Professor Berger- Property Outline Spring 2013
1) What is Property?
a. Property is the relationship of individuals to each other with respect to things
b. Rights can be divided in space and time and depends on the existence of law to be enforced
c. Think of property as a bundle of sticks/rights: one may not always have all of the sticks
· Right to exclude others-but limited by other situations (emergency/landlords)
· Right to use-but limited by other’s right to use
d. Ways that we recognize property rights
Ø First Occupancy- produces certainty and reduces confrontation
Ø Governmental allocation
Ø Settled/justified expectations
Ø Long-use respect(labor)
Ø Distributive Justice/need based-get resources according to their need
Ø Unequal distribution of wealth
2) Justifications for Allocation of Property
A. Discovery Doctrine (Johnson v. M’intosh)
Ø Discoverer of the land has exclusive title and the right to extinguish others from the land.
B. Governmental Allocation
Ø Government has the ultimate power to determine who gets land
Ø Promotes certainty and security in rights
Ø This sometimes violates ideas of justice (Ex. Johnson v. M’intosh, the N.A. had first occupancy of the land but the govt did not give them title)
C. Labor and Investment/ First Occupancy/ Distributive Justice
Ø Squatters: Govt allows them to stay, on land because they have put in labor, they have long presence on the land, and they need the land (dist. justice).
Ø BUT freed slaves: their possession of land not recognized even though they too had worked the land, been present on the land, and needed it. The govt gave the land back to the plantation owners to create stability after the civil war.
Ø Labor alone does not always create property rights BUT in some cases labor will justify a property right (INS v. Associated Press). Why protect intangible property?:
1. My labor, my right BUT if you don’t need it someone else should have it
2. Incentivizes creativity BUT this protection could cause monopoly
D. First Occupancy
Ø The Law of Capture: If you have actual possession, the property is yours.
Ø The idea that first-in-time has the first right. PROBLEM: This could also promote unfairness (Pierson v. Post, Post who put in the labor, lost)
Ø Custom: Sometimes courts use custom of industry as a baseline for rule of possession. (Popov v. Hyashi).
Ø Exception: Where there is negligent behavior, the law of capture may be overcome by concerns for social justice and welfare. (Eliff v. Texon Drilling Co.)
E. Relativity of Title: The idea that one may have rights to property against one person but not against another.
Ø Law of Finders: Finder has right against the whole world accept a true owner or a prior rightful possessor
Ø Prevents violence, encourages use of the property, serves possessor’s expectations
Ø Depends on whether property is lost, mislaid, or abandoned
1. Lost: Finder usually wins against all sub. people.
2. Abandoned: Finder usually wins against all sub. people and true owner. 2 elements: act of abandonment and intent to abandon (Charrier v. Bell)
3. Mislaid: Homeowner/landowner wins. True owner will know where to find it
4. Treasure Trove: Gold, silver, jewels, or money that seems intentionally concealed so long that the true owner is dead. Goes to finder.
Ø Bona Fide Purchaser: Has a right against a true owner if the TO entrusted property to a merchant but not if the property was stolen
F. Adverse Possession
Ø Title is taken away from the true possessor without abandonment
1. Hostile or Adverse: Non-permissive use. Most courts say intent doesn’t matter (Minority of courts require either good faith or bad faith)
2. Open and Notorious: Reasonable diligent owner could see that a hostile flag was being flown over his property
3. Exclusive: Choosing who to let on and who to let off, acting like an owner (Nome 2000)
4. Continuous: Includes tacking, and only have to be there as much as a normal owner would (Brown v. Gobble and Nome 2000)
5. Actual Possession: Must use as an ordinary user would use the land. Paying taxes helps, and a fence + use is usually enough
6. Color of Title: May be substitute for actual possession. This is a faulty deed.
Ø Policy Justifications
1. Efficiency: better if property is in the hands of those who are using it and value it (social welfare)
2. Certainty: Want people to be able to keep property they have used for a long time
3. Settled expectations: People expect to keep land that they have been using
4. Root theory: People form connections to the land after using it
G. Prescriptive Easement
Ø Gain a right to continue to use the land in the way you have been using it (right of use or right of way)
2. Hostile (May be more difficult to show because use of the right of way may be presumptively permissive)
3. Actual Use
4. Open and Notorious
5. Exclusive—Not often required
Johnson v. M’intosh (Tension between govt title and informal title)
Facts: Property in VA is given to US after the Revolution. But P says they purchased the land from the Native Americans who have first occupancy. D says they were granted the land from the govt.
Issue: Who has the better title? Do Indians have the right to transfer title to their land
Holding: The government has the better title and Indians cannot transfer their land
Rule: Discovery Doctrine: The discoverer of the land has the exclusive right to title against all other European nations and the right to extinguish the Native Americans by conquest or consent. N.A only have a right to occupancy and not a right to possession
Reason: The U.S. has exclusive title because of the discovery of the land by Europeans and the conveyance of the land from Europe to the U.S.
Note: D’s make a distributive justice argument claiming that the N.A. would not use the land efficiently and that farming would make a better use of the land.
INS v. Associated Press
Facts: AP filed a complaint claiming INS was misappropriating news info gathered by AP by taking news from early bulletins and newspapers and then printing it and selling it.
Issue: Can INS read AP’s gathered news and republish it as their own?
Holding: There is a quasi property interest in the news. Judgment affirmed and AP is enjoined from misappropriating INS’s news.
Rule: Hot news doctrine: There is a quasi property interest in news against competitors to prevent unfair competition because of the labor that goes into gathering news. While the news is still hot and the original gatherer is still benefitting from it, a competitor may not use their property without permission.
Reason: Taking of news w/o permission breeds unfair competition thus eliminating the value of the news gathering and the entire industry.
Dissent: Holmes thinks that AP should simply just be afforded credit, but that news cannot be property because it is only a collection of words
Pierson v. Post
Facts: Post is hunting a fox on a beach and is in pursuit of it. Pierson shoots the fox first and carries it away.
Issue: Is pursuit of a wild animal enough to claim a property interest?
Holding: No, Post has no property interest in the fox
Rule: To claim property right in a wild animal, one must have actual possession or deprive the animal of its liberty by mortal wounding
Reason: The rule promotes certainty and decreases lawsuits. It also will prevent conflict.
Dissent: Thinks that the decision should have been based on the custom of hunters. Post should have won because his pursuit gave him constructive possession
Popov v. Hyashi
Facts: Popov caught a baseball but it wasn’t actually secure in his hand, and then he was tackled by a crown. He lost control of the ball and Hyashi found it and picked it up. Popov sued for the ball.
Issue: Did Popov gain possession of the ball when he attempted to catch it?
Holding: As a matter of fairness, both parties win.
Rule: First to gain possession is the owner of the ball and the actor must retain control after incidental contact (custom in baseball). There must be a reasonable expectation that full control of the ball will be acquired
Reason: Popov never gained possession but only had a pre-possessory interest and Hyashi gained unequivocal possession. But it would be unfair not to recognize Popov’s right bc he may have gained full possession if not for the unlawful behavior of the crowd. It would be unfair not to recognize Hyashi’s right bc he had actual possession of the ball.
Eliff v. Texon Drilling Co.
Facts: Eliff owned the surface rights and royalty interests in some land and the rest belonged to Driscoll. Texon was drilling on Driscoll’s land and the oil blew out, caused an explosion, and damaged Eliff’s land.
Issue: Does the law of capture absolve respondent’s liability even though the damage occurred after the minerals had been drained from pet’s land?
Holding: Def. is liable for the damage caused
Rule: Oil or gas drained onto your land belongs to you BUT where obtained negligently liability can be incurred
Reason: Negligent treatment of valuable resources does not promote society’s general welfare. To sustain fairness the law of capture is overcome where negligence is in play.
Armory v. Delamirie
Facts: Chimney sweep found a jewel and took it to be appraised. The jeweler refused to give the jewel back
Holding: The chimney sweep had the right to the jewel he found
Rule: Finder has rights against the whole world accept the true owner and prior, rightful possessors
Charrier v. Bell
Facts: P found numerous artifacts in the Trudeau village buried under the ground and tried to claim them based the fact that the original owners abandoned this property.
Issue: Can prop
For example, in Fontainbleau, if the court ordered a nuisance was present, Fontainbleau could just offer to pay Eden Roc to give up their right to enforce the injunction. (in absence of transaction costs)
o Coase II: Transaction costs may prevent wealth maximizing bargaining, so courts assign the entitlement to the party who has the most valuable use
Armstrong v. Francis Corporation (Reasonableness test)
Facts: Francis Corp developed their land and caused damage to Armstrong’s land by causing an increase in the flow of a stream. Caused erosion, flooding, and serious property damage
Issue: Is Francis Corp’s development a nuisance?
Holding: Francis corp is liable for damage and their development is a nuisance to Armstrong’s enjoyment of the property
Rule: If the gravity of harm caused to the land outweighs the utility of the possessor’s use of the land, then a nuisance has occurred
Reasoning: The court argues that it is fairer for the developers to bear the cost of providing the landowners with protection against property damage.
Friendswood Development v. Smith-Southwest Industries
Facts: P landowners allege that D pumped large amounts of water from their land causing subsidence in P’s land. There is a conflict over which rule to apply. English rule: may pump as much water as you want as long as its not done maliciously. American Rule: Can only pump as much water for the reasonable use and benefit of the property
Issue: Is def. liable for nuisance and should the court apply the English rule or the American Rule
Holding: D. is not liable for nuisance based on the English rule, but the court adopts the American rule for future cases
Rule: Can’ t withdraw water that is negligent, willfully wasteful, or malicious and if such act is the proximate cause of subsidence then D is liable
Note: Distinguish cases by 1) Show a factual difference 2) Undermine policy justifications
o Precedent involving water were not about subsidence, but were about infringing on other’s right to the use of the water
o Policy justification was that they wanted the water to be used up in order to promote social welfare and utility. But this no longer makes sense in a context where property is being damaged
Page County Appliance v. Honeywell
Facts: D’s computer in store interfered with P’s television displays. Caused by radiation leaking and the center filed a nuisance claim
Holding: Yes, there is a private nuisance
Rule: The D must “materially participate” in the nuisance and hypersensitive uses are not a nuisance
Reasoning: Using a television is not an unusual or hypersensitive use, and Honeywell materially participated bc they serviced and maintained the computers
Fontainbleau Hotel Corp v. Forty Five Twenty Five Inc.
Facts: Eden Roc Hotel sought an injunction against Fontainbleau hotel to stop them from building their structure too high so that it wouldn’t block the sunlight from their beach and pool area.
Issue: Is there a claim for a private nuisance for blocking sunlight and air?
Holding: No there is no claim for nuisance
Rule: Generally, where a structure serves a useful and beneficial purpose, there is no claim for nuisance when only light or air is being cut off
Reasoning: Court says even if structure is being built out of spite, no claim for nuisance. Still no easement for light and air
Prah v. Maretti
Facts: P sought an injunction against D because D’s construction was going to block the sunlight and interfere with P’s solar panels on his home that were used to heat the house.
Issue: Is there a claim for private nuisance?
Holding: Yes, there is a nuisance claim and D is liable
Rule: Interference of light claim must be observed under a reasonableness standard
Reasoning: Policy justifications no longer valid. The light is not just used for aesthetic reasons. Obstruction substantially and unreasonably interferes with the use of P’s land.