Tangible – personal possessions, land
Intangible – I.P – concept, idea; copyrights, trademarks, goodwill in a business
Pound’s “Bundleof property rights” – each element/right (six rights – enjoyment of fruits or profits, use, dispose, exclude, possess, destroy) is a stick in the bundle. The sticks can be separated, but you would still be the owner (renting or leasing an apartment to someone – you still own apartment, but you are giving away the right to exclude others for the period of time person rents apartment from you). One need not have all the rights in order to have a legally protected interest in a thing.
–Johnson v. M’Intosh – Plaintiffs had land conveyed to them by the Piankeshaw Indians, Defendants had same land conveyed by US. — Property is anything to which you can attach the following note: “To the World: Keep off X, unless you have my permission, which I may grant or withhold. Signed: private citizen (endorsed by the state).” – Legal Positivist Approach—”Property is the sole and despotic dominion that one claims and exercises over the external things of the world, in total exclusion of the rights of any other individual in the universe.”
B. Acquisition by Discovery
Court held the Indian title was invalid, because of the “doctrine of discovery,” which said whoever got to an unclaimed piece of land in America first claimed it in the name of his European sovereign, who recognized it as held by the discoverer, giving him the right to exclude other people and have the title.
Europeans owned the land, but Native Americans had a right to occupancy, but this right to occupancy didn’t mean they had a right to convey title.
Chain of Title
Under discovery doctrine, Europeans may only take over land from original occupants in 3 instances:
Conquest – allowed only in the event of a just war (only happens in self-defense), and when the land was annexed into your country
Cultural Interpretations of Possession – European view is that owning land is exercising dominion over land, doing things to it, and excluding others from it. Indian view is that Earth is organic and no one owns it. Rather, occupants are stewards of the land. One leaves a small environmental footprint on land.
Five Main Theories of Property Rights:
Natural Rights Theory
Social Utility Theory
– (most relied upon today) Legal protection of private property promotes the maximum fulfillment and protection of human needs. Social utilitarians say that all laws should fill needs and aspirations, so property laws are justified, because they successfully satisfy the human rights and human needs more than other theories do.
The law of capture allows an individual to perfect a private personal right in a wild animal by establishing possession of it.The law of capture can promote scarcity. Pursuit is not capture.
If there’s an infinite amount of a certain resource, we don’t need any rules about how much we are allowed to take (air, water) – the second we realize we live in a finite world with finite resources, scarcity kicks in and rules regarding private property rights have to be set in place to determine who gets what – can lead to overinvestment in capital resources (bigger boats, etc).
Wild animals in their habitat are the property of no one.
Owner of land owns no property interest in wild animals on the person’s land
U.S. Possession Rule
Ex: Fisher had 28 feet net and encircled fish with net. Net had hole in it. Hole left practical possibility of escape. Court determined that it was practically impossible for fish to find hole; therefore, capture had occurred and possession had been established, and a property right existed.
Policy is that it encourages people to capture wild animals, and the rule helps protect the time and resources of the people who are investing in materials to help them catch wild animals, so they can rightfully enjoy the benefits – consequence is that it creates scarcity. – Possession requires actual deprivation of animal’s liberty, by killing, capturing, or mortal wounding combined with pursuit & near certainty of capture. Short of actual capture or killing, you must establish capture somewhere between the practical impossibility of escape and certain capture being insufficient. – some sort of natural, or divine, law dictates we protect private property.– Private property rules express a contract, or agreement, between the individual and society as a whole to protect established expectations about how we share stuff. – promoted by John Locke. We own our own bodies, so we have a moral right to ownership of product of that body; therefore, we have a moral right to product of one’s own labor – “possession and exclusion of others” justifies the societal protection of the occupier’s claims – implicit in this theory is “first in time, first in right.”
C. The Law of Capture
Pierson v. Post
Property in wild animals is only acquired by occupancy, and pursuit alone does not constitute occupancy or vest any right in the pursuer.
The mortal wounding of an animal or the trapping or intercepting of animals so as to deprive them of their natural liberty will constitute occupancy.
Possession involves actually killing or capturing the fox. You must have mortal wounding and the non-abandonment of your pursuit, and a virtual certainty of capture.
Dissent in Pierson took the instrumentalist approach – law ought to change with the time and laws ought to be designed to promote or advance some human interest
“Tragedy of the Commons” by Garrett Harden and “Wealth of Nations” by Adam Smith
Adam Smith Proposed Following Theories:
We will participate in voluntary transactions if they lead to us being better off – I value a cup of coffee at two dollars, and you value it at four dollars; therefore, I will sell it to you for four, because that makes me better off by two dollars, and you are better off because you have the cup of coffee you desired.If each of us acts to improve our own self interest, adding up those individual self-interests will maximize the aggregate social satisfaction (if individuals are better off, the community is better off)When we make decisions, we make decisions we believe will maximize our individual satisfaction – it’s not out of goodwill that the baker bakes bread or the butcher cuts meat; he does it to make him more money
Meets at the point where supply and demand intersect – this is the point where society is best off
Ex: I have an industrial site on my property next to a river. It would cost me $1,000 a month to dispose the waste. For no cost to me, I can dump the waste in the water. I save $1,000 a month doing it, and I don’t experience consequences because I dump it at the mouth of the river, so I know where the fresh water is. However, this waste affects another in a great deal, so the pollution is an externalized cost to them.Costs can be externalized if they are imposed on others
These costs will narrow the range of possible tradesImpediments to a transaction (sales tax, negotiation consequences, time)
You receive the benefits that others experience and you don’t work for.
Free-RidersTransaction CostsExternalitiesEfficiencyInvisible HandRational Maximizer
a. The Concept and Role of Property Rights—Property rights lead to certainty in society. They allow people to have certain expectations when dealing with each other and the government.
i. The primary function of property rights is to give incentives to increase efficiency to create a greater internalization of externalities.
ii. Property laws decrease the costs of internalization of beneficial and harmful effects, thus leading to greater efficiency.
b. The Emergence of Property Rights—Indians who hunted valueless animals for their own usage were fine, but when the economy changed with the Fur Trade, property claims began to emerge in response to over-hunting of certain areas.
i. By having your own plot, you a
g. Gold, silver, currency, etc., intentionally secreted by an unknown owner of the distant past.
h. England rule – if treasure trove is found, it goes to the King.
i. American rule – altered rule under two sets of rules:
i. Older Rule – treasure troves are lost, and like all lost property, the finder gets it.
ii. Modern Rule – designed to discourage trespass, so treasure troves go to the owner of the land on which it was found. We justify this by saying either that the treasure trove was embedded in the soil, or that it was intentionally placed there, not accidentally locked in a chest and buried underground, so it becomes mislaid property, which goes to theowner of the land.
a. Armory v. Delamirie – Armory found a jewel which he took to Delamirie, a goldsmith, for appraisal, but Delamirie’s apprentice removed the stones. Delamirie refused to return them.
i. A finder of chattel has title superior to all but the rightful owner or prior possessors.
ii. Relativity of Title – relative to the other people competing for the property, you have better rights to the property.
iii. We also protect prior possession because possession is the only evidence we have that we are the owner – you shouldn’t have to go around proving what you are carrying is actually yours.
iv. By protecting prior possession, we promote voluntary bailments (the entrusting of items to others). A voluntary bailment occurs when the owner of the goods (the bailor) gives possession to the bailee, as when you leave your clothes with a laundry or check your coat at a restaurant or turn over your car keys to a parking lot attendant or deposit mail in the post office.
b. McAvoy v. Medina – P found $ in D’s barbershop, he sued to get it from the owner.
i. A finder of property acquires no rights in mislaid property, is entitled to possession of lost property against all but the owner, and is entitled to keep abandoned property.
Protect Possession as Much as Ownership for Five Reasons:
Advances Public Order
Advances Commerce and Neighborly Conduct
Increase Likelihood Lost Item Will Be Returned to Lost Owner
Easier to Administer than Defending Your Possession or Carrying Receipts to Prove Ownership
A finder is someone who takes possession of lost or unclaimed property by having: (1) intent to control the object, and (2) a sufficient act of control. We must consider the finder’s status. Finders are separated into three categories: – involuntarily placed an object with no intent to abandon– voluntarily placed it with intent to pick it back up, and that true owner forgot he laid it there.
Post was hunting a fox. Pierson, knowing this, killed the fox and carried it off. – unoccupied land – “land owned by no one” (occupancy determined by civilized, socially complex people, like Christian nations such as European nations – just b/c Indians are on land doesn’t mean they are civilized; therefore land was considered unoccupied)– tracking the ownership of something back to the original owner – term of art “first in time, first in right” – dominant property theory at the time of case – any tangible or intangible good, idea or concept one can own through acquisition, possession, exchange/dispose or control (exclude others from having).