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Property I
Wayne State University Law School
Dolan, John

Property Law: Class Notes

8/31/09

2. Who owns
The mustang colt?
He who captures it. “Rule of Capture” – very solid evidentiary value
Why?
What are the benefits of owning the colt?
How does law relate to the concept of property?
A debt is property.
What is reification? Making the intangible tangible: Where the document IS the property, stock certificates, bonds.

3. The tragedy of the Commons
Marginal utility
Externalities*
Creating wealth and property*
Efficiency
Distributive justice*

4. Learning from Posner
Alienability (transferability): you can sell, trade, gift property.
Exclusivity: The ability to exclude others from the use of property. Under dominion.

5. Kremen v. Cohen Network Solutions, Inc. (9th Cir 2003)(p. 18)
Facts: Kremen registers domain name “sex.com”. Conman gets

Issues: Did NSI convert Kremen’s Property?
Is a domain name property?

Holding: Circuit held that summary judgment was improper. Remanded.

Rationale: A domain name is a form of non-tangible property.

9/1/2009

[A] Class Questions
Summary judgment is entered for the movant, without a trial, when there is no genuine dispute of material fact and the movant is entitled to judgment as a matter of law.
De novo – “anew” or a fresh look (at findings of fact made by the lower court)
[B] Notes on Judicial Opinions
Most lower state courts don’t write opinions, when written, they are not often published. Federal District Courts, however, do often write opinions, but they may not be published. LexisNexis and West law will carry unpublished opinions. Appellate courts almost always write opinions when affirming or reversing.
[C] More on Kremen v. Cohen Network Solutions, Inc.
To establish the tort of conversion, plaintiff must show (a) ownership or right to possession or property, (b) wrongful disposition of the property right, and (c) damages. Conversion is a strict liability tort. Negligence is of no material issue.
Stare decisis – follow precedent (stand by the thing decided and do not disturb the calm).
American Law Institute produces the Restatements. Whether the Restatements are persuasive authority is not so clear, as a general rule.
Though the Restatment is influential and their rule was followed by the District Court, the Circuit Court held that California does not follow the Restatement on this matter (i.e., of merged documents).
Certain matters are for the legislature and not for the courts to create common law.

Teaching Point #1 of Kremen: Property can be intangible. It just has to be something of value. (note: this was stated by the Professor himself)
The District Court’s ruling was formalistic. The Circuit Court’s can be said to be more “realistic.”
Formalistic Approach – literal application of a rule.
A realist looks at the impact of the application of a given rule.
Teaching Point #2 of Kremen: We don’t always know what property is. (note: the growth of our wealth in the U.S. is largely due to intellectual property.)
Teaching Point #3 of Kremen: Courts can make common law.
A bailee is presumed to be liable for conversion if he is unable to return property. He is presumed to be negligent.
Externality
Distributive Justice – how are assets distributed in society?
How have courts decided what is property from the two cases?
[D] Moore v. Regents of the University of California (1990).
Moore had hairy cell leukemia. Staff of the UCLA Medical Center were aware that “certain blood products and blood components were of great value in a number of commercial and scientific efforts” and that access to a patient whose blood contained these substances would provide “competitive, commercial, and scientific advantages.” More consented to removal of his spleen. Moore returned during course of 7 years to donate more samples of blood, skin, marrow, et al. Staff of the UCLA Medical Center established a cell line from Moore’s T lymphocytes. The Regents applied for a patent on the cell line, listing Golde and Quan as inventors. Proved extremely profitable for all involved, save for Moore. Moore theorizes that he continued to own his cells post-removal, at least for the purposes of directing their use, and that he never consented to their use in potentially lucrative medical research.
KEY ISSUE: Did Moore have a property interest in his cells?
Since conversion is a strict-liability tort, it would impose liability on all those into whose hands the cells come.
9/2/2009
Moore vs. Regents (p.27-34)
Facts- Moore receives treatment at UCLA by Dr. Golde. Golde takes bodily samples, eventually must remove Moore’s spleen, and tells Moore he must continue to fly from Seattle to UCLA for treatments where more samples will be taken. Out of Moore’s samples, Golde, along with Shirley Quan (researcher for Regents of UCLA) develop a cell line that is potentially worth 3 billion dollars. Genetics Institute and Sandoz Pharmaceutical Group enter paying for a commercial agreement.
–Moore sues 1) Dr. Golde, 2) Regents of UCLA, 3) Shirley Quan, 4) Genetics Institute, 5) Sandoz Pharmaceutical Group.
–Court finds that no conversion crime exists, however there is a cause of action for informed consent and fiduciary duty.
–Major reasoning is that strict liability would be imposed on all researchers who can create beneficial medical advances.
–Other points include the enhanced value of the cells—they are not simply what was taken from the body
2 sided argument—Need for research to be done, and to continue vs. Dissenting argument by Judge Moss stating something harmful is done to the man for the benefit of society.
Teaching Points

Courts can’t solve everything
Be careful pouring old wine into new bottle (old rules will not always apply to new circumstances—maybe formalism fails.

Jacque v. Steenberg Homes, Inc. (p. 36)
-Defendant asked permission to move a mobile home across the plaintiff’s yard. The plaintiff responded, “no” but the defendant moved it across anyway, causing no physical damage to the yard of the plaintiff. Court awards $1 nominal damages and $100,000 punitive damages. Court reasons that “landowner’s right to exclude…is essential.”
Class Discussion Points-
-How could the company have gotten the mobile home to the site? (Offer payment?)
-Why are the punitive damages so high?
-Hypothetical of teenage boy crossing yard, eventually shot and killed by older man.
-Easement by prescription: Continuous crossing of property; can get court order to continue to do so (it is the court order that makes the easement “prescriptive.”
9/3/2009
State v Shack (NJ 1971)

Read a case to know where a law is; where it’s going.
Be familiar with exclusion cases, this being one of them
Keep in mind how old this case is, and the circumstances in which it was decided
Democratic initiatives “war on poverty.”

New Jersey Court – Has tended to be a court for liberal change, and has embraced the democratic initiatives.
The case may not teach us much about “today” How would it be ruled at present?
Facts:
Two individuals, Tejeras and Shack went to the farm of Plaintiff Mr. Tedesco. They wanted to meet with certain farm workers on his property regarding medical help and legal advice. Mr. Tedesco said that it could be done but only in his office where he could sit in to hear what was said. The Defendant’s declined, and Mr. Tedesco called a sheriff and filed a complaint for trespassing.
Issue: Is it within the rights of Tedesco to exclude those who wish to aid the workers from his property?
Holding: Tedesco does NOT have the right to exclude those trying to help his impoverished farm workers from his land.
Ruling: A few rules that the court did not address.

Under landlord & Tenant law – an owner is restricted on his ability to exclude owners from the tenant’s property. Court rejected talking about this.
When you have an issue to decide that can be decided on non-constitutional law, you should. Courts try to avoid extending Constitutional Law.
Supremacy Clause: Federal statutes supersede the trespass laws. Court avoids using this in order to stay away from the Constitutional Law.

Court decides that “title to real property cannot include dominion over the destiny of persons the owner permits to come upon the premises.”
Class discussion

How far does the right to exclude go?
Do you have the right to deny access to your home to someone

r. But, the legislature has the power to tax, regulate, etc. The right to alienate or not alienate property exists but there is a limit that is set by the legislature (only to the extent that they are in power).
Congress has the power, under the 13th and 14th amendments, do so regulate.

*There are limits on how we use property.
The Objects and Classification of Property

Land – Real Property
Personalty-Chattels – Tangible Personal Property
Intellectual Property – Intangible Personal Property
Minerals
Water / Air

Real Property – Land surfaces (soil, rocks, trees, house, crops), sub-surfaces (coal, oil, uranium, etc.), and air.
Intangible Personal Property – bank account, stock paper, debt, copy rights
Tangible Personal Property – inventory, company’s equipment
*Fixture – ex. Furnace, this is hard to determine what is a fixture and what isn’t. They are a problem in law.
Brown – the common law dealt mostly with real estate, because the common law was the only source of the law. We still use the rules that they used. These rules do not apply to personal property because they don’t fit. Real estate and personal property are dealt with very separately.
Edward v. Sims
Facts:

Circuit court ordered surveyors enter land to survey the cave of Mr. Edwards. This is because Mr. Edwards and Mr. Lee are disputing the ownership of the cave. Lee and Edwards both believe that the cave is a sub-surface on their property. Lee said Edwards is allowing people to exploit the cave which he believes is part of his subsurface and you own to the center of the Earth
The court was not deciding who owned the cave, they were trying to determine this.
Edwards sued the judge in the argument that he disobeyed the law and he should not be allowed to proceed. He filed a writ of prohibition.
He believed that this was his property and that the court was essentially allowing someone to trespass on it.
Common law rule: the owner of property, unless there is a division of the estate, he is entitled to everything unless the neighbor can prove that the property is being used to the detriment of the neighbor.
You own to the center of the earth and into the heavens, that is the rule of property.
Severance: property can be divided horizontally allowing you to have surface and sub-surface rights

Example: You have coal in your cave, a geologist comes and says you have very good coal that will generate a lot of energy. You can sell the cave to the geologist to mine it. This law of severance, allows you to have surface and sub-surface rights, which would allow someone to buy these rights from the owner.

Judges say there is no law so they have to make the law. They use the law on sub-surface minerals and apply it to this situation ordering Edwards to stop using the cave section under Lee’s land.
Dissenting Opinion – Logan – believes this is not like mineral rights, mineral rights you can enjoy. If someone takes these rights away from you then you have lost your enjoyment rights. Lee would not lose the mineral rights so he will not be losing any enjoyment rights. This is because Lee does not have access to the cave.
Lee does not have an entrance to the cave. Can he make an entrance? Would this affect the outcome?
The majority opinion wants to preserve property rights in this case.