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Property I
University of North Carolina School of Law
Kalo, Joseph John

Kalo – Fall 2005

I.                    Original Title to Personal and Real Property
a.       Four Basic Elements of Property Rights:
i.      Right to Possess
ii.      Right to Use
iii.      Right to Exclude
iv.      Right to Transfer

b.       Principle of Primacy: First in time [as to what] gives you first in right?

c.       Rule of Capture: (Wild Animals) Pierson v. Post: If wild animals (ferae naturae) are captured, they belong to the capor. Mere pursuit is not enough to establish possession, unless w/in that pursuit the pursuer has mortally wounded (taken the liberty from so that capture is virtually certain) that animal.
i.      Rationale: The rule of capture fosters competition, and rewards the captor and not the mere pursuer.

d.       Rule of Capture for Oil: A landowner who is the first to bring the oil under its control has superior possessory rights to it even if it lays below the surface of several landowners.

e.       Role of Custom: Custom may affect the traditional rule of capture. For instance w/ whaling custom allows for cutting the line once the pursuer has mortally wounded the whale and granted possession rights to the first to harpoon the whale. ~ Captain Ahab problem

f.       Finders, Bailments & Accessions
i.      Accession (Conversion) The act of taking one’s property and using it as one’s own, and somehow changing the form.
1.       Essential Elements:
a.       A has a property interest in X.
b.       B interferes w/ the ownership or right of possession of X w/ respect to A.
c.       B somehow mixes his labor with X.
d.       Remedies:
i.      Damages – value of x.
ii.       Replevin (return): if the item has been so altered that it no longer has the characteristics of the original item A possessed, A may only be entitled to damages for the original value.
2.       Note1: Original Possessor has the ultimate and superior claim to anyone in the chain of conversion.
3.       Note2: Good faith & lack of knowledge is not a defense, may only reduce liability
ii.      Bailments –
1.       The finder of lost property has superior title to all but the true owner.
2.       The owner of the premises has a superior claim to MISLAID property to all but the true owner.
3.       The finder of abandoned property has a superior claim to all.

g.    Intellectual Property Rights
i.      An idea that has not been copy written, trademarked or patented cannot be considered the property of an individual if he/she has disclosed the idea to someone else.
1.       Public disclosure of an idea makes it available to all.
2.       An idea is free for all to use until someone is able to translate it into a sufficiently useful form that it may be patented (common law).

h.    Right of Publicity
i.      Essential Elements (Statutory Claim)
1.       Knowingly use
2.       Another’s likeness
3.       for the purpose of adverstising/selling
4.       without prior consent
5.       which causes an injury
ii.      Essential Elements (Common Law Claim)
1.       Δ’s use of Π’s identity
2.       to Δ’s advantage
3.       without consent of Π
4.       resulting in injury to Π
a.       Identity can be appropriated if we put a scene in context insofar as a reasonable person would assume that the possessor of that identity was involved.
i.      e.g. Here’s Johnny Toilets
ii.      Nascar/ R J Reynolds case – using the car, w/ the same # and design as the Π would lead a reasonable person to infer that Π was involved in the advertising even if Π was not visible in the vehicle.
iii.      The Lanham Act set forth the “Likeliness of Confusion” standard
b.       White v. Samsung – The Δ did not violate Vanna White’s right to pub. under CA §3344 which focuses on “likeness”, but the Δ did violate common law right to publicity which focuses on “identity” – Identity can be appropriated if we take the scene as a whole, if you put the scene in context.
c.       Bette Midler, White & Wendt cases – Provides recovery under the common law claim but not under statutory scheme.
f.        Tour 18 problem –

i.       Tragedy of the Commons
i.      A theory that addresses the potential hazard of unrestricted, accessible, exhaustible resources.
ii.      Elements:
1.       Free
2.       Shared/Open Access
3.       Exhaustible resource
4.       No effective limit on use
5.       No incentive to conserve
iii.      Can the Internet be subject to “Tragedy of the Commons” ~yes.
iv.      Problems:
1.       “Free Rider” problem ~ Kyoto protocol
2.       Lobster Issue – Communal property
a.       customs/shared set of values
b.       monitored activities
c.       boundaries w/ identifying markers – color coded buoys
d.       Informal system of management and sanctions
3.       Oyster issue
a.       regular investment needed
b.       free-rider problem
c.       no strong system of social norms

II.                  Limits on Property Rights
i.      The Right to Exclude: A property owner’s right to exclude is not absolute.
1.       State v. Shack – Property rights are culturally contingent.
a.       An owner of real property does not control the wellbeing of individuals permitted to come on the premises (migrant workers) especially in this case where they were of disadvantaged status
b.       The title to real property cannot include dominion over the destiny of persons the owner permits on the property.

III.                Common Law Rights of Property Owners
i.      A property owner does have the right to protect against encroachments:
1.       The Piles cases – A property owner ought not to be deprived of their land except in the most extreme circumstances.
2.       Williams v. South & South Rentals –
3.       Right to Exclude – Jacque v. Steenberg
a.       There is a greater policy interest in protecting PO’s right to exclude, here even though there were no damages to PO’s property, the court allowed the imposition of punitive damages which will act as a deterrent to future invasive acts.
b.      Liability Rule v. Property Rule
i.      Liability Rule: The state determines the value of the land encroached/permanently trespassed upon. Objective standard. 
1.       (What is the reasonable market value?) ~ Usually involves a trespass of public utility.
ii.      Property Rule: Protects the Π’s right to seek damages or removal absolutely.
1.       Involves a collective decision as to who is to be given an entitlement but not the valued of the entitlement – value can be subjectively determined.

IV.               Adverse Possession
a.       Elements:
i.      AP must be in actualpossession of the land.
1.       The AP must have actual physical occupancy of the property; must be using it.

ii.      Possession must be exclusive by the AP.
1.       The AP excludes all others from the land unless they have the permission of the AP.  Must not be acting as a occasional trespasser.
iii.      Possession must have been open and notorious and must have been under known and visible lines and boundaries.
1.       The AP must be possessing the land in such a way to give notice to the TO. The possession is not concealed; must be visible to others.
iv.      Possession must be adverse (hostile) & under a claim of right
1.       Possessor is acting as an owner of the property, rather than as a transient, or casual trespasser might act. (Objective Majority View)
2.       Aggressive trespasser (bad faith)/Good Faith/Mixed Intent – (Subjective Minority View – NC)
3.       A third party would assume that the AP was the TO of the land.
v.      Possession must have been continuous and interrupted for the statutory period (generally 20 years against an individual, 30 years (NC) against the state)
1.       Does not require that the AP remain on the land w/o cessation, but to remain on the land as a TO would. A vacation would not nullify the continuity requirement.
b.       Tacking: If AP1 has privity to AP2 the the 2nd AP may tack the duration of his/her occupation of the land to the duration of the 1st AP’s occupation to satisfy the requisite statutory period.
c.       Color of Title: A written instrument that conveys a tract of land but is faulty in some way. (Not a legal deed)
1.       Must be in writing.
2.       Fo

lder of the remainder.
1.       e.g. the life tenant can’t tear down the property or let it go to ruins, or the remaining party can bring tort action for breach of duty against the life tenant.
ii.      Types of Waste:
1.       Voluntary (Affirmative) – an affirmative action by the life tenant that damages the land by changing its nature, character or improvements to the detriment of the future interest holder.
a.       Tearing down property, cutting trees, extracting minerals.
2.       Permissive – damage to the future interest holder that occurs by virtue of the life tenant’s failure to maintain and preserve the land and its improvements properly.
a.       failing to pay taxes, failure to maintain roof or other necessities
3.       Ameliorating – life tenant changes the nature or character of the land or its improvements, but the change increases the economic value of the land.

e.      Defeasible Estates
i.      Limiting an estate granted so that it would be divested (terminated) either automatically or upon the occurrence of certain future events.
ii.      Defeasible estates do NOT have to be fee simple estates.
1.       The Fee Simple Determinable (FSD)
a.       an estate in fee simple that terminates automatically once the state restriction (special limitation) is violated.
b.       possibility of reverter: once the grantee’s right to the estate is terminated the future interest of the grantor becomes a present possessory estate w/o further legal action.
c.       e.g. O conveys to X so long as the land is used for farming.
2.       The Fee Simple Subject to Condition Subsequent (FSSCS)
a.       gives the landowner the option to terminate (right of entry/power of termination) the estate and recover possession of the land upon violation of a condition. Condition subsequent is NOT automatic. After the condition is broken the grantee’s estate continues until the grantor exercises right to terminate.
i.      Note: Upon the grantee’s termination of rights to the estate, the grantee can be considered an AP until the grantor exercises the power of termination (within a reasonable time) .
1.       In NC the grantor has 60 years to exercise the power of termination: § NCGS 41-32
ii.      e.g. O conveys land to X, but if premises are not used for farming O may re-enter and recover the premises.

3.       The Fee Simple Subject to Executory Limitation/Interest (FSEL/I)
a.       gives the landowner the option to divest an estate upon a 3rd party at the breach of a special limitation by the grantee.
i.      e.g. O conveys land to X until X ceases to use land for farming, then to Y.
ii.      Y’s interest is considered an executory interest.
b.       Y has a remainder interest in the estate if X violates the condition.
4.       Distinguishing between Reversion & Remainder:
a.       Reversion1 is a future interest that is held in the original grantor at either the violation of a condition of a FSD or FSSCS.
b.       Reversion2 is an interest in an estate that O retains when he conveys an estate deemed smaller than his own, his future interest in that estate is reversion.
i.      e.g. OàK for life… O has a FSA and only conveyed a LE (which is smaller than a FSA), thus he maintains a reversion in FSA.
c.       Remainder is a future interest that is held is in a 3rd party usually in a life estate pur autre vie.