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Property I
University of Illinois School of Law
Reynolds, Laurie Jo

Property Outline – Reynolds – Fall 2010
I.                   Intro Topics
Property law is seen as a “bundle of rights” with each right being neither necessary nor constant. They change and depend on external factors. The three main sticks in the bundle are: Right to use, Right to transfer, and Right to exclude. Right to exclude has been seen as one of the most essential sticks in the bundle. Blackstone once said that you have absolute control over your dominion; however, State v. Shack proves that this is not always true.
 
A.     Three specific special rights of property.
       None of these are absolute; they’re changing. (U-T-E)
1.      Right to use
a.       Moore v. Regents
2.      Right to transfer
a.       Jones v. Mayer
3.      Right to exclude
a.       RULE: Two Common Law Rules
                                   i.      Golden Rule of Property – Use your property as not to interfere with the rights of others
                                 ii.      Necessity Doctrine – Authorizes state to limit property rights when it is necc.
b.      Trespass: You cannot exclude everyone from property, and cannot violate rights of others who may not own property
                                   i.      3 Ways not to be guilty of trespass: (1) owner’s consent (2) court can limit right to exclude (3) court can rule the individual trespass is unconstitutional
c.       * See State v. Shack
 
B.     What is the role of property?
1.      To protect owners
2.      To protect non owners (i.e. property owner who puts nuclear plant in a neighborhood)
 
 
C.     Objects and Classifications of Property
 
1.      Objects of Property
a.       Property is both tangible and intangible
b.      Traditional objects of property are chattels, intangibles, land surfaces, land sub surfaces and minerals, water, and air space.
2.      Classes of Property
a.       Movables (chattels –personal property)
b.      Immovables (land and things currently attached)
3.      Definitions
a.       FIXTURE: Although once a chattel, now is part of the land.
b.      MOVABLE: Object not naturally part of the earth or sea.
c.       FREEHOLDS: Those interests that endure for the life of the holder or longer
d.      NONFREEHOLDS: Interests that endure for a term of years and those that endure at the will of the parties.
 
 
D.     The Role of Property in Society
1.      Two sides to property
a.       Individual
b.      Social side – finds this side through eminent domain and taxation
2.      Sovereignty in Property
a.       State must interfere with property rights
b.      When taking away property rights, state not always bound to compensate directly
3.      Legal Positivism
a.       Dominant view in the US that property rights arise only through the government
b.      *See Johnson v. McIntosh
4.      Definitions:
a.       DISCOVERY: British law, if you discover it, you have rights to land (Exception: native inhabitants).
 
II.               Finding
Law of finders addresses how society distributes property rights when a person acquire possession of an item of personal property through finding. The interests it involves are: the finder, true owner, the owner of real estate where item was found, subsequent finders, society.
 
A.     Rules of Finders
1.      RULE 1: Movables vs. Natural Deposits
a.       If object was natural deposit, fixed to the earth, it belongs to the property owner. If object was movable, it  belongs to finder
                                   i.      *Goddard v. Winchell
2.      RULE 2: Doctrine of Accretion and Doctrine of Avulsion
a.       Accretion: slow-moving natural changes like dirt blowing in wind onto land
b.      Avulsion Sudden Change
3.      RULE 3: Legal Possession
a.       Have to find balance between Full possession and non-possession. To do so, look at steps taken towards possession.
                                i.      *Eads v. Brazelton
4.      RULE 4: Grey’s Rule
a.       Full possession occurs when finder has complete control and momentum has ceased.
                                i.      *Popov v. Nayeshi
 
B.     Important Factors to Consider in Finders Cases
1.      Inconsistencies in how cases are derived stem from individual courts emphasizing different things
2.      What to look at to determine who has possession?
a.       Relationship between parties
                                                              i.      Owner of shop/public place usually has best claim to title
b.      Nature of the object found
c.       Mental state of the true owner
                                                              i.      Bridges v. Hawkesworth, banknotes on floor of shop were not “intentionally deposited” there by owner; were considered “lost” and awarded to finder.
d.      Expectation of Land Owner
                                                              i.      In Hannah, the land owner never held possession; could be said that once possession of the house was lawfully transferred t

ceive protection from the law. When doctrine of BFP applies, it overrides the basic rule of common law that says “no one can convey a better title than he/she has.”
 
 
A.     Two important inquiries for BFP
1.      Is the first transfer void or voidable, thus affecting C?
2.      Is C a bona fide purchaser?
a.       Did the middle man obtain property through stealing? If yes, no BFP
 
B.     Rules for BFP
1.      RULE 1:  BFP must be “buyer in the ordinary course of business”
a.       Usually doesn’t apply to specialty dealers (Like Feign)
2.      RULE 2:  BFP must purchase (1) In good faith, (2) for market value, (3) without notice—express or implied—of any defect to seller’s title.
3.      RULE 3:  UCC 1-201: Party who lost the goods can’t go after the BFP, they just go after the middleman if they are both parties in the same business
a.       Rationale: Don’t want to slow the wheels of commerce.
 
C.     UCC 1-201 (Statutory Estoppel)  v. Common Law (Equitable Estoppel)
1.      Statutory Estoppel: “Any entrusting of possession of goods to a merchant who deals in goods of that kind gives him power to transfer rights of  X to a buyer in the ordinary course of business”
a.       UCC 1-201 defines a buyer as: “A person who in good faith and without knowledge that the sale to him is in violation of the ownership rights or security interest…from a person in the business of selling goods of that kind” (207).
2.      Equitable Estoppel – Common Law: “Owner may be estopped from setting up his own title and the lack of title in the vendor as against a bona fide purchaser for value where the owner has clothed the vendor with possession and other indicia of title”.
a.       For common law, BFP must have more than possession. Possession alone isn’t enough.
3.      DIFFERENCES:
a.       Under Common Law (Equitable Estoppel), purchaser has to make inquiry into provenance of an item to qualify as a BFP.
b.      UCC  (Statutory Estoppel) requires no inquiry into history/dealings of item