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Property I
University of Tennessee School of Law
Plank, Thomas E.

Property, Spring 2010 (Plank)
First Possession
A.       Acquisition by Discovery
a.        First in time, first in right
b.       Johnson v. M’Intosh: this was an ejectment for lands in IL claimed by people who purchased land from Indians
B.       Acquisition by Capture
a.        Elements
                                                   i.      D controls (requires physical control and intent to control)
                                                 ii.      Personal prop
                                               iii.      Belonged to P
b.       Economic Theories
                                                   i.      Externatlities: effects on others that aren’t considered when someone makes a decision
                                                 ii.      Tragedy of the commons: overdepletion of natural resournces due to heavy discounting of future values
C.       Acquisition by Creation
a.        Intellectual Property
                                                   i.      International News Service v. Associated Press: INS got the benefit of selling the news without actually doing the research by taking news from INS employees and from their online news board- whether INS using news taken from bulletins or early editions of AP publication constitutes unfair competition in trade- yes b/c news is quasi-prop b/c it can’t be copyrightsed but it requires time and money to get it- by permitting this to happen for the purpose of profit, it would render publication profitless for AP
                                                 ii.      Cheney Brothers v. Doris Silk Corp: the business Cheney Brothers was copying a popular product from Doris Silk and selling it for a cheaper price- whether the P’s designs can be protected from being copied- ct said no b/c prop is limited to the chattels which embody his invention and others may imitate these b.c there is no prop right in design
                                               iii.      Smith v. Chanel: Chanel perfume company alleged that a company used the same formula to create a scent and the company was advertising that the product was equivalent to the Chanel perfume- ct said that the compny could do this b/c there was no patent for the formula so Smith could copy it- also, strong public interest in allowing imitation b/c important for competition
b.       The Right to Include and Exclude
                                                   i.      Jacque v. Steenberg Homes: Steenberg plowed a path thru the Jacque’s prop- they asked if they could, Jacque said no, but they did it anyway – ct said since there was little to no damages to prop, only damages awarded BUT the J’s were awarded pun damages to punish Steenberg b.c there is a strong interest in excluding trespassers
                                                 ii.      State v. Shack: Tedesco was a farmer who had migrant workers living on his land- D’s worked for a gov’t agency and asked to speak with some of the farmers and Tedesco wouldn’t allow it- whether the type of entry constitute criminal trespass- ct said right to exclude doesn’t include liability for criminal trespass0 ownership of real prop doesn’t include the right to bar access to gov’t services
 
Subsequent Possession
A.       Acquisition by Find
a.        There is a hierarchy of ownership- the true owner always has the higher prop interest than first finder but first finder has higher interest than second finder, etc.
                                                   i.      Armory v. Delamirie: little kid finds a jewel and takes it to a jewelry shop and jeweler offers to buy it, little boy refuses, but jeweler won’t give it back- little boy sues for money damages (replevin would be seeking the item back)- whether a finder has a sufficient prop interest to support a c/a for damages- ct said the little boy is not the true owner but he doesn’t have to prove he is the true owner- possession is a prop interest- first finder will take precedent over a second finder
B.       Acquisition by Adverse Possession
a.        Possessor must show (1) actual entry giving exclusive possession that is (2) open and notorious, (3) adverse, and (4) continuous throughout the ST period
                                                   i.      ST of limit begins to run when the claimaint goes into adverse possession of the true owner’s land
                                                 ii.      “Actual possession gives notice:” must give true owner notice that a trespass has occurred and give notice of extent of possessor’s claim (will only gain title to the land that he actually occupies)
                                               iii.      “Exclusive possession:” possessor doesn’t share with the true owner or to public
                                               iv.      “Open and notorious:” occupation must be sufficiently apparent to put the true owner on notice of trespass
                                                 v.      “Adverse:” possessor doesn’t have the true owner’s permission to be on the land- doesn’t mean anger or animosity- state of mind of the possessor is irrelevant so he doesn’t even have to know he is trespassing
                                               vi.      “Continuous possession:” requires only the degree of occupancy and use that the average owner would make of the prop- constant use not required but intermittent use is not sufficient
b.       Van Valkenburgh v. Lutz: Lutz owned lots 14 and 15 and when he bought it, there were no streets- when he lost his job, he began to cultivate the land and became a farmer- V bought the prop next to him and filed action to make Lutz’s clear prop from the land but Lutz’s won- however V filed for delivery of possession to the land but Lutz counterclaimed that he was entitled possession b/c he held and possessed the land for 30 years- whether there is evidence showing that the premises were cultivated or improved sufficiently to satisfy adverse possession
                                                   i.      Need actual continued occupation of land, ,actual entry giving exclusive possession, open and notorious, adverse and under a claim of right, and continuous for ST period
1.       Occupation: ct ruled that they did not occupy the land b/c did not cultivate the land substantially or improve it- however the dissent disagreed b/c his brother lived there, he grew crops, he built chicken coop, and din’t have to farm the entire lot
2.       Open and notorious possession: he said he knew he didn’t own the lot but everyone knew it as the Lutz’s garden
3.       Hostility and claim of right: ct doesn’t challenge the claim of right aspect- means hostile to the legal title, not violent- means you claim it as your own whether or not it is yours and your acts as an owner have to be inconsistent with the actual owner
c.        Mannillo: P seeks injuction against trespasser but D claims possession by adverse possession- whether entry and continuance of possession under a mistaken belief that the possessor has title exhibits hostile possession to sustain a title for adverse possession- difference b/t knowledge (actually know) or notice (did you have reason to know)- ct said where there is an encroachments of a small area and intrusion is not apparent, no presumptin of knowledge
C.       Acquisition by Gift
a.        Elements: (1) intention to make gift, (2) delivery of gift, and (3) acceptance of gift
                                                   i.      Intent necessary: intent to make a present (not future or at donor’s death) , irrevocable transfer (not conditional) of prop
1.       Conditional gifts: if a donor presently transfers prop but with an express or implied condition, donative intent is not satisfied until either the condition is fulfilled or the donor fails to revoke the gift within a reasonable time
                                                 ii.      Methods of Delivery
1.       Manual: actual physical delivery of prop to donee- required by common law
2.       Constructive: donor provides the donee with the sole means of access to gifted prop (ex. sole key to a safe deposit box or a vault that holds the key)
3.       Symbolic: donee receives a document or item that is symbolic of the gifted prop (ex. writing that declares the donor is giving a valuable item of personal prop to donee along with a photo of the gifted prop)
                                               iii.      Acceptance: acceptance by donee is essential to validity of inter vivos gift but when the gist if of value to donee, the law will presume an acceptance
b.       Delivery Issues
                                                   i.      Manual delivery is preferred when possible so that fraud is not involved 
1.       Newman v. Bost: on his death bed, the man tried to leave the P everything- whether there was sufficient delivery of the personal prop items to make the gift good
a.        The ct is weary of gifts causa mortis (gift on cause of death) b/c it contradicts with the ST of frauds and wills, which protect against fraud
b.       The giving of the keys was constructive delivery b/c it was a means by which to control the piece of furniture that could not be delivered but it doesn’t work b/c it could have easily been delivered- needed manual delivery
c.        Even delivery of an insurance policy can’t be delivery b/c you don’t have the power to control it
                                                 ii.      As long as the donor has the ability to revoke the gift, a valid delivery has not occurred
                                               iii.      Donee doesn’t have to control gifted prop for delivery to be satisfied
1.       Gruen v. Gruen: P’s father told him he was going to give him a painting as a gift but he wanted to keep possession of it until his death- whether a valid inter vivos gift of a chattel may be made where the donor has reserved a life estate and the donee never has had physical possession of it before donor’s death
a.        Intent: the letters from his father were unambiguous in that he transferred the title to his son, although he kept it
b.       Delivery: his father delivered the letters to him, which serve as the instruments of the gift- this gave him title without possession
c.        Acceptance: P made it known that he had ownership of the painting b/c he told his friends
Estate System
A.       In General
a.        Estates in land are possessory interests (either present or future interest), as opposed to nonpossessory interests (easements, profits, covenants, servitudes)
b.       Freeholds: give possession under some legal title or to hold (FS, LE)
c.        Nonfreeholds: give mere possession (leases)
B.       Present Possessory Estates
a.        Fee Simple (FS): estate capable of being inherited by heirs and has the capability of lasing forever
b.       Defeasible Fees: FS estates of potentially infinite duration that can be terminated by a condition
                                                   i.      Fee Simple Determinable(FSD): estate that automatically terminates on the happening of a stated event and goes back to grantor
1.       Created by “for so long as,” “while,” “during,” or “until”
2.       Can be conveyed but grantee takes the land subject to the condition
3.       Possibility of reverter:

to being defeated by a condition subsequent
                                                 v.      Contingent Remainder (CR): a future estate that is given to unascertained persons or is made contingent upon some event occurring other than the natural termination of the preceding estate
1.       Unborn or unascertained persons: until the remaindermen are ascertained or born, there is no one ready to take possession if the preceding state came to an end
2.       Rule of Destructibiity: at common law, CR had to vest prior to or upon termination of the preceding estate or it was destroyed- if the remainder is still subject to a condition precedent when the preceding estate terminates, the remainder is wiped out and the right of possession moves on to the next vested interest
a.        Destroying contingent remainders enhanced the alienability of land
b.       Rule didn’t apply to executory interests- therefore, cts must construe a limitation as creating a contingent remainder rather than an executory interest if that construction is possible- this exemption of executory estates from this rule led to the development of the Rule Against Perpetuities
c.        Modern rule: today, O would retain a reversion and person would CR would now have an executory interest (EI)
3.       Doctrine of Merger: if the LE and the next vested estate in FS come into the hands of one person, the lesser estate is merged into the larger
4.       Rule in Shelley’s Case: at common law, if a freehold estate was given to A and in the same instrument a R was limited to the heirs or heirs of the body of A, the R in the heirs was not recognized and A took both the estate and R
a.        If (1) one instrument (2) creates a LE in land in A, and (3) purports to create a remainder in A’s heirs, and (4) the LE and remainder are both legal or both equitable, the remainder becomes a remainder in FS- therefore a LE in A merges into a vested remainder in FS
b.       Has been abolished in a majority of states
5.       Doctrine of Worthier Title: where there is an inter vivos conveyance by grantor with a remainder limited to the grantor’s heirs, it is invalid and grantor retains a reversion
a.        Furthers alienability and applied only to land but Cardozo applied the doctrine as a rule of construction so that it can be applied to personal and real property
d.       Executory Interest (EI): a future interest that must, in order to become possessory, (1) divest or cut short some interest in another transferee (shifting executory interest), or (2) divest the transferor in the future (springing executory interest)
                                                   i.      Remainders v. EI
1.       Only 2 FI can be created in a transferee (R and EI) so if it is not a remainder b/c the preceding estate is not a LE, it must be an EI
2.       R cannot follow a FS so any interest that follows a fee and is held by a 3rd person is an EI
3.       EI are not destructible while CRs are still destructible in some J
4.       EIs are not considered vested whereas CRs can become vested
5.       Rule in Shelley’s Case doesn’t appy to EI but it does apply to Rs limited to the heirs of grantee for life
                                                 ii.      Transferability of R and EI
1.       VR are transferable, deviable, and descendible
2.       CR and EI at common law were not assignable inter vivos but devisable and descendible UNLESS the holder’s survival is a condition to the interest’s taking- today, they is sometimes held to be transferable inter vivos
3.       Any transferable FI is reachable by creditors
e.        Class Gifts
                                                   i.      Rule of convenience: a class closes when some member of the class can call for a distribtion of his share- applicable only in absence of an expression of intent to include all persons
1.       Ouright Gift- class closes at time gift is made: when a will makes an outright gift to a class, if any members are alive at testor’s death, class closes at testor’s death- if not members living at death, all afterborn persons are included
2.       Postponed Gift- class closes at time fixed for distribution: when possession of a gift are postponed, class remaind open until the time fixed for districbution (happens when a gift follows a LE)
3.       Subject to Condition of Reaching a Given Age: when there is a class gift conditioned upon members attaining a certain age, class closes when (1) the preceding estate terminates and (2) the 1st class member reaches the age