· Property: The interest a person holds in a subject matter, backed by the power of the state (speaking of the interest and not the subject matter)
o State is willing to back up a persons’ right to exercise their use of property
· Types of Property:
o Tangible: Real property (land) and personal property (assets)
o Intangible: Intellectual Property
· Marketable Title:
o The title is free from any defects or problems
o If selling house, can have a few rights/sticks outside bundle IF EXRESSLY agreed to (by both parties) in the contract.
· 3 Criteria of an efficient system of property rights:
o Universality – the right to use and all resources should be owned or ownable by someone
o Exclusivity – Owner has right to exclude others from property
o Transferability – property can be transferred
o Having the 3 criteria creates incentives for people to invest in property & use the land and its resources, without interference from others.
· Bailment: Personal property delivered by one person (bailor) to another (bailee) who holds the property for a certain purpose, usually under an express or implied in fact contract.
o Bailor: hold title to the property
o Bailee: Holds right to possession (has right to use property)
o If anyone interferes without permission, both bailor and bailee have a cause of action.
· Escheat: If line of heirs runs out, the property will escheat back to the Crown/State. Reversion land ownership back to the lord/state when the immediate tenant dies without heirs.
· A transferee takes no better title than his transferor
o Exception: Bona Fide Purchaser of Value (BFP Doctrine)
§ True owner delivers & sells the property to a buyer, but the buyer purchased it by fraud.
§ Since there is fraud the true owner can rescind the title & reclaim full ownership
§ If the buyer turns around & sells to the BPF and the BFP acquires a voidable title, then the BFP will gain true title
§ BFP – one who has in good faith paid valuable consideration for property without notice of prior adverse claims.
o Kremen v. Cohen Network Solution, Inc.
· Black Letter Rule: Domain names constitute intangible property interest subject to conversion under California Law.
o Moore v. Regents of the University of California
· Instant Facts: A doctor repeatedly harvested Moore’s body tissues & fluids under the guise of treatment, while using them for lucrative medical research without informing or compensating Moore.
· Black Letter Rule: An individual does not retain title or ownership rights in bodily fluid, tissue, or organs taken from her body during medical procedures & thus cannot maintain a tort action in conversion.
· (3) Basic Attributes of Property:
1. Right to exclude others
2. Right to Transfer to Others
3. Right to Use It
The Right to Exclude
o State v. Shack – Right to Exclude is not absolute
· Instant Facts: Federal human rights workers entered a private farm to help migrant workers housed there, owner had them arrested for trespass.
· Black Letter Rule: State property laws cannot be applied to keep people from visiting migrant farmworkers.
o Property owner’s right to his property is not absolute. Owner does not have right to control destiny of his worker’s. Implied right that the defendants can aid the workers.
The Right of Disposition
· Disposition – traditional attribute of private property. Like the right to exclude, it is not absolute.
o Jones v. Alfred H. Mayer Co. – Right to Disposition is not absolute
(Before Fair Housing Act)
· Instant Facts: When a white landowner refused to sell a house to a black buyer, the black buyer sued under a federal statute requiring blacks to be given property rights equal to whites.
§ Black Letter Rule: Congress may ban private owners from racially discriminatory sale of their property. Based on 42 USCA 1982 – ‘‘All citizens shall have the same right, in every state, as is enjoyed by white citizens thereof to inherit, purchase, sell, hold, and convey real and personal property”
The Right to Use
o Rights to property use can be limited by governmental bodies that impose
· Ex: zoning, subdivision ordinances, environmental regulations.
o Nuisance Doctrine: requiring that the use of land not unreasonable injure the land of another.
Objects & Classifications of Property
o Edwards v. Sims – Heaven to Hell Theory
· Instant Facts: After a cave on landowner Edwards’s (D) property became a tourist attraction, neighboring landowner Sims (P) sued for a survey to prove the cave ran under Sims’s (P) land.
· Rule: Landowners also own the subsurface below their land and the air rights above it, but neighbors may demand a survey to determine who owns the subsurface.
· Heaven to Hell Theory of Ownership – Owning land above & land below. Court has power to interfere with land rights if necessary to determine who owns subsurface (surveying cave).
· Exception of Heaven to Hell Theory – Courts have not enforced rights for space “to the heavens”. Limits to land rights above property (for air travel and such). Have right to space above property to a reasonable height.
o Johnson v. McIntosh – Law of Conquest
o Instant Facts: Johnson (P) purchased title to some land from the Indians while McIntosh (R) gained title issued by and through the United States government. Johnson (P) seeks to gain legal recognition of his title. Johnson (P) was granted land by two Indian Tribes, the Illinois and Piankeshaw nations, in 1773 and 1775. Johnson (P) now seeks to have these grants recognized by the courts in an ejectment action against McIntosh (R).
o Rule: Title to lands can be issued by and through the Sovereign or Government; indigenous peoples do not have legal authority to issue title notwithstanding their occupation of the lands.
Law of Conquest – You conquer the land, you have title to the undiscovered land
Natives have right of occupancy (license to the land) that is non-transferable à therefore nothing to give away.
o Shelley v. Kraemer – Restrictive Covenant
o Instant Facts: Shelley (P) seeks to purchase a home that is subject to a restrictive covenant barring ownership or occupancy by non-Whites. They challenge state judicial enforcement of the covenant as a violation of equal protection and due process.
o Rule: State judicial enforcement of private agreements is ‘‘state action’’ as that term is construed under the Fourteenth Amendment and is thus subject to all 14th Amendment-based limits on state action.
· Otherwise Shelley would have been denied equal protection of the laws by being deprived of property without due process of law and denied privileges & immunities of the US
· Restrictive agreement standing alone is not a violation but
· Describe the nature of estate & not who will take it up
o Thus, there was a presumption that unless otherwise described, the freehold estate was to be conveyed as a life estate
· That’s why “and her heirs” was necessary
· Modern Day – presumption unless otherwise described, the estate conveyed is a fee simple
· 3 effects when there is Requirement Language:
o Condition – affects the nature of the estate
o A promise – contract law
o Mere wishful expression (moral obligation, no legal enforcement)
CLASSIFICATION OF INTERESTS IN REAL PROPERTY
· Freehold Estates (these are real property)
A. Fee Simple (always inheritable)
1. Fee Simple Absolute
2. Fee Simple Defeasible (base/qualified fee)
i. Fee simple subject to special limitation (aka: fee simple subject to common law limitation; fee simple determinable)
ii. Fee simple subject to condition subsequent
iii. Fee simple subject to executory limitation
B. Fee Tail (successor to fee simple conditional – always inheritable)
C. Life Estates (never inheritable at common law but estates “pur autre vie” may be inheritable today)
1. Created by deed or will (conventional life estate)
i. Life estate for the life of the grantee
ii. Life estate for the lief of one other than the grantee – called estate pur autre vie
2. Created by operation of law (legal life estate)
i. Fee tail after possibility if issue extinct
iv. Estate during coverture
· Non-freehold Estates (chattels real – not inheritable at common law – treated as personal property)
A. Tenancy for years (for a term)
B. Tenancy from period to period (meaning year to year, month to month or week to week) – periodic tenancy
C. Tenancy at will
D. Tenancy at sufferance (not really an estate)
· Concurrent Estates (meaning ownership or possession by 2 or more persons at the same time)
A. Joint tenancy
B. Tenancy by the entirety
C. Tenancy in common
D. Tenancy in coparcenary
· Incorpreal Interests in Real Property (these cannot be possessed physically because they consist of mere rights)
C. Covenants running with the land
D. Equitable servitudes
· Future Interests
B. Possibilities of Reverter
C. Rights of re-entry for condition broken (more recently called powers of termination)
1. Vested Remainders
2. Contingent Remainders
E. Executory Interests
1. Executory limitations created by deed
i. Springing uses
ii. Shifting uses
2. Executory devises created by will
i. Like springing uses
ii. Shifting uses