Property I Outline

I. Introduction
A.
1. Real Property:
land
B. Ownership —
1.
Most cases are a legal struggle of arguments regarding what is ownership.
C. Possession:
D.
E.
F.
1.
2.
3.
4.
Which rules are more just?Which rules are better in terms of our understanding of community?Which rules do justice to our personal autonomy? Which rules best maximize our communal pie?
G.
H.
I. Consensual transactions:
I. Chapter 1 – First Possession:
A. Acquisition by Discovery:
B. Acquisition by Capture:
1. 4 purposes:
a.
b.
c.
d.
Introduce some features of legalese – rules and standards (and what distinguishes them), custom, analogical reasoning, instrumental reasoning, the role of legal concepts.Preview the law of natural resources. Introduce the rule of capture, specifically concerning wild animals.
2. Pierson v. Post:
a. Facts:
i.
ii.
Both on common property for the purpose of hunting (not a case about trespass).
b. Issue:
i.
ii.
Question: Who had possession, and therefore, who is the rightful owner? “What acts amounts to occupancy, applied to acquiring right to wild animals?”
c. Holding:
i.
ii.
Livingston: dissenterMajority opinion: whoever deprives the beast of its natural liberty has possession (so D).
d. Reasoning:
i.
e. Dagan’s Comments:
i.
ii.
iii.
iv.
v.
vi.
Anytime we think incentives, we need to think how behavior will change.
vii.
Judges sometimes rely on empirical evidence to prove their point. Be suspicious of this empirical evidence – it is faulty. Most economists today think that the majority’s opinion will lead to more dead foxes, not Judge Livingston. Law needs to be a hybrid of rules and standards. There are some situations in which we feel more comfortable with rules, some in which we are more comfortable with standards. Rule stands in contrast to Standards: Open-ended norms. A rule of reason (reasonableness). MudHow is certainty promoted by a rule that says possession comes by mortal wounding? Rule: The norm of the majority. Has a list of variables, each of which is relatively easy to determine. Rules are subject to a relatively objective factual evaluation. Crystals. Create certainty. First possession: they agree with the principle, but they disagree on what it means to be first in time.
Community goal is to kill foxes – in order to achieve this goal we need to interpret these rules that will produce the right incentive. Livingston: Rule: reasonable prospect of capture is enough for possession. It is society’s goal to kill foxes. If this is the goal, then we need to promote people to hunt foxes (turn it into a business). If killing foxes becomes a business, then people will invest (in technology, etc.) to make the business more productive. This is a sporting issue, not a business issue.
3. Ghen v. Rich
a. Facts:
b. Holding:
c. Reasoning:
i. Custom
ii.
Probably would have happened anyway because this promotes more dead whales. Had it been decided the other way, the industry would have seized.
d. Dagan’s Comments:
i.
ii.
iii. Custom:
iv.
Alternative to custom is a top-down approach. Rules developed by legislators. bottom-up – People’s behavior begins to have normative, binding effect enforced by court. The law relies on people on the ground in order to establish efficiency.Ghen sold Rich and not Ellis probably because Ellis is gone. This is the result of a legal accident.
Court could have used Pierson v. Post and relied on the rule that Ghen had done all he could – he mortally wounded the animal. – Under 3 conditions: 1. Usage found to prevail generally in the industry. 2. Limited to this one business. 3. Unlikely to disturb outsiders.For P. P-Ghen is a whaler. Ellis found the whale. Rich is the buyer of the whale.
4. Keeble v. Hickeringill
a. Reasons:
i. Constructive:
although it is not, it is. This can be used as long as it makes sense – it is in harmony with the goals we want to encourage.
b. Dagan’s Comments:
i.
ii.
iii.
iv.
Possession is a legal concept – it has purposes. As long as the purposes make sense, our precedents seem valid.
v.
Rules need to have same purposes to make sense.
vi.
Start with the goals, end with the language of the law. Start with what we want to accomplish, end with the concept.
5.
6.
7. Relativity of Title:
a.
i. Self help:
to help one’s self (outside of legal processes). This is a bad thing.
T trespasses and captures a wild gaming bird. T1 trespasses and steals bird. In a court of law, T will prevail over T1, even though T trespassed to get the bird in the first place. Title/ownership is relevant, and the law favors first-possession.
8. Animus Revertendi: domesticated animals that are known to have developed a habit of return.
a.
b.
Concerning animals not usually domesticated (deer, etc.), owners have some responsibility to mark them – or they are negligent. animals usually domesticated (cat, dog, horse, cow, etc.) are not open to the public to be hunted/taken.
9. Bundles of rights:
a. Ex. Geese and government:
We may call a regulator an owner, for the purpose of a regulation we think is desirable. For other purposes we may change the meaning of ownership to mean “a regulator without consequences of harm.”
10. Natural Resources –
a. Analogy:
i. Virtues
ii. Difficulties
: Rules for one thing may not work when applied to other things. For example, The rules of capture seem to have disastrous consequences when applied to natural resources. : we can rely on our past experience to establish new rules on the frontier.
b. Bernard Rule:
c.
In the case of water we need significant investment for capture. We want to encourage this investment, so we give right to possession even before water is actually appropriated. We do not want to encourage duplicate efforts when they are counterproductive. rule of capture applied to oil and gas. Overturned quickly. expand the scope of an existing case.
11. Demsetz’s Article: “Toward a Theory of Property Rights”
a. Demsetz’s point:
b. Commons:
i. Open Access:
ii. Common Property:
iii. “Tragedy of the Commons”:
iv.
v.
Commons promotes high Transaction Costs: The cost of coming to an agreement. Includes free-riders and hold-outs. If the only effect of commons is systemic distribution (things distributed equally to everyone in the community), then there is no tragedy. But, in leading to over or underconsumption, commons does not take into account the future. The inevitable workings of this regime lead to tragedy – this tragedy being overexploitation of resources and little or no conservation. resources owned and managed by a finite number of people working together and excluding outsiders. Commons usually refers to Common Property.anarchy – no law. There are no restrictions to use.
c. Private Property:
i.
ii.
iii.
iv.
There are externalities even with private property, but with private property transaction costs are minimized – only have to negotiate with neighbors. The benefits of private property are the costs of common property. The costs of private property are the benefits of common property.Also reduces transaction costs significantly. Solves commons problem by internalizing external costs and benefits, and provides incentives for conservation, efficiency.
d. State Property:
e.
i.
If pressure on the resource is not high enough, property will not be privatized. Private property is expensive – to enforce, to regulate, etc.
f.
i.
ii.
His account is still a ringing celebration of market capitalism, private property. His view is: Because of scarcity it will be worth our while to shift toward private property. It is the happier, more viable arrangement of natural resources.
g.
h. Problems with Demsetz.
i.
ii.
iii.
iv.
If we evolve to private property, then we shouldn’t see society going back to commons, but we do see it. Doesn’t explain how private property develops. Transaction costs appear too high for it to happen. Does not address state ownership.
i.
i. Economic benefits:
ii. Social benefits:
Sometime people are lonely. They enjoy working together. Commons property is a media through which we interact with each other