where a company has expended resources in creating news and information. alleges a common law patent protection from International News (above). ISSUE: is there a generic common law patent protection which lasts for the commercial life of a creation? RULE: ³in the absence of some recognized right at common law. Doris Silk Corp. such collected news would not be created. This collection of news was then made available to all the members of . Associated Press. Others may initiate these at their pleasure.´ y Rationale: o There can be no common law patent protection b/c it would be too difficult to define the boundaries o International News  common law protection  Only Congress may create patent protection  Must be limited to facts of the case y International News vs. below) Cheney Brothers v. o Tangible Property: the court is protecting the ³chattels´ (the words) themselves. W/out protection.. 1930: fashion designers may copy each other¶s works FACTS: (Cheney) creates short-lived fashion designs which are not sufficiently original to support a patent nor can they be copyrighted under the copyright act. Cheney²why are they different? 6 . not merely the intellectual concept from being copied (this view is consistent w/ Cheney Bros. the creator can exclude others from copying it until its commercial value as news has passed away y Rationale: o has invested time and resources into the creation of the news (labor theory p possession) o If copying was allowed. or under the statutes«a man¶s property is limited to the chattels which embody his invention. no news service could manage to stay in business (economic consideration²foster competition) y 2 Views of Case: o Intangible Property: an attempt to encourage the ³creation´ of property.

and trademarks is to grant a limited monopoly over the protected material y A monopoly to promote creative activity y Limited in order to advance competition Patents y Granted for novel.. Words: in Int. News. ³Common Law Intellectual Property and the Legacy of International News Service v. grating individuals exclusive rights to property is an effective way of allocating scarce resources Granting exclusive rights to info does not necessarily promote a market economy²competition depends upon imitation  Intellectual Property Idea behind patents. useful. News. it is trying to protect competition o Idea vs. It is the unimpeded availability of substantially equivalent units that permits the normal operation of supply and demand´ o this public benefit might be lost if could not inform potential customers of their equivalent product o indentifying ¶s trademark is the most effective way  Baird. Associated Press´ In a market economy.o Public Policy: in Int. the idea behind the design was being copied o Underlying Theory: ideas cannot be protected by common law property or copyright laws Smith v. copyrights. while in Cheney. being the first to appropriate them. by advertising that its product was the equivalent of ¶s more expensive product. In Cheney. it was not so much an idea that was being copied. and non-obvious process or products y Takes a long time to acquire y Lasts 20 ears from date of the original application y Non-renewable. 1968: the ³right´ to copy unpatented protects FACTS: (Chanel) claims (Smith). was infringing on their product rights ISSUE: can one advertise their product as equivalent of a more expensive product? RULE: there is a right to copy unpatented products y Public Interest: strong public interest²³for imitation is the life blood of competition. the process or product in question becomes public domain Copyrights y Protect the expression of ideas (not the idea themselves) y Begins as soon as the work in question is set down in a tangible medium 7 . Chanel. Inc. the court is trying to protect the news service businesses. but actual words that had a 1st right to. once expired.

Lasts for a long time (70 years after the death of the author or creator) subject to a right in others to make ³fair use´ of the materials Trademarks: words and symbols indicating the source of the product or service y Protects against use of similar marks by others when such use would result in confusion y Aid to consumers²makes it easier to verify that what they are buying is the product they have come to like or trust y Aid to businesses²provide a way of advertising products, services, and reputation y Arise out of use of the mark in commercial activity y Lost when they are abandoned or when they become generic (e.g., aspirin) White v. Samsung Electronics America, Inc., 1993: scope of the right of publicity BACKGROUND: (Vanna White) suited (Samsung) for an advertisement depicting ³Wheel of Fortune´ and a robot resembling White in the future. The District Court granted SJ against White. Court of Appeals reversed in part, holding that issues of material fact precluded SJ on her claim for violation of her common law right of publicity DISSENT: much of this case is focused around the dissent and the majority¶s broadly defined right to anything that ³evokes´ personality y Overprotection: is just as harmful as under-protection. It stifles the very creative force it¶s supposed to nurture. y Balance: the majority is creating a new and much broader property right. It¶s replacing the existing balance b/w the interests of the celebrity and those of the public by a different balance, one substantially more favorable to the celebrity o IP rights aren¶t free²they¶re imposed at the expense of future creators and of the public at large o IP law is full of careful balances b/w what¶s set aside for the owner and what¶s left in the public domain  All of these diminish an IP owner¶s rights and all let the public use something created by someone else  All are necessary to maintain a free environment in which creative genius can flourish y Moral Implications: IP law assures authors the right to their original expression, but encourages others to build freely on the ideas that underlie it. This is neither unfair nor unfortunate²it is the means by which IP advances the progress of science and art y

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Radin, Property and Personhood(PPL, 8): a general justification of property entitlements could hold that the property rights get stronger as you move from fungible1 to personal property Facts/Reasoning: y To be a person, an individual needs some control over resources in their external environment. Property rights can give this control, and thereby support personhood. o Most people possess certain objects they feel are almost part of themselves. o In contrast, property that is held purely instrumentally is fungible y If the body is property, then objectively it is property for personhood. o Body parts can become fungible commodities in some cases, just as other personal property can become fungible w/ a change in its relationship with the owner ± blood transfusion, hair cut off for a wig, etc. Theory: the personhood perspective generates a hierarchy of entitlements: the more closely connected with personhood, the stronger the entitlement y This theory would tell gov¶t to curtail one person¶s fungible property right in favor of another¶s personal property right y Not all object-loss is equally important. A few objects may be so close to the personal end of the continuum that no compensation could be just Conclusion y Radin suggests how legal procedure (burdens of proof, standards of review) can shift the risk of error away from hurting protected interests in personal property y However, she is surprised that this general limitation on property has not developed Heller & Eisenberg, ³Can Patents Deter Innovation? The Anticommons in Biomedical Research´(PPL, 159) The Tragedy of the Anticommons y The "tragedy of the commons" metaphor helps explain why people overuse shared resources y However, the recent proliferation of intellectual property rights in biomedical research suggests a different tragedy, an "anticommons" in which people underuse scarce resources because too many owners can block each other o ³upstream´: research o ³downstream´: post-research product How a Biomedical Anticommons May Arise

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Fungible: (of goods contracted for without an individual specimen being specified) able to replace or be replaced by another identical item; mutually interchangeable

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2 Mechanisms by which a gov¶t might inadvertently create an anticommons o Concurrent Fragments  Creating too many concurrent fragments of IP rights in potential future products  If these receptors are patented and controlled by different owners, gathering the necessary licenses may be difficult or impossible o Stacking Licenses:  Permitting to many upstream patent owners to stack licenses on top of the future discoveries of downstream users  Researchers will face increasing difficulties conveying clear title to firms that might develop future discoveries Transition or Tragedy? y 3 Structural Concerns caution against uncritical reliance on markets and norms to avoid a biomedical anticommons tragedy o Transaction Costs of Bundling Rights o Heterogeneous Interests of Rights Holders o Cognitive Biases Conclusion y Privatization of biomedical research must be more carefully deployed to sustain both upstream research and downstream product development. Otherwise, more IP rights may lead paradoxically to fewer useful products for improving human health o Moral Limits: Property in Organisms and in Body Parts Diamond v. Chakrabarty, 1980: micro-organisms are patentable (genetic research) FACTS: (Chakrabarty) sought to patent his human-made, genetically engineered bacterium. The patent examiner denied patent on grounds that micro-organisms are products of nature and are not patentable under the patent act. ISSUE: are micro-organisms patentable w/in the statutory language of the patent act²³whether micro-organism constitutes a µmanufacture¶ or µcomposition of mater¶´? RULE: laws of nature, physical phenomena, and abstract ideas are not patentable (common law)²new and useful process, machine, manufacture, or composition of matter or an new and useful improvement thereof, are (statutory language) HOLDING: the broad language of the act and the legislative history behind, suggest that the ¶s micro-organism is patentable for it is a ³non-naturally occurring manufacture or composition of matter´ y Statutory Construction of Patent Laws y

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and selling. buying. y Example of rape: o Market conceptions of rape: 11 . The rhetoric about universal commodification might lead to wrong answers in sensitive cases. ³Market-Inalienability´(PPL 336): the idea that each person¶s attributes are fungible and therefore tradable. undermines our notion of personhood which is based on an ideal of individual uniqueness Facts/Reasoning: y Market-inalienability is the situation in which something cannot be traded on the market. not for the Court to decide Radin.´ y Radin critiques universal commodification (Posner) which privileges profit-maximizing. y Radin argues that we should evaluate market inalienabilities by understanding of the concept of ³human flourishing. there would be no need for the plant patent legislation  Micro-organisms do not qualify as patentable unless Congress expressly so decrees b/c genetic technology was unforeseen y Public Policy²argument against patentability²rejected o Petitioner¶s amicus brief suggesting the grave risks involved w/ genetic research ought to preclude patentability of micro-organisms  Court rejects this for several reasons Sometimes it is better µto bear those ills we have than fly to others that we know not of¶ The grant or denial of patents is not likely to put an end to genetic research or its ³risks´ It is a matter of ³high policy´ for legislative investigation. o stifles the individual and social potential of human beings. o Courts should not read into he patent laws limitations and conditions which the legislature has not expressed (broad reading)  Legislative history of broad language (intentional)  Committee Reports²µanything under the sun made by man¶ o 2 Arguments Against Patentability²both rejected  If Congress meant for ³manufacture´ and ³composition of matter´ to include living things. o disguises relationships between people as relationships between commodities governed by abstract market forces. is insulting or injures personhood regardless of the result. and will lead to different results than if we promoted rhetoric of non-commodification.

property rules are prima facie more efficient) entitlement in own bodily integrity (pluralist2) o These market understandings of rape  present a risk of error (might undervalue the costs of rape to the victims)  conceive of bodily integrity as fungible (when it is personal)  detach from the person that which is integral to that person Moore v. ¶s also kept ¶s spleen for research w/out his consent. Regents of the University of California. did not tell that his cells were unique and access to them was of great scientific value. 1990: excised body parts are not one¶s own property FACTS: (Moore) had his spleen removed by (Moore) for hairy-cell leukemia. liability rule. ISSUE: (1) does a doctor have a duty to disclose the extent of his research and economic interests in a patient¶s body parts? (2) are human body parts property such that they may be converted? RULE: (1) a doctor has a duty to disclose the economic interests in a patient¶s body parts. MAJORITY y Breach of Fiduciary Duty: stated a cause of action against in alleging that he breached his fiduciary duty by failing to disclose the extent of his research and economic interest in Moore¶s cells before obtaining consent to the medical procedures by which the cells were extracted y Conversion: Extending tort theory of conversion to cover Moore¶s claim is not advisable o Conversion is a tort governed by strict liability that protects against interference with possessory and ownership interests in personal property o There is no direct authority for importing law of conversion to this case  2 Pluralist: a theory or system of devolution and autonomy for individual bodies in preference to monolithic state control. 12 . eventually created and patented a cell line from Moore¶s cells and commercially marketed the item for a great deal of money. Eventually was informed of the research but not of ¶s economic interest.Posner: prevention of rape is essential to protect the marriage market and to secure property rights in women¶s persons  Calabresi-Melamed: people hold a property rule (vs. (2) human body parts are not property p may be converted. underwent 7 years of follow-up tests that he was led to believe were important for his treatment.

before a body part is removed. o Rather than extend conversion.g. if patient donated cells to a research institution.o POLICY: policy counsels against such an extension of conversion to cover human cells  Do not want to provide disincentive for socially useful research. has a cause of action y Property Interest: Uniform Anatomical Gift Act (donor has the authority to make a gift of his body parts upon death) p notion that patient retains a property interest which is bestowed upon the patient. If misled. and exposures to researchers to potentially limitless tort liability? y A licensing scheme establishing a fixed rate of profit sharing between researcher and subject has already been suggested y Creating a tort of conversion is not the answer to addressing ¶s greed CONCURRING & DISSENTING: (Judge Broussard) y Cause of Action: there is common law precedent to support Moore¶s conversion claim.  Do not want to limit product development of medicine or research by creating uncertainty about legal title to biological materials. bidding for such materials. In these cases. y Majority¶s holding just prevents patients from getting any profit from cells value while permitting defendants to exploit their full economic value DISSENT: (Judge Mosk) 13 . not the doctor y Fiduciary Duty: breach of fiduciary duty will not always exist in other factual settings. o Problems in this area are better suited to legislative resolution CONCURRENCE: (Judge Arabian) y MORAL: Legislature must deliberate moral issues raised o What effect on human dignity will be created if there is a marketplace of human body parts.. patient would have no claim under conversion. it is more appropriate to protect existing disclosure obligations through liability o The tort of conversion is not necessary to protect patients¶ rights. the use to which the part will be put after removal.  Under majority opinion. then another research institution stole those cells to do research ± there is no breach of fiduciary duty. patients will have no way to seek redress without a claim under tort theory of conversion. A patient has a right to determine. o E.

¶s home was requisitioned by the gov¶t. 1722: the finder of lost property has a title superior to all but the true owner  FACTS: (Armory) found a jewel and took it to ¶s (Delamirie¶s) shop to have it appraised. who expect to prevail y Promotes peaceable possession (if prior possessors did not prevail. Bundle of Rights: property is often said to refer to a ³bundle of rights´ that may be exercised with respect to an object. A month later. (3) to exclude. removed the stones and offered 3 half pence to for the jewel. at least in part. He could have contracted with researchers and pharmaceutical companies to develop and exploit the vast commercial potential of his tissue and its products Bundle of Rights: property is less about things and more about rights over things Rights: (1) to use. property law is all about the 4 rights and who has them y This case turns.g. (2) to possess. files an action for trover3. individuals might begin to steal property. 3 14 . drycleaners) y Protects the expectations of prior possessors. hoping that the law would protect him) Hannah v. (Hannah) was Trover: common-law action to recover the value of personal property that has been wrongfully disposed of by another person. Delamirie. he had the right to do with his own tissue whatever the defendant¶s did with it. Peel.  ISSUE: does the finder of lost property have a title superior to all but the true owner?  PRIOR POSSESSOR RULE: the finder of lost property has a title superior to all but the true owner Social Goals: y Protects an owner who cannot prove that he is the true owner y Protects individuals who entrust goods to others (entrusting goods to others promotes social welfare. e. refused to return the stones. (4) to transfer/sell At its barest. these limits do not extinguish the right itself y When Moore¶s cells were excised. 1945: property owner does not necessarily have title to all that is found on his property  FACTS: (Peel) purchased a home that he never lived in. But the same bundle does not attach to all forms of property y Even though the law limits or forbids the exercise of certain rights over certain forms of property (for policy reasons). refused and demanded the jewels be returned. on who has the right to sell or gift the spleen y Subsequent Acquisition of Property (Without Purchase) y FOUND PROPERTY Armory v. 2 years later..

contends that he has title since he owned the land. o FACTS: prehistoric boat was found in land that was leased to the o ISSUE: whether the boat belonged to the lessor or lessees o HOLDING: boat belonged to the lessor What these 3 cases show: y A landowner possesses everything attached to or under his land y A landowner does not necessarily possess that which is unattached to his land o Prior Possessor Rule: finder of lost property has title superior to all but true owner  EFFECTS: (4) Protects owners who cannot prove title Encourages the entrusting of goods to others Protects the expectations of possessors Promotes peaceable possession  EXCEPTIONS: (2) 15 . Briggs Gas Co. After 2 years. Hawksworth o FACTS: bag of money was left in a shop. the true owner was not found and the police awarded the brooch to . the finder of property on this land has superior title against the landowner. sues for damages or replevy. had no knowledge of the brood.stationed at this property where he found a brooch. 3 Prior Cases y Bridges v. v. in an area open to the public o ISSUE: whether superior title lay in the finder or the shop owner o OLD RULE: superior title goes to finder  b/c the shop owner never possessed the bad and b/c the place where the bag was found was open to the public y South Staffordshire Water Co. turned the brooch into the police. By employing the servant. does a finder of property on that land have superior title to the landowner?  RULE: if the owner of property has never occupied his land. claims superior title since he was the finder.  ISSUE: if a landowner has never lived on aparcel of land. the landowner was exercising control over that part of the land where the rings were found y Elwes v. Sharman o FACTS: a servant found 2 rings on the landowner¶s land while working for the landowner o ISSUE: whether superior title lay in the finder of the landowner o NEW RULE: superior title goes to the landowner  b/c the finder worked for the landowner.

they lose it o Reporting lost articles is a social goal. (McAvoy) found the wallet and gave it to the shop owner. b/c it helps return lost property to the true owner Lost property found under the soil or embedded in the soil belongs to the landowner y REASONS: (2) o Owners of land expect that they own not just the surface but all that lies underneath it o Discourages trespassers from coming onto land insearch of treasure McAvoy v. 1866: ³finder´ does not have title to mislaid property  FACTS: a customer of a shop laid his wallet on the counter but neglected to remove it²the customer had ³mislaid´ his wallet. the true owner will likely retrace his steps and return to the shop where he mislaid it p efficient return of property to true owner CRITICISM: (2) y It is difficult to determine whether property has been mislaid or lost y Individuals retrace their steps for both lost and mislaid property ADVERSE POSSESSION OF LAND o The Theory and Elements of Adverse Possession 16 . not lost o When property is mislaid in a shop.  ISSUE: does the finder of mislaid property have title to that property?  RULE: a finder has no title to property that is mislaid ORDINARY RULE: finder¶s keepers²not in this case y REASON: property was mislaid.y If an employee finds a lost article on the employer¶s premises. the shop owner has a duty to safeguard the property until the true owner returns p a finder can never gain title to mislaid property McAvoyvs. If the true owner did not claim it. The true owner was never found and refused to turn the money over to . requested that advertise it. if they do report it. the property goes to the owner y REASON: the employee is acting on behalf of the employer y CRITICISM: discourages finders from reporting found articles² if they do not report the lost article. the finder. Medina. Bridges y BRIDGES: the property was not voluntarily placed somewhere and then forgotten²the property was lost y MCAVOY: the property was not lost. it was mislaid RATIONALE: y One of the goals of property law²returning lost property to its true owner o If property is mislaid. (Medina). they keep it. to keep it until the true owner should claim it.

to provide proof of meritorious titles. s claim title thru adverse possession. In 1937. s (Valkenburghs) purchased lots near the s and in 1947. ³Title by Adverse Possession´: the great purpose of the statute of limitations is automatically to quiet all titles which are openly and consistently asserted.01: adverse possession as a means of ³transferring´ ownership The running of the statute of limitations not only bars an action by the erstwhile owner but also vests a new title This new title ³relates back´ to the date of the event that started the statute of limitations running (owner as of that date)  Henry W. s only removed part and later s built a fence preventing s from crossing the land.Powell on Real Property §91. Ballatine. s sue to gain possession of the lots. s sent s a letter informing them that this was their land and to remove their property. 1952²BAD LAW: proving adverse possession FACTS: In 1912. s (Lutzes) bought lots 14 and 15 in a large subdivision and occupied lots 19-22 by building a one-bedroom shack. he fails to prove the ³claim of title´ element y Land must be enclosed or sufficiently improved (§ 40) o Requirement not met here  Land was not enclosed  Land was not sufficiently improved: Shack was too small The garden was insubstantial Placing rubbish  improvement  17 . cultivating a garden and storing rubbish on it. ³The Path of the Law´ ECON: diminishing marginal utility of income PYSCH: people regard loss of an asset in hand as more significant than forgoing the opportunity to realize an apparently equivalent gain (prospect theory of cognitive psychology) MORAL: it is morally wrong for the true owner to allow a relationship of dependence to be established and then to cut off the dependent party Van Valkenburgh v. and correct errors in conveyancing  Oliver Wendell Holmes. s sued s admitting that s owned the land but claiming a right of way across the land² s prevailed. Lutz. Now. purchased lots 19-22 that s had been using. RULE:In order to acquire title by adverse possession: (3) y Possession must be actual (NY Civil Practice Act § 39) o This requirement is not met here for 2 reasons:  Garden occupied only a small portion of lots  The s¶ garage encroached on land only by a few inches y Possession must be under claim of title (§ 39) o Since testified that he knew that the land had belonged to the s in this action and in the prior action by to establish a right of way.

Reigle (pp. and then to give it up Property Rules vs. 127-28) where s settled onto land to hold it until a better owner came for it. y (3) Adverse and under a claim of right. regardless of the subjective state of mind of the adverse possessor o ³Good Faith´ Standard: required state of mind is. but I intended to make it mine´  See Patterson v. and y (4) Continuous for the statutory period ³claim of title requirement´ / claim of ³right´ or ³hostility´ (#3 above) y this is often approached in regards to the ³state of mind´ of the adverse possessor y there are 3 different views: o Objective Standard: state of mind [of adverse possessor] is irrelevant  If all other requirements of adverse possession have been met. ³I thought I didn't¶ own it.  HOLDING: s failed to satisfy all 3 elements above p no adverse possession DISSENT: actual possession means only possession that puts owner on notice y There is substantial evidence to indicate that the land was substantially improved y The land need not be completely occupied²it need be occupied only to the extent necessary to put the true owner on notice y To establish ³claim of right´ in the statute. hostility will be implied. ³I thought I owned it´  Most who have hostile possession of land do so w/ a ³good faith´ claim of right p jury or other factfinder may (absent contrary showing) infer from hostile possession that it is done in good faith that a claim of right exists o Aggressive Trespass Standard: required state of mind is. it is not necessary that the s believed that the property was theirs o It is sufficient only that they intended to acquire and use the land as their own o The fact that the s admitted that they did not have title is only evidence of whether or not they intended to acquire and use the land as their own Common Law Requirements for Adverse Possession 4 Requirements: y (1) An actual entry giving exclusive possession that is y (2) Open and notorious. Liability Rules 18 .

was under the mistaken belief that she owned the land. counterclaimed for a declaratory judgment that he had gained titled thru adverse possession. filed a complaint seeking to enjoin ¶s alleged trespass. then o The adverse possessor¶s interest w/ a property rule after the SoL has run Liability Rules: when a property interest is protected by a liability rule. the interest cannot be taken from its owner w/out the owner¶s consent. steps and a concrete walk leading from s house encroached some 15 inches onto ¶s land. For 20 years. all transfers are voluntary y Ordinary adverse possession doctrine protects: o The owner¶s interest w/ a property rule before the SoL has run. or the deed is improperly executed) y Not required in most American jurisdictions y May have important advantages for adverse possessor o Where the adverse possessor enters into a possession of only a part of the property  Constructive possession: actual possession under color of title of only a part of the land covered by the defective writing is constructive possession of all that the writing describe Activities relied upon to establish adverse possession reach not only the part of the premises actually occupied. contended that did not gain title since her taking was not of the requisite ³hostile´ nature² encroachment must be accompanied by an intent to invade the rights of another. a will) or judgment or decree that is for some reason defective and invalid (as when the grantor does not own the land conveyed by deed or is incompetent to convey. the interest can be taken w/out the owner¶s consent but only upon payment of judicially determined damages transfers are forced y Transfer of the owner¶s interest to the adverse possessor could be forced but only upon payment of compensatory damages by the latter  Color of Title and Constructive Adverse Possession Color of Title: refers to a claim founded on a written instrument (a deed. ISSUES: (1) must possession be accompanied by a knowing intentional hostility for adverse possession? (2) does a minor border encroachment satisfy the ³open and notorious´ requirement? 19 . but the entire premises described in a deed to the claimant Mannillo v.Property Rules: when a property interest is protected by a property rule. Gorski. 1969: abandonment of the hostility requirement p open and notorious possession FACTS: (Mannillo) and (Gorski) owned adjacent lots.

we would be rewarding the possessor who entered w/ a premeditated and predesigned hostility and be punishing the honest. 1970: continuous seasonal occupancy by successive owners establishes adverse possession LAND OWNED BY KUNTO KUNTO LAND OWNED BY MOYER MOYER LAND OWNED BY HOWARD HOWARD 20 . and if not. which does not hinge on whether the adverse entry is caused by mistake or intent y OPEN AND NOTORIOUS REQUIREMENT: no presumption of knowledge arises from a minor encroachment along a common boundary o Only where the true owner has actual knowledge of the encroachment may it be said that the possession is open and notorious p clear enough to be immediately visible  The present action does not create a clear situation of adverse occupancy The only way could have determined ¶s encroachment would be thru a survey o RATIONALE: landowners should not be required to bear the expense of a survey every time the adjacent landowner makes some improvement y CON: this may impose an undue hardship on the adverse possessor who mistakenly encroaches on his neighbor¶s property while making an improvement p equity may require that the court force the true owner to convey the land upon payment of the fair value by the adverse possessor DISPOSITION: remanded for determination of (1) whether had actual knowledge of the encroachment. but it must be notorious enough to give the true owner actual or construct notice of the encroachment y HOSTILITY REQUIREMENT: mistake does not negate the hostility requirement o MAINE: requiring hostility  CON: if knowing intentional hostility were required. Kunto. (2) whether should be required to convey the strip of land to o The Mechanics of Adverse Possession Howard v. mistaken entrant (court¶s view)  PRO: only rewarding the person who actually desires to take possession (not the court¶s view) o CONNECTICUT: mistake does not negate the hostility requirement  PRO: the key to adverse possession is the true owner¶s neglect to recover the possession of his land.RULE: possession need not be knowingly and intentionally hostile.

HOLDING: b/c and his successors continuously occupied the parcel for more than the statutory period. In 1960. sought to convey a ½ interest in his property to the Yearlys. B/c neither Moyer nor any of predecessors had every asserted ownership of the property. the trial court concluded that had not continuously possessed the property b/c it was used only for summer occupancy. he is entitled to quiet title to the disputed property y SUMMER OCCUPANCY: uninterrupted possession does not require constant year-round occupancy but rather such control over the property as ordinarily marks the conduct of owners in general holding. learned that the legal description on his deed did not coincide w/ his property and that he was in fact the record owner of the Moyers¶ property and the Moyers were the record owners of the property owned by . agreed w/ Moyer to convey record title of his property (which Moyer previously believed belonged to him) in exchange for Moyer¶s interest in ¶s property. and that he was not permitted to ³tack´ his predecessors¶ occupancy of the property to establish the 10-year statutory period required for adverse possession. tacking of ¶s predecessors possession must be allowed y TACKING: ordinarily.  . has not personally occupied the property for the required 10-year period  To establish continuity for the statutory period. the same legal description was used on the deed and surveys were conducted on the property. ISSUE: may tack on the occupancy of his predecessors to meet the statutory 10-year requirement for adverse possession even though. and Yearly then filed an action to quiet titled. Upon commissioning a survey of his property.WEST EAST FACTS: Since 1932. appealed. the ¶s property had passed thru several owners until 1959 the (Kunto) took possession by deed. in a situation in which one seeks more property than is described in the deed. he agreed to the conveyance. ³a purchaser may tack 21 . and caring for property of a similar nature and condition o p occupancy of the summerhouse during the summer months over the 10-year statutory period sufficiently establishes adverse possession. When considering ¶s claim that he had acquired title to the property by adverse possession. who owned the property directly to his west. however. the and his predecessors were only summer inhabitants? RULE: tacking on successive possessions of property is permitted for purposes of establishing adverse possession if the successive owners are in privity. During each transaction. managing.

the SoL is tolled  FACTS: in 1946. Kunto²) When land is adversely possessed by a series of people. permit it only of possession continues for a period much longer than that applied in the case of private lands ADVERSE POSSESSION OF CHATTELS O¶Keeffe v. however. the statute of limitations is extended if specified disabilities are present y A disability is immaterial unless it existed at the time when the cause of action accrued y ³Such person´ in the statute may be extended to ³or anyone claiming from. Whether they seek more property than represented in their deed or a different parcel altogether. others. adverse possession does not run against the gov¶t²local. their successive interests are in privity. by. state or fed. Snyder. though all of them together do?  Disabilities In every state. seeking ownership of property w/out a valid claim of right. and tacking is permissible to establish adverse possession Tacking Tacking the adverse use of predecessor where the land was intended to be included in the deed but was mistakenly omitted (Buchananv. such that there is nothing onto which the adversely possessed land can be tacked (Howard v. privity is a judicial recognition of a reasonable connection b/w successive occupants who have a ³good faith´ claim of right. none of which occupied the land for the statutory period. or under such person´  Adverse Possession Against the Government Under common law rules. 3 paintings by Georgia O¶Keeffe were stolen from an art gallery operated by her husband. Cassell²) Extending Buchanan to a situation where the deed describes none of the land in question.the adverse use of its predecessor in interest to that of his own where the land was intended to be included in the deed b/w them. Stieglitz. will not defeat the property interests of true owners  In reality. but was mistakenly omitted from the description´ o Such tacking is permitted b/c the current possessor is in privity of the estate w/ each successive possessor by operation of the deed running b/w them o PRIVITY: ensures that continuous trespassers. she never confronted him nor  y 22 . (nullum tempus occurit Regis²no time runs against the king) Few states allow adverse possession against the gov¶t on the same terms as private land. 1980: if the owner uses diligence to locate and recover the property. (O¶Keffee) suspected that Estrick may have stolen the paintings.

to locate and recover the chattels (depending on the circumstances). His is inconsistent w/ O¶Keffee¶s allegation of theft.   reported it to the police. In 1976. STATUTE OF LIMITATIONS: in certain situations. discovered that Frank had sold her paintings to (Snyder). this isn¶t really true) DISPOSITION: reversed and remanded for a finding of whether used diligence in discovering who had the lost paintings Things the trial court should consider in determining whether is entitled to the benefit of the discovery rule: 23 . but he recalls seeing them in his father¶s house as early as 1941. titles should be settled  The efficient use of land should be encouraged O JUSTICE: a true owner who is not at fault in failing to recover his property should not be divested of titled y CON: this rule may harm a good faith purchaser who had the bad luck to buy stolen property O COURT: a purchaser may always learn whether property is stolen or not (in reality. if Frank acquired a voidable title from his father. in 1972. the owner of chattels may not know that her property has been stolen. Frank claims continuous possession for over 30 years thru his father and claims by adverse possession. which is often concealed) DISCOVERY RULE: upon discovery of theft the SoL is tolled if the true owner of the chattels makes diligent efforts. or she may not know who the adverse possessor is (this is especially true of stolen art. For the purposes of this appeal. Frank does not know how his father acquired the paintings. Frank has the power to transfer good title to a good faith purchaser under the UCC. under the circumstances. which keeps a registry of stolen paintings (not clear whether such a registry existed in 1946). the SoL is tolled to avoid harsh results y Unlike land that is adversely possessed. Frank acquired the paintings from his father. However. explains that she did not pursue her efforts to find the paintings b/c she was settling her deceased husband¶s estate. Finally. or if Frank did not have a voidable title. may still acquire title by adverse possession. authorized Bry to report the theft to the Art Dealers Association of America. who may have been a thief. RULE: the SoL is tolled if the owner of stolen chattel makes diligent efforts to locate and recover the lost chattel HOLDING: in no circumstances can a thief transfer good title. If was not a good faith purchaser. concedes that the paintings are stolen. this may include reporting the theft to the police or registering the lost chattels w/ a registry so as to notify potential buyers that it may be stolen y PROS: O POLICY: promotes policy considerations of adverse possession  After a long time.

taking into account all the variables in a particular situation and not unduly burden the true owner BETTER RULE: protect true owners by requiring potential purchasers to investigate the provenance of works of art y COMPARED TO DISCOVERY RULE: more burden on purchasers and less burden on true owners  Doctrine of Market Overt (Europe and elsewhere) A bona fide purchaser may acquire good title from a thief if the sale in question takes place in an open market y PRO: gives ample notice to the true owner y CON: results in laundering of stolen goods o Native American Graves Protection and Repatriation Act of 1990: museum must give Native American artifacts back to member(s) w/in the direct lineage upon their request unless the museum can establish proof of ³right of possession´ obtained by direct consent from an individual or group that had the authority of alienation  Adverse possession  right of possession p Native Americans rights > adverse possessors rights to chattel y The Right to Exclude y PROPERTY AND PROSPERITY o Blackstone. Lubell) SoL for replevin does not begin to run in favor of the good faith purchaser until the true owner makes a demand for return and the good faith purchaser refuses y Until such demand is made. for to alert the art world y Whether registering paintings w/ ADAA or any other organization would put a reasonably prudent purchaser of art on constructive notice that someone other than the possessor was the true owner o Stolen Chattel and Statute of Limitations:  New York Rejects the Discovery Rule (Guggenheim v. there was an effective method. Commentaries on the Laws of England (PPL.Whether used due diligence to recover the paintings at the time of the alleged theft and thereafter y Whether at the time of the alleged theft. possession of the stolen property by a good faith purchaser is not considered wrongful NY court was worried about a due diligence requirement on the owner y Encouraging illicit trafficking in stolen art y Would be difficult to craft. other than talking to her colleagues. 45): the cyclical nature of property rights  Historic Evolution of Property Certain types of objects were turned into property before others Rights: Temporary usage p more permanent entitlement 24 .

and an immediate successive occupancy of the same by the new proprietor  Death of the occupant is the most universal and effectual way of abandoning property: when. or y ABANDON his property and let the municipal law of the country step in and name next successor THE RIGHT TO INCLUDE. who was ready to give in exchange for it some equivalent that was equally desirable to the former proprietor y 2 Views on Rights: o CONTINUANCE: of the original possession which the 1st occupant had. the dying person can either: y CONTINUE his property by disposing of his possessions by will. 1997: the individual has a strong interest in excluding trespassers from his or her property  FACTS: (Jacque) sued (Steenberg) for intentional trespass after Steenberg took the easier route across the ¶s property in order to delivery a  25 . w/out any consent or compact. being a degree of bodily labor. or o ABANDONMENT: of the first thing by the present owner. Steenberg Homes. neither is it necessary that there should be²for the very act of occupancy alone. both the actual possession and intention of keeping possession easing. the property which is founded upon such possession and intention out to cease of course BUT: under civilized gov¶t. was highly convenient or useful to another. which before belonged generally to everybody. but particularly to nobody? 2 Natural Law Views: y (1) IMPLIED ASSENT: right of occupancy is founded on a tacit and implied assent of all mankind that the first occupant should become the owner y (2) LABOR: there is no such implied assent. from a principle of natural justice.. is. or what it is that gave a man an exclusive right to retain in a permanent manner that specific land. Inc.y Several principles upon which property rights may be based: God¶s bequest to all mankind An analogy to animal nesting behavior Reward to labor ³Necessity´ for agricultural (moving towards more permanent nature) Occupancy  Exclusive Rights ISSUE: How this property became actually invested. sufficient of itself to gain a title TRANSFERING y What became inconvenient or useless to one man. THE RIGHT TO EXCLUDE Jacque v.

these ends would not be met if the intended beneficiaries could be insulated from efforts to reach them y Since the migrant workers are outside the mainstream of the communities in which they are house. Society has an interest in preserving the integrity of the legal system. but in the loss of the individual' s right to exclude others from his or her property´ The individual has a strong interest in excluding trespassers from his or her land²SCOTUS: ³one of the most essential sticks in the bundle of rights that are commonly characterized as property´ SOCIETY: society has an interest in punishing and deterring intentional trespassers beyond that of protecting the interests of the individual landowner.  ISSUE: whether the camp operator¶s rights may stand b/w the migrant workers and those who would aid them  RULES: (1) a man¶s right in his property is not absolute and (2) one should so use his property as not to injure the rights of others (3) necessity. 1971: necessity may trump the possessory right of an owner under a trespass statute  FACTS: (Tedesco) alleged that s (Shack. Court of appeals affirmed. leaving tracks in the snow. Supreme court concluded that when nominal damages are awarded or an intentional trespass to land.000 in punitive which it set aside. a staff attorney for CRLS and Tejeras. they are unaware of their rights and the opportunities and services offered to them o They can only be reached by positive efforts So. continued to move across the snow covered property. in the discretion of the jury be awarded.mobile home and even offered money at the time. private or public. punitive damages may. y Such agencies were created by congress to provide assistance for these migrant workers. the actual harm is not in the damage done to the land. Representatives of these agencies and organizations may enter upon he premises to seek out the worker at his living quarters. so long as there is no behavior hurtful to others. which may be minimal. the migrant worker must be allowed to receive visitors there of his own choice. but refused. ³in certain situations of trespass.  HOLDING: though no damages could be calculated. a field worker for SCOPE) were trespassing on his property when they came to visit 2 seasonal migrant workers residing on his farm who needed medical and legal aid per a congressional statute. and members of the press may not be denied reasonable access to workers who do not object to them 26 .  DAMAGES: awarded $1 in nominal damages and $100. Private landowners should feel confident that wrongdoers who trespass upon their land will be punished State v. Shack. Their conduct was therefore beyond the reach of the trespass statute. too. may justify entry upon the lands of another  HOLDING: s here invaded no possessory right of the famer employer.

1984: the public¶s right to use the beach includes the right to go thru private as reasonably necessary  FACTS: (public advocate) claimed that the (the Association) denied the public its rights of access to and use of the public beaches during the summer season  RULE: the public¶s right to use the tidal lands and water under the public trust doctrine also includes the right to gain access thru and to use privately-owned dry sand areas a reasonably necessary Originally the public¶s right to use these lands and waters has included navigation and fishing rights.  ISSUE: does the have a common law right to exclude from their casino for card counting? 27 . now the right has expanded to include recreational uses. from providing police to representing the interests of the borough y The quasi-public nature of is apparent. then the public trust doctrine is satisfied The activities of are akin to those of a municipality.) Relevant factors under the Matthews reasonable test include: y Location of the dry sand area in relation to the foreshore y Extent and availability of publicly owned upland dry sand area y Nature and extent of the public demand y Usage of upland area by the owner Uston v. NJ Dept. Bay Head Improvement Association. y The extension of the public trust doctrine to include such recreational uses furthers the general welfare and the public¶s right to enjoy these privileges must be respected y The right of access is not an unrestricted one²as long as reasonable access to the sea is provided. Borough of Avon-by-the-Sea). the public interest is satisfied As long as the reasonably necessary use of these areas is allowed. Inc. like swimming and bathing (Borough of Neptune City v. Resorts Int¶l Hotel. along w/ reasonably necessary access. constitutional limits > statutory authority > common law rights  FACTS: (Resorts) excluded (Uston) from their casino for card counting..Matthews v. 1982: reasonable right to access > right to exclude. and thus membership must be open to the public at large y p the general public will be able to use the beaches during the daylight hours in the summer months²the right of access and use should reasonably satisfy the public need at this time  PUBLIC TRUST DOCTRINE: COURT: public must be given ³reasonable access´ to the foreshore and be permitted to use privately owned dry sand areas of the beach when such use is ³essential or reasonably necessary´ for the enjoyment of the ocean o Public Trust Doctrine  REASONABLE (Home Builders v.

soda fountain) Entertainment (movie theater. it must strike a balance y Public confidence and trust in the credibility and integrity of the regulatory process and of casino operations o Exclusion of persons who can play may diminish public confidence in the fairness of casino operations  To the extent persons not counting cards may be mistakenly excluded. concert hall. and privileges. any common law right the might have to exclude for these reasons is precluded by the Act and subject to constitutional limits. lunch counter. Schmid: BALANCE b/w individual rights and property rights p no right to exclude unreasonably o ³the more private property is devoted to public use. motel) Dining (restaurant. the more it must accommodate the rights which inhere in individual members of the general public who use that property. Civil Rights Act of 1964²Places of Public Accommodation  All persons are entitled to full and equal enjoyment of goods. hotel. per the Casino Control Act. public policy might be further diminished o Right of the casinos to have rules drawn so as to allow some reasonable profit o Title II. sports arena)  This does not apply to a private club or other establishment not open to the public EXCEPT to the extent that the facilities of such establishments are made available to the customers/ patrons w/in the scope of the above mentioned  The Right to Use y 4 NUISANCE LAW 4 Sic utere tuo ut alienum non laedas²one should use one¶s own property in such a way as not to injure the property of another 28 . lunchroom. advantages. only the Commission alone has the authority to exclude patrons based upon their strategies for playing licensed casino games.´ POLICY: if the Commission is to devise rules. facilities.HOLDING: No. services. Common Law Right to Exclude < Common Law Right to Reasonable Access y 14th Amendment¶s guarantee of equal protection was the assumption that the State was obligated to guarantee all citizens access to places of public accommodation y State v. cafeteria. and accommodations of any place of public accommodation  Establishments of public accommodation affect commerce Lodging (inn. theater.

(Penn Oil) began operating an oil refinery approx.  ISSUE: can an otherwise lawful enterprise constitute a nuisance per accidens or in fact if it is not constructed or operated in a negligent manner?  RULE: a private nuisance occurs when there is substantial interference w/ the use and enjoyment of land. (Morgan) acquired a composite track of land where he built a restaurant and trailer park. a lawful enterprise p not a nuisance at law. In 1950. People of ³ordinary sensitiveness´ w/in 2 miles of the refinery were rendered uncomfortable or sick by the emissions p substantial interference w/ enjoyment and use of ¶s land. regardless of its location. appealed. regardless of the degree of skill exercised to avoid such injury o intentionally and unreasonably caused harmful gases and odors to escape and substantially impair ¶s use and enjoyment of his land and the evidence shows that intends to continue operating the refinery in this same 29 . recklessness. High Penn Oil Co. o knows the nuisance is a result of his or her conduct. The refinery is a lawful enterprise pNOT a nuisance per se (act or structure that is a nuisance at all times.  HOLDING: a nuisance per accidens or in fact may be created or maintained even w/out the presence of negligence.Morgan v. surroundings. Jury found the refinery to be a nuisance and awarded $2. 1953: substantial interference w/ use and enjoyment of land p private nuisance  FACTS: Prior to 1945.000 ft. or unintentional and the result of negligence. or abnormally dangerous activity.500 in damages and the trial judge also enjoined from continuing to operate the refinery. from ¶s property. or o knows that a nuisances is substantially certain to result from his or her conduct y A person who intentionally creates or maintains a private nuisance is liable for the resulting injury to others. 2-3 days a week the refinery produced large amounts of nauseating gases and odors.  PROCEDURE: and others demanded that put an end to the pollution by argued that ¶s use of the refinery is a part of its occupation.. further argued that the refinery could only be a nuisance if it was constructed or operated in a negligent manner. 1. or the manner in which it is conducted or maintained) It is a nuisance per accidens (act or structure which is a nuisance by virtue of location or manner of operation) Sic uteretuo et alienum non laedas²every person should use his or her own property so as not to injure another INTENTIONAL INTERFERENCE y Interference w/ a person¶s private use and enjoyment of land is intentional when the person whose conduct is in question: o acts for the purpose of causing the nuisance. and that interference is either intentional and unreasonable.

unprivileged physical intrusion NUISANCE Actionable invasion of a possessor¶s interest in the use and enjoyment of land Unreasonable conduct. and other structures along these lines would seem to demand questions of ³reasonableness´ Though these activities are abnormal and unduly hazardous. if the supported land had been built upon in such a way that subsidence would not have occurred but for improvements. Substantial injury. 30 . contradicting the restatement definition above) Comparison of Trespass and Nuisance TRESPASS DEFINITION STANDARD FOR RELIEF Actionable invasion of a possessor¶s interest in exclusive possession of land An intentional. they still have legitimate purposes and fill important needs that may need to be addressed when assessing damages o ³Unreasonableness´  RESTATEMENT: to determine unreasonableness n a case of intentional nuisance. Dairyland: ³whether its (the power plant¶s) economic or social importance dwarfed the claim of a small farmer is of no consequence in this lawsuit´ (thus. and (in most jurisdictions) the equities balance in the ¶s favor Damages for past conduct or permanent damages for future conduct or an injunction (in the court¶s discretion) REMEDY Damages for past conduct and an injunction against future trespass (as a matter of right) o Right to Support  Lateral Support: support provided to one piece of land by the parcels of land surrounding it COMMON LAW RIGHT: imposes a duty on neighboring land to provide the support that the subject parcel would need and receive under natural conditions. ordinarily. one that renders a person liable no matter how reasonable his or her conduct may be  PROBLEM: situations involving facilities for highly flammable or explosive substances Oil refineries. the court is to consider whether ³the gravity of the harm outweighs the utility of the actor¶s conduct´  Jost v. there is no right to support of structures on land STRICT LIABILITY: liability is absolute²negligence need not be shown y BUT. chemical waste facilities. storage areas for explosives used in construction.manner and will continue to inflict irreparable injury on p is entitled to temporary damages and injunctive relief o Nuisance per se: is considered an ³absolute´ nuisance.

C. Effects of ¶s unit on : y Prevents from carrying on normal convo w/in home y Interferes w/ ¶s sleep at night y Value of ¶s property went from $25.$200. from the ¶s property line and approx.5 ft. v. there was no shortage of apts in Houston  PROCEDURE: jury found that the noise from the A.  RULE: an injunction will be denied as a remedy for nuisance only if the necessity of others compels an injured party to seek damages in an action at law. groundwater) or their release as a result of excavation The right of lateral support can be waived or expressly expanded (by a grant of right to additional support)  Subjacent Support: support from underneath as opposed to the sides Issues arise when one person owns surface rights and another owns some kind of subsurface rights The situation is analogous to that of lateral support NUISANCE REMEDIES Estancias Dallas Corp.g. inconvenience. constituted a permanent nuisance. Central Hide. 70 ft. complex was completed next to the ¶s (Schultz) home. according to the doctrine of balancing of equities. a court.000 p $10. from their bedroom. claiming in part that the court had erred in failing to balance the equities in their favor. and the harm to the if the injunction is denied Storey v. and not b/c the party causing the nuisance has the right to work  HOLDING: in determining whether to grant an injunction. considering: material personal discomfort. annoyance.000 . if the subsidence of improved or unimproved land is show to have been caused by w/drawl of fluids (e. Shortly after.. 1973: permanent injunction may be proper after a balancing of the equities  FACTS: in 1969. the (Estancias) began operating a large.000 alleges: y The system cost about $80. single air conditioning unit to serve the entire complex. will consider both the potential harm to the and to the public if an injunction is granted.y there is no liability w/out negligence (so long as the excavator gives notice of his plans) y No liability. and impairment of health. s appealed. absent negligence. Court granted s a permanent injunction against s as well as $10. 1950²emphasis on PUBLIC INTEREST 31 . Schultz.000 in interim damages. The unit was located 5. o At the time.000 to construct y Separate units for each of the 8 buildings would have cost $120. an 8-building apt.C.000 y Switching to separate units would cost b/w $150.000 y The apts could not be rented w/out A. The unit sounds like a jet engine or helicopter.

their home.. this seems like an unfair decision y s suffered at most. and other neighbors claimed that their property interests were injured b/c of the high levels of dirt.  RULE: courts can grant an injunction conditioned on the payment of permanent damages to a complaining party  HOLDING: an injunction may be granted when the economic consequences would be greater on the nuisances-making party than the complaining party² to do otherwise (as the trial court did) would contradict the long-standing doctrine that an injunction should be granted where a nuisance has been found and the complaining party has sustained substantial damage. quieter one in the 8 separate units There may be other equities the court considered in its balancing test y s possibly had only one major asset.C. a larger corporation. mentioning that the area was ³a quiet neighborhood before these apts were constructed´ y should have known that the unit would be excessively noisy and that litigation could result from its actions Boomer v.  PROCEDURE: trial court found that this constituted a nuisance and temporary damages were allowed in various specific amounts up to the time of trial. Atlantic Cement Co. granting an injunction would result in the plant closing poptions y OPTION 1: granting the injunction but postponing its effect until after a specified period of time  32 . and vibration that the plant produced. s were also awarded $185 in permanent damage.C. However. $15. there is no evidence that there is a shortage of apts in Houston p there is no indication that the public would suffer or have no place to live if the apt complex had to go w/out its noisy A.000 in various personal damages y stands to lose up to $200.000 in dismantling the old A. w/ more resources at its disposal y Emotional costs may have been a factor if the s needed to move into a new home y s were in that area first. smoke. An injunction was denied on the grounds that the total damages to s were small compared to the value of s operations and the damage that an injunction would inflict upon . system and installing a new. 1970: injunction conditionally granted  FACTS: (Atlantic) runs a large plant near Albany. system p no evidence that the µnecessity of others¶ compels the s to seek relief thru a suit for damages rather than one for an injunction ANALYSIS: On surface.000 in loss property value and $10. while was.y An injunction could be granted if it would cause only slight injury to the public and the nuisance-causing party compared to the injury suffered by the complaining party o Here.

1972: where a complaining party moves to the area of the nuisance.00030. claiming it was a public nuisance b/c of the flies and odor blown from the lots to Sun City. ( ¶s lots were w/in 500 ft.o Wait for technological advances which would allow to eliminate the nuisance w/out shutting down ¶s plant o BUT there is no guarantee that would even make such advances on its own and such advances would probably an industry-wide effort which has no control over y BEST OPTION: grant the injunction on the condition that pays s a level of permanent damages fixed by the court ( would be purchasing a servitude on s¶ land) o Permanent damages are allowable when the loss a complaining party could recover would be smaller than the cost of completely removing the nuisance o This would preclude further recovery by s or their grantees  DISSENT: even though a reversal is required here. on its southern side). once all those who complain are paid off. at the same time. ¶s feed lots expanded from 35 acres to 114 acres. Sun City.5 miles north of . an injunction may be issued conditional upon the complaining party paying damages caused by issuance of the injunction  FACTS: in 1959.000 head of cattle which produced over a million lbs. ¶s property reached Olive Ave. was offering homes 2-1. In 1960. did not consider odors from ¶s lots to be a problem and continued southward expansion. v. was feeding b/w 20. of Olive Ave. the odor and flies nonetheless created an annoying if not unhealthy situation. it also provided hundreds of jobs to the local population p employees stimulating the local economy and contributing to the property tax base of the community Spur Industries. By 1962. At this time. of wet manure per day. there will be no incentive to correct the nuisance and the pollution and noise will continue. Webb. By 1967. (Spur) bought feedlots near by and began expanding them. Moreover.  ISSUE: can an otherwise lawful activity become a nuisance b/c others have entered the area of activity. and thus be enjoined 33 . (but not the citizens of Sun City or the residents of Youngtown [retirement community nearby]) filed an action to enjoin ¶s operation of the feedlots. and thus subject to injunction?  RULE: an otherwise lawful activity can become a nuisance b/c others have entered the area of activity. At this time. an award of permanent damages should not be allowed in place of an injunction where substantial property rights have been impaired by the creation of the nuisance.  ANALYSIS: classic conflict b/w environmental and economic interests Even though ¶s plant cause much environmental harm. Although practiced good management of the lots. Inc. (Webb) began working on a residential development. Del E. The majority essentially allows to continue causing harm to the surrounding community for a fee set by the court.

´ courts have held that parties may not obtain relief injuries after they knowingly came into an area reserved for industrial relief o BUT. HOLDING: a public nuisance affects the rights enjoyed by citizens as members of the general public. that party can be required to provide compensation for the cost of moving or shutting down the activity. a new city would spring up and force their relocation o is entitled to relief b/c of the damage to people who bought homes in Sun City and the deteriorating home value o It would be unfair to allow a developer who has taken advantage of lower land prices in a rural area to develop a new city to use that city as a means of chasing a nuisance away w/out compensating the one who has to move y p this kind of relief²a conditional injunction upon payment by the complainant²is limited to a case where a developer has introduced the very population which renders the lawful activity a nuisance NOTE: the court calls ¶s operation both a public and private nuisance PRIVATE NUISANCE: courts usually hold that impairment of a person¶s use and enjoyment of his or her land (as was the case here) constitutes a private nuisance y STANDING: b/c a private nuisance is created when the use and enjoyment of land is interfered with. or of an interest in land can file suit PUBLIC NUISANCE: a private nuisance can also be a public nuisance if it interferes w/ a more general public right 34 . if the party requesting the injunction is the one creating the need for the injunction. Here it is clear that the feedlots amounted to both a public and private nuisance as far as the southern residents of Sun City were concerned AZ LAW: lists public nuisances dangerous to the public health. but also the operators of lawful businesses whose activities become nuisances b/c of the encroachment of others y In such ³coming to the nuisance cases.  BUT. and includes ³any condition or place in populous areas which constitutes a breeding place for flies«which are capable of carrying and transmitting disease-causing organisms to any person or persons´ PUBLIC INTEREST: courts must protect not only the public interest. the law of nuisance is not that rigid GOAL: promote what is fair and reasonable under all the circumstances y Factors to consider: o and predecessors had no idea that when they began the feedlot. only an owner of land.

though. o Public Nuisance  RESTATEMENT: ³an unreasonable interference w/ a right common to the general public´  ³Unreasonable´ interference: Whether the conduct in question significantly interferes w/ public health. reckless. or convenience Whether the conduct is proscribed by statute or ordinance (Spur) Whether the conduct is of a continuing nature or has produced a permanent or long lasting effect  Underlying bases of liability are the same as those for private nuisance: There must be substantial harm caused by intentional and unreasonable conduct or by conduct that is negligent. comfort. Generally.y STANDING: any member of the public can sue. Estancias)  Let the Activity Continue of the Pays Damages (Boomer)  Let the Activity Continue by Denying All Relief  Abate the Activity if the Pays Damages (Spur) o Nuisance Law and Environmental Controls o Calabresi&Melamed. Liability Rules. 233)  Introduction  The Setting of Entitlements  Rules for Protecting and Regulating Entitlements Property and Liability Rules Inalienable Entitlements  The Framework and Pollution Control Rules  The Framework and Criminal Sanctions Calabresi-Melamed & The Law of Nuisance PROPERTY RULE ENTITLEMENT IN 4 Rule 1 4: granted injunction (: must stop activity (Morgan and Estancias) Rule 3 4: denied all relief (: can continue activity LIABILITY RULE Rule 2 4: awarded damages (: if ( pays pcan continue activity (Boomer) Rule 4 4: pay damages to ( (: if 4 pays p(must remove nuisance ENTITLEMENT IN ( 35 . safety. only a person who can show he or she has sustained injury or damage that is different from that suffered by the rest of the public can actually file a claim. peace. and Inalienability: One View of the Cathedral´ (PPL. or abnormally dangerous Gravity of unreasonableness turns heavily on considerations of gravity and utility o 4 Ways of Resolving Nuisance Claims  Abate the Activity in Question by Granting Injunctive Relief (Morgan. ³Property Rules.

all parties have to find out if their property agreement is subject to the new parameters y Frustration Costs and the Language of Property Rights o It is in the interest of the public to have standardized forms of property and the numerusclausus rule acts as a sort of ³pollution tax´ to prevent people from adopting new and complex forms of property agreements y Optimal Standardization and the NumerusClausus o The rule moves property agreements towards optimal standardization by allowing old forms of property 36 . Once the new form is created and non-involved parties know it exists. but civil law calls this numerusclausus y Leases are limited to four types: o Term of years o Periodic tenancy o Tenancy at will o Tenancy of sufferance y Anyone who wants to create a different kind of lease such as one that lasts ³for the duration of the war´ has to fit the lease into one of the four types Measurement Costs. ³Optimal Standardization of the Law of Property: The NumerusClausis Principle´(PPL. The common law has no name for this limitation. and the Optimal Standardization of Property Rights y Measurement-Cost Externalities o Creating a new type of property agreement imposes a measurement cost on other people who are not involved with the first transaction. 360) The NumerusClausus in the Common Law of Property« y Difference between Property and Contracts o CONTRACTS recognizes no inherent limitations on the nature or duration of interests that can be subject to contract o PROPERTY only recognizes a limited set of agreements that conform to standard forms. Frustration Costs.(Spur) The Right to Divide Dividing Ownership in Time y PRESENTLY POSSESSORY ESTATES o Introduction  Merrill & Smith.

while the heir was a minor y Marriage: lord could sell the marriage of a minor heir y Escheat: land reverted to the lord if the tenant died w/out heirs Provided the economic support for the feudal system Important in historical development of property law (b/c of avoidance)  Avoidance of Feudal Incidents Landowners tried to avoid them 37 . who in turn granted part of this large acreage to other tenants. not the relationship between tenant and land  Feudal Tenures and Services The king granted vast acreage to his tenants-in-chief.agreements to exist and permitting legislative creation of new forms y Information Costs and the Dynamics of Property o As information costs go down. w/ the possessor of land at the bottom and the lords above him entitled to various services (modern rent)  Feudal Incidents In addition to services. one can expect a loosening of the rule The NumerusClausus and Institutional Choice y The rule makes courts an inhospitable place for change of property law and forces people to look to the legislature. known as The Crown. tenants were liable for feudal incidents y Generally due on the tenant¶s death y Form of inheritance tax Principle Incidents: y Relief: payment by the heir to relieve the land from the lord¶s grasp y Wardship: lord was entitled to possession of the land. who is said to "hold" the land The sovereign monarch. This in turn makes the rules more universal and stable Conclusion o Historical Background  Tenure Legal regime in which land is owned by an individual. including rents and profits. who might subinfeudate further Every tenant owner services to his lord which might be: y Fighting for the lord y Laboring on the lord¶s land y Furnishing foodstuffs for the lord¶s house hold y Payment of money rent A feudal ladder was developed. held land in its own right All private owners are either its tenants or sub-tenants The term "tenure" is used to signify the relationship between tenant and lord.

Courts laid down several rules that had the effect of preserving feudal incidents for the lords The Statute of Uses (1536) y Henry VIII forced thru Parliament y Purpose of restoring the king¶s feudal incidents (clever lawyers have been able to bypass) y Laid down the foundation for modern conveyancing and the modern trust  Decline of Feudalismp System of Estates o Types of Estates  Common law has developed 4 kinds of estates. each indicating the period of time for which the land might be held Fee simple: an estate that has the potential of enduring forever y Created by O. or y Tenancy at will: so long as both the landlord and tenant desire o The Fee Simple²ABSOLUTE  How the Fee Simple Developed In early feudal times. tenant held land only for his life Tenants wanted land to pass to their heirs at death p bargain w/ lords pInheritability y If the lord agreed to accept the tenant¶s heir in his place at his death p lord granted the land ³to the tenant and his heirs´ pFee simple: an inheritable estate Alienability y Demand for land increased p idea that a tenant should be able to convey the fee to another during his life w/out lord¶s consent y p end of 13th cent. the owner. but will necessarily cease if and when the first fee tail tenant has no lineal descendants to succeed him in possession y Created by O granting ³to A and the heirs of his body´ Life estate: an estate that will end necessarily at the death of a person y Created by O granting the property ³to A for life´ Leasehold estates: include estates that endure: y Term of years: for any fixed calendar period or any period of time computable by the calendar (called a ³term of years´ regardless of the length of the period). granting the land ³to A and his heirs. or y Periodic tenancy: from period to period until the land lord or tenant gives notice to terminate at the end of a period.´ Fee tail: an estate that has the potential of enduring forever. the fee was freely alienable5  Creation of a Fee Simple Feudal times y Lord would have to grant the land ³to the tenant and his heirs´ Heirs have no present interest 5 Alienable: able to be transferred to new ownership. 38 .

and cousins) y If decedent leaves no spouse. great-grandchildren. (varies by state) o Child of the adoptive parents. nieces. the fee simple escheats to the state Standardization of estates A fee simple: an estate capable of being inherited by whoever turns out to be the heirs of the fee simple owner y No limits on its inheritability y EXCEPT the limit that creates a fee tail y y y 39 . uncles. grandchildren.  A grant ³to X and his heirs´  X¶s heirs have interest ³«and his heirs´ are words of limitation = X takes a fee simple X can sell or give away the fee simple. sisters... issue. spouse ½ y No spouse + no issue p parents take all Collaterals: y All blood kin except ancestors and descendants(brothers. and o If paternity is establishedp child of the father (inheritance from father varies by state) y Stepchildren: do not take Ancestors: if the decedent leaves« y Issue p parents do not take y Spouse + no issue p parents ½. and all further descendants Child¶s share: y Spouse + childp spouse ½. or parent p collateral relatives take y Complicated system for determining which collateral relative takes Escheat: if a fee simple owner dies w/out a will and w/out heirs. nephews. aunts. or o Child of the natural parents as well y Non-marital children: inherit as« o Child of mother.children ½ (divided) y No spouse pchildren take all in equal shares y If child predeceases the decedent pper stirpes distribution: the issue represent the child and take the child¶s portion y Adopted children: treated either as. or devise it by will p depriving X¶s heirs of the land Modern law y Requirement of ³and his heirs´ has be abolished y A deed or will is presumed to pass the largest estate the grantor or testator owned Inheritance of a Fee Simple Heirs: those persons who succeed to the real property of an intestate decedent (one who died w/out a valid will) under a state¶s statute of intestate succession Issue: ³issue´ means children.

and owners of the remainder  Abolition of the Fee Tail Fee tail has been abolished in England and in all American jurisdictions (except DE. reversioners. which have a standardized form p restricts freedom of ownership y RATIONALE: limit fragmentation of ownership p promotes easy transferability of rights o The Fee Tail  Historical Background Feudal England y Land was basis of family power. MA.o Fee tail: limits inheritance to a particular class of heirs Numerusclausus: the prohibition of new or customized property interests in civil law y Applies to estates and all property interests y Requires owners create only legally recognized property interests. and RI) QUESTION: what estates are created by transfer ³to X and the heirs of his body´? p statutory and judicial solutions: y X has a life estate o Few states hold that X has a life estate or. what amounts to the same thing 40 . status and wealth y Objective for landowners: to keep land in the family y p Fee tail created to keep land safe for succeeding generations ³The fee simple conditional´ y Attempt by landed lords to tie up land in the family y Created by a grant ³to X and the heirs of his body´ o X could convey a fee simple if a child where born to X o p X¶s estate = fee simple conditional upon having issue Statute de DonisConditionalibus y Abolished the fee simple condition y Permitted creation of new estate in the land²the fee tail  2 Characteristics: Lasts as long as the grantee or any of his descendants survives Inheritable only by the grantee¶s descendants  Creation of Fee Tail Using words of inheritance and words confining succession ³to X and the heirs of his body´ y ³heirs of the body´ = grantee¶s issue or lineal descendants y The fee tail goes to each succeeding generation in turn  Taltarum¶s Case²approved common recovery Common recovery: fictitious lawsuit whereby a tenant in tail in possession could go into court and walk out with a fee simple absolute A tenant in tail could turn his fee tail into a fee simple absolute. ME. barring all the rights of issue.

y

o An un-barrable fee tail for X¶s life, w/ a remainer in fee simple to A¶s issue X has a fee simple o Majority of states hold that X has a fee simple but are split on a subsidiary point  X has a fee simple absolute  X has a fee simple but any remainder to become possessory on failure of issue is given effect if and only if X leaves no descendants at his death

o The Life Estate  Definition: An estate that has the potential duration of one or more human lives Common today, particularly life estates in trust When property is held by Y in trust for X for life, X is entitled to all the rents and profits or other income form the property White v. Brown, 1977  Restraints on alienation Disabling restraint: w/holds from the grantee the power of transferring his interest Forfeiture restraint: if the grantee attempts to transfer his interest, it is forfeited to another person Promissory restraint: provides that the grantee promises not to transfer his interest y If valid, enforceable by the contract remedies of damages or injunction  Valuation of Life Estate and Remainder Baker v. Weedon, 1972  Waste General idea: y A should not be able to use the property in a manner that unreasonably interferes w/ the expectation of B y Designed to avoid ³uses of property that fail to maximize the property¶s value´ Affirmative Waste: arising from voluntary acts y Liability results from injurious acts that have more than trivial effects y Injurious: acts that substantially reduce the value of the property in question Permissive Waste: arising from failure to act y Question of negligence²failure to take reasonable care of the property  Creating a Legal Life Estate²problems that may arise Sale: life tenant cannot sell a fee simple unless all other persons having an interest in the property consent or unless a court of equity orders sale and reinvestment of the proceeds

41

Lease: might be advantageous for life tenant to lease property for period extending beyond death Mortgage: life tenant may need to obtain a mortgage to make improvements on property. Banks do not ordinarily lend money if the security is a life estate, rather than a fee simple. Waste: certain actions that a tenant may want to make on the property may constitute waste which may result in an injunction or damages Insurance: life tenant is under no obligation to obtain insurance. But, if he does and there is a fire, etc., he is entitled to all the proceeds and the remaindermen, nothing.  Legal Life Estates of Personalty Law of waste does not apply To deal w/ ³waste,´ trustees may be appointed  Protecting the Life Tenant by Creating Trust Trust: more flexible and usually more desirable than a life estate Trustee: holds the fee simple y ³Manager´ of the property y May be directed to pay all the income to the life tenant or to let the life tenant come into possession y Powers over property are found in either: o Instrument creating the trust o Supplied by law y Power to administer the trust for the benefit of the life tenant and remainder men include the powers to: o Sell p invests proceeds and pays the incometo the life tenant o Lease o Mortgage o Remove minerals o ³whatever a prudent person would do w/ respect to the property´ o Seisin: a person seised of the land was responsible for the feudal services, and feudal incidents (taxes) were due on the death of a person holding seisin (a freehold tenant in possession)  Freehold estates: onlya freeholder in possession has seisin Fee simple Fee tail Life estate  Non-freehold estates: a leaseholder has only possession (in feudal days they were not considered to be estates, only personal contracts) Leasehold estate  RULE: never could be an abeyance (suspension) of seisin o Defeasible Estates  Fee simple Fee simple absolute y Cannot be divested

42

y

y

y Interminable Fee simple defeasible: may last forever, or may come to an end upon the happening of a future event y Fee simple determinable o So limited that it will end automatically when a stated event occurs o E.g. O conveys X ³to A and its heirs, so long as X is used µfor school purposes¶´  O, the grantor, has a possibility of reverter y Fee simple subject to condition subsequent o Does not automatically terminate but may be cut short o E.g. O conveys X ³to A and his heirs, but if X is not used µfor school purposes,then X goes back to O¶  O, the grantor has a right to re-enter Mahrenholz v. County Board of School Trustees, 1981 Mountain Brow Lodge No. 82, Independent Order of Odd Fellows v. Toscano, 1967 City of Palm Springs v. Living Desert Reserve, 1999 Ink v. Cit of Canton, 1965 FUTURE INTERESTS o Interests retained by the transferor/ grantor:  Reversion  Possibility of Reverter  Right of Entry (power of termination) o Interests created in a transferee/ grantee:  Vested Remainder Indefeasibly Vested Vested Subject to Open Vested Subject to Partial Divestment  Contingent Remainder Given to an unascertained person Made contingent upon some condition or future event (other than natural termination)  Executory Interest THE TRUST Present Possessory Estates

PRESENT ESTATE FEE SIMPLE ABSOLUTE FEE SIMPLE DETERMINABLE

EXAMPLES ³To A & his heirs´ ³To A & his heirs so long as«´ until«´ while«´

DURATION Forever As long as condition is me, then automatically to the grantor

FUTURE INTEREST GRANTOR None Possibility of Reverter

FUTURE INTEREST GRANTEE None (See Fee Simple Subject to an Executory Interest, below)

43

and if not«. and The life estate and remainder are both legal or both equitable.FEE SIMPLE SUBJECT TO CONDITION SUBSEQUENT FEE SIMPLE SUBJECT TO AN EXECUTORY INTEREST ³To A & his heirs. O. but if«. remainder to A¶s children who reach 21. his children are all under age 21  Remainder is destroyed  X reverts back to the reversioner. then to B´ ³To A for life.  Then. blocking merger y 44 . below) Executory Interest (See Fee Simple Determinable. above) Reversion Executory Interest FEE TAIL ³To A & the heirs of his body´ ³To A for life. to B´ ³To A and his heirs but if«.´ or ³To A for the life of B´ ³To A for life. but if«´ upon condition that«´ provided that«´ however«´ ³To A & his heirs for so long as«. above) (See Fee Simple Subject to a Condition Subsequent. the remainder becomes a remainder in fee dimple (or fee tail) in A o This is all the rule does o It may be followed by the Doctrine of Merger: a life estate in A merges into a vested remainder in fee (a larger estate) held by A.  NOTE: life estate cannot merge into vested remainder in fee simple if there is an intervening vested life estate.´ At A¶s death. to B´ Until happening of named event and reentry by grantor As long as condition is met. and Purports to create a remainder in persons described as A¶s heirs (or the heirs of A¶s body). to B´ Until A and his line die out Until the end of the measuring life Until the end of the measuring life Until the end of the measuring life or the happening of the named event None (but remainder is possible) None (but see below) Remainder Executory Interest LIFE ESTATE (MAY BE DEFEASIBLE) Reversion None Reversion Rules Promoting Marketability of Land²Rules Restricting Contingent Remainders y RULE OF DESTRUCTIBILITY OF CONTINGENT REMAINDERS: a remainder in land is destroyed if It does not vest at or before the termination of the preceding freehold estate o EXAMPLE: O conveys X ³to A for life. then to 3rd party Until happening of event Right of Entry (See Fee Simple Subject to an Executory Interest. who owns it in fee simple absolute o POLICY: destroying contingent remainders enhanced the alienability of the land THE RULE IN SHELLEY¶S CASE o Provides that:  If all of the following: One instrument Creates a life estate in land in A.

the Rule in Shelley¶s case is a rule of law and the grantor¶s intent cannot change it RULE AGAINST PERPETUITIES²the principal guardian against the control of the living by the dead hand o RULE:No interest is good unless it must vest. if at all. In 2003. does not apply to vested remainders or to future interests in the grantor (reversion. which may be rebutted by evidence of the grantor¶s intent. possibility of reverter. A dies. at A¶s death y The remainder in fee simple in B is a vested remainder when created o LOOK FOR the possibility of remote vesting²What-Might-Happen  Courts do not wait to see what happens.)  EXAMPLE: O conveys ³to A for life. y The gift is void²this is what might happen o It is possible for the first child of A who becomes a lawyer to be a child not alive in 2000. IN) o Inter vivos branch: when an intervivos conveyance purports to create a future interest in the heirs of the grantor. still in effecting AK.  If It will not necessarily vest or fail w/in the period²if there is any possibility that it may vest beyond the period²it is void EXAMPLE: In 2000. Some 25 years later. o D might die before becoming a lawyer  Then if A. but look at the interest at the time of creation and determine then if the interest will necessarily vest or fail w/in the perpetuities period set by the rule. (a rule against a remainder in the grantor¶s heirs. and right of entry) EXAMPLE: O conveys ³to A for life. the future interest is void and the grantor has a reversion. then to O¶s heirs. then to B and his heirs. y The conveyance is entirely valid y The remainder for life given to A¶s children will vest.´ A has a daughter D in law school. bereft at D¶s death and desiring a lawyer in the family. in 2028.y y DOCTRINE OF WORTHIER TITLE (abolished by most. then to A¶s children for their lives. O conveys ³to the first child of A who becomes a lawyer.´ A has no children.  EXAMPLE: O devises ³to A for life then to O¶s heirs. procreates another child²C²born in 2002. 45 . o NOTE: this is a rule of construction. the devise is void and the heirs take by descent.´ The remainder to O¶s heirs is void O has a reversion o Testamentary branch: If a person devises land to his heirs. DE.S. not later than 21 years after some life in being at the creation of the interest  Applies to contingent remainders and executory interest. C becomes a lawyer and claims the gift. if at all.´ The devise to O¶s heirs is void O¶s heirs take the reversion after A¶s death by descent NOTE: this does not exist in U.

then to Z.´ ³To School Board so long as it is used for a school. then to Y. the to A¶s children for life. then to A¶s grandchildren. then to such of B¶s children who become lawyers. a life in being (NOTE: the wife is named) Unborn widow problem: law assumes that a person¶s surviving spouse might turn out to be a person not now alive. then to his widow for life. the corpus to Z and his heirs. but if at her death Y is not survived by children. then to A¶s children for life. then to B. D. Y is the measuring life Fertile octogenarian problem: law conclusively presumes that a person can have children so long as the person is alive A. B. remainder to those of B¶s siblings who reach age 21.´ ³To A for life.´ ³To A for life. D. then to M¶s grandchildren. C. B. At the death of A. (A¶s interest is stricken) B¶s parents can be used as measuring lives B may have a child born after the disposition who becomes a lawyer more than 21 years after B¶s death No unborn widow problems because the gift is to W. C. ³Trust income to Polo Club. then to M¶s children for their lives.´ ³To B for life. and E (all born today at Obie Hospital). then to A¶s surviving children.´ ³To M for life. and E are the measuring lives Valid Invalid Valid Invalid Valid Invalid Valid Invalid Valid Invalid Administrative contingency²the slothful 46 .´ ³To School Board so long as it is used for a school. Interest created by will: validating life must be a person alive at the testator¶s death Interest created by an irrevocable inter vivos transfer: validating life must be a person alive at the date of the transfer Interest created by revocable trust: validating life must be a person alive when the power of revocation ceases (usually at the settlor¶s death) Interests Under the Rule Against Perpetuities EXAMPLE ³to A for life. W.´ ³To X for life. for life.The gift is void²this is more than 21 years after the death of A and D (the only relevant lives) o Validating Lives  The validating life must be a person alive at the creation of the contingent interest. then to the Red Cross.´ ³To A for life. then to his wife.´ M is 80 years old and has had a hysterectomy.´ ³The residue of my estate to my descendants VALIDITY Valid Invalid EXPLANATION B¶s remainder is vested on creation A may have a child after the interest is created and so may have grandchildren beyond the perpetuities period This falls w/in the charity-to-charity exception The interest may vest in A¶s heirs or devisees hundred of years from now. then to A¶s surviving descendants. then to A.´ ³To B for life.

holding as one person  Cannot be severed w/out consent of both spouses  Creation requires 4 unities for a joint tenancy + unity of marriage p 5 unities SEVERANCE OF JOINT TENANCIES: any joint tenant at any time can destroy the right of survivorship by severing the joint tenancy p tenancy in common and the right of survivorship is destroyed. Shared Property Concurrent Estates: Shared Ownership under the Common Law y TYPES. o Conveyance by joint tenant: each joint tenant has a right to convey her interest p severs joint tenancy w/ respect to that share  Contract to convey: a K by one joint tenant to convey her interest in the property (which is specifically enforceable in equity) may sever the joint tenancy Doctrine of Equitable Conversion: the execution of the K gives the buyer equitable ownership and converts the seller¶s legal ownership into a K right to receive the selling price p unity of interest is severed in equity Contract by all tenants: does not sever the joint tenancy for 2 reasons: y the parties did not intend to sever 47 y . and the surviving co-tenant has the right to the whole estate  2 or more persons own the property w/ a right of survivorship When one joint tenant dies. or by joint adverse possession Interest: interest of each joint tenant must be equal in an estate of one duration (identical interests) Possession: each joint tenant must have right of possession of the whole o Tenancy by the entirety:concurrent ownership created only b/w husband and wife. CHARACTERISTICS.´ executor problem: a bequest to vest ³when m estate is settled´ or ³when my executor is appointed´ violates the Rule because the named event may not happen w/in lives in being plus 21years.  Common law requires 4 unities for a joint tenancy: Time: interest of each joint tenant must vest at same time Title: all joint tenants must acquire title by same deed or will. her interest p to her heirs or devisees o Joint tenancy: each co-tenant owns an undivided share of property (as in tenancy in common).who are living when my estate is distributed. CREATION o Tenancy in commons: each owner has a separate undivided interest in the whole  2 or more persons own the property w/ no right of survivorship b/w them When one tenant in common dies. survivor(s) takes all.

1980: joint tenant can unilaterally sever a joint tenancy w/out the use of an intermediating 3rd party by conveying his/her interest to him/herself  FACTS: 4 (Riddle) and his wife. purchased real estate and took title as joint tenants. the depositor may open a joint bank account intending it to be a ³convenience account´ A can lawfully write checks during the depositor¶s life to pays A has no rights of survivorship  NOTE: b/c joint bank accounts can be used as either a ³true´ joint and survivor account or as a convenience account p litigation over which type of account was intended by the depositor o Joint bank account as a will substitute²³payable-at-death´  Can be used purely as a will substitute y 48 . the parties have a unity of interest in equity  Conveyance to self: common law required a person to convey to another person but some cases (Riddle. to pay bills. W wished to sever the joint tenancy so she could pass on her interest in her will. W. below) have permitted a joint tenant to unilaterally server the tenancy by conveying her interest to herself w/out using an intermediary. O. Her estate attorney prepared a deed allowing W to grant a ½ interest in the property to herself.  NOTE: must be done by deed not by will Riddle v. Before she died. explicitly stating the purpose was to ³terminate those joint tenancies formerly existing´ b/w 4 and W. A. now discarded y Attorneys have devised ways since Clark to avoid intermediaries o Burke v. Carter: transfer of property requires to parties y COURT: the rule that one cannot convey an interest in property to oneself is an archaic rule. Reiss: wife severed joint tenancy by transferring interest to son as trustee of a trust for her use and benefit W could have terminated the joint tenancy thru any number of means JOINT TENANCY BANK ACCOUNTS o True joint and survivor account: either party on the account can w/draw the amount deposited and the survivor takes wtv sum is remaining the account when the other joint tenant dies o Convenience account  EXAMPLE: if a depositor. is aging or sick and needs another person. Harmon. Stevens: permitted wife¶s use of associate of her attorney as 3rd party (³strawman´) in property transfer used to sever joint tenancy o Reiss v.y even applying the equitable conversion.  ISSUE: can a joint tenant sever her interest by conveying her interest to herself w/out the use of an intermediary?  HOLDING: one joint tenant may unilaterally sever a joint tenancy w/out the use of an intermediary device Clark v.

4s have a 99/144 interest. declaration that instrument is will.  PROCEDURE: 4s brought action in trial court seeking a partition by sale y Partition: dividing the lands resulting in individual ownership of the interests of each joint tenant y Partition by sale: partition of the property by sale w/ proceeds divided according to the respective interests.) RELATIONS AMONG CONCURRENT OWNERS o Per my et per tout: ³by the half and by the whole´  Term used to describe how each tenant in a tenancy in common or a joint tenancy holds a whole share of the property w/ regard to survivorship.  HOLDING: a court is not required to order a physical partition even in cases of extreme hardship A partition by sale should only be ordered when the physical attributes of the land make a partition in-kind impracticable or inequitable. court concluded that a partition in-kind would result in ³material injury´ to both 4s and (p sold at auction by a committee and that the proceeds be paid into the court and redistributed to the tenants. would be better promoted by such a sale  NOTE: although courts usually say that a partition in-kind is preferred but more often than not. 4s want to develop the property into 45 residential lots. does not intend A to have any right to w/draw money in the account until O dies If extrinsic evidence shows this is O¶s intent. ( has a 45/144 interest. 1980: a partition by sale should only be ordered if in the best interests of all parties involved  FACTS: 4s (Angelo and William Delfino) and ( (Helen Vealencis) own real property as tenants in common. and when the interests of all the owners. the opposite usually occurs PRESENT TREND: order sale in partition y in deference to the wishes of all parties involved. but holds a share equal to other tenants w/ regard to the right to occupy. o Partition: an equitable action available to any joint tenant or tenant in common  Concurrent owners might decide for any number of reasons to terminate a contenancy but can¶t do so thru a voluntary agreement p partition  NOTE: unavailable to tenants by the entirety Delfino v. or  49 . Vealencis.(¶s home is on the western end of the property and also runs a garbage removal business on a portion of the land. O. etc. ( appealed. many courts hold the joint bank account is invalid b/c no gift is made during life The account is a testamentary act not executed w/ the formalities required for a will (2 witnesses. not just one.y The depositor. ( moved for a judgment of in-kind partition y in-kind partition: physical division of the property into separate tracts After hearing.

holds title to the whole property and may rightfully occupy it until another cotenant (() asserts possessory rights y ( claims 4¶s lock on the unit amounts to ouster2 o No evidence that the locks were used to exclude ( from the property²they were used to secure 4¶s merchandise inside o No evidence that ( or any other cotenants asked for the keys to the locks or were prevented from entering the building b/c of the locks  HOLDING: w/out evidence that 4intended to exclude the other cotenants. Trial court awarded ( $2. 4 began using the vacant space to store merchandise.  ISSUE: is a cotenant in possession of property liable to other cotenants for rent when there is no evidence the cotenant in possession has done anything to exclude the other cotenant from the property?  MAJORITY RULE: in the absence of an agreement to pay rent or ouster of a cotenant. demanding that 4 either vacate half the building or pay half the rental value. 4 is not liable for rent y ouster: the beginning of the running of the statute of limitations in cases of adverse possession. deprivation of an inheritance. Mackereth. 4 appealed. 4 did neither and ( brought suit. When a lessee (Auto-Rite) vacated their rented unit. ejection from a freehold or other possession. 1976: absent an agreement to pay rent. as an occupying cotenant. ( wrote 4 a letter. the liability of an occupying cotenant for rent to other cotenants. a cotenant in possession is not liable to cotenants for the value of use and occupation of the property. 6 50 . a cotenant in possession is not liable to his cotenants for the value of his use and occupation of the property unless there is ouster6 of a cotenant  FACTS: 4 (Spiller) and ( (Mackereth) owned a building as tenants in common. Ouster: can refer to either the beginning of the running of the statute of limitations for adverse possession or the liability of an occupying cotenant for rent to other cotenant y Adverse possession aspect of the word is precluded b/c 4 has acknowledged the existence of the cotenant relationship by filing a bar for partition y Liability for rent aspect of the word is evidenced when an occupying cotenant refuses a demand of other cotenants to be allowed into use and enjoyment of the land o (¶s letter only demanded that 4 vacate or pay rent o ( did not state any desire of ( to enter the premises o (¶s letter was insufficient b/c 4.100 in rent.b/c the court believe that sale of the property is actually the fairest means of ending any conflict b/w them Spiller v.

and other carrying charges o Repairs and improvements  Marital Property y DURING MARRIAGE Sawada v.y MINORITY RULE: (not followed by the court in this case) a cotenant in exclusive possession must pay rent to cotenants out of possession even when no ouster is established PROS y More fair to cotenants out of possession y When a cotenant occupies the property in question. Ume owned a parcel of real property as tenants by entirety 11/30/68: 4s (Masako & Helen Sawada) were injured when struck by car driven by (Kokichi 06/17/69: 4 Helen filed complaint against ( for damages 07/26/69: date of deed for (s¶ conveyance of the property to their sons 08/13/69: 4 Masako filed complaint against ( for damages 10/29/69: summons & complaints served on ( 12/17/69: deed from (s to sons was recorded y the sons paid no consideration for the conveyance y both sons were aware at the time of conveyance that their father (() had been in an auto accident and carried no liability insurance y (s continued to reside on the premises they conveyed to sons 01/19/71: judgment was entered in favor of 4 Helen for $8.28. held in tenancy by the entireties. subject to levy and execution by his or her creditors?  HOLDING: under the Married Women¶s Property Act. 1977: an estate by entirety is not subject to the claims of creditors of only one of the spouses  FACTS: ( (KokichiEndo) and his wife.846. it is essentially kept ³off the market´ p potential rent from a prospective renter is lost CON: the majority rule encourages constructive use of the property vs.199. mortgage payments. 01/29/71: Ume died and was survived by (Kokichi 4s brought suit to set aside the conveyance of the marital property and satisfy their judgment. Trial court refused.  ISSUE: is the interest of one spouse in real property. the interest of a husband or wife in an estate by the entities is not subject to the claims of his or her individual creditors during the joint lives of the spouses 51 . Endo. 4s appeal. leaving it vacant and possibly unimproved until a new renter occupies ACCOUNTING FOR BENEFITS.46 and 4 Masako for $16. RECOVERING COSTS o Rents and profits o Taxes.

4 was employed as a full-time flight attendant and ( worked part time devoted his time to education. the creditor presumably has notice of the characteristics of the estate that limit the ability to reach the property y (s did not defraud the judgment creditors PUBLIC POLICY: property held by spouses in tenancy by the entirety is often the single most important asset of the family unit.5 years of the marriage and obtained a corporate position w/ starting salary of $14. 70% of total income used for family expenses and (¶s education. divorce terminates the unity of husband and wife p terminates tenancy of the entiretyp conversion  In some states:tenancy by entirety p joint tenancy  In most states: tenancy by entirety p tenancy in common RATIONALE: spouses do not want survivorship rights after divorce In re Marriage of Graham.000. 4 contributed to approx. 1978: an educational degree  property p not subject to division upon divorce  FACTS: 4 (Anne) and ( (Dennis) were married for 6 years.y SEVERANCE: Under tenancy in entirety. To allow 3rd parties to become a joint tenant w/ a couple would severely hinder the use o this asset as security for loans on education and other family expenses y (¶s conveyance of marital property to sons is not subject to the 4s¶ claims  DISSENT: the majority interpretation of the Married Women¶s Act equalizes the positions of the spouses by taking away the husband¶s right to transfer his interest This position prevents the wife from exercising the same right that the husband once enjoyed for the sake of equality BETTER POSITION: say either spouse may levy and execute upon their rights of survivorship y p the separate interest of (Kokichi should be alienable by him and subject to attachment by his separate creditors A voluntary conveyance by ( should be set aside when it is done to defraud his creditors TERMINATION OF MARRIAGE BY DIVORCE o In most states. 52 . neither spouse has a separate divisible interest in the property that can be conveyed or reached by execution of a judgment y NOTE: joint tenancy may be severed by such a process y The estate can only be created w/ a married couple p can only be destroyed by the actions of a married couple FRAUD: tenancy by the entirety cannot be entered to defraud creditors y If the tenancy already exists. ( attended school for 3. Couple had no marital assets. During the marriage. During marriage.

transferred. Trial court found that. an education obtained by one spouse during a marriage is jointly-owned property to which the other spouse has a property right. the court should go beyond narrow concepts of property in order to promote equity LAW OF TORTS: recognizes that the deprivation of future earnings is something that can be compensated for when impaired or destroyed Mahoney v. no marital property has been accumulatedand a degree  property There are limits on what constitutes property²an educational degree is not encompassed even in broad views of the concept of property y A degree is of personal value to the holder y A degree itself terminates on the death of the holder and is not inheritable y A degree cannot be assigned. conveyer. a wife has dower in all freehold land: y of which her husband seised during marriage and y which is inheritable by issue born of the marriage  7 maintenance: request for spouse to provide financial support post-divorce 53 . travel expenses to and from school. sold. 4 made no claim for maintenance7 or attorney fees.y PROCEDURE: both jointly filed for divorce. Court of appeals reversed. as a matter of law.  HOLDING: a spouse who provides financial support while the other spouse acquires an education will have that contribution taken into consideration when marital property is to be divided. and any other means of support he/she provided while the other earned a degree NOTE: some states have enacted statutes specifically mandating a division of educational benefits y PROBLEM: whether or not to reimburse working spouses for the income the other spouses might have contributed if they had not devoted all their time to education TERMINATION OF MARRIAGE BY DEATH OF ONE SPOUSE o Common Law  Dowerp wife A life estate in 1/3 of each parcel of qualifying land At common law. 1982: working spouses should be awarded ³reimbursement alimony´  HOLDING: a professional degree is too speculative in value to be considered marital property Working spouse should be awarded ³reimbursement alimony´ p spouse repaid for covering the costs of the spouse¶s education. BUT here. where the wife works to educate her husband but is rewarded w/ a divorce after the husband attains a degree. Mahoney. household expenses.134 of (¶s future earnings. 4 was awarded $33. or pledged y A degree is an intellectual achievement that may assist in the future acquisition of property but  property in and of itself  DISSENT: in such cases like this.

LA.y RULE of Dower: once inchoate dower has attached. all income and proceeds of sale of the property are community property If new assets are purchased w/ community funds p new assets = community property One spouse. a wife cannot lose dower unless she consents or the couple is divorced  Curtesyp husband At common law. a surviving husband had curtsey y The husband had curtsey only if issue were born of the marriage o Gives husband incentive to produce issue y The husband received a life estate in all of his wife¶s lands o Not merely 1/3 (as in dower) o RATIONALE: notion that males should control the land whereas females needed only support o Modern Elective Share  Almost all common law property states give the surviving spouse an elective share in the decedent¶s property owned at death Share is usually 1/2 or 1/3. or some other fraction determined by the length of the marriage Can be both real and personal property  Election: surviving spouse has the option (³election´) of taking a forced share or taking what the decedent spouse left by will If she elects the forced share p what was left by will is credited against the force share COMMUNITY PROPERTY SYSTEM o Common property: consists of earnings of either spouse during marriage and property acquired thru earnings  THEORY: husband and wife are a marital partnership (³community´). w/out the other¶s consent cannot change the community property into separate property  Separate property: ID. or devise is separate property How title is held is not controlling in defining community property² whether the asset is traceable to earnings during marriage is controlling o Income from Property  Community property: once property is characterized as community property. descent. on wife¶s death. that both contribute to the material success of the marriage p both should share equally in material acquisitions  NOTE: Property owned by either spouse before marriage or acquired after marriage by gift. there is a strong presumption in favor of community property o Mixing Community Property with Separate Property 54 . TX: income from separate property = community Other states: income from separate property = separate NOTE: where characterization of property is doubtful.

This sale is w/in W¶s power. invest it. salary of $10. H owns a business valued at $100..If community and separate property have been commingled in such a manner that is impossible to ascertain and identify each source. and allocate the balance to separate property o Management of Community Property  Either spouse. Technically. can manage community property Either can sell it. After marriage.000 in profits.e. acting alone. H continues to manage the business p accumulates $80.  Fiduciary duty in exercising management powers Each must use good faith in exercising authority  55 . H has the right to manage W¶s earnings as well as his own and vice versa EXAMPLE: H and W own 100 shares of GM as community property. 7% per annum) on the $100. W decides to sell the stock at market price and reinvest proceeds in GE stock.. the commingled whole will be presumed to be community property  EXAMPLES: H and W maintain a bank account depositing therein both earnings and income received from separate property y If no records are kept as to which deposits are separate property and which are community p commingled whole treated as community H and W buy a parcel of land using both separate and community funds to pay the purchase price and keep no records y p commingled whole treated as community o Management of Separate Property  Where one spouse devotes time and effort in managing his or her separate property p increased value The enhanced value y Is partly attributable to the spouse¶s separate investment and partly due to the spouse¶s skill and industry y Belongs to the community EXAMPLE: at time of marriage.000 a year). y What portion of the profits is community and what portion is separate property? o Court must decide if the chief contributing factor in realizing profits is the capital investment of H or the personal efforts of H  If the greater factor was H¶s efforts (a community asset) p court will allocate a fair return (i. etc.e. lease it.000.000 investment and allocate any excess to the community property  If the greater factor was H¶s investment (before marriage) p court will allocate the reasonable value of H¶s services to community property (i.

minerals. wild game. fish  When a profit is granted p an easement to go on the land and remove the subject matter is implied O Affirmative/positive easements: owner of an affirmative easement has the right to go onto the land of another (³servient land´) and do some act on the land (common) O Negative easements: owner of a negative easement can prevent the owner of the servient land from doing some act on the servient land (rare) 56 . they do not change if a couple changes domicile Separate property statep remains as separate property when they move to a community property state Community property statep remains as community property when the couple moves to a common law property state  Servitudes y OVERVIEW O Landowners often want to make agreements w/ their neighbors respecting the use of one or both of the parcels of land  Such agreements p 2 broad categories Rights arising from a grant or a right by one landowner to another = easements or profits Rights arising from a promise respecting the use of land by one landowner to another = real covenant or equitable servitude  Easements: a grant of an interest in a land that entitles a person to use land possessed by another  Real covenant: a covenant that runs with the land at law p may recover damages  Equitable servitude: covenant enforceable in equitypmay seek injunction or specific performance O Law of profits àpendre: the right to take something off another person¶s land that is part of the land or a product of the land  Profits include: crops. timber.If fiduciary duty is breached p liable to other spouse Real Property: usually land held as community property cannot be sold except w/ the consent of both husband and wife  Business Interest: spouse managing a business that is community property has the sole management and control of the business  Gifts: community property states follow different rules respecting gifts of community by one spouse o Migrating Couples  Property rights in earnings are determined by the state of domicile when the property is earned Separate property statep earnings of both are separate property of each Community property statepearnings of both are community property  Once the property rights are determined.

Rosier  Willard v. First Church (parking lot use by 3rd party) Public Policy/Public Trust y Matthews v. Petersen approached McGuigan with an offer to buy lot 20 but McGuigan would only sell the lot if the church could continue to use it for church parking p(¶s attorney drawing up a provision for the deed 57 . a right to cross to reach the public road. Bay Head (beach) Estoppel y Holbrook v. Rosier (roadway and levee) Prescription y Van Valkenburgh v. Taylor (improvements on road) Implied from Prior Use y Van Sandt v. a Realtor). Scientist. First Church of Christ. McGuigan was a member of the church and allowed lot 20 to be used as a parking lot during church services.y O Easements appurtenant: if an easement benefits its owner in the use of another tract of landp appurtenant to that land  Dominant tenement: the land benefited  Servient tenement: the land burdened  EXAMPLE: is located b/w ‘ and a public road. the owner of . A. conveys to B. The easement over is appurtenant to ‘ y ‘ = the dominant tenement y = the servient tenement  An easement appurtenant is attached to the dominant tenement and passes w/ the tenement to any subsequent owner of the tenement It cannot be separated from the dominant tenement and turned into an easement in gross (below) unless the owners of the dominant and servient tenements make a new agreement permitting that O Easements in gross: if an easement does not benefit its owner in the use and enjoyment of his land but merely gives him the right to use the servient landp easement in gross  ³in gross´: signifies that the benefit of the easement is not appurtenant to other land  Can be assigned if the parties so intend EASEMENTS o Creation of Easements  6 Ways to Create Easements: Express (written) Agreement y Willard v. 1972: a easement can be created in favor of a 3rd person by reservation (minority view) FACTS: McGuigan owned 2 lots (19 & 20) across the street from the ( (Church). Petersen listed it with 4 (Willard. She then sold lot 19 to Petersen who used the building on that lot for office space. Lutz (trespass) y Othen v. Wishing to resell the lot. the owner of ‘. Royster (plumbing) [Implied by] Necessity y Othen v.

in granting his or her property to a 2ndperson. ISSUE: van a property owner. PROCEDURE: McGuigan testified that she bought lot 20 to provide parking for ( and that she would not have sold it unless she was sure ( could use it for parking.´ When 4 became aware of this easement clause in the deed. reserve an easement in that property for a 3rd person? RULE: A grantor can reserve an easement in property for a person other than the grantee y COMMON LAW RULE: such reservation of an interest is not possible o This rule was based on the feudal concept of reservation from a grant²a grantor could pass his whole interest in property to a grantee but a new interest was created in the grantor o Today¶s courts should not feel so retrained by feudal methods y MAIN OBJECTIVE: carrying out the intent of the grantor p property grants are to be treated in the same way as contracts o Applying a more rigid feudal approach (common law rule above) p unfair results  The original grantee has likely paid a reduced price on the property in exchange for allowing a certain use of the property to continue y COURT: the interests of the grantors outweigh the interests the grantees may have if the old rule is followed p judgment reversed o 4 has not presented any evidence that he or any others have relied on the common law rule when purchasing the property o Neither can 4 claim that he was prejudiced b/c the lot had not been used by the ( for an extended period of time o It is clear that McGuigan and Petersen intended to convey the easement for parking to the ( NOTE: most jurisdictions today hold that an easement of this kind cannot be held in favor of a 3rd person (as done here) 58 . he began an action to quiet title against the church.to the lot stating that the change in ownership was ³subject to an easement for automobile parking during church hours«such easement to run w/ the land only so long as the property for whose benefit the easement is used for church purposes. Trial court found that both McGuigan and Petersen intended to convey an easement for the church BUT the easement clause in the deed was invalid b/c a person cannot reserve an interest in property to a stranger to the title.

. Reservation:the regrant of a new easement.g. the words exception and reservation are often treated as synonymous. Subsequently O conveys X to B ³except for an easement previously granted A. Exception:a provision in a deed that excludes from the grant some preexisting right EXAMPLE: O. The rules applicable to easements generally apply to profits.´ y The preexisting easement in A is excepted. who by the same instrument regranted an easement to O. y License: is permission to go on land belonging to the licensor and is revocable at the will of the licensor. Owner of easement has contract rights against the original grantor of the easement and all of his successors. the grantee.    RATIONALE: a 3rd party would have no interest in the land being conveyed from which the 3rd party could reserve an easement in the 1st place. Burden passes to subsequent owners of the servient land. can be created to benefit a 3rd party. unlike an easement. y EXAMPLE: if O ³excepts´ an easement in himself p treated as a reservation License: is permission to go on land belonging to the licensor. NOTE: today. 1976: easement by estoppel²a license is irrevocable once the licensee has relied on the license to his or her expense or detriment y 59 . was treated as the = grantor of a reserved easement Reservation in favor of a 3rd party y MAJORITY: an easement can be reserved only for the grantor²an attempt to reserve an easement for anyone else will likely be held void (contrary to Willard) y NOTE: a covenant. UPS delivering packages. not previously existing Reservation in favor of grantor: y Regrant theory: a deed from O to A purporting to reserve an easement in O was treated as conveying a fee simple absolute to A. the owner of X. when a new easement has been retained. guests at a party²they all have licenses) Characteristics: y Can be oral or in writing y Revocable at the will of the licensor NOTE: differences b/w easements and licenses²GOOD FOR TESTS y Easement: an interest in land. the plumber repairing a drain. Taylor. conveys an easement over X to A. It could not be reserved b/c it has previously been granted to A. Holbrook v. Licenses are very common y (e. o A. y Profit: the right to take something off another person¶s land that is part of the land or a product of the land.

4s continued to use the road on a regular basis. 4s home was completed at a cost of $25. o At trial ( testified that he allowed the 4s to use and repair the road so they could reach their home. y 1970: disagreement over road use o ( waned 4 to give him a writing which would relieve him of any responsibility in case someone were injured or otherwise damaged on the old mining road o 4s testified that the writing was an attempt to make them buy the land the road was situated on for $500 o (s later raised a steel cable across the road to block passage and set up ³no trespassing´ signs o 4 then filed suit to remove the obstructions and to declare their right to sue the road w/out interference ISSUE: can an easement be established by estoppel8 or reliance? RULE: a license cannot be revoked after the licensee has erected improvements on the land at considerable expense while relying on the license HOLDING: an easement can be established by estoppel. even when the person making use of the property does not do so adversely.FACTS: y 1942: (s (Holbrook) purchased the property in question y 1944: (s allowed a mining road to be cut on the property and was used for that purpose and royalties until 1949 y 1965: 4s (Taylors) bought a 3-acre building site next to (s¶ property y 1966: 4s built a house on that site during which 4s were permitted to use the roadway for access for workmen.000 and after. and for the construction and improvement of the house. Durbin o A licensor may not revoke a license which includes the right to erect structures and acquire an interest in the land similar to an easement after the licensee has exercised the privilege of the license and erected improvements on the land at a considerable expense y COURT: Lashley Rule is satisfied p4¶s license to use the road may not be revoked and their right to use the road has been established by estoppel estoppel: the principle that precludes a person from asserting something contrary to what is implied by a previous action or statement of that person or by a previous pertinent judicial determination. but with the permission of the property owner y Lashley Telephone v. 4s widened the road and graveled part of it for approx. $100. 8 60 . for transporting equipment and materials. This was the only location where a road could be created to provide an access route.

19 and the public sewer. or ³oral easement. 20. 1952 Henry v. including prior use FACTS: y 1904: Bailey owned a plot of land directly south of Tenth Street and east of Highland Ave. 4. 1938: an easement can be implied from the circumstances surrounding the conveyance of the land. Purvine. the 4s used the road to build and improve their $25.    o Here it is clear that the 4s used the road w/ the consent or at least the tacit approval of the (s o Moreover. Dalton. 1959 VanSandt v. This plot was divided into 3 numbered lots²19.´ actually exists y One would not need to rely on the oral statements of the licensor and licensee alone.000 home. y Conveyances of lots: o Bailey conveyed lot 19 to Jones by a general warranty deed w/ no exceptions or reservations o Bailey conveyed lot 20 to Murphy by a similar deed o Jones and Murphy built homes on their respective lots o Title to lot 20 p( (Royster) o ( (Gray) succeeded to the title to lot 4 by the time Bailey sold lots 19 and 20 y 1924: lot 19 had been conveyed to 4 (Van Sandt) who continued to own and occupy the premises there y 1936: 4 discovered his basement had been flooded w/ several inches of sewage and filth o Investigation p4 discovered the sewer drain extended across the property of (Royster and ( Gray o The drain was several feet below ground and there was nothing visible on the ground to suggest the existence of the drain or its link to the houses 61 . y The improvements themselves would attest to the presence of the easement Shepard v. running from Bailey home on lot 4 p lots 20. and widened and maintained the road at their own additional expense Easement by Estoppel: is one of the most widely used methods of avoiding the Statute of Frauds Fraud Theory: stronger terms to back estoppel in the past²allowing a grantor to revoke a license in such circumstances would work a ³fraud´ against the grantee (used in CA and IL) y CRITICISM: the fraud theory is overkill²the use of estoppel is sufficient to protect the license Equitable Part-Performance: the act of improving the property is tangible evidence that the license. o The city built a public sewer on Highland Ave. o A private lateral drain was built. Royster. Bailey¶s home was on lot 4 (eastern).

yet was not readily visible to a party to the conveyance of his property? RULE: the implication of an easement will depend on the circumstances under which the conveyance of land was made.PROCEDURE: judgment rendered in favor of (s. not the language of the conveyance RESTATEMENT: those circumstances should include the extent to which the manner or prior use was or might have been known to the parties y p parties will be assumed to know and to contemplate the continuance of reasonably necessary uses which 62 . y 4 appealed claiming: o No easement was ever created in his land o Even if one was created his property could not be burdened w/ it b/c he had no notice y (s argue that an easement was created by the implied reservation when lot 19 was severed from Bailey¶s lot as a result of the sale to Jones ISSUE: can an easement be created by implication when it was used by a previous owner. including the extent to which the manner of prior use was or might have been known by the parties y Each party will be assumed to know about reasonably necessary uses which are apparent upon reasonably prudent investigation y An easement may be implied for a grantor or a grantee on the basis of necessity alone HOLDING: y Easement: an interest one has in another person¶s land p an owner can NOT have an easement in his or her own land o BUT an owner can nonetheless use one part of his or her land to benefit another part of the land pquasieasement  Quasi-dominant tenement: part of land benefiting from this use  Quasi-servient tenement: part of land burdened w/ the particular use y EARLY CASES: when the owner of the overall property transferred the quasi-servient tenement to a new owner p an implied reservation of easement was made in favor of the conveyor of property o Implied easement: arises as an inference of the intentions of the parties to a conveyance of land  Inference is to be drawn from the circumstances.

y If an easement is implied in favor of the granteep the easement is created by implied grant to the grantee y If an easement is implied in favor of the grantorp the easement is created by implied reservationto the grantor NOTE: an easement in gross will not be implied²an easement by implication must benefit a dominant tenement created by dividing a tract into 2 or more lots. Quasi-easement 63 . would be apparent upon reasonably prudent investigation y COURT: when Jones bought lot 19 he was aware of the lateral sewer drain and knew that it was built for the benefit of Bailey o NECESSARY: the easement for the drain was necessary for the comfortable enjoyment of her property and an easement can be implied on the basis of necessity o NOTICE/APPARENT:4 had notice and the easement was apparent  4 and his wife made a careful inspection of the property and knew the house had modem plumbing and that the plumbing had to drain into a sewer y STATUTE OF FRAUDS o NOTE: no Statute of Frauds problem in Van Sandt  b/c the easement stemmed from the circumstances NOT from any of the language of the conveyance o The Statute could very well apply to the conveyance itself y NECESSITY REQUIREMENT: 2 approaches o Strictly necessary: some court still believe that the prior use must be strictly necessary to the use and enjoyment of the dominant parcel of land o Reasonably necessary: easement implied from prior use must be ³reasonably necessary´(Van Sandt)  ³reasonably necessary´ = whatever will be convenient to the enjoyment of the dominant land  Rule is violated if the owner of the dominant land would be put to appreciable expense to provide an alternative to the claimed easement Implied Easement from Prior Use An easement by implication is created by operation of law. not by a written instrument p an exception to the Statute of Frauds Implied only over land granted or reserved when tract divided: an easement can be implied only over land granted or reserved when a tract is divided into 2 or more parcels.

E. of the 100-acre tract and a 16. Trial court found that 4 had an easement of necessity along the roadway and ordered ( to ensure that it would be in usable condition. Rosier. PROCEDURE: 4 filed suit claiming that s act deprived him of access b/w the highway and his home. o The south fence was built in 1895 o The north and outside gate were built in 1906  ( used it to haul wood and permit their live stock to go on the 16. fence of the road. At the time a tract is divided into 2 or more lots. o 1924: tract was conveyed to ( (Rosier) and others y 1897: Hill conveyed a 60-acre tract just S. a use of one part of the tract must exist from which it can be inferred that an easement permitting its continuation was intended o The existing use = quasi-easement y NOTE: not a legal easement b/c O cannot have an easement in his own land Othen v.31 tract just W. then into a fenced lane which runs along the south side of (¶s 100-acres. This levee made the lane so muddy that the land was impassable. by going thru a gate on the west line of his 60-acre and east line of (¶s 16.31acre tract.-long levee along the S.31-acre tract  (¶s tenants on the smaller tract also used the roadway the same way 4 did  ( made all necessary repairs to the lane and no one else recognized any obligation to maintain it y Surface waters threatened to make the road impassable and erode the (¶s farmland p( built a 300-ft. of the 100-acre tract to others o 1904: 4 (Othen) acquired this tract y 1899: Hill conveyed a 53-acre tract E. of the 60-acre tract to separate buyers o 1913: owners conveyed the 53-acre lot p4 o 1924: owners conveyed the 16. except by horseback for several weeks at a time. 1950: an easement can be implied from necessity based on the circumstances.31-acre lot p( y 4¶s 113 acres are not contiguous w/ Belt Line Road or the other bordering highways p4 reached Belt Line Rd. 4 wanted a temporary injunction to keep (s from maintaining the levee and a permanent injunction to keep the (s from interfering w/ his use of the roadway. ISSUE: can an easement to use a roadway on a neighbor¶s property be implied when the owner seeking the easement has not proven the y 64 . or by prescription if the use was adverse FACTS: Hill once owned the entire 2493-acre Tone Survey y 1896: Hill conveyed a 100-acre tract west of Belt Line Rd.

THE USE MUST BE: 5 Open and notorious (i. open. y BY PRESCRIPTION: 4¶s use of the roadways has been merely w/ the permission of the (s p could not develop into prescriptive right o REASONS: why permission was inferred  The gate  Invitees used the roadsp owner made it available to other people/ general public (this will not lead to a valid easement by prescription) Easements by Necessity ISSUE: what is ³necessary´? Easements by Prescription NOTE: the requirements for use by prescription (adverse use)  those of adverse possession y BOTH REQUIRE: actual. w/out any attempt at concealment) 65 .e. and hostile (nonpermissive) use y NOTE: ³continuous´ and ³exclusive´ are different o For easements. or that the use was not done w/ the permission of the neighboring property owner? RULES: y NECESSITY: an easement can be created by implied reservation only when: o There was a unity of ownership b/w the alleged dominant and servient estates o The easement is a necessity and not a convenience o The necessity existed at the time the 2 estates were severed y BY PRESCRIPTION: an easement by prescription can only be acquired if the use of the easement was adverse HOLDING: 4 has no easement either of necessity or by prescription: y IMPLIED: no easement by necessity can be implied o Unity of ownership?  o Necessity? 2  No evidence that the roadway was a necessity when Hill conveyed the 100-acre tract in 1896  It appears the roadway was merely a convenience²4 could go around the tracts to get to Belt Line Rd.  use of the roadway is a necessity.. the particular use is treated as being ³continuous´ if the claimant engages in it as often as is normal for an easement of that kind Easement by Prescription²Summary of Elements FOR AN EASEMENT BY PRESCRIPTION. notorious.

This does NOT automatically mean that ( is entitled to injunctive relief²( may be awarded nominal damages DISSENT: ( should be entitled to injunctive relief²misuse of an easement is trespass y 4 should have known from public records that the easement was not connected to parcel C 66 . just normal use. any extension of the easement to other parcels is a misuse of the easement HOLDING: parcel C was not a part of the original dominant estate under the terms of the 1952 grant and you must look to the intention of the parties²4¶s use is a technical misuse of the easement but it is nonetheless a misuse. an injunction against further interference w/ the use of the easement and damages. bringing suit.5 5 5 Under a claim of right and not w/ permission of the land owner Continuous (not necessarily constant. ( counterclaimed for damages and an injunction against 4 using the easement for parcel C ISSUE: can the holder of a private easement use it to access a parcel of land that is not the dominant estate when there will be no increased burden on the servient estate? RULE: if an easement benefits its owner in the use of a particular parcel of land.000 developing the property o ( placed logs. such as grazing during grazing season) Uninterrupted by owner¶s entry upon the land. 1986: an easement which is appurtenant to one parcel of land cannot be extended to benefit another parcel FACTS: y 1952: the then-owners of parcel A granted a private road easement across their property to the then-owners of parcel B for ³ingress to and egress from´ parcel B y 1973: (s (Vosses) acquired parcel A y 1977: 4s (Browns) bought parcel B from the owner and then parcel C from another owner o The previous owners of parcel C were not parties to the easement grant o 4s planned to build a single home that would straddle the boundary line b/w parcels B and C o 4s began to clear both parcels y 1979: (s began trying to stop the 4s from using the easement by which time 4s had spent over $11. and a chain link fence w/in the easement PROCEDURE: 4 sued for removal of the obstructions. or²in some states² protesting use o Scope of Easements (716-25)  Brown v. a concrete pit. Voss.

. she might have strongly object to heavier use (e. y 67 . driving a truck on her land to pick apples) o Termination of Easements  Preseault v. U.S. Takings Clause. based on any written instruments and the circumstances at the time the easement was created y Whether the increase will reasonably burden the servient tenement Express or implied easements can generally be increased to in scope to meet the needs of the dominant tenement as they normally develop Courts are slow to increase the scope of an easement obtained by prescription y While the servient owner might now have objected to some slight use of her land (e. y 1899: right-of-way acquired by railroad company which laid rails and operated a railroad along the strip y 1960: VT acquired all assets of the RR and leased the right to use the right-of-way to VT Railway who operated trains over the land until 1970 y 1975: the tracks and all RR equipment were removed from the portion of the right-of-way running over 4¶s tract y 1983: Congress approved the Rails-to-Rails Act in order to preserve discontinued RR corridors for future RR use and to permit public recreational use of the rights-of-way.. the creation of a foot path to pick apples)..g. The act empowered the ICC (Interstate Commerce Commission) to permit discontinuance of rail services and transfer the rights-ofway to public or private groups willing to maintain the strip as a public trail. claiming that the Rails-to-Trails Act was unconstitutional y SCOTUS: the Act was constitutional but 4 may have a remedy under the 5th Amend. y 1986: ICC approved an agreement b/w the VA Railway and VT and the city of Burlington to discontinue rail service over 4¶s land and to maintain the former RR strip as a public trail PROCEDURE: 4 sued the ICC. A right-of-way ran across the land. 1996: conversion of abandoned railroad easement p public nature trail = unauthorized taking of servient estate FACTS:4 owned a fee simple interest in a tract of land along Lake Champlain.If an injunction were granted for (. 4 could still acquire access to parcel C thru other means²renegotiating the easement or some other statutory means  Increasing the scope of an easement Courts will look at: y The intent of the parties.g.

compels compensation o Inconsequential that it remains possible to restore the RR service over the right-of-way o The actions taken by the VT Railway in collecting various license and crossing fees from persons crossing the track  persuasive evidence of a purpose or intent not to abandon the use of the right-of-way for actual RR purposes y 68 . it is far less frequent and more controlled than public pedestrians and bicyclists y TERMINATION: the removal of the rails and all RR equipment in 1975 = abandonment p gov¶t taking occurred and the 5th Amend. or  a purpose inconsistent w/ its future existence HOLDING: y SCOPE OF EASEMENT: when a RR acquires an estate in land for laying track and operation RR equipment thereon.4s then sued the U. claiming that the gov¶t (() thru the ICC took 4¶s property when it authorized the conversion of the former RR right-of-way p public use trail o 4 argued that the right-of-way was originally an easement. there must also be acts by the owner of the dominant tenement conclusively and unequivocally manifesting either:  a present intent to relinquish the easement.S. and that the easement had terminated by abandonment in 1970 ISSUE: does gov¶t use of land that goes beyond the scope of an easement constitute a ³taking´ of the servient estate? y SCOPE: gov¶t use of land that goes beyond the scope of an easement = ³taking´ of the servient tenement owner¶s property ISSUE: is an easement terminated by mere nonuse? y TERMINATION: an easement is NOT terminated by mere nonuse. hat the use for public trail purposes was beyond the scope of the easement. the estate acquired is no more than that needed for the purpose p easement NOT fee simple estate o Gov¶t¶s use of the land for a trail is NOT w/in the scope of the easement o NOTE: the scope of an easement may be adjusted over time only if the change is consistent w/ the terms of the original grant  A change to a public recreational trail is NOT consistent w/ the original terms of a RR easement  Although RR usage is noisy. o TERMINATION BY ABANDONMENT: in order to terminate an easement by abandonment.

comment h. however. 4 must show that the covenant qualifies as a real covenant o Creation of a Real Covenant  Writing is required 69 . treats negative easements as restrictive covenants o Conservation Easements (738-40) COVENANTS RUNNING W/ LAND²³REAL COVENANTS´ & ³EQUITABLE SERVITUDES´ o Real Covenant: a covenant that runs with the land at law  Enforceable at law by a successor owner of the promisee¶s land  Enforceable against a successor to the promisor¶s land  For money damages. the estates are typically easements y SCOPE: scope of easements may change overtime.2. a RR easement is limited to RR (and possibly other transportation) uses o Gov¶t use of an easement that goes beyond the scope of the easement or that occurs after the easement is terminated entitles the servient estate owner to compensation y TERMINATION BY ABANDONMENT: easements may terminate by abandonment where nonuse is coupled w/ an act evidencing an intent to abandon the property o In the RR context. there was no clear and unequivocal sign of intent to abandon o The RR continued to enter into the crossing and license agreements after 1975 y SCOPE: an RR easement can be used as a public trail o Merely shifts the use from one public use to another o Imposes no greater burden on the servient tenement ANALYSIS: y EASEMENTS: when RRs acquire estates in land for laying track and operating a RR. DISSENT: y TERMINATION: RR did not abandon its easement o Even though the tracks were removed.y o In the years since 1975 neither the State nor the RR has made any attempt to reinstate RR service on the right-ofway. the act of removing all rails and equipment evidences an intent to abandon y ISSUE: is it really inconsistent w/ the scope of a RR easement to allow pedestrians and bicycles to use the land? o Depends upon WHETHER easements should be narrowly or broadly interpreted o Negative Easements (736-38): the right of the dominant owner to stop the servient owner from doing something on the servient land  Negative easements are usually treated as equitable servitudes  RESTATEMENT: § 1.

grantee is bound by any covenants in the deed to be performed by the grantee o Requirements for burden of covenant to run at law  Intent: contracting parties must intend that successors to the promisor be bound by the covenant Intent is usually found in the language of the deed or K y Spencer¶s Case: the intent to bind ³assigns´ o if the covenant concerns a thing that is not in being at the time the covenant is made but is to be build or created thereafter.NOTE: may not be implied nor can it arise by prescription (easements)  Grantee need not sign deed to be bound Most deeds are signed only by the grantor(deed poll) By accepting a deed poll. the burden of the covenant will not bind assigns unless they are expressly mentioned y MAJORITY RULE: intention is to be gathered from the whole instrument and not from the presence or absence of the word ³assigns´  Touch and concern  Privity of estate: there must be privity of estate b/w the promisor and his assignee Horizontal privity: b/w the original parties y NOTE: concerns only the original parties²even if successors in interest are trying to enforce the covenant. you must look only to the original covenanting parties to determine horizontal privity y Mutual Interest: the burden will run if one party has an interest (apart from the covenant) in the land of the other p covenant must be coupled w/ easement (Massachusetts law) y Successive Relationship: privity of estate is present where the promise is contained in a conveyance of the land²where the original parties to the promise succeeds to an estate previously owned by the other party (majority rule) y Restatement of Property: privity is satisfied by either a mutual relationship or a successive relationship o First Restatement objected to the burden of covenants running at lawp burdens were ³equitable servitudes´  BUT benefits could run at law or equity  RATIONALE: judgment for damages (which could result in unlimited personal liability) was much more objectionable than an injunction or foreclosing a lien (which limited the (¶s liability to the value of the land) THINK²³Calabresi-Melamed´ y Restatement of Servitudes: horizontal privity is not required for burden to run (minority view) Vertical privity: b/w the promisee/promisor and assignee o Requirements for benefit of covenant to run at law 70 .

(¶s purchase deed no similar 9 mesne conveyances: intermediate conveyances b/w the first grantee and the current holder of title 71 .   Intent Touch and Concern Privity of estate NOTE: horizontal privity is not required for the benefit of the covenant to run to a successor A Promisee. benefit to Whiteacre B Promisor. 4 also owned several of the houses that formed the Square. The deed of conveyance contained a covenant. Moxhay. The property passed by various mesne conveyances9 from Elms to ( (Moxhay). 1848: a covenant will be enforceable in equity against a person who purchases land w/ notice of the covenant  FACTS: 4 (Tulk) sold a vacant piece of land in Leicester Square to Elms. burden on Blackacre Horizontal privity: b/w original parties Vertical privity: b/w promisee and assignee Vertical privity: b/w promisor and assignee D C Requirements for the Running of Benefits and Burdens COVENANTS EQUITABLE SERVITUDES BENEFIT INTENT NOTICE TOUCH & CONCERN HORIZONTAL PRIVITY VERTICAL PRIVITY BURDEN BENEFIT BURDEN              o Tulk v.

covenant against building on the square. 791-92)  Validity of Servitudes GENERAL RULE: a servitude is valid unless it is: y Illegal y Unconstitutional. 766-67. and assigns would keep and maintain the property as a pleasure ground and square garden. 797-98) Distinguishing Characteristics of Real Covenants and Equitable Servitudes REAL COVENANTS CREATION Writing is always required EQUITABLE SERVITUDES Writing is usually required by may arise by implication from common scheme of development of a residential subdivision No privity required RUNNING OF BURDEN Requires: y Horizontal privity: shared interest in and. Truskolaski. Kraemer. uncovered w/ buildings o Shelley v. 766-67)  Modification and Termination of Servitudes Because of Changed Conditions (p. 791-92) Of Certain Affirmative Covenants (p. COVENANT: Elms. or covenant pit in a 72 . his heirs. enclosed by an iron railing. 1962  Pocono Springs Civic Association v. 1972  Rick v.The property was to be ³uncovered w/ any buildings´  PROCEDURE: ( tried to assert the right to build structures on the garden as he saw fit and 4 filed for an injunction to prevent ( from using the pleasure ground and garden for any purpose other than as an open area. 1948 o Termination of Covenants  Modification and Termination of Covenants Expiration Release Abandonment Merger Estoppel Prescription Condemnation y If the gov¶t condemns an existing easement or condemns the servient land so as to destroy an existing easement p gov¶t must pay compensation to the easement owner  Western Land Co. MacKenzie. West. ( did admit that he purchased the land w/ notice of the original covenant in the 1808 deed. or y Violates public policy (p. Servitudes (2000) (p. v. 1995 o Restatement (Third) of Property. by original covenanting parties. apart from the covenant.

balcony. storage room. office. A promises not to build a swimming pool on the property Required EXCEPT: equitable servitude may be implied from general plan of development of residential subdivision y y y y y y EXAMPLE O allows the electrician to come onto his land to fix an outlet Not required NOTE: an invalid oral easement is a license WRITING TERMINATION y y y y y y y y Unity of title (merger) Release Abandonment Alteration of dominant tenement End of necessity Destruction of servient tenement Prescription Change of conditions Same as Easement Usually revocable at will May be revocable if coupled w/ an interest or if licensor estopped by licensee¶s expenditures Merged Estoppel Hardship Change of conditions Abandonment Eminent domain Common Interest Communities y CONDOMINIUMS o Essential Features  Individual Units Each individual unit (apartment. patio  Common Areas Entire condominium except the individual unites 73 . store) is owned separately in fee simple Unit may include space restricted to use by the unit owner even if the space is not w/in the boundaries of the individual unit y EXAMPLES: parking space.y RUNNING OF BENEFIT REMEDY deed from grantor to grantee. + Vertical privity: successor holds entire interest held by covenanting party No privity required in most states Injunction Vertical privity required Damages Summary of Non-Possessory Interests EASEMENT DEFINITION A grant of an interest in land that allows someone to use another¶s land Owner of parcel A grants the owner of parcel B the right to drive across parcel A Generally required EXCEPT: y implications y necessity y prescription PROFIT Right to take part of the land or a product of the land of another O allows A to come onto O¶s land to cut and remove timber Required LICENSE Permission to go onto another¶s land REAL COVENANT/ EQUITABLE SERVITUDE Promise to do or not to do something on the land or related to the land O conveys an adjoining parcel to A.

is appurtenant to each unit  Financing Each unit owner may finance the purchase of her unit independently of all other owners in the project y The unit owner gives the mortgage lender. the condo owner has no right to partition the common areas so long as the structure remains intact Easement for entrance and support y A nonexclusive easement for entrance and exit and for support thru the common areas. who finances the purchase. a separate mortgage on her unity for which she alone is responsible y The failure of one unit owner to make payments permits the mortgagee to foreclose on that unit (not affecting the other unit owners) BUT there may be financial interdependency by virtue of monthly charges to keep up the common areas o Creation of a Condominium  Declaration of Condominium or Master Deed States that the owner is creating a condo to be governed by the provisions of the state condo act Most states require that the declaration be recorded in the county recorder¶s office y May contain may details of the organization of the condo. Owned by all owners of the units as tenants in common y No right to partition o Unlike ordinary tenant in common. or these may be set forth in separate bylaws signed by each unit owner at the time of purchase of the individual unit  Matters discussed in declaration or by laws include: Owners¶ Association y All owners of units are members of the condo association y An elected board of directors runs the association y Until all units are sold. staircases.Includes: walls. a professional manager is employed Owners¶ Fraction y Each owner¶s fractional share of the whole project is set forth o This usually fixes permanently the unit owner¶s proportionate interest in the common areas  Including: her share of the common expense and her interest in the whole project upon its destruction y This fraction may be used during tax assessments 74 . more commonly. swimming pools. or. the developer may keep control of the association and management Management y The board can manage the condo. etc. elevators.

they must comply w/ the requirements for covenants running with the land in law or equity Enforcing payment y Most declarations and some statutes provide for the imposition of a lien to enforce the collection of assessments for common expenses y This lien may be foreclosed by the management in the same manner as a mortgage on real property  Tort Liability Individual Units  75 . 804) y BUT courts are moving toward applying different standards of judicial review to different types of rules Types of Rules y Restrictions Originating in Documents o Have a strong presumption of validity  Trend is to strike down these original covenants only if: Arbitrary Violative of public policy Violative of a constitutional right  RATIONALE: buyers voluntarily agree to be governed by these terms when they buy in and are entitled to rely on the enforceability of restrictions in an originating document y Restrictions Subsequently Adopted o MUST be reasonable o Court may give a less deferential review to a subsequent bylaw change than it gives to a covenant in the originating documents  Reliance interest of the buyers is not so strong w/ respect to subsequent changes  Courts may balance the importance of the new rule¶s objective w/ the importance of the individual interest infringed upon o Administration of Common Areas  Expenses of Maintenance Statute or declaration should.Rules of Conduct Creation of Rules y Originating document may provide for certain rules of conduct y Or. and ordinarily does provide that unit owners are liable for their shares of common expenses The provisions for financial contributions are covenants y To be enforceable. the promulgation of rules may be left to subsequent action by the membership association or board TEST of Validity of Rules is ³reasonableness´ (p.

etc.y Individual unit owners are subject to tort liability for injuries occurring inside their respective unites Common Areas y All unit owners are jointly liable for injuries occurring in the common areas that the own as tenants in common y Owners¶ association may also be liable for such injuries o RATIONALE it has assumed management and control of the common areas o BUT this has no effect on the owners¶ personal liability o Restrictions on Transfer  Restrictions are often imposed on the transfer of a condo unit Typical restriction usually prohibits transfer of the condo unit w/out the consent of the association  Problems with Restrictions: Restraint on Alienation y Units = fee simple o Direct restraints on transferring a fee simple are usually held void p o ISSUE: whether the same rule as is usually applied to a fee simple will govern the unit y Courts have been more tolerant of the restraints on a condo unit o RATIONALE:  Interdependent ownership  RULE: a restraint is valid if it is a reasonable means of accomplishing valid objectives Illegal Racial Discrimination o Nahrstedt v.)  In addition to owning stock in the corporation. renewable terms p the residents in a cooperative are both: y Tenants(under their leases w/ the cooperative corporation) AND y Ownersof the cooperative corporation (by virtue of stock interests) o Basic Characteristics  Tenant-shareholders elect a board of directors. or y Short. depending on the operational costs y 76 . which operates the building  Rent may be increased or decreased by the board of directors. the occupants receive leases from the corporations Lease terms y Long terms (99 years). Lakeside Village Condominium Association (1994): COOPERATIVES (APARTMENTS) o Cooperative Apartment House  A corporation holds legal title to an apt building  Shares of stock are sold to the persons who will occupy the apts The amt of stock required to live in the bldg depends on the value of the apt (size. location.

both the lease and stock interest of each tenant are subject to restrictions on transfer PURPOSE: assure the remaining tenants that the new tenant will be compatible and financially responsible NOTE: there may be more justification for a restraint in a cooperative rather than a condo y If rent payments are insufficient p corporation raises the rent accordingly so each tenant ends up paying her proportionate share  Restraint on Alienation The cooperative owner owns a leasehold not fee simple y Most cases hold that a restraint on a leasehold is valid o RATIONALE: restraint on sale of stock is valid p restraint on sale of cooperative apt is valid HOWEVER courts are split over whether the cooperative corporation can arbitrarily w/hold its consent to transfer TEST: restriction must be reasonably tailored to the purposes of assuring: y Financial responsibility and y Social compatibility NOTE courts may review the application of a restriction to particular buyers  Preemptive Option Rather than retaining the right to veto the transfer. the cooperative corporation may retain the right of first refusal (a preemptive option) if any member wishes to sell her stock and lease Preemptive options restrain alienation and to be valid must be: y Reasonable in purpose and duration y Courts have been liberal in upholding preemptive options in cooperative ventures NOTE: have not been held subject to the Rule Against Perpetuities o Termination of lease  The corporation may terminate the lease of the tenant fails to pay her assessed share of common expenses or violates the rules of conduct established by the corporation  LIMITATION: the rules of conduct promulgated by the board of directors are unenforceable if they are arbitrary or unreasonable   77 .Liability for mortgage payments Liability for taxes. maintenance. and repairs Repairs w/in each apt are the responsibility of each tenant (or as provided in the lease) MISSING o Restrictions on Transfers  Normally.

or A refinancing of the debt o Purchase-Money Mortgage/ Seller-Financed Mortgage  If the seller = lender p seller = mortgagee MORTGAGE MECHANICS o Borrowing: borrower signs 2 documents:  Promissory note: formal IOU by which the borrower (debtor) obligates himself to pay the money back to lender according to certain terms: Interest to be paid for the use of the money Timetable for making payments  Mortgage: provides collateral for or ³secures´ the debt Mortgagor: borrower (debtor) Mortgagee: lender (creditor) o Defaulting: if the mortgagor defaults on loan or breaches terms of the agreementp  Mortgagee can bring an action (foreclose) to sell the home  Sales proceeds are applied to retire the note o Ranking Mortgages  Establishes which mortgagees (creditors) have the first right (priority) to any sale proceeds. should the property be sold(i.e. ³first.) Junior Liens/ Mortgages: lower priority Senior Liens/ Mortgages: higher priority  Paying off debts y 78 . Reserve Bank Can go up or down by a limited amount each year Has a lifetime cap  Loan will not be fully paid off at maturity p requires either: A ³balloon´ payment by the borrower at end of loan period. debt is completely paid off o Adjustable Rate Loans  An initial below-market interest rate that gradually increases according to an index based on debt issued by the Fed.´ ³second. who received payments of principal and interest as they were made by homeowners  PROS: appealed to many investors who would otherwise have found home mortgage loans unattractive investments p increase the supply of capital + reduce interest rates o Fully Amortizing Fixed Interest Rate Mortgage  Borrowers make constant payment each month which includes a component for interest and one for principal  Amount of each payment stays the same for the life of the loan  As principal is paid off p interest declines  At end of loan term.The Right to Alienate The Mortgage y KINDS OF MORTGAGES o Mortgage-Backed Securities  Hundreds of mortgage loans purchased were pulled together  Securities representing the pools were issued to investors..´ etc.

000 to be paid over a 15-year period at 5% interest. holding money paid up to that 79 .000 w/ sale K providing: $15. 4 retained legal title and would convey it to ( upon full payment of purchase price. purchaser risks losing the property to the seller¶s creditors or to a bona fide purchaser for value  Bean v.62 each. ( was entitled to possession of property. 1983: if buyer defaults on an installment land sale K p payments are not forfeited as long as a substantial amt has been paid on the K FACTS: 4 (Bean) agreed to sell a house to ( (Walker) for $15. Walker. if ( defaulted in payment and failed to cure the default w/in 30 days p4s could demand rest of balance or terminate K and repossess.y y Party having first priority may use all proceeds from foreclosure sale if necessary to satisfy any amts still owing to the lender If any sales proceeds remain after satisfying the first mortgage p money goes to second mortgage holder LEGAL OWNERSHIP OF MORTGAGED PROPERTY²2 THEORIES o Title Theory (Minority View)  Lender (mortgagee) has legal title to the mortgaged property until the debt is repaid o Lien Theory (Majority View)  Recognizes the mortgage as a security device  Mortgagee has rights to the property when mortgagor breaches some term of the mortgage Mortgagee (lender) = Legal Title Mortgagor (borrower) = Equitable Title o Major Difference = Time of Possession  Title theory: mortgagee can go into possession as soon as there is a default and remain in possession during the foreclosure proceedings  Lien theory: mortgagor retains possession until foreclosure proceedings are completed ALTERNATIVES TO THE MORTGAGE o Deed of Trust  Borrower delivers the deed of trust to a 3rd party (trustee) Often the lender¶s attorney. instead of directly to lender  If borrower defaults p trustee can foreclose the mortgaged property  PRO: allows mortgagees to sell the collateral more quickly and cheaply than under the traditional foreclosure process NOTE: traditional mortgages may achieve same result by incorporating a power of sale right in the mortgage o Installment Land Sale Contract (Contract for Deed)  Seller retains legal title and does not deed the property to the purchaser until the purchaser pays the full purchase price  Purchaser has an equitable interest in the property  CON: unless purchaser records the installment sales K in the local deed records. in monthly installments of $118. Under K.

Fin.000 (the exact price owed on mortgage and costs and fees). an attorney filling in for the ( attorney. On 12/15 the only people present for the sale were 4. Corp. and The parties incorporate a power of sale provision in the mortgage or deed of trust  Murphy v. y Mortgagee (Lender) kept mortgaged property y Mortgagor (Borrower) was barred (foreclosed) from asserting any rights to the property o Judicial Foreclosure (Common Alternative)  Mortgagee files complaint p court determines what debts are to be paid from the sales proceeds  CONTRAST to strict foreclosure²mortgagees are only entitled to sales proceeds up to the amt owed  Deficiency judgment If sales proceeds are inadequate. a representative for ( and Hollis. creditors get a deficient judgment against the debtor personally Creditors can go against the debtor¶s other assets to satisfy the deficiency judgment o Private Foreclosure Sale  May be implemented by mortgagees wanting to avoid the delay and cost of a judicial foreclosure if: The state allows it. OLD RULE: if purchaser missed a payment p purchaser forfeited his interest in the property and seller kept the property no matter how wide the disparity b/w the property¶s fair market value and the amt remaining in outstanding debt. ( (FDC) gave notice of its intent to foreclose. 4s soon paid the late mortgage payments but not the costs and legal fees of the foreclosure proceedings p FDC scheduled foreclosure sale for 11/10/81 at the property but postponed the date until 12/15/81 at the request of 4. ( representative made the only bid at the sale for $27. Dev.. 1985: mortgagee conducting a foreclosure sale must exercise ³good faith´ and ³due diligence´ in obtaining a fair price FACTS: after refinancing their loan. 4 (Murphy) became unemployed and fell 7 months behind on mortgage payments.point as ³liquidated damages´ under a forfeiture clause. considered as ³rent´ up to that point´. TODAY: courts treat installment land Ks like a deed and mortgage transaction p seller restricted to the proceeds of the sale equal to the amt of remaining debt obligation y FORECLOSURE o Strict Foreclosure (Old Rule. still used by 2 states)  Mortgagee could petition court to foreclose a mortgagor from redeeming his property after the foreclosure date On foreclosure date. Dube (a client for Hollis) offered to buy property from ( for 80 .

000 p( counter-offered for $40.000 EQUITY ($19.000.000 in 1980  Reasonable person would have known 4¶s equity in home was at least $19. Court found ( failed to exercise ³good faith´ and ³due diligence´ in obtaining a fair price for the property. Fair market value = $54. PROCEDURE: 4s sued (. and made bud w/out knowledge of any other immediate buyer o BUT ( failed to exercise due diligence in obtaining a fair price y DUE DILIGENCE o TEST: whether a reasonable person in the lenders¶ place would have adjourned the sale  Property was appraised at $46.000  fair price²it was only meant to make ( ³whole´ w/ regard to the amt owed on the mortgage  ( did NOT give the same notice to the 12/15 postponement that it gave to the 11/10 sale  CONSEQUENCE:( was able to buy the house at a low price and make a quick profit y DAMAGES = difference b/w a fair price and the price obtained at sale o Equity of Redemption  Mortgagor enjoys a right of redemption until the property is sold p defaulting mortgagor can keep the property by paying off the loan before the property is sold 81 .000) = value of property ($46.000.000 p sold 2 days later for $38.000) ± amount owed ($27. Court assessed damages at $27. HOLDING: a mortgagor has a fiduciary duty in order to prevent unjust enrichment p a mortgagee executing a power of sale has a duty to protect the interests of the mortgagor and exercise good faith and due diligence in obtaining a fair price for a mortgagor¶s property.000.$27. ( appealed. y FAIR PRICE: varies depending on the circumstances of each case y GOOD FAITH: an ³intentional disregard of duty or a purpose to injure´ p ³bad faith´ o COURT: ( lacked bad faith  ( complied w/ statutory requirements of notice and conducted sale in compliance w/ similar provisions  ( postponed sale once. did nothing to discourage other buyers.000) o DUTY: ( had a duty to protect 4s¶ equity by obtaining a fair price  $27.

2009) Title Assurance y RECORDING STATUTES (559-83) (589-97) o In General  2 Practical Functions of Recording Systems: (1) assurance: to assure title by determining a priority of rights to a parcel of land (2) informational: prospective purchaser or lender can search deed records to determine whether the prospective seller or borrower has record title  Constructive Notice Prospective purchaser is deemed to have constructive notice of all property recorded documents regarding the property PURPOSE: to encourage prospective purchasers to review the deed records and not rely on the seller¶s representations  Priority of Rights Record title holder > legal title holder Bona fide purchaser for value > person who failed to record First recorder > subsequent recorder o Indexes  Searching a Grantor-Grantee Index (1) check the Grantee Indices y Present p Past(to root of title) y Root of title o Usually the doc by which the fed.y o Statutory Right of Redemption  May allow a mortgagor to stay in possession of the property until a set period of time has expired  In that extra time after foreclosure: Mortgagor can gather money p redeem from the purchaser at foreclosure sale p get property back o Statutes enacting fair market value limitations  Protects mortgagors form low foreclosure sale prices when the real estate market happens to be depressed  Enables a mortgagee to get a deficiency judgment only for the difference b/w the debt of the mortgagor and the fair market value of the property at the time of the foreclosure. or state gov¶t granted the land to a private person o May be an adverse possession judicial proceeding or some other doc established by state law as ³root of title´ y PROBLEM: searcher cannot locate the prospective seller or cannot complete some link back to root of title o DUTY: searcher must inquire as to why the deed records are incomplete (2) check Grantor Indices 82 . as determined by the court LANDMARK NAT¶L BANK V. KESLER (KAN.

and Burris found no record of this when inspecting title Mother Hubbard Clause: language used in conveyance which describes the property to be conveyed as all of the grantor¶s property in a certain county y Refers to nursery rhyme describing Mother Hubbard as going to her cupboard. mortgages.y y y  Past p Present (until day of closing) PURPOSE: to determine that the marketability of the title NOTE: easements. etc. 1978: ³Mother Hubbard´ clauses are valid b/w original parties BUT  constructive notice for subsequent purchasers FACTS: Owens and others assigned all their oil and gas interests in the count to Tours. BUT is insufficient to give constructive notice to a subsequent purchaser w/out actual notice Orr v. leases. are more easily found in the grantor index than the grantee index   Tract Index All documents affecting a parcel of land are indexed on a page for that parcel of land NOTE: majority of states retain the more cumbersome grantor-grantee index²WHY? y Reluctant to change y More liability o The gov¶t employees in the grantor-grantee system merely index. causing misspellings in the title index RULE: requiring a title searcher to examine title records for other spellings of the grantor¶s name would be an undue burden on the transfer of property Idem Sonans: ³Having the same sound´ y Doctrine: even though a person¶s name has been inaccurately written. 1988: title searcher is not required to search for misrecorded instruments FACTS: Byers was unaware of Orr¶s lien on Elliot¶s property b/c Elliot¶s name was misspelled on the abstract of judgment. the cupboard was bare´ y IDEA: a grantor¶s interests in a county are similarly cleared out by this clause RULE: a Mother Hubbard clause is upheld as b/w the parties to the instrument that contains it. they do not decide what properties are affected o Possible claims that a gov¶t employee¶s negligence caused a title problem y Title Insurance Companies/ Abstract Companies o Maintain a plant by which they reconstruct all deeds and records creating their own equivalent of a tract index Luthi v. ³and when she got there. Byers. Evans. the person¶s identity will be presumed from the similarity 83 .

mortgage. rights to. o Notice  Actual Notice  Constructive Notice/ Record Notice Knowledge or notice a purchaser could gain by searching the deed records Purchaser is deemed to know all matters contained in the docs legally recorded in the deed records Is usually asserted when a purchaser did not search the records (actual notice)  Inquiry Notice Is obtained when the purchaser hears or observes something that would cause an ordinarily prudent person to inquire further Sources of Inquiry Notice: y Visiting the property y Common scheme of development DUTY: prospective purchaser has a duty to view the property o Types of Recording Acts (3)  Recording Acts: establish the priority persons have to a parcel of land  Race Statute: 1st to officially record > 1st to receive deed. and encumbrances on a parcel of land ³linked´ together in some manner of pronunciation b/w the correct and incorrect spellings of the person¶s name Description by Gov¶t Survey 84 . Even if he knows about a previously unrecorded conveyance PRO: certainty CON: unsatisfactory results  Notice Statute: subsequent bona fide purchaser w/out notice > other claimants Subsequent purchaser is not required to record at all to prevail against prior unrecorded claimants Notice may be: actual. etc. constructive or inquiry notice Zimmer Rule:  Race-Notice Statute Subsequent purchaser is protected against prior unrecorded instruments only if the subsequent purchaser: y (1) is w/out notice of the prior instrument and y (2) records before the prior instrument is recorded Kinds of Notice: y Actual Notice y Constructive Notice y Inquiry Notice Shelter Rule: a person who takes from a bona fide purchaser protected by the recording act (usually for value) has the same right as his grantor (protect to whom subsequent conveys property whether or not they have notice) o Chain of Title:series of documents affecting ownership of.

Hughes. y Board obtained title 3rd but recorded 1st. 1912: deed from a grantor not part ofchain of title  a recorded deed p recording  constructive notice FACTS: y Hughes obtained the title 1st.   Board of Education of Minneapolis v. but recorded 2nd. 1975: purchaser of a lot in subdivision has constructive notice of restrictions on neighboring lots FACTS: Daly tried to build an apt building on a lot in a subdivision which was restricted to single-family houses ISSUE: is a subsequent purchaser of a lot in a subdivision bound by restrictions contained in deeds to neighboring landowners when the purchaser took title w/out knowledge of those restrictions? RULE: a subsequent purchaser from a common grantor in a subdivision has constructive notice of the restrictions on the rest of the subdivision p acquires title subject to those restrictions HOLDING: Gifts (157-72) y GIFT: A NON-CONTRACTUAL. Daly Dry Wall. clear title 4 Generic Problems of Title Recordation: (1) ³Wild Deed´: deed recorded BUT not w/in chain of title b/w neither the grantor nor the grantee is known to the searcher of the title in the official records (2) when title is recorded too late Guillette v. GRATUITOUS TRANSFER OF PROPERTY o Made w/out consideration  If there is consideration p law of gifts does not apply o 2 Types of Gifts:  Intervivos Gift: gift b/w living persons  Gift Causa Mortis: gift made on account of a donor¶s impending death o NOTE: a transfer of property by will= a devise or quest  gift INTER VIVOS GIFTS o 3 Requirements  Donative Intent  Delivery  Acceptance o Donative Intent  Donee bears burden of proof to show that the donor had the donative intent y Evidentiary standard is very high  A gift cannot be subject to a condition precedent y 85 . is treated as though it were unrecorded p it gives no constructive notice Warranty Deed: a conveyance which explicitly lists covenants concerning the quality of the title being conveyed p grantor conveys good. RULE: a deed from a grantor outside the chain of title. y Duryea and Wilson obtained title 2nd but recorded 3rd. even if recorded.

1898: more difficult to give gifts²symbolic delivery is not allowed o FACTS: after giving the keys to much of the furniture in the house to 4.y Upon acceptance. gift cannot be subject to a condition precedent y Gift Causa Mortis o Made when the donor has an apprehension or expectation of his or her own impending death o Donor delivers the chattel w/ the intent that control over the subject takes effect immediately BUT becomes absolute only upon the donor¶s death y Newman v. o RULE: a party may give a future interest in chattels as a gift while reserving a life estate in himself. a sale deed or deed of gift stands for the thing itself o Acceptance  Acceptanceis generally presumed  Rejection requires evidence of rejection  RATIONALE: property may not be forced on the unwilling  Upon acceptance. a gift is complete and irrevocable o Delivery (in order preferred by the courts)  Actual Delivery: Actual physical delivery of the property. 4 has never had possession of the painting. o RULE: symbolic delivery of a gift is not effective. the decedent pointed to the furniture and said to 4 that he was giving it all to her. or  Constructive delivery y Delivery of something giving access to and control over the property o EXAMPLE: keys y Lost Chattel (owner gives instructions on how to recover) o Recovery by donee = constructive delivery o Donor revealing hiding place = constructive delivery  Symbolic delivery: when physical deliver is impossible or impractical y Representational: delivery of a symbolic representation o EXAMPLE: a picture of a large chest of drawers is delivered to the donee (symbolic of delivery of chest) y Representative: one stands for many (partial delivery) o EXAMPLE: delivery of one item along w/ a written inventory of similar items  NOTE: generally. In one of the pieces of furniture was a life insurance policy. Constructive delivery is allowed only when it is impractical to delivery actual possession. Gruen. 1986: easier to give gifts²a party may give a remainder to another while reserving a life estate in himself o FACTS: the elder Gruen gave 4 a painting but reserved a life estate for himself. gift is complete and irrevocable y B/c. o HOLDING: Leases y LANDLORD AND TENANT LAW 86 . o HOLDING: y Gruen v. Bost.

. payment monthly p month-to-month periodic tenancy TERMINATION: Requires Express Notice y Notice must = length of tenancy o i..o Types of Tenancies  Term of Years TERM: anywhere from less than a year p several years LANDLORD¶S INTEREST: landlord retains a future interest of reversion arising when the term ends TRANSFERABILITY y In case of death: o Tenant: inheritable under tenant¶s will  UNLESS for personal services o Landlord: decedent¶s estate has duty to recognize lease y Alienable o BUT generally restricted thru covenant or clause in lease TERMINATION: No Notice Requirement! (part of the lease) y Unless Statute requires landlord to do so  Periodic Tenancy TERM y Indefinite term y Type of periodic tenancy depends on payment schedule o i. only as long as the parties agree TRANSFERABILITY: Not Transferable or Assignable! y Ends at death p not inheritable y Transfer of landlords title or assignment of tenant¶s rights p termination CREATION y Express y Implied²EXAMPLES: o When a purchaser occupies property pending conveyance of title o When a lessee occupies under a lease executed by less than all tenants in common TERMINATION: ³At Will´ p No Notice Period Required o Assignments and Subleases (388-402) 87 .e.e. month-to-month tenancy p requires 1 month¶s notice o EXCEPTIONS  If periodic tenancies • 1 year p can be terminated on 6 months¶ notice  Statutory requirement CREATION: y By Express Agreement y By Implication²term of years p periodic tenancy o If term of years expires + tenant continues to pay rent as it comes due + landlord continues to accept rent and does not attempt reentry p terms and conditions of the original term are carried over  Tenancy at Will TERM: continues by mutual agreement.

) demanded increased rent in exchange for consent to assign a lease. Ernest Pestana.e. 1985: a lessor must act reasonable p lessor may not arbitrarily w/hold consent to an assignment FACTS: ( (E. 1964: applying K law to lease agreement p court will look to the intent of the parties to determine whether an assignment or a sublease has occurred FACTS: the original lessee (Rogers) transferred his interest to ( (Conditt) RULE: to determine whether an assignment or a sublease has occurred. RULE: a lessor may not unreasonably and arbitrarily w/hold his or her consent to an assignment.P. the court looks to the intent of the parties HOLDING: Distinguishing b/w Assignments and Subleases²2 Ways Traditional Rule²Look at the Terms & Language of the Agreement y Assignment: lessee transfers his entire interest under the lease o Lessee transfers the right to possession for the duration of the term y Sublease: lessee transfers anything less than his entire interest o (i. Conditt. if 2 years remain on the lease and the lessee transfers for a term of 1 year) o Lessee retained a reversion²the right to possession reverts back to him at the end of the period designated in the transfer y Suppose: o Lessee transfers all interest in some part of the premises  MAJORITY: partial assignment o Lessee transfers entire interest BUT retains the power of termination or right or reentry  MINORITY: sublease Rule of Intent (Minority Approach) y Look to the intent of the parties Kendall v.. Inc.. HOLDING: Commercially Reasonable Rule 88 .    Ernst v.

1977: lease K plandlord has duty to mitigate damages FACTS: 4 (Sommer) failed to make efforts to re-let an apt when ( (Kridel) abandoned it RULE: landlord is under a duty to mitigate damages by making reasonable efforts to re-let an apt wrongfully vacated by the tenant HOLDING  Landlord¶s Remedies & Security Devises Rent and Damages Security Devises y Security Deposits y Other techniques o Tenant¶s Rights and Remedies: The Landlord-Tenant ³Revolution´ (421-40)  Reste Realty Corp.o Tenant Defaults/Landlord¶s Rights (410-421)  Sommer v. Cooper. Kridel. v. 1969: a tenant may vacate the premises and terminate the lease if his quiet enjoyment is interfered w/ by the landlord 89 .

4 informed ( of these defects. ³Public Use´ = for a ³Public Purpose´ y Public use does not require that the property be intended only for ³use by the public. 2005: economic development is a valid public purpose for which eminent domain may be exercised  FACTS: City condemned private property to be used for commercial residential and recreational purposes as part of an economic revitalization project  RULE: a sovereign may not take the private property of one person w/ the purpose to confer a benefit upon another  HOLDING: takings of private property for use by other private citizens pursuant to an economic development plan intended for public purpose are valid under the 5th Amend. Peter) leased an apt unfit for habitability to 4 (Hilder). the basement that ( (Cooper) was leasing flooded RULE: a tenant may vacate the premises and terminate the lease if his quiet enjoyment is interfered w/ by the landlord. St.´ but rather that taking be for a ³public purpose´ Determining whether a development plan is for a ³public´ purpose y Considerable deference is given to legislative judgments y Plans must be looked in their entirety to determine the overall intentions of the plan Economic Developmentis a long standing function of the gov¶t 90 . ( failed to remedy them. City of New London. Peter. 1984: life is easier for renters²there is an implied covenant of habitability in every lease y FACTS: ( (St. y RULE: there is an implied warranty of habitability in every residential lease y HOLDING: Perspectives 404-14 Constitutional Protection of Property Rights Eminent Domain y THE PUBLIC USE REQUIREMENT o Kelo v. HOLDING: Constructive Eviction Quiet Enjoyment Scope Partial Eviction Actual Constructive Tenant¶s Remedies Illegal Lease Implied Warranty of Habitability Hilder v.        FACTS: whenever it rained.

Parker) Breaking up of land oligopolies (Hawaii v. 1922: when a regulation of a use of property that is not a nuisance imposes too great a burden on property owners p cannot be enforce w/out just compensation (J. Mahon. and such mining was prohibited by statute Kohler Act: forbids mining of coal in such a way that would cause the sinking of. a law which transfers control = taking  FACTS: Penn Central made plans to construct an office bldg. or other properties they also own. Holmes)  FACTS: a company sold surface rights to some land to Mahon. any structure used for human habitation  ISSUE: is a property regulation statute which eliminates a pre-existing property right the equivalent of a taking w/out compensation?  RULE: while property may be regulated to a certain extent. keeping the coal in place is one of the only ways of preventing the surface from sinking p appropriate y Mere presence of notice against danger or a mere contract cannot prevail against the exercise of the police power when the public safety is threatened Penn Central v. 480-502 THE BALANCING APPROACH o Pennsylvania Coal v. City of New York.y o y AFTERMATH The most emphasized aspect of the case has been the court¶s deference to legislative decision-making in matters of eminent domain Prompted significant federal and state legislation limiting the right of eminent domain for purely economic development ³Just Compensation´  Conversion of blighted areas p respectable communities (Berman v. Landmark owners are allowed to transfer their development rights under zoning regulations to contiguous properties on the same block. among other things. over Grand Central Terminal but was blocked by a Landmarks Preservation Law Landmarks Law: restricted any changes in the Terminal¶s exterior architectural features w/out the Commission¶s approval. or morals is not a taking A restriction is lawful if it is appropriate means to a public end y Here. Midkiff) Regulatory Takings y y PERSPECTIVES. PP. o 91 . but retained the right to mine underneath. it will be recognized as a taking Implied Limitation of Property Rights y Some property rights are enjoyed under an implied limitation and must yield to the gov¶t¶s police power y Limitation: this implied limit must be limited by ³freedom to contract´ and ³due process´ clauses  HOLDING: the Act does not offer a public interest sufficient to warrant the taking of coal There is a public interest in protecting the owner of a single home BUT the potential damage here is not common or public The right to coal must include the right to mine it  DISSENT: a restriction that is imposed to protect the public health. safety. 1978: a law which restricts control  taking. if that regulation goes too far in diminishing the economic value of the property.

office space. and concessions p Penn Coal is permitted to obtain a ³reasonable return on investment´ p  taking 4 had not been barred from any construction over the Terminal²only 2 plans had been rejected Airspace rights y Because they have not submitted any plans for a smaller structure. over the cable it was allowed to install on the bldg by a state statute Executive Law § 828: a landlord ³may not interfere w/ the installation of cable facilities upon his property or premises´  RULE: a permanent physical occupation of an owner¶s property (regardless of the public interest it may serve) = a taking p require just compensation  HOLDING: the cable = a ³permanent´ physical occupation p requires just compensation Permanent Physical Occupation y Prevents the owner from controlling the occupied space y Prevents the owner from excluding the occupier from possession and use of the space o Power to exclude = one of the most important elements in an owner¶s ³bundle of property rights´ Compensation y Size matters(but does not matter when determining whether a taking has occurred) Housing Regulations²State May Regulate: y Housing conditions by imposing duties on landlords and tenants o not 3rd parties y An owner¶s use of property o Cannot authorize a permanent physical occupation of space  DISSENT: takings claims should be evaluated under a multiple factor balancing test. which demands just compensation HOLDING: the law does not interfere w/ Penn Central¶s primary expectation concerning the use of the Terminal for RR service. and not by a set formula ISSUES: definitions y ³permanent´ y ³physical´ Court should have considered: y 4 had no other use for this space o Compensation should be determined w/ this in mind y The tenants had countervailing interest in allowing ( to use the space 92 . 1982: a permanent physical occupation of an owner¶s property (regardless of the public interest it may serve) = a taking p require just compensation  FACTS: a new bldg owner sued a cable co. it is not known whether they will be denied permission to use any of the Terminal airspace y Landmarks law allows right to transfer airspace rights to nearby properties DISSENT y THE PERMANENT PHYSICAL OCCUPATIONS CATEGORICAL RULE o Loretto v. and allows the owners to receive a reasonable return on his or her investment  a taking. Teleprompter Manhattan.   RULE: a law which does not interfere w/ an owner¶s primary expectation concerning the use of the property.

 y Size does matter in determining whether there is a taking NOTE: ( could argue that its cable TV service. South Carolina Coastal Council: S.C. authorized by the City = public use California courts have declared that the promotion of public recreation and education = a legitimate public purpose y y THE TOTAL-TAKINGS CATEGORICAL RULE o Lucas v.C. statute which barred him from building on his barrier island property = taking w/out just compensation  RULE: a land-use regulation that deprives an owner of all economically valuable use of property by prohibiting uses that are permitted under background principles of property and nuisance law = taking p requires just compensation  HOLDING: The Problem with Exactions o Nollan v. City of Tigard 93 . statute which restricted development in coastal areas = taking b/c it deprived an owner of all economically productive use of his property  FACTS: Lucas claimed that a S. California Coastal Commission o Dolan v.

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