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Property I
University of Illinois School of Law
Morriss, Andrew P.

Property Spring 2010 Morriss

Table of Contents
Introduction. 4
A. Acquiring Property. 9
1. Lost / Abandoned / Mislaid property, Finder v. Landowner. 9
Case File 6.0: Bascom’s Foley. 9
2. Tragedy of the Commons / Possession / Acquiring property by capture. 10
Case File 7.0: Wilderness Outfitters. 10
3. Acquiring Property by Deed. 11
Case File 8.0: The Estate of John Vail11
4. Ownership of the body and the sale of transplant organs. 13
Case File 11.0: Kidney Failure in Green Iguanas. 13
B. Estates & Future Interests. 14
1. Estates in Land. 14
(a) Generally. 14
(b) Possible Interests. 14
(c) Transferring an Estate. 15
(d) Category: Fee Simple. 15
(e) Category: Life Estate. 16
(f) Estate for Years. 17
(g) Fee Tail17
(h) Defeasible Estates. 17
2. Future Interests. 20
(a) Generally. 20
(b) Common Law Future Interests Retained by Transferors. 20
(c) Common Law Future Interests Created in Transferees. 22
(c)(i) Vested Remainder. 23
(c)(ii) Contingent Remainder. 24
(d) Executory Interests. 25
3. Adverse Possession. 26
Case File 12.0: Nora Charles & Asta. 26
4. Life Estates. 28
Case File19.0: River Ranch Trees. 28
5. Rule against Perpetuities. 29
6. Mineral Rights, Option Contracts & RAP. 35
Case File 21.0: AmVestors. 35
C. Co-ownership. 36
1. Ways to Jointly Own Property. 36
(a) Tenancy in Common. 36
(b) Joint Tenancy with Right of Survivorship. 36
(c) Tenancy by the Entireties. 37
(d) Issues. 37
2. Interpreting w/o Magic Words: Joint tenancy and tenancy in common. 38
Case File 23.0: The Frying Pan Cabin. 38
3. Partition of Tenancy in Common. 39
Case File24.0: House of Breadfast39
4. Reviewing condominium rules. 39
Case File 25.0: The Next Tricki Woo. 39
5. Joint Property Issues w/r/t Tenancy by the Entireties. 40
Case File 27.0: Fineman Hardware Store. 40
6. Marital Property & Dividing it upon Divorce. 42
Case File 28.0: Payton Main’s Divorce. 42
D. Landlord/Tenant44
1. Landlord’s Duty to Control Other Tenants: Constructive eviction in a commercial setting. 44
Case File 29.0: Coco’s Restaurant44
2. LL’s and Tenants’ Rights w/r/t Subleases and Assignments. 45
Case File 30.0: Fit for Life. 45
3. Landlord’s Responsibilities w/r/t maintaining the property. 46
Case File 35.0: Mouse in the House. 46
E. Land Sales. 46
1. Sales of real property / who bears the risk of rezoning?. 46
Case File 43.0: Tucker’s Garage. 46
2. Sales of real property / Warranties. 48
Case File 44.0: Shingles. 48
F. Easements & Covenants. 50
1. Easements gross and appurtenant50
Case File 47.0: Fishing the Calfpasture. 50
2. Implied reciprocal negative easements. 51
Case File 48.0: Winkel Properties. 51
3. Running covenants. Do they run with the land?. 52
Case File 50.0: The Komondor. 52
G. Government Restrictions on Use. 53
1. Zoning Out a Topless Bar. 53
Case File 55.0: Decency in Grimes. 53
2. Nuisance. 54
Case File 57.0: Gravel Trucks on Cold Duck. 54
H. Takings & Condemnation. 58
1. Condemnation. 58
Case File 63: Patty’s Flower Shop. 58

Introduction
1) Property law enables us to:
a) Acquire property
i. When you are sitting in a real estate closing you might not know the details but you know something important is going on because you are signing a bunch of papers – old example of actually going to the land and passing twigs and dirt back and forth.
b) Own property
c) Use property
i. Can you exclude people from your property?
d) Make property into collateral
i. In transactions
e) Share property
i. Spouses
f) Dispose of property
i. Property might have negative value (if it has toxic chemicals that you are obligated to dispose of can you just say “I don’t want this land anymore!” and get rid of that obligation)
ii. Can’t develop the land because of zoning but still have to pay homeowners dues, like a game of hot potato – yours is the last name on the land so you are obligated to pay for it forever bc no one wants it
g) Solve conflicts over property
i. between owners & non-owners
ii. among owners
iii. between people with simultaneous claims to particular property
2) Common Property (everyone shares) / Private Property (individual or group of individual owns)
a) “Fee simple absolute” = maximum sized bundle of rights possible under Anglo-American law.
i. Fewer rights now than historically, but still the most rights you can have.
ii. You own Blackacre, located in Champaign, IL, in fee simple absolute. You own:
ü You can develop on it within the zoning regulations (Champaign County zones based on soil quality to try to reserve the best quality soil for farming)
· And within further restrictions (ie: dad’s development where can only paint house sand colors – it’s in the deed)
ü Can sell your property to anyone (unenforceable covenants in deeds excluding selling property to certain racial/religious groups, against public policy and will not be enforced)
iii. What you don’t own:
ü Can’t just go shoot an endangered animal just bc it’s on your land
ü Don’t own a bunch of land use rights (city of Champaign has taken away some of those rights)
ü Don’t have the right to put an exclusionary covenant about who can own it after you (race/religion)
ü Don’t have the right to build inconsistent with the things that are around you (gas station in the middle of a neighborhood)
ü Can’t use your property in a way that harms other people (nuisance)
iv. Who owns what you don’t own?
ü City?
ü Your neighbors?
v. Property rights become more specified when they become more valuable – ie: bundle of rights in Greenacre, NY would be smaller than the bundle of rights to Blackacre in Champaign, IL.
ü You are closer to ppl (buildings touching each other!) in NY so the possibility of infringing on others’ rights is larger
ü Condos in NY as opposed to houses in IL, you won’t own an acre of land in NY, you own a room
ü Champaign has looser land use restrictions than Urbana, that’s why North Prospect built up over time (Urbana & Champaign used to be more of the same size).
b) Married Couple in Champaign, IL:
i. If you & professor own property there are fewer options available to you than if you own it with your spouse.
ii. This is why who we allow to marry matters
iii. BC the husband & wife is one person (“and that person is the husband”) – wife couldn’t control it but it was still hers. Then the West (Wyoming – also first state to give women right to vote) started to change that – on a huge ranch the woman needs to be able to sign contracts in case the husband is on the other end of the property or off on a fishing trip.

ne else will take it.
d) English medieval culture:
i. Common land for keeping cows would get overrun (cows would eat all the grass and the cows would die) if there weren’t rules in place for how many cows each person could put out there.
e) Maine lobster gang:
i. Control who fishes for lobster so controls the lobster population, no overfishing
f) Fishing on Island:
i. Have to pay someone to fish for salmon
g) Avert the tragedy of commons by regulating access
i. Need some mechanism for controlling access
ii. Give one person or a group of people right of access to keep others out (external mechanism), within that group there might be an internal way to regulate (you get to put cows on the common land in proportion to how much land you have, don’t just get to put infinite # of cows on there)
h) Unitization (oil in Texas)
5) Transaction Costs
a) How can I make it cheaper to do transactions (DeSoto)
b) Lawyers are part of transaction costs
c) Standard bundles reduce transactions by making negotiations cheaper (like “fee simple absolute” or “corporation” – having those categories/tools “pre-made” (off the rack clothes) you don’t have to keep negotiating those things over and over again (tailor-made clothes)
i. Have to make up for it in volume: do more deals
d) Rules provide predictability – some courts (NY State) don’t want to change the law much bc ppl might have relied on it in ways they don’t know. others have no problem (CA)
e) Transactions increase wealth or else people wouldn’t do them, so more transactions (because of lower cost of transactions) is a GOOD thing. Lots of parts of property is making it cheap & easier to do lots of transactions.
6) Rebundling Rights
a) Find new ways to mix up rights that relate to a specific piece of property, can increase value by doing this.
b) Bundle of sticks metaphor
c) Rearranging bundles through voluntary transactions
i. Can break the sticks in half, rearrange the sticks in order to do transactions
d) If you give up something that is not important to you in order to get something that is – purple house stick was traded by his father in order to live in that community.
e) Defining new “sticks” in the bundle:
i. Can come up with a new stick in the bundle: mineral rights, and define those rights.
ii. Right to lateral support – mining towns – right to not have your land collapse bc your neighbor dug a mine. Some people were willing to pay a lot for that, others would pay less for land bc they didn’t care if it had lateral support.
f) Reallocating ownership of particular “sticks” through regulation / expropriation / forced sales.