Property Snow Spring 2015
PROPERTY
· Property is a “bundle of rights”
o Right of exclusion
§ Enforced through trespass tort
o Right of possession
§ Enforced through tort of conversion
o Right of use
§ Limits: zoning, environmental laws, local laws, restricted covenants
§ Enforced through nuisance
o Right of disposal
· 5 theories of property
o Protect first possession
o Encourage Labor
o Maximize Societal Happiness / Utility
o Ensure Democracy
o Facilitate Personal Development
· Legal definition:
o Rights among people concerning things
FIRST POSSESSION
· Pierson v. Post – fox case
o Decided based on a mix of formalism and policy
o Policy concerns:
§ Certainty of the rule
§ Peaceful society
§ Protecting commerce
o First possession principle: Possession gives rise to property rights. Thus, those who have possession first obtain property rights first.
§ Rule of Capture for Wild Animals
· Need intention to possess
· Deprive of natural liberty
· Brought w/n certain control
· White v. Samsung Electronics America, Inc – wheel of fortune case
o Right of exclusion
§ Can exclude anyone from your property w/o negotiate that w/ them
o Right of publicity
§ A celebrity’s name, likeness, signature, voice all protected b/c they have marketability value
§ Elements to prove:
· D used P identity
· Appropriation of P’s name / likeness for D’s advantage
· Lack of consent
· Resulting injury
RIGHT TO TRANSFER
· Johnson v. McIntosh – Indian case
o Decided based on relativity of title, settled expectations, best use, and Locke’s labor theory
o Relativity of title principle: One may have property rights superior to someone else even though he or she does not have the most superior property rights to that thing. (e.g., true owner < prior possessor < present possessor)
o Settled expectations principle (policy): If culture has formed its society around certain expectations, undermining those expectations would result in chaos.
§ Granting the Indians superior property rights would destroy our society
o Locke’s labor theory: If one spends time, money, energy, etc. on improving a thing, that thing should belong to him.
§ The settlers had spent years taming the land and cultivating it, therefore it should belong to them
§ Question: Why would someone do all of this if property law allowed someone to just sweep in and take away his or her property?
o Best use principle: The one making the best use of the property should have superior property rights.
§ Had we left the land in the hands of the Indians, the whole country would still be wilderness
ADVERESE POSSESSION
· 4 Elements of Adverse Possession
o (1) Actual entry giving rise to exclusive possession
§ Requirements:
· Must possess as an actual owner would
· This varies by the form of the property
· Exclusive means to the exclusion of the true owner AND other adverse possessors
§ Examples:
· Building a house, farming, fishing, cutting timber, etc.
· Paying taxes is helpful to making a claim, but it is not necessary
§ Actual possession determines how much of the property the adverse possessor has a claim to
· Adverse possessor only gains ownership of as much of the property as he actually occupies
· Exception: color of title (see below)
§ Actual entry determines when the adverse possession clock begins ticking
o (2) Open and notorious
§ Requirements:
· Visible and obvious so that the owner would discover the adverse possessor by a reasonable inspection
· No effort to hide
§ De minimis exception: (Manillo case)
· If the encroachment is so small as to not be self-evident to the naked eye – knowledge of the encroachment is not presumed absent a showing of actual knowledge
· Without actual knowledge, the true owner may be forced to convey the land to the adverse possessor for a fair market value (i.e. forced sale) if:
o (a) The encroachment cannot be eliminated w/o great expense; OR
o (b) Elimination is impractical
§ Examples and non-examples:
· Hiking and hunting may be enough to be actual entry, but not sufficient to be open and notorious
o (3) Adverse and under a claim of right/title
§ All about the state of mind – Must intend to claim the property
§ Three way jurisdictional split for this requirement:
· (1) Hostile – Knew the property was not yours and claimed it anyway
· (2) Good faith – Did not know that the property belonged to someone else
· (3) Non-permissive (most common) – Courts say, “We do not care what your state of mind is, as long as you do not think that you have permission to be there.”
§ This element prevents tenants from adversely possessing the landlord’s property
o (4) Continuous for the statutory period
§ The required period is set by a statute
§ Continuous does not mean unceasing – same standard as what we would expect of an actual true owner (i.e., you do not have to be there 24/7/365)
§ Tacking – adverse possession periods of two or more successive occupants may be added together to meet the statutory period. Tacking requires privity, which can be shown in 2 ways:
· Privity of possession – both possessors are adverse possessors and their possession is temporally adjacent, and the previous adverse possessor manifested some sort of intent to transfer to the new adverse possessor
· Privity of estate (preferred due to evidentiary issues) – property rights transferred through written instrument
· Privity means conveyance of property rights.
· Privity is the connection between one possessor and the other.
· Privity requires intent on both sides along with transfer.
§ Disability – a condition of the party which may have a claim against an adverse possessor that exists at the time the action accrues (i.e. when the statutory period begins to run)
· Examples:
o Minor
o Unsound mind
o Imprisoned
· ONLY applies if the disability exists from the beginning of the statutory period and lasts far enough into the statutory period such that the tolling period extends beyond the statutory period
o If the disability comes into existence after the statutory period starts to run – it does not toll
o If the disability starts and stops within the statutory period, the true owner of the land is still bound by the statutory period
· Exam tip: If you have continuity for the required period, make sure that the statutory period is not tolled because of a disability
· Policy of adverse possession: preventing waste by penalizing the negligent and dormant owner for sleeping upon his rights (Best use theory)
· Notes:
o The adverse possessor only gets a claim to the interest held by the titleholder. Thus, if the title holder only holds a life estate – that is all that the adverse possessor can claim
o You cannot adversely possess against government land
·
Adverse Possession of Chattels
· Need all the elements of adverse possession of real property
o (1) actual and exclusive possession
o (2) open and notorious (problem element)
§ Even though the adverse possessor may satisfy the open and notorious requirement – it may not be sufficient to put the original owner on actual or constructive notice of the identity of the adverse possessor
o (3) Continuous for the Statutory Period
§ The statutory period is usually much shorter than that of real property
o (4) Adverse Under Claim of Title
· Majority Rule
o The burden of proof is on the adverse possessor to prove he met all the element of adverse possession (including open and notorious)
§ Open and notorious must be sufficient to give rise to actual notice – similar to the encroachment context
§ Clock can’t start until adverse possessor gives actual notice
· Minority Rule
o Discovery Rule – a cause of action will not accrue until the injured party discovers, or should have discovered facts sufficient to bring a cause of action
§ Burden of proof is on the true owner to prove that he has exercised due diligence in recovering the property and to show that a reasonable person would not have sufficient facts to bring a cause of action for recovery
· If true owner can show this, statute of limitations will be tolled
· Tacking
o The adverse possessor of chattels can still tack time
o Under discovery rule the true owner does not have to exercise due diligence each time the chattel changes possession from one adverse possess to the next
· Void Title
o Generally if property was stolen, the thief acquired no title and could not transfer good title to others regardless of their good faith and ignorance of the theft
· Voidable Title – Merchant Exception
o MERCHANT EXCEPTION – where the true owner entrusts the property w/ a merchant who deals with that sort of good in the ordinary course of business, the merchant is a bailee, and if the merchant sells it to a good faith buyer, the good faith purchaser will take good title from the merchant
§ POLICY – consumer should be able to trust a merchant dealing in a specific good
GIFTS
· 3 Elements of Gifts
o Intention to make a present transfer of title
§ Title ≠ possession
§ Possessory interest in the future is irrelevant if the title has been transferred in the present
§ Promise to pass title in the future is not a gift
o Delivery of the property manifested by an act after the intent was given
§ Manual delivery – giver must feel the “wrench of delivery,” i.e., the finality
§ Constructive delivery – handing over a key or some object that will open up access to the subject matter of the gift
§ Symbolic delivery – handing over the writing or something symbolic of the property gift
