Property I Outline

PROPERTY LAW: Klein & Flournoy

Spring 2013

Property: A “bundle of sticks” that includes the rights to possess, use, exclude, transfer, and transform.

1- Right to Use: owner has right to use as he sees fit, subject to some rights in neighbors and police power regulations

a. Ways to limit property rights: (1) nuisance laws and (2) zoning laws

2- Right to Transfer: owner has right to transfer property by gift, sale, inheritance, or will (encourages people to bargain with each other, furthers a market economy)

3- Right to Exclude: owner has right to exclusive possession, right to exclude others (courts generally granted great protection)

a. Limitations when others are involved:

i. Mistaken improver: when neighbor mistakenly improves land, not his own but believing land to be his, owner of land might not be able to remove encroachment, unless encroachment is knowing and willful

ii. Civil Rights Laws

iii. Worker’s rights to organize: State v. Shack p. 90, holding that since workers have a right to organize a union (and unions have a right to communicate with workers on employer’s premises), an employer housing migrant farm workers cannot exclude union organizers from coming on property. (landowners property rights end when they interfere with the rights of others living on the land)

4- Property both confers and rests upon power: the determination and enforcement of property rights depends on the power of the state to impose its will

First Possession: Conceptual ideas of ownership; Two types: (mention First-in-Time Rule: most fundamental rule for determining ownership, “the first person to take possession of a thing owns it” [aka “Rule of Capture”)

1- First to Find (Discovery): Whoever discovered the land first, gets it (really means first European nation to discover the land

a. RN’s Notes: The concept of first in time. NOT a completely straightforward notion. See Johnson p.3 Where first to acquire is not always right. (holding M’Intosh’s claim is more legitimate, because England had sovereignty over the land, then U.S., then M’Intosh [chain of title is better than Johnson’s, because Indians lack right to convey title]) (also holding that “first discovery” gives better title to land than Indians, since they did not actually possess the land)

2- Rule of Capture: A person who first captures unowned resources is entitled to the resources (whoever is prior in time wins)

a. Capture of wild animals: If wild animals (aka ferae naturae) are captured, usually they belong to the captor. But capture is required, mere pursuit of an animal is not enough [Pierson v. Post, p. 18 (Post and his hounds are pursuing a fox. Pierson spots the fox and shoots it, killing it. Pierson is entitled to the fox.)]

i. Fugitive Resource: something that moves from place to place under its own power or gravity (the fox, water, etc.)

b. See Ghen v. Rich, p. 26: in some hunting trades, a custom, which is thought more effective in getting animals killed, may dictate a different result (holding custom to award “marked” whale to ship that first killed the whale, even though whale sunk and was discovered days later by another whaler gives original whaler possession [P did “all that was possible”])

i. Rationale for the Rule of Capture:

1. Competition: to foster competition and provide for more effective means of capture

2. Ease of administration: much easier to reward capture (objective) than protecting pursuit and a prospective capture

3. Thus, promotes certainty and efficient administration where stakes are low, not worth judicial time and resources

c. “First come, first served” is not accurate assessment of the law:

i. See Johnson v. M’Intosh, p. 3: held that Europeans, and subsequently the U.S., acquired title by conquest (holding Indians not regarded as prior in possession, moved from village to village, did not establish permanent residences or take possession of tracts of land)

ii. Johnson was first, but didn’t win, so don’t use.

iii. RN’s Notes: The first to take a fugitive resource has control of it

d. For Rights to Oil and Gas, Rights in Water, see p. 7-12 Supp.

Acquisition by Creation (Property Rights in Creation): A person can acquire property by creating it, although several exceptions (primary purpose is to reward labor)

1- Acquisition by Accession: when one person adds to the property of another either labor or labor and new materials

a. Labor Added: A adds labor to B’s raw materials à courts usually award final product to owner of raw materials (B), unless A’s efforts have sufficiently increased value to make it unfair to award final product to B (most states require that A acted in good faith)

i. NOTE FOR EXAM: Where it would be grossly unjust for B to appropriate A’s labor to himself, A will get compensation for his labor and B will get damages for A’s trespass)

b. Labor and Materials Added: A, innocent trespasser, adds labor and materials to B’s raw materials à final product generally awarded to owner of principal material (A), unless A is not innocent, then regardless of labor/materials, to B

2- Intellectual Property, p. 15 Supp: “Catch all” label for property in ideas (includes copyrights, patents, trademarks, and property in persona)

a. COMMON LAW: To avoid monopoly and encourage competition, CL commonly allows copying and imitation of ideas, as opposed to their expression, Cheney Brothers v. Doris Silk Corp., p. 61 (holding that a man’s property is, essentially, limited to tangible things, where his ideas regarding invention (absent statutory law) are free fodder for copying)

i. “Creativity thrives on imitation, put differently, imitation is the lifeblood of competition

b. Statutes: Copyright, trademark, patent laws created by Congress. IP rights are limited in time. Copyright laws include fair use exception and right to parody.

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