All property rights are relative (true owner beats possessor beats random person)
I. Acquiring Property
A. 3 Theories of Property Law
1. Lockian theory: appropriation (those who toil over the land should have the rights)
2. Government recognition: rights granted socially through the government or some other way
3. Right of Conquest: “might makes right”
B. Acquiring Rights to Property of the Commons
1. Possession (“occupancy”) defines property rights
i. Pierson v. Post (NY, 1805) – (fox hunting) Majority (TOMKINS) said pursuit is not enough – you have to take corporal possession of the animal to own it. Dissent (LIVINGSTON) proposes the alternative rule that once you are in pursuit, you have a better claim than if you pop up out of the bushes and take it.
ii. You have to possess it to own it, but are various definitions of possession:
(a) Mortally wounding and pursuing the fox
(b) Snaring it, tagging it, buying it
(c) Owning the land the fox is on
2. Rule of Capture = Rule of first possession
i. Resources that are free and un-owned go to the first person to capture them
(a) Bernard v. Monogahela Natural Gas Co. (PA, 1907): every landowner has a right to drill a well on his own land at whatever spot he may see fit, and there’s nothing his neighbor can do about it. He can only go and do likewise.
(b) Rule has been modified in states w/ large oil and gas reserves to maximize useful recovery from each plot (to maintain enough pressure to drill).
ii. What counts as capture?
(a) State v. Shaw (OH, 1902): fishing – were the fish the property of those that had set the net trap when Shaw took them out of the trap? Court says that the owners of the nets, having captured and confined the fish (it was “practically impossible” for them to escape), owned the fish.
iii. Tragedy of the Commons: class of economic problems where no individual bears the full costs of his behavior and there is no means to regulate access to a common resource. Each individual’s cost/benefit calculation leads him to overuse the resource. (Full benefit of over-exploitation, at only a fraction of the cost.)
(a) A consequence of a rule of first possession (people have an incentive to remove things from the commons)
(b) Can be solved/averted by private property or something like it – key is limiting access to common property
(c) Property law gives rights in a common resource – internalizes and distributes the costs.
B. Law of Finders
1. CL categories of found property – turns on intent of the true owner
i. Lost Property (ex. package of money found on the floor of a store)
(a) That with which the owner has involuntarily parted through neglect, carelessness, or inadvertence
(b) The finder of LOST property has rights to it against everyone except the true owner (true owner > finder > world)
(c) Rationale: we want to give people incentive to find and report things, which will help get some of them get back to the true owner (it encourages honesty)
(d) Danielson v. Roberts (OR, 1904): a man cleaning out a house on the request of the landowner found money. Ct. held that it was lost (land was long abandoned, true owner likely dead) à belongs to finder, not landowner.
ii. Mislaid Property (ex. wallet left on the table in a barbershop)
(a) The owner has intentionally placed it where he can find it, and then forgets
(b) The owner or occupant of the premises where it was found has first right to possession after the true owner (true owner > landowner > world)
(c) Rationale: it should remain on the property so that true owner can come back and find it
(d) Schley v. Couch (TX, 1955): a worker putting a concrete floor in a garage found buried money, considered mislaid property (had likely not been there for too long) so rights went to the landowner, not the finder.
(e) Heddle v. Bank of Hamiltonà Lapse of 4 years not sufficient to establish that the property had been lost beyond possibility of restitution to the true owner.
iii. Abandoned Property (ex. Horse “Bascom’s Folly” – disclaimed by both ‘owners’)
(a) The owner, intending to relinquish all rights to the property, leaves it free to be appropriated by any other person
(b) The finder is entitled to keep the property
(c) Generally not presumed – must have proof that the owner intended to abandon the property
(1) Michael v. First Chicago Corp. (IL, 1985): Sale of filing cabinets did not mean that the bank abandoned the certificates of deposit inside (both buyer and seller ignorant of concealed valuable, contract not broad enough to indicate an intent to convey the contents à title to the CDs did not pass in the sale).
iv. Treasure Trove
(a) Buried and secreted in the earth – true owner intended to return for it
(b) England – went to the king. Unclear what happens in the US.
(c) Done away with in some states by lost/mislaid categories.
2. Modern Law of Finders (trends in state statutes)
i. CL ‘law of finders’ is made of intent-based rules, but we usually never know the true owner’s intent b/c he’s not present
ii. Legislative Solution: require public depository/notice, then award to finder if unclaimed, regardless of the category it goes in (most mislaid property is found by banks – people forget about safe deposit boxes, etc.) à trend is toward doing away w/ CL categories
iii. CL remains relevant (Benjamin v. Linder Aviation, Inc.: airplane mechanic found money in the wing of a plane owned by the bank – both claim the money – court gave the money to the bank, despite an IA statute that said finder gets lost things, b/c they classified it as mislaid property. – Widely criticized.)
3. Finder vs. Landowner?
i. Is trespass involved? If finder is trespassing, he tends to lose.
ii. Is the finder a contractor or a servant?
(a) If a contractor, he’s more likely to get the property (more independent)
(1) Erickson v. Sinykin (MN, 1947): worker decorating a room in a hotel found lost money (evidence that it had b
ii. No right to sell
E. Adverse Possession
1. Elements of Adverse Possession
i. To establish adverse possession, the claiming party must show possession of another’s property which is:
(1) MAJORITY approach: claimant must physically use the parcel of land claimed in the same manner as a reasonable owner would (acts that meet the test will vary w/ characteristics of the land)
(2) MINORITY approach: statues provide specific acts that must be performed (cultivate, improve, etc.) and provide for lower standards for claimants who have “color of title” than for those who do not.
(i) Rationale: from primitive land title records in the West
(3) Normally, it is only the part of the land that you actually possess that you can get – encroaching upon someone’s land does not give you rights to their whole plot, just the part that you have been using. BUT –
(i) Constructive Possession: Legal fiction through which actual possession of a portion of a tract is extended to the entire tract
a. A moves onto O’s 1,000 acre farm and occupies 100 acres of it à A actually possesses only 100 acres, so acquires title only to 100 acres
b. A buys 1,000 acre farm from B and receives a facially valid deed. Farm is actually owned by O. A actually occupies 100 acres. à A has constructive possession of the entire farm.
(b) Open and Notorious,
(1) You must act like the real owner, behaving in a way that is consistent w/ you owning the property – A’s acts must be noticeable to a reasonable owner
(i) O’s actual knowledge is not necessary
(ii) Sneaking around at night is not enough
(2) We want to reward open & notorious behavior – gives true owner time to get the adverse possessor out (if it’s surreptitious, then true owner doesn’t have notice), and we want to reward the person making real use of the land if the owner sleeps for 10 years.
(3) Ex. – enclosing land in a fence; pasturing of animals w/in a substantial enclosure, cultivating corn on a cornfield, living in a house, making improvements on the land, etc.
(i) Tricky w/ unimproved land
(1) Can’t share possession w/ true owner or general public
(2) “Exclusive” = possession as exclusive as an owner would normally have of the type of land in question
(3) To interrupt A’s attempt at adverse possession, O must exclude A, retake possession by using it in the manner an owner would