Property Outline

Property Law Bundle of Rights
(1) Right to exclude (2) Right to include (3) Right to abandon (4) Right to destroy
Property Outline-Spring 2021

Professor DRB
Table of Contents
ESTABLISHING ENTITLEMENTS..........................................................................................................5
1. First Possession......................................................................................................................................5
Acquisition of Property...........................................................................................................................5
Acquisition by Discovery..................................................................................................................5
Johnson v. M’Intosh............................................................................................................................5
Advantages of allowing acquisition by discovery:..................................................................................6
Acquisition by Capture.....................................................................................................................6
Pierson v. Post (1805) [fox case]........................................................................................................7
Ghen v Rich........................................................................................................................................7
Keeble v Kickeringill [duck decoy pond case]....................................................................................8
Other Fugitive Resources.....................................................................................................................9
Popov v. Hayashi [Baseball].............................................................................................................10
Externalities: The Tragedy of the Commons.........................................................................................10
Theories of Property...........................................................................................................................11
Acquisition by Creation..........................................................................................................................11
Copycats................................................................................................................................................11
International News Service v Associated Press [copy news case].....................................................11
Cheney Brothers v Doris Silk Corp., [pattern protection case]
……………………………………………..12
Feist Pubs., Inc. v. Rural Telephone Serv. Co. (USSC 1991)…...…………………..
…………...13
Types of intellectual property protection through statutes:.................................................................13
Patents...................................................................................................................................................13
Diamond v.
Chakrabarty…………………………………………………………………..13
Copyrights.............................................................................................................................................14
Feist Pubs., Inc. v. Rural Telephone Serv. Co. (USSC 1991)….
………………………………14 Trademarks...................................................................................14
Cyberspace............................................................................................................................................14
Virtual Works, Inc. v Volkswagen of America.................................................................................14
Property in One’s Person.......................................................................................................................15
Moore v Regents of the University of California..............................................................................15
Henrietta Lacks’
Story………………………………………………………………………….16
The Right to Exclude…………………………………………………………………………..16
Jacque v. Steenberg Homes, Inc. (Wis. 1997)
………………………………………………...16
State v. Shcak (N.J. 1971)...……………………………………………………………………
16
The Bundle of Rights…………………………………………………………………………...17
Eyerman v. Mercantile Trust Co. (Mo. 1975)
………………………………………………...17
2. Subsequent possession.............................................................................................................17
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Acquisition of Property by Find.........................................................................................................17

Armory v. Delamirie [Jewel in the chimney case]............................................................................17
Hannah v Peel [brooch case].............................................................................................................17
Bridges case (parcel w/notes found on the floor of a shop)...............................................................18
South Staffordshire Water Co. v Sharman – cleaning the pool case..................................................18
Elwes v Brigg Gas Co. (prehistoric boat discovered by the lessees while digging to make a
gasholder).........................................................................................................................................19
Distinctions between a public place, shop and home........................................................................19
Mislaid..................................................................................................................................................19
McAvoy v Medina [Pocket book with money mislaid].....................................................................19
Adverse Possession..............................................................................................................................20
Definitions.............................................................................................................................................20
4 Elements of Adverse Possession......................................................................................................20
2 main policy concerns behind adverse possession:..........................................................................21
Van Valkenburgh v Lutz...................................................................................................................23
Mannillo v Gorski [steps case]..........................................................................................................24
Howard v Kunto [mixed up deeds case]............................................................................................25
Tacking:...............................................................................................................................................26
Disabilities and Adverse Possession:................................................................................................27
Acquisition by Gift..............................................................................................................................29
Gift causa mortis...................................................................................................................................30
Gruen v Gruen [painting case]..........................................................................................................31
3 pieces of evidence in determining gift............................................................................................31
3. Shared Interest.....................................................................................................................................32
a. Co-Ownership and Marital Interest........................................................................................................32
Common Law Concurrent Interest........................................................................................................33
The tenancy in common........................................................................................................................33
The Joint Tenancy.................................................................................................................................33
The Tenancy by the Entirety.................................................................................................................34
Marital Interests..................................................................................................................................35
Modern system: equitable distribution of marital property...............................................................36
Court’s ways of distribution..................................................................................................................37
Goals of Equitable Distribution of Marital Property:............................................................................37
What is Marital Property?.................................................................................................................38
In re Marriage of Graham [degree as property case].........................................................................38
Prenuptial..........................................................................................................................................39
Termination of Marriage by Death of One Spouse............................................................................39
The Modern Elective Share...............................................................................................................40
Property in other types of committed relationships...............................................................................40
Obergefell v. Hodges (USSC 2016)……………………………………………………………...41
4. Landlord and Tenant..........................................................................................................................41
Lease.....................................................................................................................................................41
Common Law Tenancies.......................................................................................................................42
Term of Years.......................................................................................................................................42
The Periodic Tenancy............................................................................................................................42
The Tenancy at Will..............................................................................................................................43
Garner v Gerrish...............................................................................................................................43
The Tenancy at Sufferance: Holdovers.................................................................................................44
Unlawful Discrimination/Housing Discrimination Statutes.................................................................45
Federal Fair Housing Act......................................................................................................................45
2
Civil Rights Act of 1866.......................................................................................................................46

Sublease and Assignments......................................................................................................................47
Assignment.......................................................................................................................................47
Sublease............................................................................................................................................48
Privity of Contracts v. Privity of Estate.................................................................................................48
Ernst v. Conditt (Ct. of App. Tenn. 1964).........................................................................................49
Kendall v Ernest Pestana, Inc., CA, 1985, page 490.........................................................................50
The Tenant Who Defaults.....................................................................................................................51
The Tenant in Possession......................................................................................................................51
The Tenant Who has Abandoned Possession........................................................................................52
Sommer v Kride, [Tenant engagement broke and never moved in]..................................................52
Landlord Protections……………………………………………………………………...53
Landlord’s Duties; Tenant’s Rights & Remedies.............................................................................53
Quiet Enjoyment and Constructive Eviction.....................................................................................54
Reste Realty Corp. v Cooper [ rain in the basement case].................................................................55
Illegal Lease Doctrine.......................................................................................................................55
Implied Warranty of Habitability......................................................................................................56
Hilder v St. Peter [crazy damaged apartment]...................................................................................57
Tenant’s Rights and Remedies..........................................................................................................57
The Problem of Affordable Housing.................................................................................................58
5. Mortgages.............................................................................................................................................59
Introduction...........................................................................................................................................59
How Mortgages Work...........................................................................................................................59
Enforcing Mortgage Rights...................................................................................................................60
Foreclosure......................................................................................................................................60
Multiplication of parties........................................................................................................................60
Murphy v. Fin...................................................................................................................................60
Redlining...............................................................................................................................................62
Evolution of Mortgage Industry............................................................................................................62
Commonwealth v. Fremont Investment & Loan...............................................................................63
Mortgage Reforms Track Crises............................................................................................................63
6. Private and Public Control of Land Use............................................................................................63
Easements.................................................................................................................................................64
Affirmative Easements........................................................................................................................64
Easements Appurtenant v. in Gross.......................................................................................................64
Explicit easements.................................................................................................................................64
Prescriptive Easements..........................................................................................................................65
Easements by Necessity........................................................................................................................65
In gross.................................................................................................................................................65
Easements Appurtenant v. in Gross.......................................................................................................65
Easements, Leases and Licenses.........................................................................................................66
License..................................................................................................................................................66
Easement by Estoppel...........................................................................................................................66
Holbrook v. Taylor............................................................................................................................66
Easement by Implication.......................................................................................................................67
Van Sandt v. Royster........................................................................................................................67
The Traditional Approach.................................................................................................................68
Multifactor Test................................................................................................................................68
Easement by Necessity..........................................................................................................................69
Othen v. Rosier.................................................................................................................................69
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Prescriptive Easements..........................................................................................................................69
Othen v. Rosier (Tex. 1950): Prescription.........................................................................................70
Elements for easement by prescription..............................................................................................70
Scope of the Easement..........................................................................................................................70
Brown v. Voss...................................................................................................................................70
Remedies for Easement Misuse..........................................................................................................71
Negative Easements.............................................................................................................................71
Termination of Easements..................................................................................................................72
Brandt Revocable Trust v. U.S. (USSC 2014)..................................................................................73
Rails-to-Trails Easements and Takings.................................................................................................73
Presault v. ICC (Fed. Cir. 1996)........................................................................................................73
Covenants.................................................................................................................................................74
Elements of Equitable Servitude……………………….
………………………………………….75
Terminating a
Covenant………………………………………………………………………………………….76
Zoning.......................................................................................................................................................77
How Zoning works:...............................................................................................................................78
Village of Euclid v. Amber Realty....................................................................................................78
Standard State Zoning Enabling Act.....................................................................................................79
Achieving Flexibility in Zoning............................................................................................................79
Southern Burlington County NAACP v. Township of Mount Laurel...............................................80
The Fifth Amendment Takings Clause..................................................................................................81
Two Types of Taking Cases..................................................................................................................83
Kelo v. City of New London (USSC 2005).......................................................................................84
Just Compensation..............................................................................................................................84
Spectrum of Implicit Takings Tests.......................................................................................................84
Loretto v. Teleprompter Manhattan CATV Corp. (USSC 1982).......................................................85
Other Categorical Rules on Either Side.................................................................................................86
Hadacheck v. Sebastian (USSC 1915)..............................................................................................86
Lucas v. South Carolina Coastal Council (USSC 1992)....................................................................86
Pennsylvania Coal Co. v. Mahon (USSC 1922)................................................................................86
Penn Central Transportation Co. v. City of New York (USSC 1978)...............................................87
Multifactor Test: Penn Central..........................................................................................................88
Multifactor Test for Implicit Takings................................................................................................88
4
ESTABLISHING ENTITLEMENTS
1. First Possession
Acquisition of Property
Acquisition by Discovery
Acquisition by discovery Rule: the first person to discover unowned territory has exclusive
rights to remove those in occupancy by purchase or through conquest
Occupancy alone does not establish ownership (i.e. adverse possession)
Discovery – the sighting or finding of hitherto unknown or unchartered territory
 In principle, only thing or territory belonging to no one
can be discovered
 Prior possession by aboriginal populations was
commonly thought not to matter
Conquest – the taking of possession of enemy territory through
force, followed by formal annexation of the defeated territory
by the conqueror; conquest grants exclusive rights to the
conqueror
Neither of these 2 modes of territorial acquisition has much
immediate relevance today
Johnson v. M’Intosh [Land Case]
Facts: P Johnson sues D M’Intosh in an action of ejectment

for land in the State and District of Illinois; same land
 Piankesha Tribe  Johnson
 Europeans  US  M’Intosh
Issue: Whether the title from the tribe can be recognized in the
Courts of the U.S. & whether the Piankesha tribe was able to
transfer the property  No & no.
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Action of Ejectment – seeking possession land & damages for

wrongful possession of land by another
 Johnson wants to get the land back but he also wants
from the other party for possessing the land wrongfully
If both parties had the power to make land transfers, what kinds
of things would you look at to look at to see who had the better
title?
 First in time – who owns property that’s previously
unowned; the first one to establish their property
o Trace the title back in time – who had it first &
how they passed it
The Court thinks that the Native Americans didn’t have the right
to transfer but that they did have the right to occupancy
 “Discovery gave an exclusive right to extinguish the
Indian title of occupancy, either by purchase or by
conquest.”
o itle by conquest is acquired and maintained by
force
Bundle of rights issue:
 Native American tribes had some rights, the right to
live there, use it, exclude it, but they didn’t have the
right to transfer or convey and therefore Johnson has
none of the rights.
What does the acquisition by discovery give to the Europeans?
 No right to occupy exclusively
 Right to co-exist/co-possess
 Right to transfer
 Charters
 Right to claim against other Europeans who might
claim the land
 Right to proceed to acquire further property rights by
conquest
Advantages of allowing acquisition by discovery:
First in time – Discovery is the ultimate first in time
Utilitarian Idea: it’s good for the whole of society
 It’s orderly, keeps the peace and is easy to apply
Labor theory – every man has property in his own person. The
labor of his body and the works of his hands are his property
 rewards the person who goes and finds it; rewards
people for their labor
Distributive – it gets property to people
Efficiency – Preference for private ownership over common
ownership b/c common ownership can become unmanageable;
when too many people have the right to possess something,
they might not use it as effectively
6
o Possession and property are social and legal constructions and

conclusions
When a court decides that someone has a property interest,
they’re coming to a conclusion on how the law should allocate
resources
o Property rights are not private resolutions or claims between
individuals; property rights can confer power or take away power
 Acquisition by Capture
The Rule of capture: the first person to take possession of a thing owns it.
 Rationale:
o Rewarding labor
o Protecting investment in resources
Traditional Rule for Capture of wild animals: capture is required to establish possession,
while merely chasing an animal is not enough. (Pierson)
 Rationale
o Competition
o Ease of administration
Following Custom is another Rule for Capture of wild animals (Ghen)
Rule of Ratione Soli: Rationale soli (“by reason of the soil”) – refers to the conventional view
that an owner of land has possession – constructive possession – of wild animals on the owner’s
land; in other words, landowners are regarded as the prior possessors of any animals ferae
naturae on their land, until the animals take off.
Pierson v. Post (1805) [fox case]

i. Issue: whether Post, by the pursuit with his hounds in the manner
alleged, acquired such a right to, or property in, the fox, as will
sustain an action against Pierson for killing and taking him away.
ii. Rule: capture is required to establish possession, while merely
chasing an animal is not enough.
iii. Holding: Post had no property right in the fox.
a. The court held that possession only exists when there is
actual capture, or where there is mortal wounding.
b. Rationale: property law should promote certainty, peace,
order.
Public policy is serve by a ruling in favor of Pierson:
o We want foxes to be destroyed
o Dissent: hot pursuit should be enough b/c it
encourages hunting
o Majority: reward whoever actually kills the fox
 Orderly society, keeping the peace
 The case requires a certain rule for ease
of administration – whoever morally
7
wounds or carries away the fox gets to

keep it
 Wild animals are going to be property of individuals
through trapping or holding, not just by pursuing
o the individual needs to wound or ensnare the
animals
o deprive them of their natural liberty
o Subject them to the control of that individual
 This opinion rewards the intermeddler
 Today, acquisition by capture still stands (i.e. fishing)
Ghen v Rich [whaling case]

 Facts: libel to recover the value of a whale.
Provincetown usage is that the finder reports to the
huntsman. Cape Cod usage is that person who kills the
whale owns it. P killed the whale. The finder
advertised & auctioned it to the respondent.
 Issue: whether the killer of the whale retains ownership
of the whale. Y
 Reasoning: If people don’t abide by the rule, the
industry of whaling would suffer
 Rule: A custom among whalemen in the Arctic seas,
that the iron holds the whale, is reasonable and valid
to bestow title upon the party who first harpoons a
whale. The usage for the first iron, whether attached
to the boat or not, to hold the whale, is fully
established.
 Custom is used as a source; custom is a relevant
decision making rule in this case
o Limited application of custom doesn’t disturb
general applications or property law
 It’s a good idea to adopt custom b/c it’s generally
accepted and it’s a limited industry that’s not going to
harm anyone else.
o Custom is a good way to have the intermediate
quality, it assigns part of the right to the finder
 Advantages for following custom:
o Efficiency – it works and its established
 Won’t infect the rest of the law
 Disadvantages of following custom:
o Some customs might be outdated and inefficient
Keeble v Kickeringill [duck decoy pond case]
 Facts: Action: trespass on the case (like trespass), P
had a decoy pond set up for the “taking of wildfowl”
and D drive them away by discharging guns
8
 Issue: Can a person be liable for hindering another

from taking wildfowl? Yes
 Reasoning: When an actor imports danger, an action
lies; D was interfering with P’s means of employment
just for spite
 Rule: A person should not malicious interference
with the trade of another.
o Interference with a productive and useful
activity
 Why does the court care about competition versus
maliciousness?
o The court is trying to promote what Keeble is
doing (Keeble’s employment – socially useful
endeavor) & trying to prevent what Hickeringill
is doing (sport)
o Keeble has gone to the trouble to construct the
decoy pond & court wants to prevent someone
from coming in for no good reason (labor
theory)
 “People who are so instrumental by their
skill and industry so to furnish the
markets should reap the benefit and have
their action”
o Utilitarian principles: what would be best for
society as a whole – how can we encourage
activities that are good for society?
 Consumer protection
 quantity of ducks on the market
o interference v
competition
 price concerns
o competition is a good
thing b/c it leads to lower
prices for consumers
 Interference w/ capture may be something that creates
liability; protection for pursuit
 What’s important is rewarding labor, except if the
activities that interfere are good productive
competition.
 PROBLEM: Suppose that Y is not a hunter but a zealous
animal lover who at the last instant frightens the deer away.
Does X have any recourse?
 Pierson court would want to find liability
o Pierson’s policy perspective: we want to kill
certain animals
9
o Legal hunting season, killing deer is socially

acceptable
o The hunter did not have protection because it
was not his own land
 HYPO: Animal gets mortally wounded but runs into private
property
 Hunter – labored, invested, mortally wounded
o Pierson: wounder has the rights to the animal
 Homeowner – right to prevent trespass
o Ratione soli – owners of the land owns the
animal
Assigning property rights in fugitive resources (oil, gas)
 Common law: whoever drew up the oil or gas owned it
 Outerspace: when you put up a satellite, you’ve
captured your orbit and have property interest in that
orbit
Other Fugitive Resources
Oil & Gas

 Historically, determined by the rule of capture
 Whoever drew up the oil or gas owned it
 Today, oil and gas rights are a highly regulated field with considerable variation from this default
Groundwater Rights
 English rule, followed by a few states, is unlimited capture rule
 American rule (majority) is a limited capture rule
 Landowners can draw water for reasonable use, cannot harm neighbors Groundwater rights
Surface Water Rights

 Western states often use prior appropriation rule, essentially first user has a superior right •
 Eastern states typically use riparian rights rules, whereby adjacent landowners have superior
rights Surface water rights
Popov v. Hayashi [Baseball] (Cal. S.F. Cty. 2002)

rd
 Barry Bonds hits his record-setting 73 home run; it goes
into Popov’s glove but before he can secure it, he is
attacked, thrown to the ground, and drops it
 Hayashi is also part of the crowd (court believes Hayashi is
not an aggressor), finds the loose ball, and secures it
 Popov sues Hayashi and court considers conversion claim
 Court ultimately orders unusual remedy of equitable
division
 Actual complete control over the ball must be established
in order for a person to have the kind of possession that
conversion would require.
 Policy: we don’t want to encourage pandemonium
10
Partially based on custom


 Elements of conversion action:
 1) right to possession
 2) someone wrongfully
interfering with that
possession
 The court ends up ordering the
ball to be sold and the proceeds
split
Externalities: The Tragedy of the Commons
• Initial position: Society of 100 members holds a forest of 1000 trees in communal ownership
• Each individual member has undivided 1/100 interest in 1000 trees and co-owns all 1000 trees
with 99 others
 Externality: If one individual cuts one of the trees to benefit herself, 99 others bear
99/100 of the loss.
 Will the forest be overconsumed?
 It depends on the uses to which the trees can be put
 In some circumstances, collective action problems (free- ridership, holdouts) can
arise, leading to overconsumption (a.k.a., “the tragedy of the commons”)
 Private ownership can limit externalities
 If each individual is given 10 trees as private property, when Jane cuts one she
will bear its whole loss. She gains whatever she can earn in exchange but will
then have only 9 trees, while the other 99 individuals will still each have 10 trees
 Private owners can still impose externalities (pests, poor land management, etc.)
but negotiation is easier
 Fragmentation can go too far, e.g, Heller’s Tragedy of the Anticommons
Theories of Property
 Utilitarian Idea: it’s good for the whole of society
o It’s orderly, keeps the peace and is easy to apply
 Labor theory: every man has property in his own person. The labor of his body and the works
of his hands are his property, therefore, Property rights should recognize the labor people exert
over their environment.
 Dignitary: These theories focus on property’s value in protecting the human will,
individuality, autonomy, political freedom, etc.
Acquisition by Creation
o Introduction:
 If you create something, then it’s yours to exploit
 Locke – you own the fruits of your labor in
consequence of having “a property in your own person”
 First in time ideas
11
 The trouble is that the fruits of your labor are not

always yours alone to exploit; you do not always have
full rights of property in your own person
Copycats
International News Service v Associated Press [copy news case]
 Facts: INS copies AP’s news by giving info to its
customers and then the customers print the stories;
when the east coast customers print the stories, INS gets
a copy and sends it to its customers on the west coast,
this makes it much cheaper for INS
 The Court finds that AP has a quasi-property right
(constructive) even though it doesn’t have all the
components of property that precedence might require
o Property in the news – report of matters that
ordinarily are public juris; it is the history of the
day (quasi-property right)
 Reasons why the Court is reaching to protect this
property right:
o It’s expensive for AP to produce this
information – we need to protect their
investment in creating their property and the
way to do this is through a property right
o S. Ct. gives AP a limited property right while
the news is fresh only against INS or people
like INS & enjoins INS from future copying,
not a protection against the general public
 the Court says that news has a special
quality; we want more of it produced so
we need to draw back on scooping
 However, copying & sharing of
news is a good thing for society
b/c news has quality of public
good (i.e. clean air)
o Policy: Utilitarian perspective – If the court
rule the other way, then AP would be making
less of a profit over time b/c it would be cheaper
for customers to contract with INS, and
ultimately, news would be less fresh & less
available
 If AP had no recourse and no way to
protect the information, everyone would
lose out
 Theories of property:
o Utilitarian (echoes the Keeble [duck pond]
case)
12
 Generally, we will protect property

rights from interference unless that
interference promotes competition
 Generally, news should be shared but an
exception will be made for scooping
o Labor theory – company is being protected in
its business activities
o First in time – AP finds the news; they are the
first to get there
o Acquisition by discovery, capture, creation –
all struggle with competing values of rewarding
people for their labor & what’s best for society;
serves basic fairness ideas of people getting
there first
 Copying and sharing is allowed when it is for the public
good.
Cheney Brothers v Doris Silk Corp., [pattern protection case]
 Facts: D copied P’s popular designs & undercut P’s
price; P wants protection for those designs that P
created while they are fresh; tries to use INS argument
 The Court says that this case should be based on the
common law rule than an inventor only owns the
chattle, the embodiment of their invention
o Institutional competence argument – Absent
some kind of statutory authority, they don’t
have the right to prevent others from imitating
their invention; if they want it protected, they
must get that protection from the legislature
 Who’s the best decision maker? Depends
on the case
o Fabric patterns don’t have the same kind of
societal importance as the news
 General rule: In the absence of some recognized right
at common law or under statutes, a man’s property is
limited to the chattels which embody his invention.
Others may imitate these at their pleasure.
Feist Pubs., Inc. v. Rural Telephone Serv. Co. (USSC 1991)
 Rural was a regulated telephone utility that published local
white pages and provided telephone service to its customers;
Feist was a telephone directory aggregator, which licensed
content from every other telephone director in the region to
publish regional directories, but Rural refused
 Feist copied over 1000 entries from Rural, including four fictitious
entries Rural had inserted to detect copying; Rural sues Feist for
copyright infringement
13
 USSC holds for Feist because although compilations can be

copyrighted, they must have “a modicum” of originality and the
Court holds Rural’s directory does not
 Clarifies originality requirement for copyright protection
 Monopoly position of Feist also seems relevant
 Infringement claim for fictional entries barred by copyright estoppel
Intellectual Property Statutes:

 All of them want to protect beyond what the common
law rules would
 You want to encourage innovation, reward labor, create
useful inventions, balanced with the idea that we don’t
want monopolies b/c monopolies are inconsistent with
efficiency  undermines innovation in the long run
Types of intellectual property protection through statutes:

 Patents – granted for novel, useful & nonobvious
processes or products
o Not renewable, up to 20 years
o Obvious inventions can’t be patented
o Can’t patent fundamental ideas, only inventions
o Can’t drive up prices (i.e. drug companies)
 cost is seen as the price you pay for
encouraging the innovation in the first
place
Diamond v. Chakrabarty (USSC 1980)
• Patent applicant seeks to patent microorganism genetically
engineered to clean up oil spills, is rejected and seeks review
• USSC majority finds subject matter patentable as man-made,
although also a living organism
• Labor theory focus
• Defers to Congress on policy regarding genetic engineering
• Dissent argues legislative history of two statutes demonstrates
Congressional intent not to allow patents on living things
 Copyrights – protect the expression of ideas in books
and articles, music, artistic works, and so on
o Today, anything expressive can be copyrighted,
provided the expressive aspect can be separated
from the functional
o Has recently been changed to last for the
author’s lifetime + 70 yrs
o Lasts longer, but there are a lot more exceptions
to the monopoly power of the holder
14
 derivative works – parody, some work

that draws on the original expression or
creates new expression
 Copyright alternatives
 • Secrecy
 • Contracting
Fair Use
• Major defense to infringement, along with other exceptions
 Trademarks – words & symbols indicating source of a
product or service
o Gives the incentive to think of the word
o Distinctive marks are very useful to consumers
who want to discriminate on that basis
o Protected through statute but the monopoly is
not complete
 not protected when a trademark becomes
generic term
 i.e. aspirin
Cyberspace
1. Virtual Works, Inc. v Volkswagen of America, Inc., 2001, page 69
a. Facts: Virtual Works registered the domain name vw.net, aware
that some Internet users might think that it was affiliated w/
Volkswagen; they then offered to sell the domain name to
Volkswagen, giving them 24 hours; there was a statute which
made it illegal for someone acting w/ bad faith intent to register or
use a domain name that is the same or confusingly similar to a
trademark
b. Bad faith statute:
i. Listed factors of bad faith determination & gives potential
damages remedy to people who are harmed
c. Bad faith:
i. Bad faith use of the internet in a way to exploit the value of
trademarks seems to be a concern of Congress
ii. Not only concerned with owners, but also consumers
i. they want to protect them from being confused
2. The Internet and federal regulation:
a. Intel case – Intel argued that its computer system was its property
and the employees’ emails were trespassing
b. Some federal regulation trying to curb spamming issues as well
c. The Internet has exploded a range of property issues that seemed
settled
d. Still trying to balance common law versus statutes
15
Property in One’s Persona

3. A celebrity’s right to publicity is widely recognizes as a kind of property
interest, assignable during life, descendible at death
a. Property interest includes name, likeness, & other aspects of one’s
identity
4. The right to publicity seems to be rooted in the right of privacy
a. Privacy – prevents people from invading your personality; not
letting people access your persona
b. Publicity – right to include others; controlling use & profit of your
likeness
5. Property in your personal question:
a. A question of your right to include and your right to exclude
b. Raises question of “do you have property interest in your
likeness?”
i. Likeness – voice, image, identity
c. How can that property interest be used and on what terms?
6. Theories of property law:
a. Labor theory – cultivating your persona; you invest our time,
energy, & effort and it deserves protection as a property right
i. You’ve created something that’s marketable that people
will desire and spend their money on
Property in One’s Person
7. Moore v Regents of the University of California, 1990, page 79
a. Facts: Moore goes into the hospital and has surgery to remove his
spleen; he has unique spleen cells and the research from the cells
results in a patented new cell line
b. Moore’s case:
i. Conversion – you have to prove that whatever was taken or
interfered with was your property in the first place
i. he claims his cells were converted & profited from
ii. Lack of informed consent
c. Court finds in favor of Moore on the informed consent issue &
now IC allows doctors to use materials removed for research w/o
patient compensation
d. On the conversion issue, the court decides not to extend existing
law to find property rights in cells once they’re removed from the
body
i. The Court says that what’s being patented and profited
from what not what was in more
i. Lockean idea – w/o the labor of the researches there
would be no patent
e. Policy concerns of the court:
i. 1) patient’s autonomy – protecting of competent patient’s
right to make autonomous medical decisions
16
ii. 2) researcher’s opportunity – not wanting to threaten

innocent parties who are engaged in socially useful
activities
i. uncertainty could affect product development as
well as research and research is important
iii. The theory of liability that Moore urges threatens to destroy
the economic incentive to conduct important medical
research
f. Majority balances the interest & believes that the informed consent
route is better – advise the patient of what will happen to the cells
 this will protect patient’s autonomy & provide sufficient
protection for researchers
g. Concurrence – concerned about commodification – permitting a
conversion action would lead to a morally problematic conclusion
 too much trafficking of body parts
i. Defers to the legislature
h. Dissent: J. Mosk thinks that property law is broad enough to deal
with concerns by giving Moore a property right even once the cells
are out of his body
i. He thinks that informed consent is not enough and the
patient needs more protection
i. Moore is about the right to include or the right to transfer:
i. He has the right to transfer them & he didn’t exercise that
right
ii. He has the right to include who can use his cells
Henrietta Lacks’ Story
 Black female patient presents with cancerous tumor in 1951 and portions are taken for
research, both before and after death, without her knowledge or consent
 Cells (named HeLa) become key tool in medical research, used in vaccine development,
cloning, gene mapping, cancer research, and more
 Family learns only decades later about HeLa cells’ contributions to science and continues
to advocate for a role in how HeLa cells and the information they contain is used
Considerations
The Right to Exclude
Jacque v. Steenberg Homes, Inc. (Wis. 1997)

 Although the Jacques clearly stated they did not want a
mobile home delivered to their neighbors by Steenberg
crossing over the Jacques’ land, Steenberg did so anyway
 The Jacques sued for intentional trespass and won only
nominal damages, as the trial court set aside the jury’s
punitive award, thus they appealed
17
 The Wisconsin Supreme Court holds punitive damages

available for intentional trespass, to protect the “most
essential” right to exclude (quoting USSC)
State v. Shcak (N.J. 1971)
 A lawyer and a health officer visit Tedesco’s farm to meet
with migrant workers living and working there; Tedesco
demanded to be present for the lawyer’s meeting but both
workers demanded privacy, so Tedesco asked them to leave
and swears out complaint of criminal trespass
 NJSC reverses workers’ convictions on grounds right to
exclude is not so absolute as to permit real property owner
to control the ability of those living on that property to
access government-funded services
The Bundle of Rights
 Right to exclude
 Right to include
o Includes rights to transfer by various means
o Generally, as we will see many times, property disfavors restraints on alienation
 Right to abandon
o Freely available for personal property
o Much more difficult (usually prohibited) for real property
 Right to destroy
Eyerman v. Mercantile Trust Co. (Mo. 1975)
 Louise Woodruff Johnston’s will directs executor exercise right to
destroy, “caus[ing] our home at 4 Kingsbury Place to be razed”
and to sell underlying land for benefit of estate, without indicating
reasons for doing so
 If the house is razed, the estate will net $650, versus $40,000 if it
remains intact
 Johnston’s heirs do not oppose destruction but her neighbors do,
seeking an injunction on grounds it would detract from
neighborhood’s architectural cohesiveness and diminish property
values
 Missouri Court of Appeals directs trial court to enjoin destruction
of home; majority deems it against public policy due to social cost
o Outcome would almost certainly be the opposite if the
owner remained alive
o Outcome would also likely have been the opposite if
testator explained her reasoning
18
2. Subsequent possession
 Acquisition of Property by Find
B. Rule of Find: The finder acquires title good against all the world except for
the rightful owner or prior possessor
1. Title is relative – there are potential limitations on one’s property interest
a. True owner has a better titled than a finder
b. Finder has a better title than a bailee
c. Bailee has a better title than a thief
i. Bailee – given possession of goods but there is no claim of
ownership
ii. i.e. drycleaners
2. Rule: prior possession prevails over a subsequent possessor
Armory v. Delamirie [Jewel in the chimney case]
a. Facts: P was a chimney sweeper’s boy who found a jewel and
carried it to the D’s shop to have it valued; D took out the stones
and gave it back; P suing for the value of the stone
b. Holding: The finder, though he does not by such finding acquire
absolute property or ownership, he has such a property as will
enable him to keep it against all but the rightful owner.
c. Armory wins over Delamirie b/c he has a better title
C. Keeping found property with the locus owner:
Hannah v Peel [brooch case]

Facts: P Hannah was stationed at D Peel’s house and found a
brooch; D bought the house but never moved in. P brought it to the
police; police returned it to the D and D sold it; P demanded return
of the brooch
 In this case there is no rightful owner; the finder is Hannah;
the court has to determine the rights of the honest locus
owner and the honest finder
 It is important in this case that the brooch was unattached
to the land
Holding: Court refines rule of acquisition by find: an honest finder
has title good against all but the true owner or a prior possessor.
Brooch was lost, and found by the P – Judgment for the P
 Policy considerations that lost property raises:
1. Expectations of the parties – we want a rule that makes sense to people,
particularly the people who are going to be involved
a. A certain rule reduces suits and lowers costs
b. Carrying out reasonable expectations
2. Honesty – how do we want finder’s to act?
a. Reward and encourage finding
b. Security – discouraging dishonesty
3. Getting property to the true owner:
19
a. Keep items close to where they’re found (the locus)

 If these are our policies, who would we award the item to?
4. Expectations of the parties:
a. Concern of certainty:
i.  reward the finder (most easily identified)
i. It can be really hard to know who’s the locus owner
ii.  reward the locus owner
i. If it’s really hard to identify the finder
Rule: The possession of land carries with it in general, by our law, possession of everything
which is attached to or under that land, and in the absence of a better title elsewhere, that the
possessor is not aware of the things existence
Bridges case (parcel w/notes found on the floor of a shop)
Rule: General right of the finder to any article which has been lost,
as against all the world, except the true owner, has never been
disputed.
Holding: Notes were granted to the finder
South Staffordshire Water Co. v Sharman – cleaning the pool case

Rule: the possession of land carries with it possession of
everything which is attached to or under the land
Rule: If a man finds a thing as the servant or agent of
another, he finds it not for himself, but for that other.
 A find by an employee in the mud at the
bottom of the pool should go to the locus
owner despite the Bridges court statement
that place of find makes no difference
 The locus owner should keep the rings b/c of
where they were found part b/c they were
below the surface and partly because an
employee found it
Employer/employee relationships
Employer/Employee Find Rule: Under the common law,
a servant or employee doesn’t get to keep the spoils of the
labor b/c it belongs to the master or employer
Landlord/tenant relationships
Elwes v Brigg Gas Co. (prehistoric boat discovered by the lessees while digging to make a
gasholder)
iii. Tenants found the boat but the court awarded the boat to
the landlord
iv. The lease didn’t pass the boat, just the right to use the land
b. Boat was found below the surface, belong to landlord at the time of
granting the lease; it didn’t matter that landlord did not know of it
20
Rule: that landowner owns items attached to/under land to also

apply to items found there
Finder Rule for Trespassers – “if the discoverer is a trespasser
such trespasser can have no claim to possession of such property
even if it might otherwise be considered lost.”
Distinctions between a public place, shop and home
Place Item goes to:

Public place Finder
Shop Mislaid Shop owner (locus)
Lost  Finder
Home Attached  Landowner
Unattached  Finder
Mislaid
McAvoy v Medina [Pocket book with money mislaid]
Facts: Plaintiff customer at defendant’s barbershop finds pocketbook
containing cash on a table and leaves it with shopkeeper to advertise
for its return, but true owner does not appear
Holding: Court awards property to locus owner not finder-exception
to Armory rule
Mislaid Property Rule: “mislaid” property, to be awarded to
the locus owner • How to distinguish lost from mislaid
property?
a. Mislaid property should be left with the locus owner.
i. Driven by the concern of getting property back
to the true owner
ii. People will be closer in time & proximity to
their mislaid things
b. Problems with the lost/mislaid distinction:
i. Where do you draw the line?
i. This might encourage people to lie about
where it has been found
ii. Hard to predict where the categorization
will turn out
iii. Doesn’t mislaid property become lost
after the passage of time?
iv. Not a mutable distinction
ii. Must argue about why it’s lost or mislaid based
on the circumstances on which it was found
Mislaid, lost and abandoned property:
Abandoned property – items intentionally and
voluntarily relinquished with no intent to reclaim
21
 Adverse Possession
Definitions
True Owner: Holder of title to real property
Adverse Possessor: Entrant on Property must meet 4 elements
Statute of Limitations: Time limit on actions in ejectment; Typically quite
long(e.g. 10,15, even 21 years)
General rule: “To constitute adverse possession, there must be actual possession which is
uninterrupted, open & notorious, hostile & exclusive, and under a claim of right made in
good faith for the statutory period.”
 The requisite possession requires such possession and
dominion “as ordinarily marks the conduct of owners in
general in holding, managing, and caring for property of
like nature and condition.”
4 Elements of Adverse Possession

1) Actual and Exclusive Possession- Possession like a typical owner but
exclusive of the true owner
2) Open and Notorious Possession- Possession sufficient to give notice
to an attentive true owner
3) Hostile Possession With Claim of Right- No adverse possession with
permission • Claim of right: Objective (majority); subjective
requiring good faith mistake; subjective requiring bad faith trespass
4) Possession Continuous for the Statutory Period- Continuous like a
typical owner of property in question, seasonal occupation
• Long statutory period with specified tolling for disabilities
Adverse possession – when one person owns property and another person comes into the
property and starts to occupy it and use it (adverse possessor)
5. Adverse possessor has no right until they’ve completed adverse
possession
a. Theoretically and legally possible to adversely possess
personal property
i. Extraordinarily rare
ii. Elements are similar but need to apply in a different
way
b. Adverse possession happens very rarely other than boundary
disputes
6. Possessor has a right to possess land against anyone besides the true
owner
7. Possessor possesses the property for a certain amount of time set by
statute
a. After the statute has run, by operation of the statute of
limitations, the true owners no longer has a right to the
property
22
8. The true owner can no longer sue the possessor; possessor has rights
against anyone, becomes the new true owner and acquire title to the
land by adverse possession
9. Generally, you can’t adversely possess against the government
10. Action of Ejectment – action to get an adverse possessor off the land
2 main policy concerns behind adverse possession:
11. 1) Earning policy (deserve of the adverse possessor) – the reason an
adverse possessor will ultimately be able to acquire titled is b/c if they
work on the property long enough, they should ultimately be rewarded
a. Labor theory  you worked on the land
b. Utilitarian theory  makes people work on the land
c. Property as one’s personality  it becomes part of you
d. Conforming to expectations  treating the land as your own
creates expectations that you’re the owner
12. 2) Sleeping Policy (lack of deserve of true owner)– if a true owner
sleeps on her rights in the face of adverse use by an adverse possessor,
then true owner deserves to lose title
a. Policy concerns:
i. Keeping the peace
ii. Certainty
iii. Fresh suits
iv. Evidence concerns
v. First in time diminishes if you sleep on your rights for
long enough – moral content becomes less powerful
after a long absence
13. These 2 policies work well in tandem  often point to the same
outcome
14. ACTUAL POSSESSION
a. Physically using the land in some way
b. Plays into the earning theory and the sleeping theory
15. EXCLUSIVE USE
a. An adverse possessor can’t be one of many people using the
land; they have to claim that it’s their property by their actions
b. Evidence of your particular value to single you out to get title
as opposed to the true owner
c. There can be adverse possession by a group but they need to
keep anyone else out
i. Can’t be too big of a group. True owner must be able to
tell that there are adverse possessors…
d. Puts the owner on notice as to who it is they need to get off
their land
e. Ties into earning theory and sleeping theory
f. “The sort of entry and exclusive possession that will ripen into
title by adverse possession is use of the property in a manner
that an average true owner would use it under the
circumstances, such that neighbors and other observers would
23
regard the occupant as a person exercising exclusive

dominion.” (Ewing v Burnet)
16. OPEN & NOTORIOUS
a. Type of actions that would inform a reasonable attentive owner
that someone is on their property
i. i.e. building a house, living on the property, using it or
improving it
b. This also puts the true owner on notice – if they don’t react, the
court won’t take their claim as seriously
c. Serves as an anti-fraud provision (i.e. elusive tent pitcher – not
open & notorious)
d. The notoriety requirement of adverse possession is not always
straightforward
17. ADVERSE/HOSTILE & UNDER A CLAIM OF RIGHT
a. You can’t adversely possess land that you’re using by
permission. Permission defeats adverse possession!
i. Concerns: potential for fraud
i. Otherwise, every tenant would claim ownership
ii. How will the true owner know to get rid of you
b. Concerns about the quality of hostility & adversity and claim
of right:
i. Objective/subjective/good faith theories
ii. Courts differ on the quality of hostility
iii. Everyone agrees that permissive use will not be
sufficient
c. Hostile – without permission of the owner
d. 3 views on the claim of right:
i. 1) objective standard – state of mind is irrelevant (i.e.
England)
i. We don’t care what you’re subjective intent was
as long as you’re doing all the other things that
are the other elements, that suggests hostility;
your claim of right is just that you’re there
ii. Once there is an entry against true owner, she
has a cause of action
ii. 2) good faith standard – the required state of mind is
“I thought I owned it” (i.e. voiced in many American
decisions)
i. Must make a good faith mistake
ii. Halpen v lacy Inv. Corp.
1. “one must enter upon the land claiming
in good faith the right to do so”
2. “the court regularly awards title to the
good faith trespasser, where they will
not award it to the trespasser who knows
24
what he is doing at the time he enters the

land in dispute”
iii. 3) Aggressive trespass standard – the required state of
mind is “I thought I didn’t own it, but I intended to
make it mine”
i. Bad faith claim of right; engage in willful,
intentional trespass
ii. “There is a presumption which lasts till it is
rebutted, that an intruder enters to hold for
himself.” Patterson v Riegle
18. CONTINUOUS FOR THE STATUTORY PERIOD (under the
statute of limitations)
a. The Legislature resolves how long possession has to last
i. Made the decision to shorten the period
ii. Traditionally 20 years, but today, 10 year statutes are
much more common
b. Possible exceptions:
i. Disabilities (if the owner was under a disability)
ii. Beach property – adverse possession of summer or year
round – usually judged by what typical owners do
Van Valkenburgh v Lutz [garden adverse possession case]
Facts: Lutz’s bought 2 plots of land but used the plots adjacent to it
for over 30 years for gardening and traveling; Van Valkenburghs
bought the plots adjacent to the Lutz’s plots and tried to eject them
c. Lutz’s use – right of way; traveling to and from over the lot;
gardening
i. Easement – the right to use someone else’s land in a
particular way
ii. Easement by prescription – easement you acquire by
adverse possession
Holding: Court looks closely at the statute that describe the right kind
of possession to make out a claim of adverse possession:
d. There’s no enclosure/fence – why is this important?
i. It’s an expression of the earning that you’re doing,
everyone who sees it knows what you’re claiming,
especially the true owner
ii. Puts the world on notice and especially puts the true
owner on notice
e. Improvements
i. Notice
Adverse Possession Dealing with Boundary Disputes
Claim of right distinctions:
a. Objective standard
i. “the very nature of the act is an assertion of his own
title and the denial of the title of all others” French v
Pearce
25
b. Good faith rule

c. Aggressive trespass standard/Bad faith claim of right
i. Rewards the intentional wrongdoer who entered w/ a
premeditated & predesigned “hostility” and disfavors
an honest, mistaken entrant
Mannillo v Gorski [steps case]
Facts: Gorskis built a walk and steps on their property,
which extended onto the Mannillo’s neighboring
residential property by 15 inches and the Mannillos sue
for encroachment only after the statutory period has
run, so Gorskis defend and counterclaim title by AP.
 NJSC adopts majority, objective
approach to claim of right
 Rejects subjective bad faith requirement
as reward to trespass
 NJSC ultimately holds for Manillos on
unusual application of
openness/notoriety requirement
 Requires actual knowledge by true
owner, contrary to weight of authority
 Equitable remedy for mistaken
improvers may be available on remand
ii. Policy concerns: the intent that we’re encouraging
i. Why would we give more rights to someone
doing something bad than we would to someone
making an honest mistake?
ii. Standard depends on policy of state… different
states, different policies.
iii. Court adopts objective standard – we don’t care what
your intention is
i. “Whether or not the entry is caused by mistake
or intent, the same result eventuates – the true
owner is ousted from possession.”
ii. This is the most common perspective today.
Majority opinion.
iii. Only where the true owner has actually
knowledge thereof may it be said that the
possession is open and notorious
d. Open and notorious requirement
i. Court: true owners shouldn’t have to survey
constantly
ii. When we’re dealing with encroachments, open and
notorious means that the owner has to have actually
26
knowledge of the encroachment b/c all of the elements

have to be met
iii. Any entry & possession for required time which is
exclusive, continuous, uninterrupted, visible &
notorious, even though under mistaken claim of title, is
sufficient to support a claim of title by adverse
possession
All five elements must have been met since beginning of statutory running.
PROBLEM: What result if A mistakenly erects a fence 3 ft on her neighbor’s property for
the statutory period & after being notified, tears down her fence & erects a new fence on the
original boundary?
 It doesn’t matter what she does afterward; the title
already transfers to her and she owns it after the statute
of limitations runs
Mistaken improver’s doctrine: court can force transaction. Either improver purchases
improved land from true owner, or true owner purchase improvement from improver.
 Continuous possession is only required in the sense that occupancy is continuous in
the usual owner of this kind of property would occupy it.
 i.e. summer home
 Tacking of adverse possession is permitted if the successive occupants
are in “privity”
 i.e. deed between successive occupants creates privity
Howard v Kunto [mixed up deeds case]
Facts: everyone has a deed that is for the lot adjacent to the lot they’re
occupying; Howards approached Moyers & exchange Moyers’ deed to
Kuntos’ deed; they go to court and want to eject Kuntos, who had only
been living there for a year
e. Potential problems for the Kuntos defense:
i. Continuity problems:
i. They were only summer occupants
1. lower court interpreted this to be
continuous b/c none of the property
owners used the land every day of the
year
ii. They were there for less than a year:
i. When can an adverse possessor tack on the time
spent by those that came before you?
f. Summer Occupancy:
i. General rule: “To constitute adverse possession, there
must be actual possession which is uninterrupted, open
& notorious, hostile & exclusive, and under a claim of
right made in good faith for the statutory period.”
27
i. The requisite possession requires such

possession and dominion “as ordinarily marks
the conduct of owners in general in holding,
managing, and caring for property of like
nature and condition.”
Tacking:
ii. General rule of the state: “This state follows the rule
that a purchase may tack the adverse use of its
predecessor in interest to that of his own where the
land was intended to be included in the deed between
them, but was mistakenly omitted from that
description.”
i. Tacking of adverse possession is permitted if
the successive occupants are “in privity”
ii. Privity – some kind of relationship between 2
people that the law wants to privilege
PROBLEMS: Tacking
g. A and B are in dispute over a small land area. A has a fence on B’s land.
After SOL passes, B informs A that fence is on B’s land. A moves fence.
Then A sees a lawyer who says land was his based on adverse possession.
B can use estoppel against A. Estoppel is proof of reliance on
representation.
h. 1) In 1991 A enters adversely upon Blackacre, owned by O. In 1998 B
tells A, “Get out of here, I’m taking over.” A, feeling threatened, leaves
and B enters into possession. In 2001, who owns Blackacre?
i. In O owns Blackacre in 2001. A and B were not in privity
because there was no voluntary transfer. A has no right to
eject B. Only O can eject B b/c O is the rightful owner.
i. Suppose that in 1998 A leaves under threat of force, but 6 months later A
recovers possession from B. If O does nothing, will A own Blackacre 10
years from the date of his entry in 1991, or in 2008?
i. Classic majority rule: If A leaves from threat of force &
comes back, it should be that A will own Blackacre 10
years & 6 months from date of entry b/c A didn’t abandon
the property but was forced off. A doesn’t have to start
over. It’s a kind of crediting.
i. Why add 6 months?
1. We don’t want to give A too much credit
2. True owner should have been asserting their
rights
3. O had no action against A during those 6
months so the statute of limitations is paused
for that period while A was off the property
and O gets an additional 6 months to sue A
j. If A abandons Blackacre, and B immediately goes into possession, B
should not own Blackacre in 2001.
28
i. Under the earning policy, B does not deserve it

ii. Also, no voluntary transfer so no privity
k. 2) If 1985 A enters adversely upon Blackacre, owned by O. In 1986 O
dies, leaving a will that devises Blackacre to B for life, remainder to C. In
2001 B dies without ever having entered upon Blackacre.
i. A owns Blackacre – the statute of limitations runs
ii. Once there’s an entry against a true owner, it is not
defeated b/c the true owner transfers the property
iii. What about C? Isn’t it unfair to him? What can C do?
i. C know he has the right and can try to protect his
interest by getting B to eject the adverse possessor
ii. C could try to buy B’s life estate & would have total
ownership
iii. C can bring a suit against B for something called
“waste”
1. action for waste – when someone has a
future interest, they can sue the person w/
the current possessory interest and say that
that person is wasting away their property
2. the problem with the waste remedy is if C is
unknown
Disabilities and Adverse Possession:
Note: Disability exceptions to the statute of limitations are not common law rules, they are
statutory; disability is dealt with as a very strict statutory interpretation
iv. You want to consult the disability statute to see if the
person with a disability gets an extension; sometimes they
will, sometimes they won’t
v. Courts tend not to be generous with the application of the
statutes b/c the statutes tend to be ambiguous and tricky to
apply
l. Disabilities that count are in the statute; no other disabilities count; if it’s
not listed in the statute, it doesn’t apply
i. A person whose disabilities matter is only a person who is
entitled to bring an action and has a disability at the time
the adverse possession accrues
ii. No provision for tacking of disabilities; one extension for
one disability
m. How do deal with a person with a disability:
i. 1) Look at the statute
ii. 2) Look at the cases interpreting the statute
iii. 3) If you’re not sure, don’t let your client wait, get the
adverse possessor off the land
PROBLEM page 161:
iv. Statute: “An action to recover the title to or possession of
real property shall be brought within 21 years after the
cause thereof accrued, but if a person entitled to bring
29
such action, at the time the cause thereof accrues, is within

the age of minority, of unsound mind, or imprisoned, such
person, after the expiration of 21 years from the time the
cause of action accrues, may bring such action within 10
years after such disability is removed.”
Disability Quiz Review
 Every state allows tolling of the statute of limitations for certain disabilities
o Only disabilities mentioned in the statute work to toll it; any others are irrelevant
o The only disabilities that matter exist in the true owner at the time the adverse
possessor enters
 The disability extension starts running at the time the disability is removed, though the
true owner is entitled to the full standard statutory period if it would be longer than the
disability extension
 The disability extension is only a partial cure
o Guardianship for non-extending disabilities
o Good lawyering can still be needed to manage remaining risks
o When in the following examples would the adverse

possessor acquire title under the statute set out above? In
each case, O is the owner in 1976, and A enters adversely
on May 1, 1976. The age of majority is 18.
 1) O is insane in 1976 and dies on 1999.
 a) O’s heir, H, is under no disability until
1999
o 1999 + 10  A possesses in 2009
o You stop being insane once you die
 b) O’s heir, H is 6 years old in 1999
o 1999 + 10  A possesses in 2009
o The statue doesn’t protect H
o The exception only recognizes ONE
disability
 2) O has no disability in 1976. O died intestate in
1994. O’s heir, H, is 2 years old in 1994.
 1976 + 21  A possesses in 1997
o No disability at the time the action
accrues, no extension
 3) O is 5 years old in 1976. In 1986 O becomes
mentally ill, and O dies intestate in 2001. O’s heir,
H, is under no disability. Does the adverse
possessor here acquire title in 1997, 1999, or at
some later date? If the answer is 1997 or 1999, how
are O’s interest to be protected?
 1976 + 21  1997 OR 1989 + 10  1999
30
 The period of extension is the time that the

first disability is relieve + 10 years or the
statutory period, whichever is longer
 It doesn’t matter that O at the time has
become mentally ill
 Adverse Possession Against the Government: common law, AP does
not run against the gov’t
 Adverse possession against chattel – tricky! Close to criminal law of
thievery…
Additional Adverse Possession Issues
 Generally, no adverse possession against the government
 Adverse possession of chattels is possible but complex (O’Keeffe v. Snyder (N.J. 1980)
and outside our coverage
Acquisition by Gift
A. Introduction:
B. Elements of Acquisition of Gift:
a. Intention
b. Deliver
i. Manual or
ii. Constructive Delivery or
iii. Symbolic Delivery
c. Acceptance
2. Common law requires intention to make a gift and delivery

3. General Rule for Acquisition by Gift Both “intention” and “delivery”
must be present:
a. Intention – donor must demonstrate her intention to transfer the
property and as a gift w/o compensation (consideration); may be
shown by oral evidence
b. Delivery – for personal property, it requires physical, manual
delivery; occasionally, constructive/symbolic delivery is permitted
when manual delivery is not practicable or impossible:
i. Constructive delivery is handing over a key or some
object that will upon up access to the subject matter of the
gift
ii. Symbolic delivery is handing over something symbolic of
property given
General rule of gift delivery: If an object can be handed
over, it must be.
4. Why do we have manual delivery requirement?
a. Historical foundation
31
b. “Wrench of delivery” – handing over object makes vivid &

concrete to donor the significance of the act performed; realization
that irrevocable gift has been made
c. Evidentiary issue – the act is unequivocal evidence of a gift to the
actual witnesses of the transaction
d. Person who receives the gift will have it
e. Similar to the consideration requirement in K’s
C. PROBLEMS page 179
1. O owns a pearl ring. While visiting her daughter A, O leaves the ring in
her bathroom sink. After O leaves, A discovers the ring. When A
telephones O to tell her of the discovery, O tells A to keep the ring as a
gift. Has O made a gift to A? If so, can O change her mind the next day
and require A to return the ring?
a. O has not made a gift to her daughter. She did not “hand it over”
manually. On the other hand, it could be said that ring was already
handed over…
b. If O gives the ring back to A and tells her it’s hers, then A is the
owner
c. If O doesn’t hand t over and she promises to leave it when she
dies, A cannot obtain the ring, there is no delivery
Newman v. Bost (N.C. 1898)
 Facts: On his deathbed, Van Pelt asked for Newman, handed her a set of
keys, and said he wanted her to have everything in the house, gesturing
around the room and towards the hall. The keys unlocked the bedroom bureau,
which contained a life insurance policy payable to his estate.
 Van Pelt died intestate and Newman challenged the division of property on
grounds Van Pelt made a gift causa mortis to her of all the furniture and other
property in his house and inter vivos gifts of a piano and her bedroom
furniture
 Trial court awarded Newman all 4 items; Bost appeals
 Holding: Supreme Court grounds its opinion in delivery requirement,
awarding Newman only her bedroom furniture and other items opened by
keys received (not life insurance and other furniture); remands for retrial on
question of delivery for piano
Gift causa mortis
 a gift made in contemplation of and in expectation of
immediate approaching death a substitute for a will
i. if the donor lives, the gift is revoked
2. General rule: to constitute donation cause mortis, two things are
indispensably necessary: an intention to make the gifts and a delivery of
the thing given
a. Intention – intention to make the gift need not be announced by
donor in express terms, but may be inferred from the facts
32
attending delivery – that is, what donor said & did. It must always
clearly appear that donor knew what he was doing
b. Delivery – constructive delivery is sufficient
i. In this case, life insurance policy was in the bureau but was
never mentioned or handed to P
ii. Conventional objects in bureau should belong to her, but
not unconventional objects such as insurance policies…
iii. Where articles are present and capable of manual delivery,
it must be had.
i. Policy: protect the testator against fraud
ii. If objects can be lifted, must be delivered manually.
3. If keyring included keys to all rooms in house & front door, court would
let her have it all
4. Court is very strict regarding their ruling b/c they prefer that people
on their deathbed give things in will as opposed to “gifts on your
deathbed”
Gruen v Gruen [painting case]

Facts: Plaintiff’s father wrote a letter saying he was giving
his son a Klimt (not this one) as a 21st birthday present, but
that the father would retain possession of it for father’s
lifetime. After getting some (poor) tax advice, father sent
another letter saying the painting was a gift with no
reservation of possessory rights. Plaintiff never took
possession of the Klimt during his father’s lifetime and at
father’s death, his widow refused to give it up and plaintiff
sued.
Holding: Court of Appeals finds present intent to transfer
remainder interest, permits symbolic delivery, and rejects
claim of son’s non- acceptance of gift of remainder; son
wins Klimt
5. Inter vivos gift v Gift by will
a. Inter vivos gift – requires that the donor intend to make an
irrevocable present transfer of ownership; if the intention is to
make a testamentary disposition effective only after death, the gift
is invalid unless made by will
b. Donative intent:
i. Test: Whether the maker intended the gift to have no effect
until after the maker’s death or whether he intended it to
transfer some present interest
i. As long as the evidence establishes an intent to
make a present and irrevocable transfer of title or
the right of ownership, there is a present transfer of
some interest and the gift is effective immediately
6. Remainder – interest in property that waists patiently to get into
possession after some proceeding takes place
33
a. Remainder man still has property interest, even if not in present

possession.
b. Life estates as well as remainders are transferable…
c. Different than testamentary disposition.
7. Splitting ownership over time to people
8. Court credits the evidence of letters that’s given
9. Court suggests
3 pieces of evidence in determining gift
a. Intention
i. Is there a present intention to transfer? – requirement for an
in vivos gift
ii. You need to show that the father on son’s 21st bday meant
to give gift at that time as opposed to when he died
iii. Father wanted to keep the painting in his house  does that
mean that there was no present intention to give the gift at
the time of the letter or whether there was intention to give
gift of a future interest
iv. Bundle of rights: you can have title to something even
though you don’t have the right to possess it at the present
moment
v. Someone who owns remainder of life tenant, has a property
right that’s defensible
vi. Court said he intended to make a present gift, not just a
promise
b. Delivery (either physical, constructive or symbolic)
i. General rule: if something is capable of physical delivery,
you must manually deliver it  this painting is hand-
deliverable but only symbolic delivery was made through
the letter
ii. Gruen case creates an exception: since father wanted to
retain possession of the painting and he had the intent to
give as a gift, you would have to have a “redelivery” and
it’s wasteful for the son (efficiency argument)
iii. The delivery necessary to consummate a gift must be as
perfect as the nature of the property and the circumstances
and surroundings of the parties will reasonably permit
iv. No requirement of delivery if there is no right of possession
until death
c. Acceptance
i. When a gift is of value to the donee, the law will presume
an acceptance on his part
3. Shared Interest
a. Co-Ownership and Marital Interest
Co-ownership – situations when 2 or more people have concurrent rights of present or future
possession
34
I. Introduction:
A. How is this property, if at all, shared?
1. 1) not at all
2. 2) tenancy in common
3. 3) the joint tenancy
4. 4) tenancy in entirely
B. These co-tenancies can exist with the 11 interests we’ve learned
1. Any one of them can be held by a single person or held in any of the 3
forms of co-tenancy; co-tenancy will control how it works
a. the language will govern the type of co-tenancy involved
C. Default rules for reading grants:
1. “as joint tenants”  joint tenancy
a. If you don’t have this language, you won’t have a common law
joint tenancy
2. Default: tenancy in common
a. this is a reverse of the common law preference of joint tenancies
i. makes for more certain ownership and more marketable
titles
ii. tenants in common – doesn’t matter who survives
iii. by creating a joint tenancy, you automatically pass to the
survivor
3. 1) If you just have a grant to 2 or more persons, no more information, you
will have a tenancy in common
4. 2) If you have a grant to 2 or more persons “as joint tenants”, you have a
joint tenancy
5. 3) If you have a grant to persons who are married, you will have a tenancy
by the entirety
 Common Law Concurrent Interest

 The tenancy in common
Tenancy in Common: Separate but undivided interests in the whole
property; the interest of each is descendible and may be conveyed by deed
or will
a. No survivorship rights
i. right of survivorship – the last person standing takes the
whole
ii. each tenant in common can pass their part ownership
during life or at death, by will or intestacy
b. Gives its tenants separate but undivided interest in the
property
i. Demsetz Tree example
i. Tenants in common of a 90 acre plot, all 3 own the
90 acres
1. Each one owns it along with 2 other people
35
 The Joint Tenancy

Joint Tenancy: the most common form of co-tenancy with the right of
survivorship; the joint tenants are undivided owners – interest in the whole
property (just like tenants in common)
a. Joint tenants to have the right of survivorship
b. Regarded as a single owner; each owns the undivided whole of the
property
c. Problem: How do you get out of a joint tenancy (you can be locked
in one)?
ii. Severance – you can sever the joint tenancy and turn it into
a tenancy in common
i. Example) 90 acre plot
1. Rather than letting whoever survives be the
big winner, a situation can be set up where
each can pass out interest
2. If all 3 agree, they can sever their joint
tenancy by mutual agreement and would
turn it into a tenancy in common
 Joint tenants can also sever unilaterally
1) joint tenant can transfer his interest to a third

party and that new third party will come in as a
tenant in common
3. New third party won’t get a right of
survivorship
4. If A conveys to D, B and C are still joint
tenants and still have right of survivorship
between them, but Ds interest passes like a
tenant in common
5. The whole concept of having an undivided
interest starts to break down
o Partition – they want to get the benefit of the property
paid out to them court can order payment representing
each of their interests
4 UNITIES
 time
 title
 interest
 possession
o If the 4 unities exist at the time the joint tenancy is created but are later severed, the joint
tenancy turns into a tenancy in common when the unities cease to exist
 The Tenancy by the Entirety
Can be created only in husband and wife
a. Marriage is the entirety
b. 4 unities + marriage are required
36
c. Surviving tenant has the right of survivorship

d. Husband and wife are considered to hold as one person at common
law
e. Depending on the state, it may be available to civil unions, same-
sex partners, etc.
f. Special kind of co-tenancy for people in specially recognized legal
status
g. Distinguishing factor:
iii. rules about severance are different
iv. Tenants by the entireties cannot unilaterally sever
(protection for the other spouse)
i. has to be a decision by both parties to dump the
property
v. Divorce will sever – divorce terminates it and transforms it
into a tenancy in common or a joint tenancy depending on
the state
i. Most often a tenancy in common
c. Presumption or a tenancy in common unless an intent to create a
joint tenancy is expressly declared
d. Common law presumption in the creation of a tenancy by the
entirety in conveyances to husband and wife
Avoidance of Probate
a. At the joint tenant’s death, probate of the property is avoided
i. probate – the judicial supervision of the administration of
the decedent’s property that passes to others at the
decedent’s death; probate is costly
i. probate process of getting will enforced in court is
time consuming and expensive even where there
have been reforms; property can be tied up for
months, even years
b. Joint tenancy avoids probate system because no interest passes on
the joint tenant’s death, it transfers automatically
ii. A joint tenant cannot pass her interest in a joint tenancy by
will
iii. Joint tenant’s interest ceases at death
iv. creditor can act during joint tenant’s life but not after death
c. Federal estate taxation
v. Congress has provided that when a joint tenant dies, his
share of the jointly held property is subject to federal estate
taxation
vi. joint tenancy doesn’t avoid taxes
 Marital Interests
o Common Law Marital Property System (used in the east)
 During Marriage (The Fiction that Husband and Wife are
One)
37
 wife ceased to be a legal person for the duration of the

marriage
 the husband and wife were regarded as one, the one was the
husband
 All of the wife’s property became her husband’s
 Married Women’s Property Acts – removed the
disabilities of coerture and gave a married woman control
over all her property and earnings
o such property was her separate property, immune
from her husband’s debts  made her responsible to
her own creditors
o Gave her legal autonomy
 Modern common law marital property system –
husband & wife have separate property
o Ownership is given to the spouse who acquires the
property
o Common law property states set up each spouse as
an independent actor for purposes of property
ownership
 NY is a common law property state
 Driven by history
 Termination of Marriage by Divorce
 Common law – upon divorce, property of the spouses
remained the property of the spouse holding title (whosever
name was on the deed, stock certificates, etc.)
o Property held by the spouses as tenants in common
or as joint tenants remained in such co-ownership
 Agreement to sever joint tenancy and get a
partition
o Property held in tenancy by the entirety was
converted into a tenancy in common (most often)
 Divorce itself would sever the tenancy
o Historically this system disfavored women
 Men were generally the breadwinners,
purchased the property
 Most purchases were put in the man’s name
 Almost always men who ended up taking
the property
o Alimony – way of financially supporting the wife
after a divorce. According to jurisdiction, one may
or may not be entitled to it
o Problems with the system are cited above the fact
that it benefited the spouse most likely the husband
that was the worker and whose name was usually
found on the property.
38
Modern system: equitable distribution of marital property

now, in every state, upon divorce, every state that uses a common
law property system uses a system of equitable distribution to
distribute property upon divorce
a. Whose name is on the title will not control
b. Legislature replaced common law rule w/ rule
of equitable distribution
i. Rule of equitable distribution – property is
divided by the court, in its discretion, on equitable
principles. The courts want to look at contributions
by the parties to promote fairness, being that just
because they are not the earner does not mean that
have not worked. Mode of acquisition, earnings
gifts inheritance etc. this is in order to achieve
expectations in order to create a more efficient and
better understood system. Sacrifices made my either
party, need for practical solutions, it is difficult to
compensate for some things such as this and the
courts need to come up with a practical way of
dealing with it. Fault in the divorce, some say fault
is an explicit factor, some say it is not- it can create
a fact finding mess where people will continuously
try to find fault in order to obtain a larger portion of
the pie. Mutual obligations- mostly end up having
to do with children and child support (this is usually
dealt with outside of the equitable distribution
process).
Court’s ways of distribution
ii. 1) divide all property owned by the spouses,
regardless of the time and manner of acquisition
iii. 2) divide only “marital property”
1. marital property – 2 meanings:
a. 1) includes all property acquired
during marriage by whatever means
b. 2) property acquired from earnings
of either spouse during marriage
c. Free-flowing type of approach – A court will
look at all the property and think about the
equitable way to distribute that property
iv. Sometimes starts with a presumption of equal
sharing
v. Other times, total discretion by the court to achieve
something equitable
vi. Very open-ended
39
Goals of Equitable Distribution of Marital Property:

vii. Highest value – Getting property to the person who
values the property the most
viii. Labor theory – getting property to the person who
put the most work into acquiring it
1. Household labor, outside labor, caretaking
ix. Support idea – getting property to the person who
needs it
x. Fault – rewarding the victim spouse
1. No-fault rules generally
2. NY requires fault to grant divorce
xi. Expectations – having a system that align w/
people’s expectations
xii. Fairness – moral sense of fairness
1. might take in concerns about fault, support,
who worked to enable the couple to acquire
that property
xiii. Practical solution
1. implementation of the court’s solution
2. Value of the property
3. Scheme of distribution
Modern changes in divorce law:
xiv. No-fault divorce – brought changes in property
division upon divorce
What is Marital Property?
Rule about Degree: Generally, educational degree acquired during the marriage is not
considered marital property (exception NY)
In re Marriage of Graham [degree as property case]

Facts: Grahams were married for 6 years; Mrs.
Graham was employed full-time throughout the
marriage while Mr. Graham’s main pursuit was
education, acquiring a B.S. & an MBA; Mrs.
Graham contributed 70% of financial support, did
most of the cooking & housework
Procedure:
1. Trial court considered the degree as marital
property – solution applied a percentage of
the value of the degree and a practical way
to pay for it
2. Court of Appeals – education is not
property subject to equitable distribution
xv. Supreme Court – formalistic approach: what is
property?
40
1. Educational degree is not w/in usual

definition of property
a. property is a social construction
2. Transferability – education degree is not
transferable, no exchangeable value on the
open market.
xvi. Greer case – different b/c there was accumulation
of marital property
1. Earning potential had been realized
2. In addition, the spouse asked for alimony
payments used as a way to recognize her
contributions & gave her support
xvii. O’Brien case – an interest in a profession of a
spouse is marital property in light of contributions
of the non-professional spouse
xviii. Court here: Only marital property subject to
equitable distribution, not educational degrees.
xix. Dissent: The most valuable asset acquired was the
husband’s increased earning capacity
vii. Mahoney v Mahoney
i. NJ court declined to recognize a professional degree
as marital property
ii. They ordered “reimbursement alimony”
1. Recognizes that “there will be circumstances
where a supporting spouse should be
reimbursed for the financial contributions he
or she made to the spouse’s successful
professional training”
viii. NY exception – O’Brien v O’Brien
i. Interest in a profession or professional career
potential is marital property
ix. Considerations – you want to be fair to the non-degreed
spouse but you want to recognize the work of the degreed
spouse
x. Elkus v Elkus, NY, 1991, 408 – opera singer case
i. Facts: P’s career succeeded dramatically during the
course of her marriage; during the marriage, D
traveled w/ P throughout the world, attending and
critiquing her performances and rehearsals, and
photographer her for album covers and magazine
articles
ii. The appreciation in the P’s career was subject to
equitable distribution
iii. “An interest in a profession or professional career
potential is marital property which may be
represented by direct or indirect contributions of the
41
non-title-holding spouse, including financial &

nonfinancial contributions made by caring for the
home & family.”
iv. She was arguing how her case is different from that
of Obrien because there they talk about spouses of
licensed professionals but here she is not licensed
and this is something she is born this thus he should
not be entitled to the benefits reaped.
Prenuptial
Displaces equitable distribution system w/ contracted force
solution
a. Generally enforceable, provided the agreement is fair and
reasonable and/or based upon full knowledge of each
other’s property
v. Can’t grossly favor one side
vi. Under contract law, not property law
b. Uniform Premarital Agreement Act – provides for
enforcement of antenuptial property agreements unless
these was insufficient disclosure of wealth and the
agreement was unconscionable when made
c. Parties can come to court w/ their own settlement and the
courts will generally defer to that
 Termination of Marriage by Death of One Spouse
 Common law
o Personal property – common law gave surviving
widow 1/3 if there were surviving issue and ½
otherwise
 The Modern Elective Share
o Share is something the surviving spouse may elect to take or can elect to
take statutorily defined share
o The deceased spouse can’t disinherit their spouse
 Policy Reasons: provide support and fair dealing for the surviving
spouse so the surviving spouse won’t become a tax on society
o Elective or forced share – provides a statutorily defined fraction of property
to the surviving spouse
 Property that is subject to the elective share is property that would
become part of the deceased spouse’s estate
Ways to defeat the elective share:
 Can put property into joint tenancy w/ someone else to avoid this
elective or forced share  automatically goes to joint tenant
 Transferring property to someone else during life
o Life insurance – not typically party of the deceased’s property
Community Property System (used in the west)
42
 Community property system – husband and wife are a

marital partnership and should share their acquests equally
 We will not focus on this system
 Basic assumption: once you’re married, it’s the marriage that
earns all the property
 Divided equally when the marriage is over
 Policy goal: equal sharing of property in marriage
 the marriage should credit to property ownership
 Property in other types of committed relationships
 Common law marriage – first place law recognized other
relationships
 Hold yourself out as married – say that you’re married –
represent yourself as married, even though you are not
ceremonially married
 Traditionally, available for people who couldn’t afford to
get married
 A few states still have common law marriage
o You need to show by evidence that you have acted
as a married couple
o Not just living together, representing yourselves as
married
o If you are recognized as party to common law
marriage, you get the same rights as if you were
married
 Elective share
 Equitable distribution
 Co-habiting couples – couples living together before they’re
married
 First cases – opposite sex co-habiting couples
o Lee Marvin case (CA) – unmarried couples should
be able to contract with each other for property
rights after they split up (as long as it wasn’t solely
about sex; some consideration other than sexual
services)
 Contracts between co-habiting couples
would be enforceable if they were expressed
(written down) or if they were implied
(proof of understanding between the two of
them)
o Every other state agreed but only for expressed
contracts
o Later cases gave couples in committed relationships
other than marriage the right to contract for property
rights in each other’s property
 Same-sex partners
43
o Default regimes by virtue of being a spouse

 Elective share
 Equitable distribution
o Same-sex marriage debate
 Recognize that in terms of property law,
what is at stake in the debate is, not the
ability to set up property regimes between
two people, but the ability to get the defaults
applied
o Hawaii
 Reciprocal beneficiaries – anyone who signs
up as a reciprocal beneficiary duo can get
treatment as spouses (elective share and
equitable distribution)
o Other states change the definition of who’s a
spouse, spouse status applicable to spouses
o Vermont
 Civil union approach; provide for spouse-
like protections
 Mix and match approach – Maybe you’ll get
the elective share but not the equitable
distribution
 For partners who are opposite sex partners, they often hear
the response that if you want those protections, go get
married
Obergefell v. Hodges (USSC 2016)
o James Obergefell and John Arthur legally marry
in Maryland, return home to Ohio, which does
not recognize same-sex marriage and refuses to
record Arthur as married and Obergefell as his
surviving spouse upon Arthur’s death, and
Obergefell sues on grounds these actions are
unconstitutional
o USSC holds “same-sex couples may exercise the
rights of marriage” on grounds of privacy and
equal protection
o Shifts property protection available in all US
jurisdictions to same-sex couples (who marry)
spouses from contract to status basis
LAND TRANSFERS THROUGH LEASES & MORTGAGES
44
4. Landlord and Tenant

 Lease
 Leases are hybrid documents, part property transfer and part contract
 Statutes of Frauds require leases to be in writing if for term of more than one year
 Many leases are form leases, which pose risks of exploitation due to power and
resource imbalances
 Common Law Tenancies
Tenancy Period Notice for Termination?
Term of Years Fixed, but can be No
determinable
Periodic Tenancy Fixed, but period repeats until Yes, length and timing
landlord (L) or tenant (T) prescribed by common law or
terminates statutes(Often 30 days)
Tenancy at Will No fixed; lasts until L or T Likely yes; common law
terminates requires no notice, but
modern statutes typically
prescribe notice (Often 30
days)
Tenancy at Sufferance Not fixed, but under common No; under common law, L
law, L has option of holding also has option to evict and
T to new term seek damages
Term of Years
 an estate that lasts for some fixed period of time or for a period
computable by a formula that results in fixing calendar dates for
beginning and ending, once the term is created or becomes
possessory
 A term must be for a fixed period, but it can be terminable
earlier upon the happening of some event or condition
 No notice of termination is necessary to bring the estate to
an end
 Can you have a term of years for less than a year? Yes.
o Anything that is computable
 How can we terminate it?
o terminated by mutual consent
o pre-agreed upon determination – parties can provide
for termination of lease at the occurrence of some
event
o if just one party wants to terminate, they don’t have
to give notice
o you also can’t get out of it prematurely
 Period: Fixed, but can be determinable
45
 Notice for Termination? No

The Periodic Tenancy
 a lease for a period of some fixed duration that continues for
succeeding periods until either the landlord or tenant give notice of
termination
 If notice is not given, the period is automatically extended
for another period
 Common law rule: ½ year’s notice is required to terminate
year-to-year tenancy
o Any period less than a year required a notice the
length of one period
o the notice must terminate the tenancy on the final
day of the period, not in the middle of the tenancy
o in many states, statutes have shortened the length of
notice required to terminate periodic tenancies and
have permitted a month-to-month tenancy to be
terminates at any time following 30 days’ notice
window and either party can terminate on 30 days
notice
 smoothes transitions between landlords and
tenants
 Can be bargained for or implied
 Periodic and repetitive (the period repeats)
 When does the repetition stop?
o when either the tenant or landlord terminates
 What’s the problem that the court’s have with the common
law rule?
o Alienability?
o Are we more concerned about landlords having a
steady stream of income or are we more concerned
about tenants, only having to pay for the property
they have a tenancy in?
 Period: Fixed, but period repeats until landlord (L) or tenant (T) terminates
 Notice for Termination? Yes, length and timing prescribed by common law
or statutes(Often 30 days)
The Tenancy at Will
 a tenancy of no fixed period that endures so long as both landlord
and tenant desire
 If the lease provides that it can be terminated by one party,
it is necessarily at the will of the other as well if a tenancy
at will has been created.
 A tenancy at will ends when one of the parties terminates it
46
o You can be thrown out at any time subject to the

notice requirements
 Modern statutes ordinarily require a period of notice in
order for one party or the other to terminate a tenancy at
will.
 Sometimes implied by the courts
 Common law: notice period was satisfied by telling person
they have to leave
 Garner v Gerrish NY, 1984, [Landlord died]
 Facts: Gerrish rented a house from Donovan until Donovan
died; executor of Donovan’s estate served Gerrish with a
not to quit the premises; his lease stated “privilege of
termination at a date of his own choice”
 Argument for landlord: tenancy at will – either landlord
or tenant can terminate
 Argument for tenant: determinable life tenancy –
“privilege of termination at a date of his own choice;”
creates a life estate determinable (court agreed)
 “The lease expressly and unambiguously grants to the
tenants the right to terminate and does not reserve to the
landlord a similar right. To hold that such a lease creates a
tenancy terminable at will of either party would violate the
terms of the agreement and the express intent of the
contracting parties.”
 Point of the case: when lay persons try to make deals about
what will happen, and we try to fit them into the options,
the results are not always satisfying
 Tenants get a lot of specific rights under common law
interpretation and statutes about how property should be
kept up, quiet enjoyment of the premises
o Anytime a court finds a freehold interest and not a
tenancy, you’re screening out those protections
 T defends claiming he holds a life estate
determinable only at T’s election
 NY Court of Appeals holds for T,
appearing to find a determinable life
estate
o Note this minority approach removes
parties from landlord/tenant law and
its attendant obligations
o Alternative reading is NYC violates
numerus clauses and create a new
leasehold estate (a lease for life
unilateral terminable by T)
47
 Period: No fixed; lasts until L or T terminates

 Notice for Termination? Likely yes; common law requires no notice, but
modern statutes typically prescribe notice (Often 30 days)
The Tenancy at Sufferance: Holdovers
 Arises when a tenant remains in possession after termination
of the tenancy/lease
 2 common law options for landlords when this happens:
 Eviction
 Consent to create a new tenancy
 Created by implication when a tenant remains in possession of the
property after the property has terminated
 No fixed period
 Implication of a periodic tenancy
o If you holdover on a term of years, it creates a new
month-to-month periodic tenancy
 “It is the rule that, absent evidence to show a contrary
intent on the part of the landlord, a landlord who accepts
rent from his holding-over tenant will be held to have
consented to a renewal or extension of the leasing.”
 Courts hate the holdover rule b/c it locks up property
 Period: Not fixed, but under common law, L has option of holding T to new
term
 Notice for Termination? No; under common law, L also has option to evict
and seek damages
Tenancy at Sufferance
 Occurs when a tenant over stays their lease
 Created by operation of law, not lease, when

holdover remains in possession
 Common law provides landlord election
o Landlord can hold tenant to new lease of
same term, or
o Landlord can evict tenant
o Landlord’s election is conclusive
 Modern law varies election rules and remedies,
including commonly providing double damages
remedy
 Landlord’s election to evict but failure to act
transforms tenant at sufferance to trespasser
who pursue adverse possessor
48
Unlawful Discrimination/Housing Discrimination Statutes

Federal Fair Housing Act
i. Prohibits discrimination in the sale or rental of housing

based on a long-list of classifications (race, color, religion,
sex, familiar status, national original)
ii. Subject to strict construction
iii. Have to make out a case based on one of those categories
iv. Has exceptions
i. Mrs. Murphy exception – if someone is renting
property in their own home, and it’s a small
dwelling, then we’re not going to subject that
person to discrimination prohibitions
v. Applies to category
i. discrimination of the terms, sale or rental
ii. Rules about advertising
vi. A discriminatory motive need not be proved in order to
make out a prima facie case under the FHA. Proof of
discriminatory effect is sufficient.
 Prohibits to discrimination on the basis of race, color, religion, sex,

familial status, national origin, and disability
 Applies to discriminatory sale or leasing of dwellings, terms of
such sales/rentals, advertising of them, misrepresentations about
their unavailability or profit-seeking representations about
changing racial makeup of communities in which they are located,
and failures to make reasonable accommodations in the disability
context
 Exceptions can apply for religious organizations, private clubs,
elder housing and small players
Burden-Shifting Under FHA
 Plaintiff shows discriminatory effect to make out prima facie case
o Either through a showing of disparate treatment or disparate impact
 Defendant can rebut plaintiff’s prima facie case by showing a non- discriminatory reason
o Any rational business reason will suffice for private defendants, but public
defendants must show a compelling government purpose
 Plaintiff may rebut the alleged non-discriminatory reason as pretext
Civil Rights Act of 1866
a. “All citizens of the United States shall have the same right,
in every State and Territory, as is enjoyed by white citizens
thereof to inherit, purchase, lease, sell, hold and convey
real and personal property.”
b. Bars only discrimination on the basis of race
49
c. More succinct statute

d. More general
i. doesn’t have the exception
ii. large categories (inherit, purchase, lease, sell, hold
and convey real and personal property)
vii. Claims under the Civil Rights Act of 1866 probably do
require proof of intentional or purposeful
discrimination

Prohibits discrimination on the basis of race and national origin

Applies to discrimination in the context of “inherit[ance],
purchase, leas[ing], sell[ing], hold[ing], and convey[ing] any real
or personal property”
 No stated exceptions Civil Rights Act of 1866
 Local law may supplement these protections
 Problems on pp. 474-75

(1) Mrs. Murphy advertises “For rent: Furnished basement apartment in private white
home.” She rejects a Black couple who applies, because of their race. Does she violate
the law?
 FHA: Yes, her rejection is not a violation because of the exception for
owner-occupied housing, but her advertisement violates the FHA
 1866 Act: Yes, her rejection violates the ban on racial discrimination in
leasing
(2) L advertises “Wanted: Female to share 2-bdrm. 2-bath apt. near campus.” Assume she
rejects a male applicant. Does she violate the law?
 FHA: Yes, her rejection may not be a violation because of the exception for
owner-occupied housing or definition of dwelling, but her ad violates the FHA
 1866 Act: No, this conduct falls outside the ban on racial discrimination in leasing
(3) Lawson posts "housing for rent: no minorities" on craigslist. Is the L or Craigslist
liable?
 Lawson: Yes, clear violation of FHA advertising prohibition
 Craigslist: No, Communications Decency Act held to immunize online
Sublease and Assignments
Transfers of Leaseholds: Traditional Approach

Transfer Balance of TermAssignment
Transfer Less than Balance of TermSublease
a. 3 parties under an assignment and sublease:
2. Original landlord – L
3. Original tenant – T
4. New tenant – T1
50
b. 2 schools of thought on distinction between sublease and assignment:

5. 1) Traditional common law distinction between whether the original
tenant has transferred all or part of his interest
a. Entire interest = assignment
i. Then the rule for assignment governs
 Assignment
If the transfer from T to T1 is deemed as assignment, then the landlord and the T are only
in privity of contract
 In an assignment, T assigned all of his property interest so the original parties don’t
have a relationship under property law that would put them into privity of estate
 The mere transfer from T to T1 is not going to erase the contract
 If L feels that there’s been a breach on the promises, the L can still sue the original
tenant even though L can’t sue original T on a property law theory
 There are promises between T and T1
 The new tenant & original tenant will also be in privity of contract
o If they have broken promises, they can sue under contract law
o If the tenant transfers something less than the entire interest = sublease
 Sublease
 Sublease rules apply
If the transfer is deemed a sublease, some portion of the
leasehold interest, then the original landlord and original T
are still in privity of estate
 If the landlord wants to sue the T on either
contract or estate, that will be ok
 If the transfer is a sublease, the landlord cannot
go after T1 on any theory b/c the landlord didn’t
make the new K with T1; T did
 Landlord’s privity of estate is just with the
original tenant
 Privity of Contracts v. Privity of Estate

Who has a relationship under the law
 2 kinds of privity that arise from a lease:
o Privity of Estate – a relationship that property law based
rules and rights are going to spring out of
 i.e. if a landlord wants to sue a tenant based on the
tenant’s responsibilities as a tenant, in order for the
landlord to be able to sue, they have to be privity of
estate
 Granting the same estate or lesser estate to T1
o Privity of Contract – the relationship of parties to a
contract that gives contract law based rights, arising out of
a contracting relationship
51
 i.e. if a landlord wants to sue, the P has to choose a

D with whom they are in privity of contract
 Consequences of assignment and sublease distinction:
o Regular lease – L and T are going to be both in privity of
estate and privity of contract
 L has transferred a leasehold interest to T
 Privity of estate – one of the legal consequences is
that there’s an obligation to pay rent; if the landlord
wants to sue the tenant, the landlord can do that
based in property law
 Privity of contract – the tenant promises to keep the
premises in good condition
 if the tenant lets the premises go into
disrepair, the L can sue T because of privity
of contract
 2) Intent-based rules – Modern view is to look at the intent of the parties
 Looks at whether the parties intended to transfer the whole
leasehold
 What words did the parties use?
o But laypeople don’t know the terms so this is often
confusing
 Although the intent based rule is becoming more popular as a
statement of what courts are doing, what they end up looking up is
something less than a true examination of the parties’ intent
Lease
LT
L & T = p.e. & p.c.
Assignment T  T1 Sublease
L & T = privity of contract L & T = privity of estate
AND contract
L & T1 = privity of estate L & T1 = nothing (unless
(and privity of contract if 3PB, then privity of contract)
Third Party Beneficiaries
(3PB)
T & T1 = privity of contract T & T1 = privity of estate
and privity of contract
Ernst v. Conditt (Ct. of App. Tenn. 1964)
 Ernsts (Ls) lease land to Rogers(T)for1year,7days for
go-kart track
o Lease requires Rogers to obtain written approval
to sublease or assign
o Rogers will remain liable on all covenants even
if sublease or assign
 Rogers wants to sell business to Conditt (T1),who
wants a 2-year lease
52
 Ernst agrees to amend lease to Rogers for 2-year term

and to permit “subletting” to Conditt provided Rogers
will remain liable on all covenants in lease and
amendment and all parties sign relevant documents
 Conditt defaults on rent but stays in possession
 Ernst sues Conditt for rent and breach of covenants
 If the court finds an
assignment, L can directly sue T1
under privity of estate
 If the court finds a sublease,
L can’t sue T1 b/c no privity of K
exists (Conditt)
 The court looks at the lease
under both common law and the
modern rule
o T assigned the entire rest of his lease
plus more to T1
o The court doesn’t care about the
words of the parties
o Even if using the intent based
approach, the court doesn’t recognize the
documents; Conditt is liable for the rent,
b/c he is in privity of estate
Under contract law, in most jurisdictions,
there is the third party beneficiary
doctrine
o In his acceptance of the transfer,
Conditt assumes liability for all the
promises in the original lease
 There’s a K between Conditt and
Rogers (T and T1)
 Rogers could enforce Conditt’s
responsibility to pay rent
 If Ernst had sued Rogers, Rogers
could turn around & sue Conditt b/c Rogers
and Conditt were also in a contract
o Rather than Ernst use Rogers and
have Rogers bring in Conditt, Ernst could
sue Conditt directly, if the jurisdiction
accepts third-party beneficiaries
o If the jurisdiction accepts 3PB
doctrine, which expands the category of
people in privity, then the landlord may
also be in privity of contract w/T1
53
 There’s a K between T and T1, and

the terms in the contract are for the benefit
of the landlord, then you have privity of
contract between L and T1 (direct action
against T1)
 General Rule: an assignment
conveys the whole term, leaving no interest
nor reversionary interest in the grantor or
assignor. A sublease may be generally
defined as a transaction whereby a tenant
grants an interest in the leased premises
less than his own, or reserves to himself a
reversionary interest in the term
Kendall v Ernest Pestana, Inc., CA, 1985, page 490
 Facts: The City of San Jose leased property to the Perlitches
who assigned their interest to respondent Pestana; prior to
assigning their interest to respondent the Perlitches entered into
a 25-year sublease with Bixler; Bixler agreed to sell his
business to the appellants; the lease required written consent of
the lessor but Pestana refused to consent to the assignment
 Rule: Implied reasonableness requirement: Any provision
requiring consent to an assignment in a commercial lease is
subject to an implied provision that that consent can’t be
withheld unreasonably.
o Common law view (majority): people can do
whatever they want
o Modern view (minority): they want people to be
reasonable; consent cannot be unreasonably withheld
o Many states are still holding out. Why?
 Autonomy principles
 if the parties want to be autonomous,
they have to be explicit about exercising
their autonomy
 drafting the document on reliance on the
common law rule
 Increase in value should go to the landlord
 i.e. if the price of rental property goes up
o if L has to consent to an
agreement, tenant can enter into a
sublease & capture the excess
o Under common law rule, L can
say no, unless I get $200 a month
o b/c L owns the reversion (the
greater interest in the property,
the landlord should get the
54
upside – argument for the

common law rule
 Kendall:
 Only applies to commercial leases
 Duty to mitigate by reletting
 The Tenant Who Defaults

o Introduction
 Defaulting tenants:
 Tenants who have failed to pay their rent
 Tenants who default in retuning possession (holding over)
 The Tenant in Possession
 SELF-HELP: Berg v Wiley [Family Affair Restaurant Case]
 Common law: the landlord can use self-help
o The landlord has the right to retake the premises if he is
legally entitled to retake possession:
 If the tenant defaults as long as there is a re-entry
provision
 Holdover situation
 Abandonment and surrender
o Self-help must be through a peaceable means
 It’s not clear what counts as peaceable
 Ranges from any non-violent entry or only entry
w/permission of the tenant
o Under the common law rule, a tenant who is evicted by his
landlord may recover damages for wrongful eviction where
the landlord either had no right to possession or where the
means used to remove the tenant was forcible, or both.
 Modern Rule: Self-help is not allowed; landlords have to go to
court in order to evict a defaulting tenant in possession
o Summary proceedings are available which makes the
process quicker
 (still time consuming and expensive)
o The only lawful menas to dispossess a tenant who has not
abandoned nor voluntarily surrendered but who claims
possession adversely to a landlord’s claim of breach of a
written lease is by resort to judicial process
 Policies for or against self-help:
o Against:
 Discourage landlords from taking the law into their
own hands
o For:
 Prevent more damages to the property
 damage to the landlord
55

In some jurisdiction, prohibition on self-help applies only to
residential leases:
o One’s residence is more personal
o More of a threat of violence in a residential tenancy
 Jurisdictions have split on whether the self-help prohibition should
be waivable when the tenant is signing the lease:
o Some say that the prohibition is for the benefit to tenants so
they can waive it
o Most say that self-help is a policy prohibition for the
benefit of everyone so it cannot be waived
 Summary Proceedings
 Today, every state provides some form of summary proceeding
o Summary proceedings – a quick and efficient means by
which to recover possession after termination of a tenancy
 Requires only a few days notice to the tenant prior
to bringing an eviction action
 A number of jurisdictions also allow for self-help
by the tenant (rent-withholding)
 Can be time consuming and expensive
 The Tenant Who has Abandoned Possession
Sommer v Kride, [Tenant engagement broke and never moved in]
 Facts: Tenant never moves in, notifies the landlord and forfeits his
deposit in exchange for a release from the lease; another tenant
came and looked at the apartment but the landlord did not let it
o Riverview – landlord is in the same situation but here the
tenant did move in but left after only part of the lease was
through; landlord doesn’t relet the premises
 Issue: Should the landlord make efforts to relet the property?
o Common law: no, the landlord can just wait out the lease
& go to court & get damages for the full rental; no
requirement to mitigate the damages
 Policy: no reason for the landlord to involve
himself in the property
o Modern law (general rule): looks to regular sense of
what’s appropriate in a K when there’s a breach and
mitigation is a typical requirement in a contractual
situation; a landlord has a duty to mitigate damages where
he seeks to recover rents due from a defaulting tenant
 The landlord’s duty to mitigate consists of making
reasonable efforts to re-let the apartment
 the landlord shall be required to carry the
burden of proving that he used reasonable
diligence in attempting to re-let
56
 If L could have mitigated to the full extent

of the lost rent, then there would be zero
recovery in a suit against tenant
 Will be judged on the reasonableness of the
landlord’s efforts
 Excess capacity problem: If there are
multiple vacancies, it’s hard to know what is
reasonable
 Courts have given a generally
reasonableness requirement and no direction
on mitigation
 Policy justifications on the duty to mitigate:
 modern notions of fairness and equity
 Efficiency
 Helps prevent property damage
ii. Reasons courts differ on the mitigation problem:
i. Residential commercial distinction
ii. Excess capacity problem
6. Unless your lease says it, the default rule is that the tenant can assign
however they want; unreasonable refusal is grounds to terminate the lease
a. Kendall rule – where a landlord required consent, he must
exercise that consent in a reasonable fashion
Landlord Protections
A security deposit is an amount paid by T to the L at the outset of the lease term to be returned
to T at the end of the term, so long as there have not been any defaults by the T during the term.
If there are defaults, L can use the deposit to the extent necessary to compensate herself. •
Permissible under common law • Enforced under ordinary contract law doctrine
 Landlord’s Duties; Tenant’s Rights & Remedies

 What can a tenant do when the landlord does not hold up his end of the
bargain?
 Common law:
o Tenants with complaint about the state of the premises was
out of luck
o Property law did not cover this
 Modern law:
o Much more sympathetic to the tenants
o 3 doctrines to give tenants potential remedies:
1) Quiet Enjoyment and Constructive Eviction
2) Illegal Lease Doctrine
3) Implied Warranty of Habitability
o These doctrines in conjunction with a prohibition on
retaliatory eviction all work to give a tenant a potential
57
remedy against a landlord who has failed to keep the

premises in state the tenant wants it to be
o Different jurisdictions have adopted only one or some of
them
o Different doctrine affects the available remedies
 Quiet Enjoyment and Constructive Eviction

Quiet Enjoyment is implied in every lease (residential or commercial)
 Promise by the landlord that tenant will not be disturbed in possession by the landlord
or anyone acting through landlord
 Secures the sole property law-based right of the tenant -- legal possession.
 Only covenant in a lease that not treated as independent; if L or someone under L’s
authority disturbs the possession of T, T is relieved of the obligation to pay rent.
Disturbing possession is called eviction.
Modern Reform
 Allows T to claim breach of the covenant of quiet enjoyment by ”constructive eviction”
 If conditions are so poor it is as if T were evicted, T can vacate and be relieved of
payment of rent
Downside
 Predicting if conditions will be deemed constructive eviction is challenging and high
stakes
 If the quiet enjoyment covenant is broken or breached, it

gives rise to a constructive eviction
o In order to claim constructive eviction and use the
covenant of quiet enjoyment to protect yourself, you
have to leave
o The reason of leaving must be substantial in order to
create a substantial eviction
 i.e. leaky faucet won’t do
o If the covenant was breached, the tenant no longer has
to pay rent
o Available in all leases, residential and commercial
o General rule: a tenant’s right to claim a constructive
eviction will be lost if he does not vacate the premises
within a reasonable time after the right comes into
existence
 Scope of the covenant of quiet enjoyment
o Expanded to include beneficial enjoyment
o The implied covenant of quiet enjoyment would be
breached only when the landlord’s conduct had “the
effect of depriving the lessee of the beneficial use of the
demised premises, whether by positive acts of
interference or by withholding something essential to
58
full enjoyment and included within the terms of the

lease”
o What is included within the terms of the lease?
 Partial eviction – actual and constructive
o If there is an actual eviction, even though from a part of
the premises only, the tenant is relieved of all liability
for rent notwithstanding continued occupation of the
balance
Reste Realty Corp. v Cooper [ rain in the basement case]
o Facts: the problem with the premises is it floods
whenever it rains; the repairs didn’t work; she moves
away and stops paying rent before her lease is up;
landlord sues her
o Tenant: argues that the landlord breached the covenant
of quiet enjoyment which is generally implied in leases
but was actually explicitly stated in this lease; because
of the repeated flooding, she had a substantial
interference with quiet enjoyment
 Common law: If the quiet enjoyment
covenant is broken or breached, it gives rise to
a constructive eviction
 It’s not that she was forcibly removed
but it’s as if she was removed
 Tenant doesn’t have to pay rent
 Terminates the lease
 Lack of rent is landlord’s fault, not the
tenant’s fault
o Landlord argues that she didn’t leave w/in a
reasonable time (9 months after)
 Court says reasonable is case specific
 In order to claim constructive eviction and use
the covenant of quiet enjoyment to protect
yourself, you have to leave
 You must take the risk of the cost of
moving
 This is kind of like a self-help situation
 This is a risky proposition b/c you might
be wrong
 As-is argument:
 i.e. if you rent a cold water flat, the fact
that there’s no hot water is not a breach
of the covenant of quiet enjoyment
 Illegal Lease Doctrine(Defense)
 A tenant stops paying their rent in protest of the poor
conditions of their leased premises
59
 When the landlord sued, the tenant can allege the illegal lease
defense
 The condition of the leased premises is so bad that it violates
the safety requirements of the housing code, thus the lease
itself is a illegal contract, in violation of the legal requirements
for housing, and is unenforceable
o The Courts permitted this type of offense where the
code violations were substantial and existed at the time
the lease was made and the landlord had notice of
them
 Tenant doesn’t have to move; they can stay in possession and
not pay rent
o Difficulties with asserting the illegal lease defense:
 A lot of tenants didn’t have the defense to make
because the conditions occurred as the lease
went on
 Even if you get your lease voided, you don’t
have a legal justification for being there and you
become a tenant at will and the landlord can
kick you out
 A bridge between the common law and modern cases of
implied warranty of inhabitability
 Implied Warranty of Habitability(Only Residential)
Character Proof Remedies Why Depart State of
from Common Play
Law Approach Across US
Jurisdictio
n
Not expressly T shows L Compensatory Change in IWH is now
stated but fails to damages: situation of Ls the majority
implied into all maintain difference and Ts from rule across
residential premises fit between the agricultural jurisdictions
leases for habitation value of the premises to urban • But only
• Not • T shows leased premises and suburban for
independent, so notice to L as warranted and dwellings an Ts residential
L’s breach of and the value as they without capacity leases.
the IWH reasonable exist to repair • Social Judicial
entitles T not to time for cure • Punitive concerns with support for
pay rent • Housing damages health and safety an implied
codes relevant • Repair and of Ts • Power warranty of
but not deduct imbalances fitness for
dispositive between Ls and commercial
Ts; analogy to purposes is
unconscionability limited. •
The IWH is
60
a
mandatory
rule. It
cannot be
waived, not
even
expressly.
 Implied warranty of habitability

o Arises out of the social policy concern of the unequal
bargaining power between landlords and tenants; not
intended to protect everything that might go wrong 
just issues of the level of habitability
o Tenants enter into lease agreement to obtain safe,
sanitary and comfortable housing  includes adequate
light and ventilation, serviceable plumbling facilities,
secure windows and doors, proper sanitation, and
proper maintenance
o In the rental of any residential dwelling unit an implied
warranty exists in the lease, whether oral or written,
that the landlord will deliver over and maintain,
throughout the period of tenancy, premises that are safe,
clean and fit for human habitation
 Covers all latent and paten defects in the
essential facilities of the residential unit
 essential facilities – facilities vital to the
use of the premises for residential
purposes
 Factors in determining whether there has been a breach of
IWH:
o 1) relevant local or municipal housing code
o 2) whether the claimed defect has an impact on the
safety or health of the tenant
o 3) notification to the landlord within a reasonable time
 Most jurisdictions have adopted the implied warranty of
habitability
 Process in using IWH as a defense:
o Show a breach of IWH  point to landlord’s failure to
deliver or maintain premises that are safe for human
habitation
o The tenant is responsible to make sure the L is given
notice about the problem and a reasonable time to
correct the problem
o Courts will look at housing codes as evidence
61
Hilder v St. Peter [crazy damaged apartment]

o Facts: L doesn’t fix any of the problems; T is paying
rent and sues for her money back (typically T stops
paying rent)
o Court’s rationale for adopting IWH:
 Social policy concern: former rule was outdated
 tenants used to be farmers who could
maintain premises better
 In the past, it didn’t make sense to have
a conditions responsibility on part of the
landlord
o Effect of a waiver on warranty of habitability:
 Social policy doesn’t warrant a waiver – most
jurisdictions say that you can’t waive the IWH
b/c it’s too important in society
o Remedies available in the Hilder court:
 1) Damages
 Backrent
 additional compensation
 punitive damages
o When a landlord, after receiving
notice of a defect, fails to repair
the facility that is essential to the
health and safety of his or her
tenant, an award of punitive
damages is proper
 2) Defensive remedy – withhold rent
 3) Repair and deduct – pay for the repairs
yourself and deduct them from the rent
o Goal – make the place habitable
 Social policy concern: quality housing for
people, especially poor
 Retaliatory eviction question – once you bring one of these
claims, many jurisdictions provide for protection against
retaliatory eviction
o It doesn’t protect you forever
o Gives you a period of repose where you can stay in
your property and the landlord can’t evict you
o Rebuttable presumption of retaliatory eviction
 Tenant’s Rights and Remedies
Doctrine Issues Remedy
Quiet Enjoyment and Substantial interference with Terminates the lease; tenant
Constructive Eviction quiet enjoyment doesn’t have to pay rent but
must leave w/in a reasonable
amount of time
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Illegal lease Conditions of the premises at Stop paying rent in protest of

the time the lease was made; poor conditions of their lease
so bad that it violates the premises; tenant doesn’t have
safety requirements of to move
housing code
Implied Warranty of Inhabitability of the premises Stop paying rent or backrent;
Habitability repair and deduct
Prohibition on retaliatory eviction

 Traditional common law rule: L can terminate a periodic tenancy or a tenancy at will or refuse to
renew a term of years for any reason
 Modern law: Many states prohibit retaliatory eviction, typically employing a rebuttable
presumption
 Presumption of retaliatory action arises on L’s termination, refusal to renew, increase in rent or
decrease in services within some reasonably short period after a good faith action or complaint
regarding the condition of the leased premises
 L can rebut the presumption by showing another reason for the action
 Retaliatory actions by landlords outside of this period are also prohibited and actionable, but T
cannot rely on the presumption
 NY courts: Apply no such presumption, but require residential Ls terminating in such situations
to allow Ts sufficient time to find alternative housing

The Problem of Affordable Housing
o CONS of RENT CONTROL:
 Rent control – some attempt to reduce or maintain rents to make
housing more affordable
 Posner:
 Rent control can create shortage
 Can remove incentives to enter the market
 Distributive problems – although you’re trying to help poor
tenants, landlords will favor richer tenants
 Other was to make housing affordable by the legislature:
 Set flat control – price of rental housing; set a ceiling on the
original agreed upon price
o How would landlord’s and tenant’s react?
 Landlords might charge a higher rent to begin
with
 Landlord concerns:
1. Property values tend to rise over time and
property taxes are assessed based on
CONS of RENT CONTROL:
Rent control – some attempt to reduce or maintain rents to make housing
more affordable
Posner:
b. Rent control can create shortage
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c. Can remove incentives to enter the market

d. Distributive problems – although you’re trying to help poor
tenants, landlords will favor richer tenants
Other was to make housing affordable by the legislature:
e. Set flat control – price of rental housing; set a ceiling on the
original agreed upon price
i. How would landlord’s and tenant’s react?
i. Landlords might charge a higher rent to begin with
ii. Landlord concerns:
1. Property values tend to rise over time and
property taxes are assessed based on the
value of property
a. if you can’t raise the rent, your tax
bill is going to be higher but your
rent will stay the same
b. Inflation – value of money will go
down
2. Landlord won’t want to put money in
keeping the quality of the housing high
PROS of RENT CONTROL:

7. Avoids price gauging (attempt for landlords to change the market price)
8. Rent control is not about giving poor tenant access to property, it’s about
giving people security in their homes because homes deserve more
protection
a. Security in your home gives you value (security that you’re not
going to have to move)
9. Maintaining investment in community centered in having a home
10. Residential property should be given special treatment
5. Mortgages
 Introduction
The purchase and sale of real property can be an extremely complex process. The first step is
generally a contract of sale, under which buyer and seller agree to terms and exchange promises
to conclude the transaction a future closing date. At this closing, buyer provides consideration to
the seller and the seller provides a deed to the property, which may or may not include additional
promises regarding the quality of the title so conveyed. This module will explore these key tools
in real estate transactions, as well as the utility of title insurance and vital importance of deed
recording.
For the many buyers who wish to purchase but either cannot or prefer not to pay the entire
purchase price up front, real property purchases are facilitated through borrowing. In such a
transaction, a purchaser-borrower will need to meet the lender’s criteria, execute a promissory
note agreeing to pay back the money (plus interest) on some kind of schedule, and provide to the
lender a security interest in the property the loan proceeds will be used to acquire. This security
interest is called a mortgage and it provides the lender additional security that the loaned funds
will be repaid out of proceeds from selling the property if necessary. This module will review the
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process of obtaining a mortgage and the rights of lenders and borrowers under such
arrangements. It will also confront abusive mortgage practices, including racially-discriminatory
redlining and predatory subprime lending.
 How Mortgages Work
 To secure loan, borrower must:
• Execute a promissory note agreeing to pay back the money (plus interest) on a
schedule (e.g., 15- year fixed, 30-year fixed, ARM, etc.), AND
• Give the lender a mortgage, a security interest in the property the loan proceeds
will be used to acquire
• Why both?
• If borrower defaults, lender can sue on the promissory note for damages, but if
borrower has no assets, this will be ineffective
• Lender requires the mortgage as security; it entitles lender to have the property
sold and to reach the proceeds of sale to satisfy borrower’s obligations
 Enforcing Mortgage Rights
 Foreclosure
 How does the lender enforce her rights under a mortgage?
o Sell the property (foreclosure) and apply the proceeds to pay off the loan.
o All jurisdictions allow judicial sales; some also private sales by the lender,
which are cheaper and faster but can be abused
 Discrepancies
o If foreclosure sale brings in more than amount owed to lender, balance must
be repaid to borrower.
o If foreclosure sale brings in less than amount owed to lender, lender may sue
borrower for deficiency judgment
Deed of Trust = Mortgage Alternative
• Trustee holds the legal title, can sell underlying property to satisfy lender on default; can
speed sale where available
Common Reforms
• Procedural requirements for foreclosure sales, extending borrower’s redemption right to
repurchase property for a period post- sale, prohibitions on deficiency judgments
 Multiplication of parties
Multiple Mortgages Sale of Underlying Property Assignment of Mortgage
 If mortgagor • When purchaser takes • Mortgagees also can and
mortgages property ”subject to the mortgage,” frequently do assign
multiple times, purchaser does not assume mortgages to new owners
priority is established personal liability to pay • When a mortgage is
in sequence mortgage in event of assigned, the transferee
mortgagor’s default becomes entitled to enforce
 First mortgagee is
• When purchaser “assumes the mortgage as would the
entitled to have her the mortgage,” purchaser original mortgagee
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entire claim paid off promises the mortgagor to

before the second pay mortgage
mortgagee receives • Either way, original
anything mortgagor remains liable to
pay
• Original mortgagor can seek
reimbursement from the
purchaser only if purchaser
assumed the mortgage
Murphy v. Fin
Facts: 1966:Murphys purchase home financed though
• 1980:Murphys pay off 1966 loan when refinance and
provide new mortgage of property to FDC; home appraised
at $46K
• February 1981: Mr. Murphy loses his job and within
months Murphys are in arrears on mortgage; they try
unsuccessfully to negotiate new payment schedule or
refinance
• October 6,1981:LendersgiveMurphysnoticeof intent to
foreclose
• December 15,1981:Afterconsiderablebackand forth and
various outlays by Murphys to avoid foreclosure, lenders
hold private foreclosure sale at which lender’s
representative is only bidder and purchases home for $27K;
two days later, lenders sell home for $38K
• February 1982:Murphys sue to set aside foreclosure sale
or for money damages
Murphy: Balancing Rights of Parties to Mortgage
 Lender complied with statutory requirements for
permissible private sale, but NHSC finds
technical compliance is not enough
 NHSC holds lender is fiduciary of the borrower
in conducting the sale, recognizing tremendous
power lenders wield
 Fiduciary mortgagees must act in good faith and
exercise due diligence under the circumstances
 Financial Development Company failed to
exercise due diligence it knew of the appraisal
and Murphys substantial equity in the house, so
should not have sold for such a low price
 Damages amounting to difference between the
sale price and a fair price to be determined on
remand
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 BUT Southern New Hampshire Home Traders

keeps the house as a bona fide purchaser;
Murphys cannot it back
 Murphys would lose under traditional, majority
approach
 Requires only that lenders meet statutory
processes and avoid a price so low it is deemed
“grossly inadequate” or to “shock the
conscience”
Planning Questions: What can future mortgagees
in jurisdictions like New Hampshire do to protect
themselves?
- Seek appraisal to establish upset price
- Advertise widely and in advance
- List property with broker
- Eschew private sale in favor of costlier and
longer sale process
- Even outside jurisdictions like New
Hampshire, close compliance with statutory
procedures is very important
 Redlining
 Redlining refers to 1930-40s federal agencies mapping and coding areas to indicate
where it was safe to insure mortgages
 Communities were coded in red when they were deemed risky
 Black communities were consistently coded as risky and depicted on the maps in red,
despite a lack of data indicating Black homeowners were more likely to default on
their loans
 Because mortgagees could not obtain valuable federal insurance for mortgages on
homes in Black communities, prospective Black mortgagors and other applicants for
mortgages on homes in Black communities had their applications rejected
 Redlining contributes significantly to
o Housing segregation across the U.S., particularly in the North and West
o The massive U.S. racial wealth gap

 Evolution of Mortgage Industry
Early 20th Century: Mortgages were offered  Banks judged creditworthiness
almost entirely by local institutions that individually, tended to be quite
invested depositors’ money making loans in conservative, like in It’s a Wonderful
their local communities Life
 Mortgages were difficult to acquire
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except for the very wealthy
New Deal and balance of 20th Century:  Standardized mortgage terms increase
Congress seeks to expand access by creating mortgages sales to assignees
secondary market in mortgages via Fannie
Mae (and later Freddie Mac).  Secondary market lowers interest rates
and expands access to credit
 Spurs securitization, where hundreds

of loans are pooled together and
shares of pool are sold to investors as
securities
Late 20th and 21st Centuries: Subprime  Targets borrowers w/ low credit
mortgage market grows in nonconforming scores, unverifiable income, people of
loans (with terms outside standardization) color
 Use teaser rates, negative

amortization, high loan to value ratios
 Subprime loans are securitized and

investors (wrongly) assume housing
prices will stay high; major factor in
Great Recession, see The Big Short
Commonwealth v. Fremont Investment & Loan

 Fremont(CA)made50-60%ofloanstosubprimeborrowers and quickly
sold loans it made into secondary market, insulating it from borrower
defaults
 Mass.AG sues claiming originating and servicing loans to these buyers
on these terms was unfair and deceptive trade practice prohibited by
state consumer protection statute
o Used teaser rates at least 3% below rate after increase
o Loans made to borrowers with debt-to-income ratio over 50%
based on fully indexed rates
o Loan-to-value ratio often100% or loan featured substantial
prepayment penalties
 Mass. SJC affirms preliminary injunction requiring Fremont to give
the AG notice of all intentions to foreclose and requiring any loan with
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all four unfair characteristics to be worked out with the AG to avoid

foreclosure
o “Everyone was doing it” defense fails; terms were so obviously
deceptive they are a violation regardless
o Borrowers not relieved of ultimate obligation to pay to avoid
spooking lenders and moral hazard
 Mortgage Reforms Track Crises
 Great Recession led to innovations
o Fremont approach, though not followed in majority of jurisdictions
o Time-limited foreclosure moratoria
o New procedural requirements for lenders and servicers
o Incentives for mortgage modification
 COVID crisis has spurred additional reforms
o Federal moratorium on foreclosures, now through June 30, 2021
o Federal law now provides up to six months of additional mortgage payment
forbearance, in three-month increments, for borrowers who entered forbearance
on or before June 30, 2020
o Current federal efforts follow up on prior federal actions (e.g., CARES Act
passed in late March 2020)
o State efforts provide additional relief
6. Private and Public Control of Land Use

Easements and Covenants
 Easements
 Affirmative Easements
 Express
 Estoppel
 Implied
 Prescription
 In gross
Easements Appurtenant v. in Gross
 Easements Appurtenant
o Benefit of easement tied to particular parcel
o Parcel whose owner holds the right to use or control the other parcel is called dominant
o Parcel whose use is controlled by the easement is called servient
o Benefits and burdens of easements appurtenant transfer along with ownership of the
dominant and servient parcels
o Courts interpret ambiguous easements as appurtenant
 Easements in Gross
o Benefit easement not tied to particular parcel
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o Modern law generally allows transfer of easements in gross, which transfer without any
associated dominant parcel
o Easements in gross for recreational purposes are typically viewed as personal to
their owners and non-assignable
 irrevocable interest in land that entitles its owner to enter or control the property of
another
o An easement is a right to cross over or use someone else’s land (like a right of
way, or permission to utility co to install a power line or a sewer). They are
ubiquitous. It is the giving away of one stick in the bundle – the right to use. You
can own an easement without owning the property itself. It is an encumbrance on
the owner’s property rights. The right to make some specific use of property that
one doesn’t own.
 As a contract in Real Property, easements are subject to the statute of
frauds
 Title recordation – the act of recording → rights
o Explicit easements (subj. to statute of frauds) must be recorded to be valid.
This is the presumptive rule. All Easements must be in writing. All the doctrines
below are exceptions
Other Forms of Easements
 Estoppel – license that ripens into an easement because it would be unfair to take it away
(Holbrook)
o Showing the dominant tenement expended resources
 Implied reservation/grant (easement by implication) (Van Sandt)
o Because it was always used that way by the original grantor (quasi easement by
previous owner of all parts).
Prescriptive Easements
1. Equivalent of adverse possession – must be open, notorious,
continuous and adverse
a. If you have a sign that says private property, but cuts across
your property every day, they might gain an prescriptive
easement.
b. Reason Rockefeller Center closes up 1x/year – stops the
continuous part
Easements by Necessity
1. Arise only when a parcel is landlocked (sometimes when only water
access, or very difficult)
2. Only when strictly necessary
3. Not really about intent, but about public policy – we don’t allow
landlocked parcels
b. Definitions:
i. Easements can be appurtenant or in gross
1. Appurtenant = attached to a piece of property – the most
common/important kind
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a. Dominant Tenement (one dominating the other, the

property doing the encumbering)
b. Servient tenement (one that is encumbered)
c. If an easement is appurtenant, when the dominant tenement
holder sells his property, the easement runs with the land.
They are usually transferrable with some exceptions
d. Appurtenant easements can be determinable like estates –
that is, contingent on future things happening.
e. Easement that would be transferred by deed
2. In gross = attached to a person

a. If an easement is in gross, when the owner of an easement
sells his property, he retains the easement, even when he
moves away)
3. Affirmative easements = a right to enter or perform an act on
servient land
4. Negative easements = a proscription of an activity by the owner of
the servient tenement that would harm the owner of the dominant
tenement. (less common and can only be created expressly and are
restricted to a small number of possible types)
ii. An easement ≠ profit (usually mineral/timber right, a right to remove)
Easements Appurtenant v. in Gross
Easements Appurtenant Easements Gross
Benefit of easement tied to particular parcel Benefit of easement not tied to particular
• Parcel whose owner holds the right to use or parcel
control the other parcel is called dominant • Modern law generally allows transfer of
• Parcel whose use is controlled by the easements in gross, which transfer without
easement is called servient any associated dominant parcel
• Benefits and burdens of easements • Easements in gross for recreational purposes
appurtenant transfer along with ownership of are typically viewed as personal to their
the dominant and servient parcels owners and non- assignable
• Courts interpret ambiguous easements as
appurtenant
Easements, Leases and Licenses
 Narrower use suggests easement or license; broader use suggests lease or transfer of fee
 More specific locations suggest lease or transfer of fee
 Rent reservation suggests lease
 Limited duration suggests lease or license
 Revocability indicates license
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 Exclusivity of use suggests lease or transfer of fee; lack thereof suggests easement or
license
License
An easement ≠ license (short term right to enter, does not run with the land, terminates,
cancelable/revocable at any time)
License is not revocable when it comes with an interest – i.e., right to enter to obtain
timber, for profit. Or via estoppel
Easement by Estoppel
i. Holbrook v. Taylor – right of use to a roadway wanted by one owner to
get across another’s land to the other parcel. Holbrook had allowed
previous owners and current owners to use a roadway for some purposes,
but then he decided he was afraid of liability issues and asked for money
for it. He blocks the roadway. Taylor claims easement by prescription or
easement by estoppel
1. Court rejects Easement by prescription claim. EBP resembles
Adverse Possession – “openly, peaceably, continuously, and under
a claim of right adverse to the owner, and with his knowledge and
acquiescence used a way over the lands for (the statutory period)
a. Court finds it was not continuous, and it was permissive,
not adverse. Prescriptions must be continuous and adverse.
2. Easement by estoppel – (resembles promissory estoppel/detrimental
reliance) where the licensee has exercised license to make
improvements or additions, the license is not revocable.
a. The Holbrooks sat back and watched as Taylors expended
resources to fix up the roadway AND build a house on their
land. They can’t then turn around and deny them the right
of way.
b. The risk the Holbrooks took in allowing the Taylor’s to use
their property was that ANY substantial detrimental
reliance by the taylors would cause their license to become
irrevocable. (an easement)
c. The court grants the easement, and justifies on equitable
grounds – court thinks it would just be wrong to let the
Holbrooks stop the Taylors from using the property.
3. Acc. to Jim Krier, implied easements/ easements by estoppel are
bailing out the dominant tenement holder for their bad decision in
failing to get an easement. And bailouts destroy the value of
licenses, which is in their revocability. If all licenses may ripen into
easements, then licenses will go underutilized)
Easement by Implication
 Implied easements always require a specific factual predicate
o History of common ownership of the dominant and servient tenements
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 An easement is implied from prior use when a parcel was formerly used in such a way
that one part of it benefitted from the other part
o The easement that results is implied to operate as did the prior use
o Sometimes the parcels, when still under common ownership, are described as
“quasi-dominant” and “quasi-servient”
 An easement is implied by necessity when a parcel originally owned by one owner is
divided to deprive a portion of the parcel from access to a public road
o The easement that results is implied over the portion of the parcel with public
access
Van Sandt v. Royster
Facts: sewage line running under houses from third house under 2nd and
1st to the street. Royster is in 2 and Van Sandt in 1, and 1 sues 2 to enjoin
him from using the sewer line after raw sewage ends up in his basement.
There is no easement in his deed. The original owner of all three lots was
living in 3 and had used the sewer lines, but you can’t have an easement
on your own land, and therefore it is not preexisting.
4. The court says that even though you can’t have an easement on
your own land, when you use one part to benefit another it creates a
quasi-easement, which ripens into an easement by implication.
5. Easement by implied reservation vs easement by implied grant
a. Difference is whether the original seller, in selling the land,
whether she sold the dominant or the servient tenement.
Bailey kept the dominant tenement and sold two servient
tenements, effectively reserving the right. BUT, if she sold
the dominant tenement, that is a grant – easement by
implied grant.
6. Traditional rule: easements could not arise from implied
reservation but only from implied grant. This case announces that it
is now just one factor consider.
7. The court finds that the presence of the pipes was sufficiently
apparent to Van Sandt when he bought the property as to imply the
easement. Court is willing to ascribe knowledge of the sewer line
to the owners because they had indoor plumbing.
a. Justification for an easement by implication
i. Waste – unnecessary expenses of getting new
sewers
ii. We believe parties intended to convey the easement
or believed that it was being conveyed. It’s
theoretically a way of trying to comport with
parties’ intent.
iii. The Caveat: the quasi-easement that ripens into an
easement must be apparent.
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The Traditional Approach

 Traditionally, the standard for whether an easement would be implied from prior use
differed based on which parcel the original owner transferred first. This minority rule is
still followed in NY and some other holdout jurisdictions.
 When a common owner transfers the benefitted parcel (keeping the burdened parcel), any
easement would be implied by grant (favoring the transferee)
• An easement would be implied by grant if that was the intention of the parties when the
original parcel was severed and the prior use was apparent, continuous, and reasonably necessary
• When a common owner transfers the burdened parcel (keeping the benefitted parcel), any
easement would be implied by reservation (favoring the grantor)
 An easement would be implied by reservation only if there was strict necessity
 Any easement in Van Sandt would be implied by reservation because when Bailey first
sold the burdened parcel (Lot 19) and retained the benefitted parcel (Lot 4). There is no
strict necessity so Van Sandt would win under the traditional approach.
Multifactor Test
 Most modern courts use a multifactor test to determine whether an easement is implied
from prior use. The factors are all considered at the time of the original transfer of one of
the parcels out of common ownership.
 Whether easement is claimed through the original transferor or transferee
 The terms of the original conveyance
 The consideration for the original conveyance
 Whether the claim is made against a simultaneous conveyee or a successor
 The extent of necessity for the easement
 The existence of any reciprocal benefits
 How the land was used prior to the conveyance
 Whether the prior use was known or might have been known to the parties
 The Van Sandt court finds an easement under this test because when Jones purchased Lot
19, he knew of the drain use that benefitted Bailey and the drain was important (though
not a strict necessity) for Bailey’s enjoyment of her remaining property (Lots 20 and 4),
and there was notice.
FACTORS for Easement by Implication:

b. Whether claimant is conveyor or conveyee
c. Terms of conveyance
d. Consideration given for it
e. Whether claim is made against a simultaneous conveyee
f. Extent of necessity fo the easement or the profit to the
claimant
g. Whether reciprocal benefits result to the conveyor and the
conveyee
h. Manner in which land was used prior to its conveyance
i. Extent to which manner of prior use was or might have
been known to the parties.
8. Easements by implication have a notice requirement
a. If subsequent buyer doesn’t have notice, and there is no
writing, it may be that the easement is extinguished.
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b. Prescriptive easement question is whether the sewer line is

open and notorious
c. The notice requirement for an easement by implication is
less stringent. The two types of easements represent
different social goals. Implication is about comporting
with the parties intentions, and prescriptive easements are
about sleeping and earning theories, and all the other
theories that go with AP.
Easement by Necessity
Othen v. Rosier
Road over Rosier’s land is the only way Othen can access the road
or his property from the road.
9. Necessity means strict, literal necessity. It can’t just be hard
to get to a public road from your property. Inconvenience &
expense ≠ necessity. You must be landlocked.
a. Landlocking a piece of property must always come
with an easement by necessity.
10. Easement by necessity is justified on alienability grounds.
Inaccessible property is valueless, and the law will not allow
the creation of valueless property that is inalienable.
11. Othen loses his easement implied by necessity claim
because he cannot prove that the transfer of the 100- acre
parcel in 1896 landlocked his 53-acre and 60-acre parcels
then retained by Hill. There may have been access through
surrounding land and Othen offers no proof either way.
12. The necessity required is strict and an easement implied by
necessity ends when the necessity ends
Prescriptive Easements
It is possible for the public to obtain a prescriptive easement (the public
could not adversely possess, because AP has to be exclusive. Public
prescriptive easements generally arise naturally.
13. Stopping prescriptive easements from running?
a. Prevent them from being continuous by closing off 1x/year
b. Make the use permissive, not adverse
i. Carries the risk of easement by estoppel, but the
reliance would have to be a public one.
Can be difficult to distinguish between a private and a
public easement claim. If I want to claim PE for myself,
my use has to be distinct from public use
a. Public use is not as stringent with express easement. You
don’t have to use the same path every day to get continuous
use.
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Othen v. Rosier (Tex. 1950): Prescription

Elements for easement by prescription
o Actual use
o Open and notorious use
o Hostile/non-permissive use
o Continuous use for a period generally set
judicially, often using AP S/L as a
reference point
 Use exclusive of the servient owner is NOT
required, despite comments in Othen
 Othen’s claim for easement by prescription
fails on several required elements
o Othen used the roadway with the
permission of the Rosiers from 1906
forward, so for that period there is no
hostility
o Prior1906,there is no evidence of
continuous use for the 10-year
prescriptive period
o Othen doesn’t allege he uses the same
path every time
 NOTE: Prescriptive rights can arise in the
public
if use by the general public meets the required
elements
Scope of the Easement
Brown v. Voss – Voss owns A, the servient tenement. Brown owns B, the
dominant tenement, and buys C, a property adjacent to B. There is an
explicit easement appurtenant to A. The Browns want to put a house on
parcel C and want to use the easement they have over A to get to it. It
won’t change the nature of their use of A at all, they’ll just be using it to
access C.
14. Doctrinal issue: have they impermissibly extended the scope of the
easement?
a. Why do we care where the Browns build their house?
Technical or not, this is still a misuse of the easement. But
it does not follow that the Vosses are entitled to an
injunction. The appeals court says that the trial court was
entitled to exercise its judgment in denying such equitable
relief. WASC affirms trial court holding the easement has
been misused but also affirms its refusal to grant an
injunction in light of Brown's detrimental reliance and
planned use for access to single-family residence
b. Nominal $1 damage award not appealed
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c. Justice Dore vigorously dissents, arguing misuse warrants

injunctive relief
d. The Vosses didn’t appeal their damages – only the denial of

an injunction. We might feel better if the Vosses hadn’t
accepted their nominal damages and we could use a
liability rule.
Remedies for Easement Misuse
 Majority of jurisdictions provide injunctive relief for all misuses

 Protects servient owner with property rule
 Only servient owner can permit and price continuing misuse
 Often used in limited party cases, but bilateral monopoly can frustrate efficiency
of this remedy
 Minority of jurisdictions instead award damages for some misuses
 Protects servient owner with liability rule
 Court sets price for misuse
 Particularly useful in cases with many parties, where efficient bargaining will be
difficult
 Brown dissent would award injunctive relief to force Browns to negotiate with Voss for
an extension at Voss’s price, rather than obtaining the extended scope the majority gives
them for free
 Condemnation procedure alternative available in some states to allow owners of
landlocked parcels to have a court set the price for an easement for access through
neighboring land
Negative Easements
• Can only arise expressly
• Common law recognizes only four types
• Prevent blocking light
• Prevent interfering with air flow to building
• Prevent removal of support for building (not support or land itself)
• Prevent interfering with the flow of water from an artificial stream
• Courts in individual jurisdictions have made very limited additions
• Conservation easements: Most jurisdictions authorize negative easements for conservation by
statute
• Allow land owner to grant a public body or charity right to restrain development on their
property; generate a charitable tax deduction for servient owner at time of grant
• Real covenants and equitable servitudes are often good substitutes when negative easements
are unavailable
Resembles a regular easement but they do not accrue by prescription or estoppel.
e. If we allowed them to accrue in those ways, the concern
would be that land would be unable to be developed
because a neighbor objected and had enjoyed abutting an
empty lot for a statutory period.
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15. They are unlike regular easements in that they are hard to recognize
for a 3rd party potential buyer.
16. General hostility towards negative easements. Traditionally they
are limited to 4
a. Light – can’t block windows
b. Air – can’t interfere with airflow to your land
c. Water
d. Support
e. Some states have adopted other negative easements by
statute
i. Solar easements (preventing interference w/ solar
panels)
ii. Conservation easements
iii. Conservation easements – doctrinally interesting
1. Restricts right of servient tenement holder to develop
2. Severs development rights and typically conveys them to a third
party like the sierra club
a. Why? Charitable deduction for the donation of the
conservation right
b. Significant tax benefits in terms of lower property
value/low assessment for taxes
c. They are express negative easements
i. They are transferrable – once the property is
encumbered it lasts forever
ii. Usually prevent further development (it’s ok to
have a house/barn)
iii. Development can be defined however people want
in the easement
d. The government can condemn conservation easements
through eminent domain
i. But then how do you value it for compensation
under takings? What is the FMV? It isn’t the right
to develop, only the right to veto.
ii. This is potentially majorly problematic. A
conservation easement could diminish property
value by >50%, but the easement itself could be
worth <10% of the hit the property value took.
Which means if someone could buy the
conservation rights, they could get a $1.4M for
$800k
3. Other concerns:
a. Lets private parties in bilateral exchanges drive
conservation efforts that might be perverse or inefficient
b. These things haven’t been around long enough to know
what’ll happen to them. If small, local groups, rather than
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the sierra club own them, they may not have the resources
to enforce their rights.
Termination of Easements
Easements can all be terminated in the following ways:
 Abandonment (requires more than mere non-use)

 Release by easement owner (incompliance with Statute of Frauds)
 Expiration(if duration was explicitly limited by year or defeasibility)
 Estoppel(based on reliance of servient owner on representations of easement owner)
 Prescription (when servient owner obstructs use of easement for relevant period)
 Merger of dominant and servient estates in a single owner (appurtenant easements only)
 Extinguishment by eminent domain
• Depending on how easements are created, they can be terminated in additional ways:
• Easements by estoppel terminate in a minority of jurisdiction when reliance is recouped
• Easements by necessity terminate if the necessity is eliminated
Brandt Revocable Trust v. U.S. (USSC 2014)

 Facts: US grants “right-of-way” to the Hahn’s Peak
and Pacific Railway Company to build and operate a
66-mile railway from Laramie, WY to CO, under
authority in 1875 General Railway Right-of-Way Act,
in 1908. US sells Brandts eighty-acre tract over which
the easement ran “subject to those rights for railroad
purposes as have been granted to the [railroad
company],” in 1976. Brandts transfer interest to family
trust. Railway abandon track in 2004. US brings quiet
title action in 2006, claiming ownership of the right-of-
way strip, on which it intends to build a recreational
trail. Trust argues it owns the parcel free of the right-of-
way and US has no right to build trail.
 Issue: for USSC: What did the government grant the
Railway in 1908?
o “Limited fee” interest in strip of land, with
reversion in US: After abandonment, reversion
vests fee simple in strip in US
o Affirmative easement appurtenant: After
abandonment, easement terminates and trust
holds dominant tenement unencumbered
 USSC holds the US transferred easement
o Majority strongly influenced by US argument in
prior case (Great Northern) that another transfer
under 1875 Act granted an easement
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o Dissent sees Great Northern differently; also

grants to railroads involve special issues of
power and exploitation such that standard
common law is not best guide
Rails-to-Trails Easements and Takings
Presault v. ICC (Fed. Cir. 1996)
 Presaults own servient estate over which a railroad
right-of-way ran; railroad stopped using the line and
years later the US wanted to turn it into a recreational
trail; Presauts claim this action works a taking
o As in Brandt, Federal Circuit finds railway took
an easement only, relying also on policy
arguments resonant with Justice Sotomayor’s
Brandt dissent to narrowly construe grants to
railroads
o Federal Circuit finds no abandonment when
railway neither pulled up track nor notified
regulator of abandonment; land remained
servient tenement of easement in gross
o Federal Circuit finds hiking/biking trail would
be misuse of the easement for railroad right-of-
way; US may not change use without paying
just compensation under Takings Clause
Covenants
Types of Covenants
 Real Covenant
 Equitable Servitude
a. Covenants, unlike easements, are not interests in land. They are extremely odd
contracts that run with the land. As such, they are governed by extremely odd rules.
Concerns are two fold with covenants and equitable servitudes
iv. To what extent do they bind successors? When and under what
circumstances?
v. How are they enforced? Who can sue whom?
b. Two points upfront
vi. Benefits and burdens
vii. Most of covenants gets replaced with equitable servitudes
A and B are each concerned that the other will change their property from single family units to
condos or McMansions. To deal with that, they make a reciprocal promise not to develop
beyond single family use. The problem arises when B → C and C wants to build multifamily
housing. When and under what circumstances will C be bound, and if A→D, under what
circumstances can D sue C to enforce?
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A = Benefited party B = burdened party

Buys covenant from B not
to develop (buys a
restriction on B’s land)
D C
When and how do benefits and burdens extend to C and D?

A and B are in privity of estate – what is required is different depending on whether you’re
talking about burden or benefit.
For Burden to Run with Land

If B sells to C, can A sue C to enforce? I.e. what do you need for the burden to run with the
land?
1. Writing (subject to statute of frauds)
2. Intent to bind successors (manifest intent)
3. Notice to successive holder (actual or constructive/record notice in
the title)
4. Touch and concern land (ongoing payments of money do not, for
example – like an annuity to be paid every year, or the yearly
performance of some service)
5. Vertical privity. (B and C must be in privity) Some kind of
contractual relationship where they are congruent. A life estate
doesn’t cut it in some states – it would have to be B →C in FSA.
NB that Burdens do not run against adverse possessors
6. Horizontal privity. A and B had to be in horizontal privity – must
be a grantor-grantee relationship. This means that where A and B
agree to be mutually burdened, the burden won’t run because they
are not a grantor and a grantee. The easy way around this is to use a
straw man, convey the properties away, and have the straw man
convey them back with the restriction in the conveyance.
For Benefit to run with the land
To get the benefit to run, you need the same things except horizontal privity.
c. Equitable Servitudes:
i. Tulk v. Moxhay: Tulk own Leicester Square, he conveys it to Elms with
restrictions (it’s only to be used for a garden, etc.). Elms conveys to
Moxhay, Moxhay wants to build.
1. Tulk and Moxhay are not in privity of contract. It is not a
lessor/lessee relationship, so Tulk can’t sue Moxhay to enforce
agreement. No horizontal privity = the burden cannot run at law.
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2. Clearly since the burden cannot run at law, Tulk should lose.
3. But, the court basically creates the equitable servitude: even though
it won’t run, it would be inequitable not to enforce this burden.
ii. As a matter of equity…
1. The substantively important matter is the provision of an equitable
remedy to enforce these agreements.
2. Not to say that there aren’t any elements required. You still need
Elements of Equitable Servitude
a. Notice (actual or constructive)
b. Writing
i. Exception for “common plan” to infer a servitude
c. Intent
d. Touch and concern
3. Courts will enforce covenants as servitudes in equity.
iii. The Restatement 3d changes the name and usefully distills negative
easements, covenants at law, and equitable servitudes under one title:
Covenants Running with the Land.
1. Covenants and easements are both called servitudes. For a
servitude to run you need
a. Intent
b. Writing
c. No illegality in agreement
i. No racially restrictive covenants, for example
2. Courts can give injunctive relief in equitable servitudes, which
makes the doctrine swallow covenants at law.
a. The difference between a real covenant and an equitable
servitude is not the document itself, but how it is enforced.
iv. Sanborn v. McLean – to have and enforce an equitable servitude you need
intent and writing, but there’s at least one situation in which we’ll imply
an equitable servitude.
1. Defendants want to build a gas station on a residential lot they
owned. Their neighbors object. There is no restriction recorded in
their title; their property was not explicitly encumbered.
2. The court says they should have known, because all their neighbors
were residential. (in fact many of their neighbors had been
restricted.) The covenant was created equitably, because it was the
intent of the original owner to restrict the use of the property.
Terminating a Covenant:
v. When can a covenant terminate?
1. If the use, in aggregate, offer more social benefit than the restriction
2. If property is unsuitable for the conditions in the covenant
3. If the covenant’s purpose has been thwarted
a. Might save us from discriminatory enforcement…
4. If it is still valuable to the covenant holder. I
a. If this is the test, the plaintiff should always win
5. Abandonment or waiver
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a. If covenant beneficiaries don’t enforce their rights, the

court may find that they’re abandoned or waived.
6. Change of Conditions
a. Allows courts a way around collective bargaining problems
vi. Rick v. West – developer owns 62 acre subdivision with residential use
restriction. In 1956, sells ½ Acre to West, 1957 tries to sell 45 acres to an
industrialist, West enforces covenant, in 1961tries to make 15 Acres a
Hospital. Court upholds West’s covenant rights.
1. Is it really appropriate for a ½ acre landowner to prevent a Hospital
from being built?
a. Property/liability rule? If it’s one party holding the
covenant, we can give a property rule, but if it’s many, then
liability might be better. Since it’s West enforcing the
covenant, we could give the hospital the chance to buy her
off by giving her the right under a property rule.
2. Subdivisions – in the 60’s they were created through reciprocal
covenants/equitable servitudes. This comes with attendant
problems
a. Lack of flexibility
b. Holdout problems/collective bargaining a huge problem if
most people want to change
c. Information cost problem
i. Failure to properly record the restrictive covenants
can cause some encumbered and some
unencumbered plots
3. A result of these problems is that the traditional subdivision has
been replaced by
a. Homeowners associations (by statute)
b. Condos
c. Coops
vii. Homeowners Associations
1. CC&R – Conditions, Covenants and Restrictions - document that
governs all the land under its auspices
a. Has voting mechanisms for change
b. May require payment of dues
2. Most people will, if given the choice, liven in a homeowners’
association, which will restrict their rights, for the benefit of being
able to restrict others.
a. It is effectively impossible to make a homeowners’
association from an existing neighborhood. Thus Zoning
has to step in.
viii. Condos
1. Each unit owned separately in fee simple. All exterior walls and
common spaces owned in joint tenancy.
ix. Coop
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1. The Coop owns the building and all the units. Residents are
shareholders and long term leaseholders.
a. There is a single mortgage which means that if one person
doesn’t pay the building can be foreclosed, so everyone
else will have to make up the shortfall
i. Extremely high scrutiny of coop applicants
ii. NYC Condos sell at a 10-20% premium over coops
because it is easier to buy and sell them, until you
get to ultrahigh end
iii. At multimillion dollar apartment level, the premium
reverses – buying exclusivity and the right to pick
your neighbors
Zoning
Factors Leading to Development of Zoning:
 Industrial Revolution
 Limits of Private Options
 Desire for Undisturbed Single-Family Housing
a. Zoning is a public interaction with private property, the quintessential form of
such interaction.
b. Zoning resembles private restrictive covenants but comes from the government
x. It originated in NYC
xi. Federal Government Promulgated the Standard Zoning Enabling Act
(SZEA) in 1925-26. It was quickly adopted in every state
xii. Was meant to be a model for delegation of zoning authority from the
states to municipalities, which occupy a complicated place in the federal
system. They are either agents of the state or private corporations with
delegated powers
xiii. Zoning violates true free market libertarian ideas. They would say if you
want restrictions you can buy them. But it may be that private agreements
create externalities.
1. Zoning may have public positive externalities
a. Fixes collective action problems
b. Preserves property values
How Zoning works:
xiv. Village of Euclid v. Amber Realty – the case authorizing zoning
constitutionality. It was test litigation.
1. Zoning usually works in a rough way by approving and
disapproving
2. SZEA envisioned dividing lines into chunks by use, ranked least to
most intensive
a. Residential – single family detached houses to apartment
buildings R1-R6
b. Commercial – C1-C6
c. Industrial – I1-I6
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d. Zoning ordinances are cumulative – the definition tells you

what the most intensive use is, but you can build anything
less
3. Euclidian Zoning
a. Use, area/height restrictions.
b. Amber realty says that if they could develop their land
industrially it would be worth $10k/acre, but residentially,
it would be worth 25% of that. The zoning has resulted in a
75% wipeout in value.
c. They mount substantive due process challenge under the
Lochner era scrutiny of economic regulations. Under
Lochner, the zoning would probably have been turned over.
i. How is this a deprivation of property? It is a
deprivation of one stick in the bundle – the right to
use. SO why doesn’t the court strike down the
regulation?
d. Zoning is not only, or even primarily about restricting
property rights, but is about protecting the rights of
neighbors. The court characterizes it as protecting, not
restricting property rights.
i. E.g. apartments cannibalize nice residential
neighborhoods. It’s a little like someone convinced
Justice Sutherland to fear this happening to him.
e. A due process violation would have to be a deprivation that
is arbitrary or irrational, but this restriction of industrial use
is sort of codifying what nuisance law would have
accomplished. The restriction of commercial use might be
more arbitrary.
 Ambler wins below but USSC reverses and
upholds ordinance under police power
o Holds ordinance is for general welfare
and survives rational basis review on
analogy to nuisance
o Facial attack fails, though USSC
recognizes potential for successful as
applied challenges
4. Alternative to Euclidian zoning
a. Might need to rethink the goal. That type of zoning
furthers city planning goals of a particular type – wanted
separate the uses, the residential areas on the outskirts and
the commercial on the center, but it’s possible that a combo
of business and residents keeps ‘eyes on the street’ and
makes for safer cities.
5. Zoning in general upheld – Euclid rejects a facial challenge that
zoning is on it’s face arbitrary and irrational.
85
a. However they leave open the idea that some application are
possibly unconstitutional.
b. Land use is one of the few areas where substantive due
process claims continue to succeed.
6. Zoning and nuisance:
a. The Euclid opinion relies on nuisance – they’re not using it
for the outer bounds of zoning bower, but merely to say
that the regulation is not arbitrary. It is protecting
neighboring property the way that nuisance law does.
Standard State Zoning Enabling Act

 Formal Delegation of Power to Zone
 Requirement that Zoning Align with Comprehensive Plan
o Administrative Framework
- Zoning Commission crafts original ordinance and amendments
enacted by municipal government
- Board of Adjustment grants relief from zoning ordinance: special
exceptions and variances
Achieving Flexibility in Zoning
A) Special Exceptions
 Contemplated by zoning ordinance

o Garden apartments in single-family zone under prescribed circumstances
 Steeples above height restrictions
B) Variances
 Not contemplated by zoning ordinance

o Light industry in commercial area with board of Adjustment finding that no harm
will be done to other uses in zone
C) Prior Non-Conforming Uses
 Generally permitted by prospective reach of zoning ordinance

 Only a few jurisdictions amortize and ultimately prohibit such uses
D) Amending the Zoning Ordinance
 Permissible to correct errors or respond to changed conditions

 Can be subject to developer actions
 Invalid if “spot zoning” not conforming with comprehensive plan
Southern Burlington County NAACP v. Township of Mount Laurel
 Mt. Laurel is a township outside of Camden, NJ in a historically rural area faced with
rapid growth that could threaten its tax base and increase demand for public services; it
enacts a zoning ordinance to control and target this growth
86
o Large industrial Zone=almost 1/3 of town’s land

o Zones for Single-Family Homes with Large Lots=almost the entire rest of the
town’s land
o Retail Zone=just over 1% of land
o Zones for small mixed-use developments targeted to high-and moderate-income
residents and seniors
 NAACP represents low-income and underrepresented miniority plaintiffs seeking
housing in Mr. Laurel and frustrated by
Mt. Laurel: Exclusionary Zoning
 NJSC holds developing municipality is under an affirmative obligation-as delegee of the

state’s police power-to plan and provide the opportunity for decent and adequate low-
and moderate-income housing at least to the extent to the municipality’s fair share of the
present and prospective regional need therefore
 Police power must be exercised in accord with substantive due process and promote
general welfare of all states’ citizens.
 Municipalities’ affirmative obligation is to plan and provide opportunity for appropriate
choice of housing to meet needs of all categories of people who desire to live there,
includes duty not to adopt policies which thwart or preclude this opportunity
o Burden of proof is on municipalities and Mt.
Zoning and Environmental Justice

 Zoning policy has frequently been used to site and maintain hazardous and
unwanted land uses in low-income communities and communities of color
creating serious and longstanding health and other negative impacts
 Efforts are underway to promote environmental justice, including by use of
zoning tools (in bold)
o Bans under zoning ordinances of specific types of polluting facilities often
sited in environmental justice communities
o Broad policies that incorporate environmental justice considerations into
all municipal activities, including zoning
o Environmental review processes added to zoning or planning requirements
for new developments
o Proactive planning targeted at future development to address
environmental justice via comprehensive plans, overlay zones, or green
zones
o Targeted measures addressing existing sources of pollution, like
amortization policies for prior non-conforming uses
o Enhanced public health codes that reach both existing and new sources of
pollution that impact public health
o Zoning efforts have limitations, like their typical prospective-only
application and local effect, but can be used together with environmental,
health and other policies to mitigate environmental injustices
87
ZONING – enough to know

 Zoning is prospective (forward looking)
 It provides a way of controlling use and separating incompatible
uses
 It is not a constitutional violation in diminution of property value
 Prior nonconforming uses are protected, generally
 For this, some say zoning fails because it does not allow
progress, but serves as a reification of existing use
 Amortization is one tool to get around the problem of prior
nonconforming uses.
 The other tool, of course, is eminent domain.
The Fifth Amendment Takings Clause

Rule: Constitutional Text: 5th Amendment: “… nor shall private property be taken for public
use, without just compensation”
Policy Justifications
 Efficiency
 Fairness
a. Hotly contested questions

xv. What is “taking”
xvi. What counts as just compensation?
xvii. What counts as public use?
xviii. What counts as property
b. Eminent domain is inherent right of sovereign. Every government throughout
history has had it. Our constitutional innovation was the just compensation clause
granting protection from it in restraint on power.
c. Public use limitations
xix. Rule: public use should be exactly what it says – if public won’t use it, the
government shouldn’t be able to condemn property.
xx. If we prevented the government from letting private parties, say,
contractors of waste disposal, use condemned land, that might be
problematic.
xxi. Holdouts, either bad faith strategic or even good faith ones, can be
overcome through government power.
xxii. Eminent domain condemnation is the only right entitled to liability rule
ONLY.
xxiii. The government can compel sale at fair market value. To what extent is
ED an appropriate action in the case of a holdout? Are there other, better
alternatives?
1. Are homes different? Owner-occupied primary homes might be
incommensurable.
a. Homeowners don’t get consequential damages. No moving
costs, no subjective value. However, the federal law and
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state statutes require payment to find suitable or adequate

replacement property.
2. KELO – government using power of ED to overcome a holdout
against a private developer. Extremely controversial, though
Thomas’s dissent in the case said there was a longstanding history
of giving private parties land taken through eminent domain.
d. The Economic perspective:
i. Just compensation forces the government to internalize the costs of its
actions. It prevents the government from imposing the negative
externalities on private individuals. If the government is willing to pay
compensation and still proceed, the project must by definition generate
benefits.
1. Just compensation = the highest and best possible use of the
property discounted by the costs of developing it into that use +
fixtures
e. Public Choice Theory
i. Forcing private enterprise to internalize the costs of actions is undoubtedly
one of the goals of a property regime. But just compensation may not
force the government to internalize costs. The government may, in fact,
maximize political benefits (either by appealing to special interests or
making politically popular but wildly inefficient moves) by incurring a
fiscal loss.
1. The fiscal illusion: if it’s not on the budget the government pretends
it doesn’t exist. That’s one of the reasons we force compensation,
but plenty of ‘off budget’ items impact government decisions.
ii. Traditional account: the government internalizing costs
1. Might worry that FMV standard does not accomplish this (actual
costs of condemnation are much higher to the condemned property
owner than FMV)
2. Might also worry about practicability of including other things
(consequential damages, or more significantly, subjective value), so
we ignore administratively difficult costs.
iii. However, when you’re dealing with a massive budget, the $250k you pay
a single homeowner doesn’t make a dent, so it might not actually cause
them to ‘feel’ the costs they’re internalizing.
1. When it’s a smaller, local government it might work better
(Serkin’s theory is that takings should happen locally, but just
compensation is unlikely to have impact on federal government
takings)
2. Property rights against the government might need to be intimately
bound up with the government.
f. Limiting Eminent Domain?
i. To the extent that we limit it, it might have disproportionate impacts on
different localities or municipalities that depend on abundance or scarcity.
A national rule on the acceptability of ED or the use of ED to condemn
property will have wildly divergent impact on places where land is scarce
89
and thus ED is much more necessary, and places where land is in

abundance. There’s a decent argument to be maid that ED rules should be
determined at the local/municipal level.
Two Types of Taking Cases
Eminent Domain Implicit Taking
 Government explicitly takes  Property owner experiences
private property regulation as a taking
 Property owner can challenge:
 Property owner must show
 Public Use regulation is a taking under
 Just Compensation categorical or multifactor test
 If successful, property owner can

challenge:
 Public Use
 Just Compensation
Policy Justifications
 Efficiency
 Fairness
Kelo v. City of New London (USSC 2005)

 New London wants to encourage economic revitalization of
a distressed, but not blighted, area; goes through a long
process to consider how to do it; and ultimately establishes
plan to take a large set of parcels under eminent domain.
The owners would receive compensation and the parcels
would then be turned to various uses – including office and
retail space for individuals, support for a new Pfizer
research facility, marinas and parks.
 Kelo and other impacted owners sue, claiming that this is a
taking for private, not public use, and thus is not
permissible, regardless of compensation.
 USSC majority finds taking was for public use, as part of a
comprehensive plan by the city to redevelop the area for
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more valuable uses. Relies heavily on deference to process

undertaken by municipalities.
 Kennedy, J. concurs to note pretext concerns
 O’Connor, J. objects that private property cannot be taken
for another’s private use just because the new use will
generate greater tax revenues; fails public use requirement
 Thomas, J. would limit public use to public ownership or
access; raises environmental justice concerns
 Many states and have taken up the dissents’ cause and
imposed heightened compensation requirements or other
obstacles to economic development takings under state
statutes and constitutions
Just Compensation
 Just compensation is fair market value
o Including attempt to value of property future
development
o Not including other real costs
 Sentimental value
 Value for specific needs of current owner
 Transaction costs
 Dignitary/autonomy losses
 Downzoning is prohibited but hard to prove
 Error costs run in both directions
o Paying too little (either case-by-case or on average)
harms property owners
o Consistently paying too much harms fisc
Spectrum of Implicit Takings Tests
Nuisance Abatement Regulation Permanent Physical

Occupation or “Total
 Never a taking  Taking if goes “too Taking”
 No compensation far”*
Categorical rule • Always a taking**
• Just compensation only if
taking • Just compensation always
required
• Multifactor test
• Categorical Rule
* Beware of conceptual ** See nuisance exception

severance arguments discussed in Lucas case
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Loretto v. Teleprompter Manhattan CATV Corp. (USSC 1982)
• NY statute states landlord may not “interfere with the

installation of cable television facilities upon his property
or premises” and may not demand payment from a tenant
or cable company in excess of the amount the State
Commission determines is reasonable; Commission set
one-time $1 payment as reasonable fee
• Loretto discovers Teleprompter cable running down her

building and boxes containing other cable equipment on the
roof and brings class action against Teleprompter alleging
trespass and that the NY statute works a taking without just
compensation; NY courts uphold statute under multifactor
test due to minimal economic impact of interference
• USSC majority finds taking and remands for

consideration of just compensation, adopting categorical
rule that a permanent physical occupation is always a
taking, based on
• Precedent (dissents dispute)
• Bundle of rights
• Ease of administration
• Blackmun, J. and dissenters argue for multifactor test
• Unnecessarily elevates one element of multifactor
test: character of the interference
• Permanence, physicality and occupation are not
clear concepts
• PPO rule will have little real-world impact
• NY remand court finds $1 just
compensation
Other Categorical Rules on Either Side
Hadacheck v. Sebastian (USSC 1915) Lucas v. South Carolina Coastal Council

(USSC 1992)
 Los Angeles ordinance prohibited  SC statute prohibits new building on

operation of brickyards in an area, land in designated “critical areas”
even those already in existence prone to hurricanes
 Owner of one such brickyard sues for  Lucas purchases 2 undeveloped lots in
compensation, arguing if the area later deemed critical by state
government wants to outlaw his Council, which then come under
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existing brickyard, it is taking his development ban, and Lucas sues

property, which (because of its contending statute worked a taking
substantial deposits of clay) is worth  Trial court finds Lucas’ property
many more times its value as a ”valueless” under ban, but SCSC finds
brickyard than as anything else statute works to abate a public
 USSC adopts categorical rule that a nuisance (buildings in hurricane-prone
regulation that merely abates a public areas) and holds no taking under
nuisance is never a taking Hadacheck
• Brickyards in this (now residential)  USSC adopts yet another categorical
neighborhood are a nuisance rule that a regulation that works a
• The government can abate nuisances 100% loss of value (a “total taking”) is
without compensation always a taking
• Plaintiff is entitled to no
compensation  EXCEPT, even in a
total taking or PPO
situation, there is no
taking and no
compensation required
if the regulation merely
abates a nuisance as
common law courts
understand this term
Pennsylvania Coal Co. v. Mahon (USSC 1922)

 Kohler Act (PA statute) prohibits mining anthracite coal in
a way that would cause any structure used as a human
habitation to subside, unless the owner of the mining rights
also owns the surface and it is far enough away from the
land and structures to be safe to allow subsidence
 Mahon’s deed from Penn Coal expressly reserves to Penn
Coal the right to remove all coal under the surface of the
property conveyed, and Mahon expressly takes the
premises with this risk and waives all claims for losses
from removal of coal
 After passage of the Kohler Act, Mahon sues for an
injunction to stop Penn Coal from mining under the
property; loses at trial level but PASC holds Kohler Act
legitimate exercise of the police power in pursuit of public
safety and enjoins mining
 USSC finds no taking under categorical rules but taking
under multifactor test
93
PA common law separates out three separate interests in land like Mahon’s
 Mahon’s House/Surface estate (Mahon)
 Support estate (Penn Coal)
 Mineral rights (Penn Coal)
Multifactor Test: Penn Coal
 USSC majority (Holmes, J.) creates multifactor test
o Kohler Act is a taking here because it “goes too far”
 Penn Coal’s diminution in value is too great
 No average reciprocity of advantage as in coal pillar
case
o Invalidates Kohler Act as unconstitutional taking without just
compensation
 Brandeis, J. dissent argues Kohler Act abates a public nuisance and
provides some reciprocity of advantage, so would find no taking
o Warns about the “denominator problem” (a.k.a., conceptual
severance)
o Brandeis’ arguments win in Keystone Bituminous Coal Ass’n
v. DeBenedictis (1987), when USSC upholds statute very
similar to Kohler Act without compensation
Penn Central Transportation Co. v. City of New York (USSC 1978)
 NYC’s Landmarks Preservation Law creates Commission to designate
landmark sites
o Owners of landmarks are obligated to keep exterior of building
in good repair and obtain Commission approval for any
alterations to exterior for consideration of historic value
o Owners may obtain approval if change has no effect, if it is
appropriate, or if without the change they will earn an
insufficient return
o Commission decisions subject to judicial review
 Transferable Development Rights: Owners can also transfer rights that
cannot be used on a landmark property to another of the owner’s
properties nearby and use them to go beyond zoned height restrictions
 Commission denies Penn Central requests for certificates of no effect
and appropriateness to develop Grand Central Terminal office building
 Penn Central sues in state court claiming Landmarks Preservation Law
is a taking and seeking injunction to allow construction of any
structure that complies zoning and building codes; loses in NYCoA
 USSC affirms under multifactor test
Multifactor Test: Penn Central
 USSC majority (Brennan, J.) applies multifactor test
94
o Rejects Penn Central’s argument that Commission action takes 100% of air rights
as improper conceptual severance
 Example of Brandeis’ “denominator problem”
o Landmarks Preservation Law does not work a taking because as to whole parcel, Penn
Central has not shown
o Substantial diminution in value
o With respect to distinct, investment-backed expectations
 Rehnquist, J. dissent would also apply multifactor test but finds substantial diminution
in value
o Would remand to consider compensation
o Raises concern that transferable development rights are insufficient compensation
Multifactor Test for Implicit Takings
Diminution in values (Penn Central; Penn Coal)
 Measure diminution in value with respect to distinct, investment-backed expectations
(Penn Central)
 Consider average reciprocity of advantage (Penn Coal reference to coal column case)
 Beware of possible conceptual severance strategies (Penn Central; Penn Coal, Brandeis
dissent)
Character of the interference (referenced in Loretto dissent)
 Physical invasion short of PPO
 Hinders key rights in bundle of rights (e.g., right to exclude, right to transfer)
95

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Property Law Bundle of Rights

Property Outline-Spring 2021

Acquisition of Property by Find.........................................................................................................17

Civil Rights Act of 1866.......................................................................................................................46

Facts: P Johnson sues D M’Intosh in an action of ejectment

Action of Ejectment – seeking possession land & damages for

o Possession and property are social and legal constructions and

Following Custom is another Rule for Capture of wild animals (Ghen)

Pierson v. Post (1805) [fox case]

wounds or carries away the fox gets to

Ghen v Rich [whaling case]

 Issue: Can a person be liable for hindering another

o Legal hunting season, killing deer is socially

Oil & Gas

Surface Water Rights

Popov v. Hayashi [Baseball] (Cal. S.F. Cty. 2002)

Partially based on custom

 The trouble is that the fruits of your labor are not

 Generally, we will protect property

 USSC holds for Feist because although compilations can be

Intellectual Property Statutes:

Types of intellectual property protection through statutes:

 derivative works – parody, some work

Property in One’s Persona

ii. 2) researcher’s opportunity – not wanting to threaten

The Right to Exclude

Jacque v. Steenberg Homes, Inc. (Wis. 1997)

 The Wisconsin Supreme Court holds punitive damages

Hannah v Peel [brooch case]

a. Keep items close to where they’re found (the locus)

South Staffordshire Water Co. v Sharman – cleaning the pool case

Rule: that landowner owns items attached to/under land to also

Distinctions between a public place, shop and home

Place Item goes to:

4 Elements of Adverse Possession

regard the occupant as a person exercising exclusive

what he is doing at the time he enters the

b. Good faith rule

knowledge of the encroachment b/c all of the elements

i. The requisite possession requires such

i. Under the earning policy, B does not deserve it

such action, at the time the cause thereof accrues, is within

o When in the following examples would the adverse

 The period of extension is the time that the

2. Common law requires intention to make a gift and delivery

b. “Wrench of delivery” – handing over object makes vivid &

Newman v. Bost (N.C. 1898)

Gruen v Gruen [painting case]

a. Remainder man still has property interest, even if not in present

 Common Law Concurrent Interest

 The Joint Tenancy

1) joint tenant can transfer his interest to a third

c. Surviving tenant has the right of survivorship

 wife ceased to be a legal person for the duration of the

Modern system: equitable distribution of marital property

Goals of Equitable Distribution of Marital Property:

In re Marriage of Graham [degree as property case]

1. Educational degree is not w/in usual

non-title-holding spouse, including financial &

Community Property System (used in the west)

 Community property system – husband and wife are a

o Default regimes by virtue of being a spouse

LAND TRANSFERS THROUGH LEASES & MORTGAGES

4. Landlord and Tenant