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Property I
Rutgers University, Newark School of Law
Henderson, Taja-Nia

 
PROPERTY / PROF. HENDERSON                                                                  RUTGERS NEWARK FALL 2013

ALLOCATION OF RESOURCES; PREVENTING WASTE; DETERRING SELF-HELP

Property interests/6 bundles of stick:
1) Right to use
2) Right to alter (Ex: repaint home)
3) Right to transfer (Ex: give it away or sell it, down to heirs)
4) Right to enjoy the fruits/profit from
5) Right to exclude (restrictions on public accommodations re: discrimination)
6) Right to possess
7) Right to destroy—not common, but can be 7th

One can let go some of the above and still retain right to property (leasing your apartment to a renter).

Acquisition by Capture

Dominion Rule—First in time=capture, not mere pursuit. Mortally wounding could be capture. Pierson dissent said first in time=first pursuit w/ reasonable prospect of capture

Industry custom and usage within an industry can be used to determine the rule of law regarding the ownership of property.

A party can recover against another for interfering maliciously with his ability to use his land for pleasure and profit.

Constructive possession—if there's wild life on your property, then you own it. It deters people from trespassing and taking another person's property. Privacy, safety, order.

Where an actor undertakes significant but incomplete steps to achieve possession of a piece of abandoned personal property and the failure to continue the effort is interrupted by the unlawful acts of others, the actor has a pre-possessory interest in the property

Conversion—Wrongful exercise of dominion over the personal property of another including the unjustified refusal to give the property back to a person entitled to possession. Actual interference with P’s dominion.

Trespass to chattel—Where personal property has been damaged or where the defendant has interfered with the plaintiff’s use of the property. Actual dispossession is not an element of the tort of trespass to chattel.

Locke's theory of labor—effort that went into the thing with the person's handiwork

Social utility—extermination of foxes, saving whales (or similar environmental purpose)

Efficiency—we want productive resources, if not (waste) we tend not to respect property rights

Externality—custom may interfere with social utility. But the externality (whaling/Indian tribes/Japan) can also help social utility—environment.

A private landowner has the right to exclude others from his land. This right however has no practical meaning if the state will not enforce it.

Ownership rights in real property do not include the right to bar migrant laborers working on the property from access to governmental services. A man’s right in his real property is not absolute. Necessity, private or public, may justify entry upon the lands of another.


Capture/Nature Resources & The Concept of Externalities

Fugitive resources – i.e. Oil, water gas

English rule (accepted in a few states): landowner is given an absolute interest in all resources that may be drawn to the surface of his land, even if some of the resources are on or beneath another’s land.

American rule (the rule in most states): taking has to be reasonable (wasteful use is unlawful)
·         Drilling straight down for oil is O.K. even if oil flows underground from one person’s property to another’s but
·         Drilling at an angle underneath another’s property is not allowed.

Captured + stored = ownership.
Ad coelum—owner of real property owns everything below the land.

Rule of capture encourages: 1) overproduction, 2) waste, 3) monopolies, 4) externalities
Many states have sought to supersede the rule of capture with conservation acts.

Prior appropriation—First in time, used in Western states for surface waters and some groundwater. Consequence of scarcity of water in the West. The person who first captures water + puts it to reasonable and beneficial use has a right superior to later appropriators. Encourages premature development + excessive dimension.

Riparian rights—The rights that belong to landowners whose property is on/by a natural water source. In the East, where water is more abundant, subject to the rights of other riparians. Little or no amount of focus on the productivity of the land.

Externalities:

Externalities exist whenever a person makes a decision about how to use resources without taking into full account the effect of the decision. They are ‘external’ to the person; the costs fall on the others.

An externality is not simply an effect of one person’s activity on another person, rather it is an effect that the first person is not forced to take into account. It would be unwise for society simply to ban all activities with external effects or make all those engaging in them pay for the effects.

1) Communal ownership—State or individuals cannot interfere w/ the right of any individual to exercise his/her communal rights. The effects of a person’s activities on his neighbors + subsequent generations will not be taken into account fully = great externalities.

2) Private ownership—the right of the owner to exclude others is recognized. Reduction in negotiation costs=most externalities are internalized at a lower cost.

3) State ownership—The state may exclude anyone from the use of a right as long as the state follows accepted political procedures for determining who may not use state-owned property.

Virtues of common property—buying large/amassing of capital, risk spreading benefits of shared ownership, socializing aspect, utility – beaches, parks etc.

Acquisition by Find

These are the theories you work with when there’s no precedence.

Preserve Order Theory—we maintain certain rules of property in order to reserve order among citizens.

Power Theory—the law of property was designed by those who have property. Johnson v. Mc’Intosh.
Personhood/Personality Theory—access to property is bound with our conceptions of ourselves. Personality or cultural differences may lead to a clash.

Labor Theory—we protect property rights for those people who undertake certain productive endeavors. What looks like a productive endeavor under one set of circumstances may not be that way in all contexts. Ex: Squatters v. real estate developer. The latter would win. The former might have rights only against the owner of the property—a bank etc.

Liberty Theory—private property serves as protector against the state, focus on fairness.

Wealth Maximization/Utilitarian—relative cost and benefits of allocation rights, no focus on fairness. 
With acquisition by find, our focus shifts from ‘first in time’. If someone is obviously not first, then can they still have a claim to theory?

Three types of cases: 1) Lost, 2) Mislaid, 3) Abandoned

Armory v. Delamirie—A finder of a chattel does not acquire an absolute property right, however he does have title superior to everyone except the rightful owner. When damages are at some unascertainable amount below an upper limit and when the uncertainty arises from the defendant’s wrong, the upper limit will be taken as the p

l condition and greatly enhanced its value by his labor.”

Adverse Possession

Reason grounded in public policy. Bundle of sticks=bundle of responsibility. True owner drops responsibility for the maintenance and care of his own property. Land ownership is a privilege. 

Statute of limitations is important. Adversely possessed land must be possessed for a period of time defined by statute—usually 8-10 years. SoL doesn’t always start to run when the adverse possessor first takes possession. (Mental illness, imprisonment etc.)

Requirements: ECHO-A

1) Exclusivity—adverse possessor and his family must be the only possessors.

2) Continuous—there must be continuity during the SoL period. Yet, if the nature of the real estate is seasonal and the adverse possessor uses it that way, then the requirement is met.    

Tacking—If you are an adverse possessor and you have a relationship with another adverse possessor, you and the other person can tack your time. The relationship must involve legal privity. Intentional transfer rom one adverse possessor to another by succession, sale or gift.

Adverse possession of a prior adverse possessor’s land doesn’t count as tacking. No legal privity. (Ex: A comes to B’s land.)

3) Hostile—What the adverse possessor is doing, if successful, will threaten or be at odds with the property rights of the true owner.

Sometimes the adverse possessor makes a mistake and sometimes it’s intentional. The state of mind exception—in most jurisdictions it doesn’t matter. There are a number of jurisdictions that care about the state of mind. The adverse possessor must have known that it wasn’t his land.

4) Openness/Notoriousness—Your adverse possession must be publicly visible, people easily assuming you’re actually the true owner.

5) Actual—Physically using and controlling the land. Giving notice to all that you’re in fact possessing and that your possession could potentially turn to ownership.

What can the true owner do?
1) If the statute has not run out, he can file an action to quiet the title to that piece of land. This is an equitable remedy, asking the court for a court order. Then file ejectment proceedings.
2) Actively and affirmatively grant permission to the adverse possessor. Silent acquiescence isn’t sufficient for permissive use. The benefit is that the true owner stops the hostile element. It is like giving a license—it’s revocable anytime.

Van Valkenburgh v. Lutz—At the time of this case, to acquire real title to property by adverse possession, it must be shown by clear and convincing proof that for the statutory period of time there was actual occupation under a claim of title. The essential elements of proof are that the premises are protected by a substantial enclosure or usually cultivated or improved. No substantial enclosure, enough cultivation or improvement here.