Depoorter – Property – Fall 2012
Main Issues in Property Law
1. Allocation of Resources: Optimal Allocation of Resources
2. Personal Use of Resources: Legal Relationship between you & resource
3. Interpersonal Use of Resources: Property Law regulating relationships between individuals
4. State Regulation of Property Rights: How much can the State interfere with private property rights?
RELATIVITY OF TITLE: the idea that a person can have a relatively better title or right to possession than another, while simultaneously having a right inferior to yet another person.
Property Law and Social Norms
1. Source of Law: situations where it makes sense to make the social norm the law
-Ghen v. Rich: court defers to custom
-Cost of Customs
1. Inefficiency (TRAGEDY OF THE COMMONS – individual actions hurt everyone)
2. Outsiders (don’t know about custom?)
3. Information Costs (if cost of communicating are too high, custom doesn’t work)
2. Substitute for Law: norms are more important than law, according to the people – override law
-Shasta County cow laws: dispute between herders and farmers resolved without litigation because they use custom.
-Laws only exist in places where customs have failed to solve disputes.
3. Antagonist of Law: norm is a bad thing (i.e. racism & segregation, file sharing)
-File Sharing: law has not changed with time/technology
-Backlash Effect: higher severity of punishment = more present violators support the custom/think the system is corrupt
-Focal Point Effect: more severe punishment = people who aren’t in violation think more people are in violation
-Loss Aversion: doing something for a long time & it becomes illegal = only way to avoid cognitive dissonance is to think law is bad.
Law & Behavior – why laws are effective even if they are not enforced.
1. Expressive Function of Law: expressing social preference, and sometimes people will internalize the law
2. Creates a Focal Point: 3rd party enforcement – law gives you a signal of what other people prefer (i.e. pooper scooper)
3. Rule of Law Preference: people like law abiders
4. Legal Endowment Effect: the law gives you a right, and when someone violates the law, you feel they are taking your right away (i.e. smoking)
Costs of Litigation
1. Transaction Costs
2. Information Costs
3. Strategic Behavior (settlement = weakness)
5. Commensurability (winning!)
Property Law & Policy
-Clear Title: prevent chaos caused by ambiguity in property rights
Property Rule Protection vs. Liability Rule Protection
Ownership and Forms of Acquisition
1. Convention favoring POSSESSOR
-POSSESSION: the controlling or holding of personal property, with or without a claim of ownership. Two elements:
1. an intent to possess on the part of the possessor; and
2. his or her actual controlling or holding the property
-Possession: presumption of title – protect the possessor against he rest of the world, except the rightful owner.
-ADVERSE POSSESSION: Time to complain about something is right away, before precedent is established
-ENDOWMENT EFFECT: Person values disputed resource more highly when he is the possessor (makes imminent domain tricky)
2. Convention favoring FIRST CLAIMANT (FIRST IN TIME) – Person who was there first has strongest claim
-Pierson v. Post: mere pursuit is not enough for possession of wild animals – first hunter to capture the fox wins.
-Close pursuit after mortal wounding gives hunter right of possession
-Popov v. Hiyashi: “Pre-possessory interest” – not possession, but right to possession, quasi-property right, equitable division.
-Ghen v. Rich
-When to use Custom?
-when its application is limited to the industry and limited to those working in it;
-when the custom is recognized by the whole industry;
-when the custom “requires the first taker the only act of appropriation that is possible” (impossible to actually take the whale, which sinks to bottom);
-when the custom is necessary to the survival of the industry; and
-when the custom “works well in practice.”
-Keeble v. Hickeringill – actionable interference with capture, Self help is problematic
(1) plaintiff is a tradesman, using the decoy pond in a lawful manner for his business
(2) defendant, even as a competitor of plaintiff, was acting illegally (could set up his own pond if he wanted to)
(3) promoting social goal of killing ducks
-Johnson v. M’Intosh – monopsony = much more efficient (1 buyer)
-Native Americans have right of occupancy, but not possession (title)
-First in time rule to prevent finders vs finders, and it is easier to prove who had it first
-Not effective with oil (Tragedy of the Commons), so solution is collectivization (forced collective pooling of oil wells)
Goals of Law of Find:
1. Return item to true owner (reward investment/hard work, make people feel secure in their property)
a. Carrots: finder’s fee, finder gets residual ownership if true owner can’t be located
b. Sticks: legal ramifications (i.e. misappropriation, larceny)
2. Notice (duty to provide notice to true owners – finder must take steps)
a. Statute of Limitations: helps solve ambiguity of time: when it is really yours against true owners.
Unintentional & involuntary parting (not aware)
Voluntarily placed & forgetting where it is/that they placed it
Voluntarily placed & no longer wants to possess it
Ancient, concealed by owner (element of antiquity)
Awareness/Volition of parting
Intent of owner re: coming back to get it – Circumstantial evidence
Intent of owner re: coming back to get it – Affirmative acts
Age matters/type of items.
Finder has claim against the whole world but the true owner & prior finders
Owner of premises has claim until true owner returns
Belongs to finder against all others, including the former owner
Goes to finder generally, but recently have been treated as mislaid
Relativity of Title (finder vs. finder), Fist in time rule (easier to prove)
Keeping it where person left it = most likely to return to true owner. Location where property is misla
vice v. AP (SWEAT OF LABOR)
-One who discovers the story gets a quasi-property right, good against competitors but not the public.
-Protecting labor in investigative journalism, motivated by unfair competition (free riding)
-”Hot News Items” – how quickly you can report news is essential to the value
-Metro-Goldwyn v. Grokster – contributory infringement: knowledge, induce/materially contribute; indirect/vicarious infringement: profit from it, right & ability to prevent
-Baker v. Selden (ledger) – BACK DOOR PATENT
MERGER DOCTRINE: there are only so many ways you can portray something (ex: karate game) – you get protection in expression of ideas, but if there are only a few ways of expressing the idea, in some ways you own the idea you are expressing (dangerous)
COPYRIGHT INFRINGEMENT CLAIM
1. Has there been copying?
a. Access (actual, or likely)
2. Is it substantially similar?
a. Extrinsic Test (expert witness) – notes, tune, lyrics, LITERAL – what are the chances that someone could create such a similar song?
b. Intrinsic Test (reasonable person) – does it FEEL like the same song?
3. Is it Improper?
Exception to Copyright Infringement: FAIR USE
1. Purpose/character of use (news reporting, commercial, nonprofit, educational)
2. Nature of copyrighted work (fictional, phone book, history book)
3. Amount of portion used in relation to work as a whole
4. The Effect of the use upon the potential market for or value of the copyrighted work
-White v. Samsung: [Dissent] Allowed to copy things for parody purposes (need to copy for parody to work)
-Criticism of underlying work/mockery reflecting on original work
-Satire: different – will lose in court because you didn’t need to use that particular work to make fun of something else
MASHUPS : literal infringement (don’t need to show similarity, but is it improper? – could be considered fair use)
-Funkadelic v. NWA: judge held that you had to ask for a license in samples (even though it is a short clip quantitatively, it is an important part qualitatively)
-Music industry doesn’t bring many lawsuits:
-Might be afraid of losing case & setting fair use precedent
-Effect of mashups might actually be helping original artists/exposing public to song
TRADEMARK – property right in word, name, symbol, used in business
*PURPOSE: IDENTIFY AND DISTINGUISH
-Has to be used with intention of commerce
-Used in commerce to identify goods & identify source of those goods
-GOAL: to prevent confusion among consumers, and prevent people from passing off goods as something else.
-Can’t trademark functional parts of a car, but can trademark appearance