PROPERTY
REUBEN-COOKE
SPRING 2011
The body of law that governs the relationship of persons with respect to things…poetic isn’t it?
Introduction to Property…the greatest subject in the history of man
Essence of ownership – custom, contract of sale, social contract (implied assumptions versus explicit exchanges, gifts)
Bundle of rights:
(1) Right to exclude others from possession (e.g. build a fence)
(2) Right to exclusive use (e.g. receive income from it)
(3) Right to dispose/transfer
(4) Right to possess (control) vs. not possess (abandon)
(5) Rights against government taking (gov can’t take property without paying the owner)
Purpose of Private Ownership
Increase efficient use of resources
Nourish individuality
Promote political freedom
Why protect property?
– Reward labor
– Natural law demands it – the will of God
– preserve expectations
– Increase economic efficiency (increase good competition)
– Promote individual autonomy
– Reduce disputes
How is property acquired?
– Transfer
– Capture
– Creation
Theories of property:
Locke – Labor theory of property – you own whatever you mix with your own sweat that is unowned by anyone else.
Hume – self-interested acquiescence in rules – accept legal protection for other people’s property b/c we desire the same protection for our own – scarcity makes it important to protect our own property.
Economics – Property is an efficient response to scarcity – recognition of property rights internalizes the benefits.
Custom – property rights often occur by customs intended to maximize the wealth of the customary participants.
Utilitarian – dominant view today – Primary function of property rights is to promote the efficient use of resources.
Demsetz – Property rights guide incentives to achieve greater internalization of externalities – property rights develop when gains from internalization exceed costs of internalization, when it becomes economic for those affected by externalities to internalize benefits and costs. Private property ownership (decreases externalities) is more efficient than communal property ownership (increases externalities) – increase the efficient use of resources by accounting for the externalities. Maximizes social welfare by permitting the internalization of cost/benefit uses of decision-making. CRITICISMS: common property opens resources to everyone, increase value of some resources, leads to more sociability.
Libling – Property is anything to which you’ve added value. Protect the fruits of your creation.
Tragedy of the commons – commonly owned land lacks internalization of costs, so land will be overhunted and overworked.
Externalities – an effect on another person that the first person is not forced to take into account. Likely lead to misuse of resources – function of both transaction costs and free-rider problems.
1. Discovery, Capture, & Creation
Acquisition by Capture
– Unowned property that is captured becomes the property of the person effecting the capture. Pierson.
o Pursuit alone vests no property or right. Pierson.
o Mortally wounding IS enough for occupancy if pursuit continues. Ghen.
o Actual bodily seizure is not necessary to constitute possession of wild animals if action excludes others from private use of the animal and renders escape impossible. Pierson.
§ i.e. if fugitive resources (oil, gas, water) – once they escape your land, they are no longer yours.
o Custom/sportsmen exception. Pierson dissent, Ghen
– One’s property right is good only in relation to another’s
o Right to exclude trumps first possession – ratione soli.
o Ratione soli – “According to the soil” – justification for assigning property rights to landowners over resources found on their land (oil, gas, wild animals)
– Policy considerations
o Promote actions that benefit society (i.e. killing foxes)
o Avoid opening floodgates of litigation.
o Sustain the industry. Ghen.
o Encourage productive behavior. Keeble, Ghen.
o Protect legitimate activities against malicious interferences. Keeble.
Pierson v. Post
Facts: Post was in “hot pursuit” of fox on uninhabited land. Pierson, knowing that Post was in pursuit, killed fox and took it.
Holding: Pierson owns the fox. Policy consideration is to avoid opening the floodgates to litigation – including “mere pursuit” in definition of occupancy would lead to more litigation. Court applies the following natural law theories to grant Pierson occupancy:
– Pursuit alone vests no property or right. Justinian theory
– Mortally wounding IS enough for occupancy if pursuit continues . Puffendorf & Bynkershoek theory.
– Actual bodily seizure is not necessary to constitute possession of wild animals if action excludes others from private use of the animal and renders escape impossible. Barbeyrac theory.
Ghen v. Rich
Facts: Ghen killed a while with a mob-lance that identified the hunters. Ellis found whale, took possession of it, and auctioned it for sale to Rich. Rich and Ellis knew they could have found out who the original hunter was.
Holding: Ghen is entitled to the whale he killed even if someone else finds it (per whaling custom) Custom controls ownership so long as the hunter who killed the whale can be identified. Focus is on how best to promote productive labor. Individuals often conform to the custom out of self-interest; maximize the well-being of the group.
Keeble v Hickeringill
Facts: Keeble kept a decoy pond in Minott’s Meadow. Keeble invested in the pond to attract and kill wildfowl in which he enjoyed the benefit of taking. Hickeringill discharged guns to scare away the wildfowl. The wildfowl were frightened away and did forsake the pond causing damage to Keeble’s business.
Holding: For Keeble because Hickeringill’s behavior was malicious interference/trespass on the case. If Hickeringill did this type of damage using the same employment (ie putting a decoy pond next to an existing decoy pond) there would be no action. Hickeringill had a right to set up his own decoy pond but no right to maliciously interfere. Holding promotes competition between legitimate activities.
NOT A PROPERTY CASE – this is trespass on the case. Ways it COULD be a property case:
– Consider ducks “property” (weren’t on Keeble’s land yet so ratione soli doesn’t apply)
– Interference with productive use of property
Acquisition by Creation
Key issue: Degree of exclusivity – information can be used by many people at once, but imitation might destroy the incentive to create.
Common law:
– First in time – If you created something “first in time”, it is yours to exploit.
– Quasi-property – property rights that can be exercised only against business competitors. No property rights against the general public. INS.
– There is no common law copyright/patent property rights. Cheney.
Policy considerations:
– Protecting the fruits of a parties labor (quasi-property) – encourage competition. INS
– Promote competition. Cheney.
International News Service v. Associated Press
Facts: Associated Press and INS are competing companies who gather news info worldwide – news is NOT copyrighted. AP gathers news worldwide and releases news across the country. INS takes the early additions of AP news, copies it, a
arties.
Property in One’s Person
Moore v. Regents of the U of Cal
Facts: Moore sought treatment for hairy-cell leukemia at the UC Medical Center. UC confirmed diagnosis and told him his spleen should be removed. DID NOT inform him that his cells were unique and that access to them was of great scientific value. Moore consented to splenectomy and 7 years of follow-up tests. Spleen retained for research without his consent. He found out his bodily substances were being used for research and sued for conversion of property.
Holding: For Regents regarding property rights to cells. Moore did not retain ownership in cells after they were excised from his body. Inventive work of the doctor is patented, not the cells. When plaintiff neither has title nor possession of property, he cannot maintain action for conversion – he did not expect to retain spleen after removal so he had no property interest in it.
Policy: weary to consider property rights in body parts – patient’s right to make autonomous medical decisions is grounded in fiduciary duty and informed consent – NOT in property right. Want to encourage researches engaged in socially useful activities
Commentary:
– Companies unlikely to invest in developing products w/ clear title issues
– Morality – shouldn’t grant someone the right to sell their own body for profit (anti-commercialization of body parts)
– Conflict between possessory rights and rights to labor
– Central issue is right to exclude
RIGHT TO EXCLUDE:
– Right to exclude others from possession is a fundamental property right. Jacque.
– Called into question with IP (since full value might still be reaped w/out it)
– Owners of real property don’t have an absolute right to exclude others. Shack.
o Landowner’s right to exclude end where tenants’ needs for reasonable access by visitors begin.
o You cannot use your property to harm others
o When you open up your property to people, you have obligations
o Non-owners have a right to access based on need or public policy
Jacque v. Steenberg Homes, Inc
Facts: Steenberg trespassed on Jacques land when he delivered a mobile home. Steenberg had an alternate, but longer route to delivery the mobile home.
Holding: Owner has right to exclusive enjoyment of his own land for any right which does not invade the rights of another person. Punitive damages awarded because they will protect Jacque’s property rights by: 1) Deterring trespassers 2) Encouraging use of Courts 3) Punishing total disregard for property rights.
State v. Shack
Facts: Shack trespassed to help migrant workers who were living on the land. Shack was providing legal advice.
Holding: Court said Shack had a right to enter to help the migrants – the migrants were allowed to receive visitors of their own choice so long as there is no behavior that is harmful to others – preserve the migrant’s individual rights even though they live on another’s land. Landowner’s right to exclude ended where workers’ needs for reasonable access by visitors began.
