PROFESSOR RHETT LARSON
OU COLLEGE OF LAW
THE NATURE OF OWNERSHIP AND PUBLIC GOODS
Theoretical Foundation for Property Law
· Theories for Why We Protect Private Property:
o –Promote Development (Possession & Capture)
o –Promote Labor and Specialization
o –Promote a Utilitarian Social Policy
o –Promote Democracy
o –Promote Individual Liberty
The Bundle of Sticks – All property is is Legally-Recognized Rights in Stuff
–The right to transfer
–The right to exclude
–The right to use
–The right to destroy
The Tragedy of the Commons (Hardin)
When there are no property rights but common pool resources instead, the shared resource is depleted as everyone lives in their own self-interest.
o The way to control tragedy of the commons is to assign property rights. When you deal with all the costs and benefits of the property, you’ll better control your crap.
Tragedy of the anti-commons: give too many property rights, then the possessor will not share at all, hurting everyone else.
Example: “patent troll”
Externalities and Transaction Costs (Coase)
o Externality: A cost or benefit that is experienced by someone who is not a party to the transaction that produced it.
§ A negative externality is a cost experienced by someone who is not a party to the transaction that produced it.
§ A positive externality is a benefit experienced by someone who is not a party to the transaction that produced it.
· Transaction costs: things that could prevent two people from negotiating.
A Few Terms
· Excludable: the extent to which you can keep people out.
· Rivalrous: my consumption affects your consumption. (non-rivalrous: does not affect)
· Endowment effect: value your own stuff irrationally. Once it’s yours, you think it’s worth more.
What Can and Should Be Owned? Thinking Critically About the Lines of Property
What Property Rights do you have in yourself?
· Moore v. Regents of the University of California (Cal. 1990): commodification—turning something that’s not typically a commodity (like a body organ) into economic commodity. Moore holds you can’t do that. The stuff inside you, once out, may not be actually yours.
o Three Reasons Moore came out the way it did:
1. Problem’s Solved: Moore was gonna win on fiduciary, so no reason to add a property right
2. Better for Legislature: “institutional competency”
3. Public Policy: we don’t want to stifle innovation, esp. in medical research.
· White v. Samsung Electronics America, Inc. (9th Cir. 1992): rights of publicity—your own fame, identity, is a protected property right. Don’t own what’s inside of you, but anything resembling Vanna is hers.
Both Commodification and Publicity Rights can be argued to encourage productivity.
Conversion vs. Trespass (Real Property vs. Chattels)
· Conversion is to personal property as trespass is to land. Criminal version of conversion is theft.
· Understand the basic theoretical underpinnings of property law (tragedy of the commons, transaction costs, externalities, rationales for protecting property rights, etc.).
· What is the “bundle of sticks” concept in property law?
· Be able to distinguish private goods, toll goods, common pool resources, and public goods (understanding the concepts of rivalry and excludability).
The Rule of Capture
· “The rules of Shotgun”
· First in Time, First in Right. Seems tough, but still the most prevalent view.
Pierson v. Post: Post steals Pierson’s fox as he was pursuing it.
State v. Shaw: Shaw convicted of stealing fish from net that was open but full of fish.
· To show property: (1) bring them into her power and control, (2) maintain her control, and (3) show that she does not intend to abandon the wild animals back into the wilderness.
· Animals: “deprived of natural liberty” is considered captured (fatally wounded, in a trap, etc.)
o When professionals or big money are involved, this usually goes the other way. If you get in their way, it may be tortious interference
· The NATURE of the THING you’re capturing matters.
o Somebody who finds a ring has to put it in their pocket. Catching a whale is different.
· CUSTOM matters—may be better to have arbitrators from industry decide, not an ignorant court.
o Often in applying the Law of Capture, you import the custom from the relevant community.
o In every instance of rule of capture, you’re talking about norms, customs, money.
· Does it matter whose land its on? YES, if on your land, you have constructive possession.
Why the Rule of Capture?
· –Externalities & The Tragedy of the Commons: simple for evidence and administration.
· –Promoting Labor and Development; Efficiency
· –Equity and Poverty: also bad, aggravates inequities.
· Some argue it is the opposite: Can be inefficient. Aggravate inequities. Tragedy of the commons.
Capture of Chattels
· –Popov v. Hayashi (2002): who owns a baseball hit into the stands?
· –The relationship between custom and property law.
Other Moderns Examples of, or Candidates for, Capture
· Applies to: animals. Baseball. Water rights. Oil and gas (moving away, today mineral rights belong to property rights).
· –Domain Name Speculation
· –Appropriative Water Rights
· –Carbon Credits
· –Renewable Energy Sources
ll pay you some value.
What is the public trust doctrine and why is it significant?
Explain the legal concept of “navigability” and why it is important.
What resources are, or should be, public trust resources?
What is the role of the rule of capture in the public trust doctrine?
· (1) ancient (really old); (2) reasonable; (3) certain (need evidence that you use the land); (4) uniformly observable
o common law based on Roman and English title. Not in Johnson, but used with ICC after WWII. If you could demonstrate title under this standard, you could get land back.
o not an on/off switch. It’s not black and white, it’s gray.
Johnson v. M’Intosh: conquesting nation gets the land; natives get occupancy, but it can be taken from them. Marshall basically gave them usuctory rights in the land, but can’t sell it. Still good law today.
o payment (we gave you civilization and Christianity),
o development (you weren’t using it),
o if we don’t, somebody’s gonna shoot at us. (Marshall racist, but may have made right call)
· When you discover/conquest something, how far does it go? Answer: as long as you can keep/defend it (how big your guns are).
Native American Property Rights and the Trust Relationship
· Gov’t holds lots of land in trust for the tribes. So tribes can sue for br/fiduciary duty.
The Winters Doctrine and Tribal Water Rights
Winters Doctrine: Any time fed gov’t reserves land, implicit within the reservation they reserve a sufficient minimum amount of water to meet the primary purpose of the reservation.
· Implicit: you don’t have to do anything
· Primary purpose is to establish a permanent homeland for those people.
· How do we establish how much land? Question is how much water does it take to do that?
· Typically the “PIA” – Practicably Irrigable Acres.
o Problem? Tribe’s population may expand. Assumption is people want to farm. Large tribes like PIA, small tribes with little irrigable land do NOT like it.
General stream adjudication: McCarron Amendment. Most would not like getting dragged into state court, but some would because it allows them to settle out. Might allow them to negotiate things they want.