Property as a Bundle of Rights
What is Property?
Property is a set of relationships among people with respect to a thing. These relationships are a bundle of rights. The particular rights in any piece of property depend on the circumstances and nature of the property.
There are 4 Rights that come with Property.
1. Possession – the right to have something
2. Usage – the right to use something
3. Exclusion – the right to exclude others from use
4. Disposition – the right to get rid of it
Moore v. UC Regents
Majority Rule – Individuals do not have ownership over cells of their body when those cells are outside the body. The disposition rights of cells were severely limited and court said you need all four of these rights to have property rights.
Dissent Rule – At the time of excision he had the right to do with his own tissue whatever the doctors did with it.
· Both the Majority and Dissent saw property as a bundle of rights that depended on the circumstances and the nature of the property. In this instance they just differed on where the property rights ended.
State v. Shack
Rule – Real property does not include the right to bar access to government services to 3rd parties invited onto the land. Common Law maxim – one should so use his property as not to injure the rights of others.
· The court ruled that title to property cannot include dominion over those invited on the land.
Jacques v. Steenberg Homes
Conversely if one does not invite others onto the land and holds the right of exclusion closely guarded they can deny access to all others, except for when it may invade the rights of others.
Why Have Property Rights
Johnson v. M’Intosh
Rule – Dating back to European explorers, discovery of land gave the discovering government ultimate title to the land.
· Occupancy Theory – 1st in time is 1st in right.
· Locke’s Labor Theory – We own our labor, therefore whatever we remove from nature and mix with our labor becomes our property
a. Indian’s occupancy of their lands was not enough, they were just hunters and gathers and did not mix their labor with the land in an adequate way to make it their own.
· Economic function of property – to create incentives to use resources efficiently.
· Maximization of value – Farmer can be induced to transfer rights to property to someone who can work it more productively.
· Three Criteria of Efficient System
1. Universality – all resources should be owned, except resources that are plentiful
2. Exclusivity – the more exclusive the property right, the greater the incentive to invest the right amount of resources in the development of the property.
3. Transferability – ability to dispose of property hopefully for greater efficiency.
Methods of Acquiring Property
Gifts: voluntary, given without consideration, and irrevocable after transfer. Person claiming the gift has burden to prove with clear and convincing evidence.
Intro Vivos Gifts – gifts given while alive, there are 3 essential elements.
1. Intent to make present transfer
2. Delivery – actual or constructive
3. Acceptance – when there is value to the donee acceptance is presumed
Gruen v. Gruen
Issue – Whether an inter vivos gift may be made where the donor has reserved a life estate in the personal property and the donee never has had physical possession of it before the donor’s death?
Rule – Transferring a future interest is valid as an inter vivos gift, even if the person giving the gift does not transfer possession at the moment of the gift.
Notes – Future property rights are a real thing, and you have them now, even if you don’t know what day you will be given possession. You can protect you future interests now. When the father wrote the letter, he made a present transfer of a future right. When you make an inter vivos gift it is effective immediately, it is transferred and you cannot take it back. However, when you make a testamentary gift it does not take effect until you die, therefore you can change it as many times as you want. The father has a life-estate and the son has a future interest. The father did not physically deliver the painting. However, he did send a letter which is a constructive delivery.
Note – Gruen tells us that when something of value is given its acceptance is assumed.
Speelman v. Pascal – gift of royalties on a play that was not created yet, court found that gift was valid even though enjoyment was postponed, the title to property transfers immediately.
Testamentary Gifts – gifts given through a will after one dies.
Lindh v. Surman
Issue – Whether a donee of an engagement ring must return the ring or its equivalent value when the donor breaks the engagement?
Rule – Strict no-fault approach. If the marriage does not occur, the ring must go back to the giver regardless if the giver is the person who broke off the engagement.
Abandonment- an item is abandoned if it is knowingly and voluntarily relinquished with no intent for future possession.
Lost – property that the owner no longer possesses because of accident, negligence, or carelessness, and that cannot be located by an ordinary, diligent search.
Mislaid – where one sets a piece of property down with the intent to pick it up but forgets to do so.
Why Finders Have Rights:
1. As an incentive to put the item back to productive use
2. Do not want to create fencing costs
3. To try and get the property back to the original owner
4. Promote honesty
Pierson v. Post (Fox hunting)
Issue – When will pursuit ripen into possession for the purposes of acquiring property rights in wild animals?
Rule – Mere pursuit of a wild animal is not enough, one must have an unequivocal intent to possess the beast, deprived it of its natural liberty, and have certain control over the beast.
Dissent – to have possession a pursuer must have: discovery; intent; be in reach or have reasonable expectation of taking the animal.
· They believed we should not listen to supposed authorities but instead follow industry custom. (need to be careful because sometimes industry custom will do what is best for them and what is best for society)
Duck Case – 1st landowner has a decoy duck pond, 2nd landowner builds his own decoy duck pond to attract the ducks away from 1st landowner. 1st landowner pulls out a shot gun to scare the ducks off 2nd landowner’s property. Court said 1st landowner was maliciously hindering and disturbing 2nd landowner in the exercise and enjoyment of his private property. Since the ducks were in 2nd landowners property they were his property, he did nothing foul to get them there, but 1st landowner did.
Eads v. Brazelton (Sunken ship)
Issue – Were Plaintiff’s efforts (marking the fix, placing the buoy) sufficient to vest in him property rights for the abandoned wreck?
Rule – While the cargo and steamboat clearly belonged to the finder (due to abandonment by owners of record), merely marking abandoned property for salvage does not establish possession. Instead, the finder must show the intent and ability to actually take the property (in this case, have his salvage vessel and equipment on site), although physical contact is not actually required. Actually taking and intent to reduce to actual property are what were required. Put the boat over and ability to take property along with persistent efforts to raise the led.
Pierson v. Post/Eads v. Brazelton
· Pierson – deprive natural liberty by certain control (mortal wounding, trapping)
· Eads – establish close position, persistent efforts to make your own, and the means to make it your own.
· They are similar in several ways – Both need intent to possess but intent to posses is not enough. Neither requires that you actually hold it in your hand. The first one to discover it is not enough, nor is pursuit. In Pierson there is a higher level of control needed as compared to Eads. The dissent in Pierson says that there should be a reasonable likelihood of success, which looks like what the Eads court ruled. There is a difference in the nature of the property trying to be acquired, that means there should be different rules governing what possession is.
· The harder to control the more required to assert to claim control
Finders Have Rights
· Armory v. Delamarie tells us that finders acquire some form of property rights against others, where a finder acquires rights against someone entrusted with the property, and Bridges v. Hawkesworth, in which a finder acquires property rights to property found in a store. Furthermore, we know finders acquire property rights to abandoned property from Popov. Hayashi, where the parties stipulated the ball was abandoned and the court awarded property rights to the finders.
· A finder must have possession before he obtains property rights. A finder need not have full physical possession but instead must exercise dominion and control. In Pierson the court stated possession of a fleeing fox was gained not by having it in hand, but mortally wounding it would have been sufficient. In Eads the court stated that they need to place the boat over the salvage with the ability and intent to raise it to exercise dominion
Foxes, Boats, and Baseballs
In Pierson and Eads you do not need to have actual physical possession in order to acquire property rights. In Eads you need intent, the means, and being physically close to acquire property rights. In Pierson you need intent, deprivation of liberty, and certain control. A fox is harder to gain control over than a sunken ship since a fox moves and has a will of its own. In the Bonds case a baseball has no mind of itself and will eventually come to rest and therefore is easier to control than a fox, yet the court ruled you needed more to have property rights. This is backwards to the way the courts had been going with the law.
ESTATES IN LAND
Fee Simple Absolute
· Represents absolute ownership over the real property. At death goes to your will, if no will then heirs, then government.
Fee Simple Defeasible
· Rights could be cut short if some future contingency occurs.
1. Fee Simple Determinable – if the future contingency occurs then you automatically lose the land. Land goes back to the grantor, a possibility of reverter. Magic words: “so long as” “until” “while” “during”
2. Fee Simple Subject to Condition Subsequent – if the future contingency occurs then someone has the right to object and take the land, if they don’t the land is now forever yours. It’s called the right of re-entry. Magic words: “on condition that” “provided that” “but if” “if it happened that”
Cole v. Steinlauf (deed without “and his heirs”)
Issue – Was the fact that the earlier grant said “his assigns forever” (which normally indicates a life estate) sufficient to cast enough doubt on the title to allow Plaintiff to exit the contract?
Rule – A deed can be reformed to vest a fee in a grantee where the word ‘heirs’ is omitted if it can be determined from the clearly expressed intent of the parties that a fee was intended.
· The language in the deed did not include the word “heirs” in it, thus the ownership of the title is not explicitly known. Because all the parties that executed the deed are not present it is impossible to identify the true intent of the deed. Though future courts may find the title reasonably clear and free of defect, P should not have to take this gamble.
Johnson v. City of Wheat Ridge (Failed to meet all conditions, no running water, but did not claim it in the time period required by statute of limitations)
Issue – Where the statute of limitations has expired and a condition of property transfer is unsatisfied, does the property remain with its current owner?
Rule – Yes, Plaintiff must bring any right of re-entry within the time limits of the first infraction or it become a fee simple absolute.
Roberts v. Rhodes (Granted landed for school and cemetery use, after 60 years no longer school)
Issue – If the language in a grant is not explicitly clear as to making it a fee simple defeasible can it be classified as one?
Rule – In the absence of intent to limit the title to a defeasible, either expressly or by necessary implication, the grantors pass a fee simple absolute. The mere expression that a land is to be used for a particular use is not of itself sufficient to turn a fee simple absolute into a determinable fee.
· Burden on party without property to show why party with property should not have property:
· Court doesn’t like people (dead hand) reaching too far into the future which messes up alienability of land and commerce
· Court hates forfeitures of land (don’t like taking land from people)
· Chicisaw v. Board (and other cases): Specifying intended purpose of grant not enough.
· Restatement: “to B and his heirs to and for the use of the C Church and no other purpose” = fee simple absolute.