Property 3

Property Outline Fall 2003
Introduction I. General
A. Property: i. Relationships between people with respect to things. B. Possession vs. title i. Possession: usually dominion and control ii. Title: ownership a. Common law favors either or results, not shared interest. C. Bundle of rights: Property is a bundle of rights, not necessarily all present: right to possess it, use it, exclude others from using it (most fundamental), transfer by gift or by sale.
II. First Possession: Acquisition by Discovery, Capture, Creation

A. Acquisition by Discovery i. General rule: The first in time to discover land in a new world has exclusive property rights, even as to the native people. This was agreed upon by European powers. ii. Johnson v. MIntosh (p 3)
Facts: Issue: Analysis: Johnson purchased it from the Indian tribes on the land (1773 &1775), MIntosh got it later from the US govt. Johnson sued for ejectment. Can Native Americans convey good title to lands they occupy and that are claimed by the US Govt? Have to trace the chain of title. Mere occupation may not give you legal title. Only a state can discover, and the first discoverer has exclusive property rights (Britain) before discovered, there was no title. Native Am only had right of occupation. Britain gave it to US, who gave it to MIntosh. Native Am had no title to transfer (they in some sense conveyed it already to Britain). Only first in time to discover real property has power to transfer title. Possession title. Native Americans couldnt convey to Johnson.
Concl:
a. Note: The law has to reflect some notion of reality and of history, title is European created, this is not about logic but experience the logical construct of the law is imposed on the history. If court had gone other way, would have undermined all claims of title given by US govt. iii. Labor Theory of Value (Locke): Accession a. General rule: Want to recognize the value of the labor people invest in property. We want to encourage people to invest productive labor. b. Law of accession comes into play when one person adds to the property of another. What happens when someone uses someone elses property to make something? Who owns the product? 1. Traditional rule: person who owned original property is the owner, but if the improver changed it so much that it is a completely different thing, it belongs to the improver (grapes into wine). 2. Modern rule: disproportionate value if value of improvement is disproportionate to the value of the materials, improver gets it. Usu has to be done in good faith. c. This theory applied to Johnson v. MIntosh: Native Americans didnt put an adequate amount of labor into the land to perfect a property interest in the soil. 1. Monopsonist sole buyer. Govt was sole buyer, which reduced the cost they had to pay. d. Property confers and rests on power. Owners have a form of sovereignty over others because the sovereign state stands behind the owners assertion of right. 1. Critical Legal Studies reject the notion that the law is neutral and apolitical. 2. Critical Race Theory develop a jurisprudence that takes racism into account.
B. Acquisition by Capture i. General rule: Property is acquired by actual capture. Mere pursuit is not enough. ii. Pierson v. Post (p 19)
Facts: Issue: Post pursues the fox on un-owned land, Pierson killed the fox (in sight of Post) and took it away. Does Post own the fox because he was in pursuit, or does Pierson own it because he actually killed and captured it? At what point between wild animal running free and physical possession is ownership established? Ferae naturae: wild animal (on un-owned property) isnt owned until captured Dictum: When wild animal is wounded to the point at which its liberty is taken away mortally wounded, cornered with no hope of escape it could be considered to be owned. Ruling the other way would create a fertile source of quarrels and litigation actual capture is easier to prove. Thinks foxes should be killed, so that the rule should encourage pursuing and killing. Pursuit with reasonable prospect of success = title Capture is good enough for title. Saucy intruder wins.
Analysis:
Policy: Dissent: Rule:
a. Ferae naturae: wild animal (on un-owned property) isnt owned until captured b. Return to natural state: if animal escapes, ownership right is extinguished. c. Majority opinion is a rule (clear) capture = title, dissent is a principal (muddy) - Pursuit with reasonable prospect of success = title. 1. Principals are more flexible but more costly to administer 2. There are few examples of hard and fast rules. Rules are cheaper to administer and the outcome is clear. iii. Ratione soli - owner of the land has constructive possession of wild animals on the land. Landowners regarded as the prior possessors of any animals ferae naturae on their land, until the animals take off. a. This is a construct, a legal mechanism for determining ownership without actual possession. This enforces my real property rights, discourages trespass. b. CA: Animals wild in nature are possessed by: landowners while they are on the property (if they claim ownership); when tamed; or taken and held in possession; or disabled and immediately pursued. 1. In this case, would it change the result in Pierson? Post could argue that he disabled the fox and pursued it. Pierson could still argue that he had taken it and held it in possession. This still helps Pierson more (but it does put Post in a better position than he would have been, right?) c. Many states dont follow ratione soli. People have right to keep hunters off their property under a tort right (trespass) and not as a property right over the animals. 1. Could you be guilty of trespass and own the animal? Probably yes, although then you are encouraging trespass. iv. Custom and usage rule court makes a decision about ownership based on the custom of the industry and whether a ruling would impair industry. v. Ghen v. Rich (p 26)
Facts: Ghen is a whaler. He struck a finback whale that floated to the shore. It was found by Ellis, who, against Provincetown finback whaling custom, auctioned it to Rich, who sold the oil. P-town custom whaler shoots whale, which sinks to the bottom and surfaces days later somewhere along the shore. Finder tells whaler (lance has identifier on it) and gets a finder fee. Ghen sued for price of oil and argued that it was his property. Who owns the whale, the whaler who killed it or the finder? Custom for these whales was different from that of other whales. The rule is that a whale killed (and attached to the boat by rope) is the property of the boat owner. This whale sinks to the bottom and later surfaces days later. If court doesnt protect the customs of the whaling community in this case, whaling will cease. Custom or usage rule: Court makes a decision based on the custom of the industry.
Issue: Analysis: Policy: Rule:
vi. Barry Bonds baseball a. Spectator caught the ball, fell down in the fray, someone else picked it up. Who owns the ball? b. The court ordered the proceeds to be split. This is very rare. Usually it is either or. Why is that? There really is no good answer. Courts look at property matters as either or. 1. For a long time, people thought of the law as eternal truth that had to be discovered, and this implied absolute winners and losers. Now, we think that the law is crafted. This is breaking down the law that we have to have either or determinations. vii. Fugitive resources: Oil, gas, water found underground under property owned by more than person. a. Traditional: this is like wild animals (ratione soli and the rule of capture). People own things on their property if they capture it. b. Then, realized this is really not smart. It tells everyone to pump as fast as you can if you dont get it, someone else does. This also reduces how much can be extracted (if do it slowly, can get more) and led to depletion of ground water. Inefficient production and no conservation over the long term. c. Western states governed ground and surface water by first in time 1. First person who appropriates and puts it to reasonable and beneficial use has superior right to later people. 2. Eastern states, more water, riparian rights each owner has right to use subject to the rights of other owners. viii. Externalities Exist whenever someone makes a decision about how to use resources without taking full account of the effects of the decision. Externalities are a function of transaction costs, and they encourage a misallocation and inefficient use of property. a. External costs X doesnt consider costly effects if they fall on others, even if the extra amount it would cost him to fix it is way less than the overall cost to the community if he doesnt. This use is inefficient because another use would increase the value of the resources involved and make all parties better off. b. If other parties offer to pay, X has to think about how his actions affect others, and thus internalizes the externality. c. Transaction costs: If it is too hard to make an agreement, then the transaction costs are too high because there are lots of parties, the cause/effect is unknown/uncertain, those who dont contribute can get a free ride if they dont. 1. Freeriding problem occurs when have to extract payments from a group where the benefits will confer on the group as a whole. ix. Demsetz and externalities (p41) 1. General rule: Primary function of property rights is to guide incentives to achieve greater internalization of externalities. This happens when the gains of internalization become higher than the costs. 2. Communal property: Costs of agreement and costs of policing use of communal ownership may be high. A) Communal ownership results in great externalities, and the more owners, the higher the cost of internalization. Transaction costs are high. B) People have incentives to over use and greater tendency to act contrary to collective best interest. 3. Private owners have an incentive to maximize resources, and have less externalities. A) Promotes economic efficiency and free transferability. B) Private ownership nourishes diversity. C) Private ownership reduces externalities by transforming external costs into internal costs 4. Criticism: assumes that efficiency maximizing behavior for the individual means efficiency maximizing behavior for society. b. The anti-commons: multiple rights to exclude, encourages underconsumption
C. Acquisition by Creation i. General rule: creator has exclusive rights to tangible property (chattels). a. For a long time, property law was unfriendly to intangible things. Concept of property came from land. b. Creators ownership rights in intellectual property may be uncertain unless protected by statute c. Quasi-property property rights over intangibles with respect only to certain others, such as business competitors, but not to the general public (INS v. AP). d. Competition creates a better deal for the consumers (Cheney Bros & Chanel) ii. INS v. AP: copycats (p 60)
Facts: AP releases news for members. AP has 3 complaints about INSs behavior: 1) bribing employees, 2) inducing AP members to violate by-laws, 3) copying news info from bulletins & early editions and selling to newspapers. First two already decided by lower court. AP says INSs actions violate APs property rights in the news and constitutes unfair business practice. INS argues that the moment AP makes the news public, it is available to all. May INS be restrained from taking news from bulletins and newspapers (intended for public) with purpose of selling it to INS clients? News facts themselves are not property, and reports are not of literary value so that copyrights would apply. What INS is doing is unfair business practices. AP has right to quasi property with respect to INS b/c it is their stock in trade. AP is protected from INS but not from the general public. AP has an ownership right that transcends the physical aspect of the property. Keep businesses from unfairly profiting from the labor of another. You cant take something to unfairly profit, even if it is in the public domain. Want to encourage gathering news and keep it profitable. Businesses can have quasi property where their right to intangible property is protected against another business using it to profit unfairly from their labor, but are not protected against the general public.
Issue: Analysis:
Policy: Rule:
iii. Cheney Brothers v. Doris Silk Corp. (p 64)

Facts: P makes silk designs each season, some succeed. D copied successful designs and sold for cheaper. P cannot patent all the designs (prohibitive, takes too long) and cannot copyright (no words). P requests protection only during the season. Are the silk designs quasi property as the AP news in INS v. AP? Cant ask for limited protection. INS v AP was specific to that situation, not a general rule. To prevent imitation of a design would give too great power to designer. There is no common law copyright protection. We want to encourage competition b/c it is a better deal for the consumer. Imitation of the news doesnt improve it, but imitation helps here to lower the price. Promote competition to prevent monopoly and lower prices, but must be balanced against incentive to produce, invent.
Issue: Analysis:
Policy: Rule:
a. Copyrights 1. Protects the expression of ideas, not the ideas themselves. 2. Copyright is federal law. Want copyright protected across the country b/c otherwise it would interfere with commerce. This is a good policy argument, but it is not one we have accepted in most areas of property law (which is primarily state law). 3. The Constitution specifically called for a national copyright /patent law. 4. It is a reward system, and you want to provide incentive for people to keep creating new things. Well give you property rights so you can make money off of it in order to promote progress. 5. Patents only last for 20 years. Copyrights keep being extended (Mickey Mouse). b. Smith v. Chanel (p 65) 1. Smith advertised product was same as Chanel No. 5. Allowed to do so b/c there is a public benefit: imitation & competition = lower prices. Expenditure of $ is not a legally protected right.
iv. Virtual Works v. Volkswagon (p69)

Facts: Virtual Works, ISP, bought vw.net, knowing that it was remarkably similar to Volkswagons trademark, VW. They thought about possibly selling to VW later. Virtual Works used it for 2 years, then contacted by VW to buy from them. Virtual Works said would sell to the highest bidder. Did Virtual Works, in bad faith, purchase vw.net in order to profit from its similarity to Volkswagons trademark? There is a law passed by Congress prohibiting cybersquatting. To be illegal, you have to have a bad faith intent to profit, and there is a whole list of factors for determining bad faith. Virtual Works met these criteria: knew it was similar, intended to profit, could have bought another name, never went by VW. Fair competition is good, unfair competition is bad. Bad faith use of another companys registered trademark in a domain name is illegal. Unfair profit from someone elses good name.
Issue: Analysis:
Policy: Rule:
a. Cybersquatters = Virtual Works b. Parasites are people who register domain names similar to TM and then use them in ways that tarnish image. c. Poachers: register domain names similar to other orgs in order to disseminate unfavorable info about them. d. Dilution use of a TM may dilute or blur distinctiveness of TM. v. Property in Ones Persona (p 77) a. Used to be all about privacy: Woman whose face was on a flour sack had to consent. b. Then became more about right to exploit ones image for ones own profit. 1. Vanna White case: Computer image based on her. It wasnt her image but her character and concept. She has a property interest in her character. vi. Property in Ones Person (p 79) a. Moore v. UC Regents (p 79)
Facts: Moore sought treatment for leukemia. Had his spleen removed and many tests done. Had 7 years of tests and follow-up procedures he was led to believe were important to treatment. Doctors used his spleen and samples to make cell line worth billions. Moore sued for conversion (possession of someone elses property as your own), lack of informed consent, breach of drs disclosure obligations. Does a person own his or her own organs and bodily tissues once removed? Found no cause for conversion, just breach of doctors disclosure obligations. Conversion must be an actual interference with Ps ownership or right of possession; only property can be converted. It is possible that someone elses cells could have been used. His cells were the starting point, but at the end point they were no longer unique to him, and Drs put in lots of work and skill. Moore has an interest in his cells while in his body but extraction from his body severs his interest. Cal Statute limits patients control human tissues should be safely disposed of. Moore had the right to say no to the procedure and can keep his cells in his body. Conversion is a strict liability tort, all who use the cells would be liable, including other researchers with no connection to patient. Property is a bundle of rights: right to use, right to exclude, right to dispose of. These rights dont have to all be present all of the time for you to have property interests. Property rights of ones own tissue is fair and prevents unjust enrichment. Majoritys interpretation of statute is wrong. It authorizes transfer of tissue for research purposes and only prohibits sale for treatment and transplant. The statute treats tissue as property that can be sold and should be protected by law of conversion. Majority gives patient only the right to refuse and not the right to grant consent on the condition of sharing proceeds. To win on a nondisclosure action, Patient must show that they would have said no if he had known AND no reasonable person would have said yes. Want to encourage researchers to come up with medical breakthroughs that help people, and legislature should decide. Leshy disagrees if wanted to have legislature decide, should have ruled the other way. Patients dont have lobbying power like the medical industry
Issue: Analysis:
Dissent:
Policy:
Property Outline Fall 2003 Rule: Once body parts removed, they no longer belong to the patient but Drs have a duty to get informed consent to use them. Moore had no property rights over his tissues once they were removed from his body.
1. Notes: A) A patent is granted for invented skill. The patent of the process doesnt mean I own what created that process or the materials that go into the process. B) Law of accession: What happens when someone comes along and applies his skill and labor using your materials? Who owns the product? 1) The person who owns the materials continues to have an interest. 2) How much depends on all the facts and circumstances. Courts may give owner of materials more than worth of materials, but nowhere near as much as the worth of the product. b. The right to include and exclude (p 99) 1. General rule: Property is a relationship among people that entitles owners to include (permit) and exclude use or possession of the property by others. A) The right to exclude is fundamental (even when inefficient) except to serve the public good. 2. Jacque v. Steenberg Homes (p 100)
Facts: Issue: Analysis: The best path for a mobile home to be transferred was across the Jacques land. Jacques refused, Steenberg Homes went across their land anyway. Can owner exclude someone from crossing land even if would cause no damage and is more efficient than going around? US Supreme Court recognizes private landowners right to exclude others from his land, one of the most essential sticks in the bundle of rights. Intentional trespass can threaten the individuals ownership of the land. Society has interest in punishing trespassers beyond protecting the interests of the individual landowners. This serves the public good. In the long run this is economically rational even though inefficient in this case. The right to exclude is fundamental (except for serving public good).
Policy: Rule:
A) Privacy interests. In addition to property rights, there is a privacy and liberty interest at stake here. Even though this is an extreme situation, this is the law and you have the right to exclude people. 3. State v. Shack (p 101)
Facts: Shack attorney for farm workers legal rights and Tejeras nonprofit worker, entered Tedescos property in order to provide medical assistance and legal advice. Tedesco said they had to do it in his office. Ds refused and said workers had right to be seen privately. Did D trespass by entering and refusing to leave private land in order to offer legal and medical services to farm-workers housed on that land? Title to real property does not include dominion over people owner permits onto the premises. Migrant workers are highly disadvantaged, and need services. Necessity may justify entry upon lands of another. There is no legitimate need for a right in the farmer to deny workers the opportunity for aid. Is this consistent with Jacque? The larger human value served by allowing medical and legal aid in the Shack case overcomes the right to protect against trespass. This policy distinction isnt relevant in Jacque. Generally speaking, convenience doesnt override property rights. Right to exclude is not absolute: does not include dominion over people owner permits onto the premises (farm-workers).
Issue: Analysis:
Policy:
Rule:
A) The court doesnt say this is unconstitutional under 1st amendment - they could have, but they didnt. If court has a choice between common law and the constitution, courts avoid the constitutional question when they reasonably can. Ruling on constitutional matters is rigid, difficult to reverse and potentially at odds with other branches of govt.
II. Subsequent Possession: Acquisition of Property by Find, Adverse Possession, and Gift
A. Acquisition by Find (p107) i. General Rule: Finder has good title against all but the true owner. ii. Armory v. Delamirie (p 108)
Facts: Issue: Analysis: Rule: Chimney sweep finds a jewel and takes it to a goldsmith for appraisal. Goldsmith takes the jewels out. CS suing for amount jewels were worth (trover). Who has rights to the jewel? Unless the jeweler produced the jewel, the jury should find the strongest case against him (most valuable jewel as would fit in the setting). Finder has good title against all but the true owner.
a. Trover: Sweep sued not for the jewel but the value of the jewel (trover). Replevin is suing for return of the actual goods. b. Bailment is temporary possession for some particular purpose. The owner is the bailor, and the other person is the bailee. It is a pretty elaborate law. 1. Traditional rule: Different kinds of bailments had different kinds of standards of care. Finder: low standard, Cleaners, etc.: high standard of care 2. Modern: Mostly just a reasonable duty of care regardless of kind of bailment. 3. The law of bailment is traditionally the law of contract because it is usually governed by some contract, but contract law doesnt work all the time. c. Lawful possession: Anderson v. Gouldberg. Possessor of personal property has superior rights against all but the true owner, even if he obtained his possession wrongfully. Otherwise, would lead to endless series of unlawful seizures once out of true owners possession. d. Notes: 1. The sweep is the bailor, and the jeweler is the bailee. In regards to the true owner: the sweep is the bailee, and the owner is the bailor. This is an implied bailment. 2. Sweep gets all the money based on the assumption that he has absolute clear title to all but the owner. Should the value be discounted the amount of the odds that the true owner will show up? A) For a long time, law didnt want to split property: Its yours or it isnt. 3. The jeweler is paying the sweep in effect for title, title that is good against all except the true owner, so then if the true owner does appear, then the jeweler has to give it back. A) The true owner cant sue the wrongful possessor if the bailee has already recovered from him. What if the sweep is gone? Law probably would find that the jeweler had to pay again. But S/L would apply. iii. Locus owner a. General Rule: 1. Locus owner doesnt have title over lost chattels not attached to land but does generally have title over items imbedded in the soil. 2. Finder has title over lost property, owner of locus has title over mislaid property. b. What is the right of the lessee? 1. T does have a permissive, possessory right stronger than Peel. 2. Terms of the lease may affect ownership 3. Elwes v. Brigg gas company leasing the land found a boat in the land. A) Could say that the gas company leased all the things that could be mined from the soil, and the boat is like a mineral OR B) Could say that the gas company leased only the particular minerals in the soil and the boat belongs to the landowner
iv. Hannah v. Peel (p 111)

Facts: Issue: Analysis: Peel has a house that was requisitioned for soldiers. Hannah, a soldier, finds a brooch in the house. Hannah turned it over to the police to search for owner. No owner was found, Peel claimed from police and sold. Hannah demands broach or damages. Does the owner of the land on which the finder found the brooch, have better title to the brooch than the finder? The plaintiff, as the finder of the lost article whose true owner was never found, has better title than the defendant who was the owner of the premises. P found the brooch, which was lost, and tried to find the real owner, who was never found. P brought Ds attention to the existence of the brooch. D never occupied the land and was never in possession. Thus, he never possessed the jewel even though he owned the land. There is a law that says you own things attached to your land, but this is chattel that isnt attached. We want to reward finders, especially honest finders, except against the true owner. Locus owner doesnt have title over lost chattels not attached to land. Finder has title (against all but true owner).
Policy: Rule:
v. McAvoy v. Medina (p 118)

Facts: Issue: Analysis: Policy: Rule: Plaintiff found a pocket book on the counter in defendants shop. Is the finder of a pocketbook left on the counter of a shop entitled to possession as the finder of lost property? A pocket book left on the counter is not lost property. Thus the finder of such property does not have title because the property was not lost. A mislaid item has a higher chance of being recovered. We want to encourage items to get back to their true owners. True owner more likely to come back to the shop to look for it. Finder has title over lost property, owner of locus has title over mislaid property.
a. Notes: You can still serve the policy by giving the shop owner custody but the finder should get it if true owner is not found, or make arrangement to divide the property between finder & owner. b. Lost v. mislaid 1. Lost: true owner didnt intentionally or clearly place object somewhere. Title to finder except as to true owner. 2. Mislaid: true owner intentionally places object somewhere and subsequently forgets to pick it up. Title to locus owner except as to true owner (usually). 3. Abandoned: true owner intentionally left it because no longer wanted it. Title to finder absolutely. c. Objects of the law regarding lost, mislaid, and abandoned property: 1. Get back to true owner. This is first and foremost. 2. Encourage people to be honest. The law, where it can be avoided, should not encourage people to lie and should encourage and reward honesty. 3. Minimize litigation: Promote certainty, have clear rules. 4. Maximum utilization of property 5. Protect (reasonable) expectations of locus owner. Where there is a real property owner in the mix, you have interests and expectations around that property. A) Protect privacy dont want to authorize people to go onto private property looking for things. Protect right to exclude. 6. Where you have these conflicting policies, the law gets muddied. You get a bunch of cases talking about things that are not coherent. A) Getting back to owner best served by giving to Peel, rewarding honesty, to Hannah. B) Why not penalize the true owner for losing it? You might be licensing people to steal in ambiguous situations. Finders keepers would still cause litigation over who found first. d. Statutes: 1. CA finder must notify true owner if known and restore without compensation; if > $100, take to police. If less than $250 and owner doesnt claim in 90 days, finder keeps it. More valuable property may be advertised, and if not claimed, sold at public auction
vi. Shipwrecks a. Shipwrecks are not considered abandoned property, generally generally claimed by government or insurance company. Usually litigation is between private party and insurance company, sometimes between the locus owner and/or govt. 1. State owns certain distance out, then US govt, then international law and usually no locus owner. b. Historians and archeologists are very distrustful of applying the law of finds. The modern salvagers are, at least public relations-wise, sensitive to this. Say they will excavate archeologically. c. Another problem is that finding shipwrecks is expensive. Wont do it unless there is some incentive. Encouraging these excavations is also part of the picture. 1. Government should regulate to protect the archeological interests, interests of finder, true owner, locus owner. If you do it right, you can serve all of these purposes. vii. Treasure Troves: treasure buried underground for safe keeping with intent to return. a. Traditionally belonged to the king b. In US, all hidden $, and treated as other found property. 1. If found in moveable property like an airplane, it is mislaid and belongs to owner of plane. 2. If found in ground owner of land 3. If found in property but deemed abandoned first finder or his agent/bailee. viii. Estray beasts whose owner is unknown. B. Acquisition by Adverse Possession (p 127) i. General rule: If you 1) actually enter to exclusively hold and possess 2) hostile to the true owners rights (in minority), 3) openly and notoriously, and 4) continuously for length of statute of limitations, title becomes yours and is assumed to have become yours at point of entry. a. Actual entry and exclusive possession means using the property as the true owner would use it under the circumstances (Howard v. Kunto). b. Hostile (state of mind): must have intent to claim the property of another. Use cannot be authorized by owner. 1. Minority requires hostility. 2. Majority uses Objective Standard: If other requirements of AP are met, hostility is implied, regardless of subjective state of mind. A) If you say that state of mind is irrelevant, then you are treating people with base, thieflike intentions the same as honest mistakes. This is the moral objection to objective view. B) If you say state of mind counts, litigating these cases is a mess. In the big picture, its better even if you end up rewarding a few thieves. 3. Claim of right: Good faith claim - thought it was yours A) You can still be hostile to owner even if in good faith B) Courts more likely to award to person who thought they had a claim of right than person who knows hes trespassing. c. Open and Notorious 1. Statute of limitations begins when possession/use is open and notorious 2. Owner of property should be put on notice by the use. You have to be able to know that there is a trespass. It isnt fair to trigger the clock if you dont know about it, if there wasnt reason for you to know it. 3. For small encroachments, actual notice to owner is required (Manillo v. Gorski). d. Continuous 1. If owner reasserts right to property, then statute of limitations starts over. This use better informs the true owner. 2. Continuous use is how the true owner would use the land under the circumstances.
e. Statute of limitations 1. Western states have shorter statutes of limitation, and usually have an additional requirement that you must pay real estate taxes to have AP. A) Conventional wisdom is that this came about b/c of RR land. RRs were huge landowners with no way to effectively police the land. ii. Why AP? a. OW Holmes: Possessor has come to expect continued use and access, and the true owner has fed that right by not ejecting. b. Economic: if you (owner) are not using it, someone else should be allowed to. Property is there to be used productively. This is for the good of society. 2. AP takes time. You have to do it for years. If someone makes productive use of property that would otherwise lie fallow, law says ok. 3. The economic explanation doesnt depend on the state of mind. There are other reasons for not looking at state of mind. It is hard to figure out and hard to prove, and it is almost always something that happened a long time ago. ii. Earning and Sleeping a. Earning productive economic efficiency idea. AP earns title by his actions, good works and socially productive activity. This focuses on actions and intent of the AP. b. Sleeping looks at true owner. Penalize the true owner for sleeping on their rights. c. Both are valid, but there are some cases that would turn out differently based on which one you think of as the main reason for AP. d. Squatters rights: book says squatters never get rights, but if they are using the land openly and adversely, there is no reason why they cant be APs. There is a lay sense of squatters that there is an understanding btwn owner and squatter. iii. Van Valkenburg v. Lutz (p 129)
Facts: Lutz bought some land near an empty lot. They traveled across the lot, built a small shack on it, grew vegetables and raised chickens on it. 30 yrs later, Van Valkenburgs bought the empty lot and tried to kick the Lutzs off. In court, Lutz conceded that the lot was owned by Van Valkenburgs but argued for right to use the travel way and won (easement). Then Lutz brought suit for ownership of the lot through adverse possession. Was the whole of the land usually cultivated or improved by the Lutzs? Under NY statute: Adverse possession 1) where it has been protected by a substantial enclosure, or 2) where it has been usually cultivated or improved for at least 15 years. The proof fails to show that the whole of the land was cultivated and improved by the Lutzs. The garden was only on a small part of the land, the chicken coops were portable and moved around, and there was junk laying all around. Lutz said he knew at the time it wasnt his land. A fundamental concept of adverse possession is that the occupation be under claim of title that is hostile to the true ownership. In a previous suit, Lutz conceded that the land was owned by the Van Valkenburgs rather than declaring his hostility and asserting his rights as the true owner. Court shouldnt be making decisions on the facts but looking at the law and whether the trial court erred Intent to claim property or mistakenly possessing property is not enough.
Issue: Rule: Analysis:
Dissent: Rule:
a. Notes: 1. Notice to owner: Protected by substantial enclosure court says no, but there were markers. Purpose of this is to give notice to others so that the world and the true owner that I am claiming it. When you take steps as an AP that gives the true owner the opportunity to kick you off, the clock starts ticking on the statute of limitations. 2. You can AP part of someones property, so why does Lutz get nothing? b. Color of title vs. claim of right/claim of title. Color of title is where you are making an adverse possession claim but you have something in writing that gives you title. 1. Rules for these claims are somewhat more relaxed: shorter statute of limitations, possession of part of the land is constructive possession of the whole.
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e. Bilateral Monopolies (Marengo cave problem, p 141) 1. Bilateral monopoly: Two parties locked into dealing with each other. This can lead to high negotiation costs w/ each trying to get the best deal. This isnt economically efficient. 2. Cave is under two peoples properties. Who owns the cave? A) Ad coleum doctrine is that person who owns land owns what is in the air above and under the ground. B) This is a commons problem. They both have an ownership and it is inefficient. C) Could say that person who owns the entrance owns it. That person is the only one who can use it from their property. There is a single owner, and others dont have expectations of being able to use it. But what if there is more than one entrance? How about whoever discovers it? But then licensing trespass. iii. Manillo v. Gorski (p147)
Facts: Gorskis bought a lot adjacent to lot owned by Mannillos. Gorskis made additions to the house, including raising the house and extending the stairs. These steps and the concrete walk extend 15 inches onto Mannillos land. Gorski claims title by adverse possession. Is a hostile state of mind required? Was possession open and notorious? When Gorskis built steps and path over property line, they thought they were on their own land, but state of mind is irrelevant. Maine doctrine (hostile intention) is rejected. Use must be open and notorious. The encroachment was so slight that Mannillo may not be expected to know of it even though he could see the actual path. If it is open and notorious, Gorskis should pay reasonable price for the land (modern trend). Maine doctrine (hostile intention) rewards the intentional wrongdoer while disfavoring the honest, mistaken entrant. Making owner survey all the time is an undue burden. Hostile state of mind requirement rejected. For small encroachments, actual notice to owner is required.
Issue: Analysis:
Policy: Rule:
a. Notes: 1. Earning rationale Gorskis built the steps 2. Sleeping rationale Mannillo didnt even know he was sleeping on his rights and reasonably couldnt know. This is what the court adopts. Court says there must be actual notice, but probably would suffice to have inquiry notice you have enough knowledge to put on you the duty to inquire further. b. Property rules and liability rules 1. Property interest protected by property rule: cant take from owner without consent. All transfers are voluntary. 2. Property interest protected by liability rule: Interest can be taken without owners consent but only payment of judicially determined damaged: forced transfer. c. Doctrines of agreed boundaries, acquiescence, estoppel 1. If the two parties agree on a boundary but they are mistaken, and there is a long period of acquiescence (but perhaps shorter than S/L), then neighbors are estopped to deny the validity of their statements and actions d. Mistaken improvers 1. Early common law: anything built on the wrong land, even innocently, belonged to the landowner. 2. Later, forced conveyance of land at market value or give landowner option to buy improvement. A) If takes up lots of land, may be ordered removed. B) Intentional encroachers often made to remove. C) If innocent encroachment is so small as to be trivial, relief may be denied.
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iv. Howard v. Kunto (p153)

Facts: Since at least 1932, the deed to the land occupied by the Kuntos described the lot adjacent to them rather than the lot they actually occupied. A survey by the previous owners showed that the deed was correct. The Howards (occupying land two lots to the east) had a survey of their land in 1959 and discovered that they actually owned the land of the Moyer house, and the Moyers owned the land of the Kunto house. Howards traded with Moyers the title of their land for the title to the Kuntos land. Howard brought an action to get legal recognition of their ownership of the title of the land occupied by the Kuntos. Can summer use only of this summer home be considered continuous use as required for adverse possession? Can an AP under color of title use the period of time immediate predecessors occupied to establish his AP? Summer use only of a summer home is continuous use. This how an ordinary owner of this land would use this home. A person may tack the adverse use of his predecessor even when none of the occupied land is included in the deed. Tacking is permitted if successive occupants are in privity (mutuality of legal interest), and has been used for cases where the owner believed that he owned more land than his deed stated. The claim of right of a person who occupies a lot directly adjacent to the lot in his deed is no less persuasive than the person who believes she is purchasing more than her deed describes. Continuous use for AP purposes is measured by how an ordinary owner of the land would use it under the circumstances. Tacking of AP time is permitted if successive occupants are in privity of contract or blood.
Issue:
Analysis:
Rule:
v. Tacking (p 159) a. You can tack on land if there is a piece of it that isnt in the deed but you think it is. b. You can tack on previous adverse possessors time if you are in privity (a legal relationship) like privity of contract- one bought it from the other; inherited it; got it as a gift. 1. Series of trespassers cant tack. c. You can also tack on previous true owners if the property was transferred while you were AP. 1. Earning rationale: earned it from both owners 2. Sleeping: Shouldnt you go out and look at it before you buy it? First owner slept and so did the next owner. vi. Disability (p 161) a. If owner has certain disabilities minor, unsound mind, imprisoned, S/L is extended to certain length of time after disability is removed. Applies if disability existed when cause of action accrued b. Also has included anyone claiming from, by, or under such a person vii. AP against the government (p162) a. Common law: AP doesnt run against govt. Also some Constitutional provisions protecting state lands. 1. Sovereign immunity. Govt is immune to claims or suit w/o consent. 2. State owns in trust for the people. 3. Govt owns 1/3 of land, and it is an unfair burden to have them police it all the time. The govt generally keeps this land for public to use. If govt was open to AP, they would fence it off and keep people out. iv. Adverse Possession of Chattels (p 163) a. Usually shorter statute of limitations b. OKeefe v. Snyder (p 163)
Facts: Georgia OKeefe found her paintings that had been stolen in the 40s in an art gallery. Gallery owner (Snyder) bought from Frank, who said he got it from his father, who knew Steiglitz. OKeefe did not report paintings stolen at the time, only much later. Snyder argues that statute of limitations has run, and has title through adverse possession (tacking possession with Franks). Is there enough conflict of evidence for suit to be brought by OKeefe for possession and title of the paintings?
Issue:
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Property Outline Fall 2003 Analysis: S/L wont start until the items are discovered or reasonably discoverable as long as the owner has taken reasonable measures to locate the stolen items and notify potential buyers that they have been stolen. Transfer of possession by subsequent possessors makes it harder for the owner to find it, and discovery rule still applies. However, once it has begun, S/L doesnt begin running anew if items change hands as long as there is privity between possessors. Discovery rule for AP of chattels: in appropriate cases, cause of action will not accrue until injured party discovers, or by reasonable diligence and intelligence should have discovered, facts that form the basis of the action.
Rule:
c. Discovery Rule in appropriate cases, cause of action will not accrue until injured party discovers, or by reasonable diligence and intelligence should have discovered, facts that form the basis of the action. 1. Puts the burden on the true owner. We look to the conduct of the true owner, not the AP, not how open AP is but how hard true owner tries to find it. In real property, we always look to actions of AP rather than true owner. 2. Clock doesnt start again if possessor changes and they are in privity. This is to protect the bona fide purchaser. 3. Bona fide purchaser cannot get good title from a thief but can from other scoundrels (bought with bad check, etc.) who have a voidable title. d. Demand Rule: AP clock starts running only after true owner demands return. Only NY has this rule. e. Native American Graves Protection and Repatriation Act of 1990 (p 176) 1. Federal law trying to get Native American artifacts and burial items to Native Americans. 2. Can the museums claim AP? No. Museums have to give it back (complicated issues with tribes that dont exist) unless, museum can show right of possession. A) Right of possession is possession obtained with the voluntary consent of the individual owner or tribe (and museum must show this) unless results in 5th amendment taking of property without compensation. B) Federal law trumps state law about AP. C. Acquisition by Gift (p 178) i. General rule: A valid inter vivos gift must include 1) intent, 2) constructive, symbolic or actual delivery, 3) acceptance. Until delivery has taken place, gift is not complete. a. Delivery 1. Constructive delivery handing over a key or something that gives access to the subject matter of the gift. 2. Symbolic delivery handing over something symbolic of the property given (a written instrument). 3. Purpose of delivery requirement partly to make donor feel and understand what they are doing. Also proof that the donor intended to and actually gave the gift. b. Acceptance is assumed if it would be beneficial to the donee. ii. Inter vivos gift gift completed while donor is alive. Cannot be revoked after it is completed. iii. Gift causa mortis gift given in consideration of death. These gifts are automatically revoked and go back to the donor if the donor survives but cannot otherwise be revoked. a. Gift causa mortis requires stronger proof than inter vivos gift. If the gift is valid, it circumvents the will. Wills require a lot of formality but gifts dont. The easier you make it for people to claim gifts causa mortis, the more you undermine the wills statute. iv. Newman v. Bost (p 180)
Facts: On deathbed, Van Pelt gave Newman keys to bureau, doors in house and told her she could have everything in the house. Newman kept the keys. Bost, administrator, sold everything and kept it, including life insurance policy in the bureau and fire insurance on the piano Van Pelt had bought for Newman. Newman sues for furniture and life insurance policies as gifts causa mortis and for her bedroom property and insurance money on the piano as gifts inter vivos. Was there valid delivery of the gifts to Newman from Van Pelt, both of the gifts causa mortis and the gifts inter vivos?
Issue:
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Property Outline Fall 2003 Analysis: Gifts causa mortis: There was valid delivery of any article of furniture that could be unlocked by the keys give to Newman, as these articles could not be manually delivered (constructive delivery is enough). There was not valid delivery of the life insurance policy because it could have been manually delivered and bureaus are not intended or expected to store such things of value. Gifts inter vivos: There was valid delivery of Newmans bedroom belongings because they were bought for her during Van Pelts lifetime for he exclusive use and control. There was not valid delivery of the piano because Van Pelt insured it as his piano. Dicta: no such thing as symbolic delivery for gifts causa mortis. Constructive delivery is sufficient where the donor plainly intends to make the gift and the items are not present or are incapable of manual delivery because of their size or weight. When items are present and capable of manual delivery, manual delivery must be had.
Rule:
a. Notes: 1. If the bureau had been a safe and he gave her the keys, it would have been delivery. A safe is intended for holding things of value, while bureaus are not designed to hold things of value. 2. Court seemed to rule differently on facts found by the jury although appellate court is supposed to accept the facts found by the jury. v. Gruen v. Gruen (p 187)
Facts: Issue: Analysis: Father (Victor) wrote letter to son (Michael) giving him Klimt painting for his birthday. Father wanted to keep possession of painting during his life (keep a life interest). Son never had possession. Father died, stepmother wants to keep it. Can a valid inter vivos gift of chattel be made where the owner reserves a life estate and the donee never has physical possession before donors death? There is a distinction between ownership and possession. The correct test is whether the donor intended the gift to have no effect until after the donors death (making it a gift causa mortis), or whether he intended it to transfer some present interest. Once a gift is made it is irrevocable, and donor is limited to rights of life tenant, and the donee gets the remainder. Under a will, neither title nor possession vests immediately. When a gift is of value to the donee, acceptance is assumed, but Michael also gave clear and convincing evidence that he accepted it. Requirement of delivery is not rigid or inflexible but must be tailored to suit the circumstances of the case. Requiring actual delivery in this case would be artificial. A valid inter vivos gift of chattel can be made where the owner reserves a life estate and the donee never has physical possession before donors death. Son gets the painting.
Policy: Rule:
System of Estates III. Possessory Estates (p 197)

A. Feudalism (p 197-205) i. All land was owned by the king. He gave possession to lords and barons, who had an obligation to provide certain number of soldiers to the king. Lord could give possession of a parcel to an underling in exchange for soldiers or other obligation (seisin). B. Estates (p 195) i. Estates: an interest in land that has two characteristics: it is or may become possessory, and it is measured in terms of duration. a. Courts interpret ambiguous grants as the largest estate possible (White v. Brown) ii. Freehold: no ascertainable termination date, includes fee simple, life esate. a. Freeholder has seisin possession with duty of feudal services. Passing seisin had to include formal delivery of a piece of the land (clod of dirt, branch) while on the land. (p 238) iii. Nonfreehold: have an ascertainable termination date, includes tenancy for years, periodic tenancy, tenancy at will, (tenancy at sufferance). a. Leaseholders dont have seisin. (p 239) iv. People cant make up any other kinds of estates. a. To carry out your intent, you have to fit it into the existing pigeonholes. There is too much instability if property owners have freeform ability to recreate rights.
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C. Fee Simple (p 209) i. Fee simple: Absolute ownership (used to be called fee simple absolute), as far as any property ownership can be absolute (ownership is almost never absolute). a. Most unrestricted and longest estate. It is permanent and of unlimited duration ii. How Fee Simple Developed (p 209) a. Heritability land wasnt owned by possessor but held by possessor as a tenant so couldnt go to heirs. Then heirs paid for it, then it went automatically to heir for continued payment. b. Alienability later became alienable and always passed to heirs. Tenants could sell with lords permission. iii. Creation of fee simple (p 211) Words used to convey fee simple: a. Common law: To A and his heirs To A forever b. Modern trend: To A. When language is unclear, courts prefer fee simple estates. iv. Inheritance of Fee Simple (p 212) a. If a person dies intestate (no will) property goes to heirs. You dont have heirs until after you die. b. Heirs are children and issue (their children), parents, collaterals (siblings, aunts, nephews, cousins). 1. Now spouse gets a portion. c. If you dont have any heirs, it escheats to the state. d. Wills: person who gets your property under your will is your devisee. D. Life Estate (p 221) i. Lasts for the life of the person. Always followed by a future interest. Person w/ life estate has a life estate pur autre vie. a. You can sell your life interest. b. Typically measured by the life of the person who holds the estate, but can be measured by someone elses life. c. To A for life, To A until he dies, To A and at his death to his children ii. Waste doctrine a. Duties of LT 1. LT may not waste or unreasonably decrease the value of the property for the person with the remainder interest. Also must pay taxes, make repairs, pay interest on mortgage. No obligation to insure. 2. Life tenant cant sell, can only lease during lifetime, cant get a mortgage for repairs, may not be able to use the property in many ways because of waste. b. If a mine was open when donor is alive, it is within his expectation that life estate will mine the coal, and remainder people cant stop her. BUT, if a mine is later discovered, life tenant would have to get remainders permission. c. Waste doctrine influenced by the age of the life tenant. Gets more discretion about managing the property the longer her life expectancy is. Why? She has more incentive for long term management. The older she gets, the more her interest will differ from the remainder d. Affirmative and permissive waste (p 235) 1. Affirmative waste injurious, voluntary acts that have more than trivial effects and that substantially reduce the value of the property. A) Generally speaking, LT can make changes if it doesnt depreciate the value of the property. 2. Permissive waste failure to take reasonable care of the property. This is a question of negligence. e. Adverse Possession of property held in life estate 1. If AP property while owned in fee simple that is split into life estate and remainder during S/L, AP was possessing against FS owner. A) Remainderman has an ownership interest that has been snatched away by AP. R loses property by LTs inaction. B) R can sue LT for waste.
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2. If you enter against a life estate owner, and statute runs, AP gets life estate for original life estate owners life. If LT dies before statute of limitations runs, clock begins again at LTs death. iii. White v. Brown (p 221)
Facts: Lide left her house to sister-in-law (White) in a handwritten will for White to live in and not sell. Lide left personal property to niece Sandra (Whites daughter). White alleges she was vested with a fee simple title. Did Lide leave a life estate to White or fee simple title? If the expression of the will is doubtful, the doubt is resolved in favor of an absolute estate. Lide did not provide a person who would inherit the remainder of the property after Whites life estate. There is not enough evidence of intent to pass life estate to overcome the laws strong presumption against it. Court will discard provision that property will not be sold because the law resists absolute restraints on alienation. The limitation that the house was not to be sold indicates that Lide intend to give a life estate. You cant just strike this part of the will. Court interprets ambiguous grants to mean the largest estate possible.
Issue: Analysis:
Dissent: Rule:
a. Notes: 1. If White had a life estate, heirs would have remainder (in fact, vested remainder). White wouldnt be able to leave house to her heirs when she dies because she only has a life estate. 2. But, since Jessie didnt provide a person to get the remainder, she probably didnt intend a life estate. If she had said and then go back to my heirs, or to this other person afterwards, this would imply an intent for a life estate. 3. Court interprets ambiguous grants to mean the largest estate possible. Why? Makes the economy more efficient because people will use larger estates to a greater extent. b. Law is hostile to absolute disabling restraints on alienability 1. Why? We want property to be flexible and used in the highest and best way possible. 2. Anything that does not restrict sale absolutely is ok (not be sold to corporation; for 5 years; to Evelyn as long as she doesnt sell it, then back to my heirs). This is a forfeiture restraint, which is allowed (p 228). 3. Promissory restraint you get it if you promise not to transfer it, and your promise is enforceable under contract remedies. c. Valuation of Life Estate and Remainder (p 229) 1. Use life expectancy tables, figure out how much per year of the interest goes to the life tenant, multiply by years of life expectancy. 2. Remainder is value at end of life tenancy minus life estate value. iv. Baker v. Weedon (p 230)
Facts: Weedon had 3 grandchildren from a previous marriage. He left his farm as life estate to his current wife (Anna), then to her children upon her death, or to his grandchildren if Anna had no children. Anna has no kids, so Weedons grandchildren are the remaindermen. Previously they worked out selling to govt an easement for a highway. Anna doesnt have enough money to live on and wants to sell most of the farm, invest the proceeds, and live off of the interest. Would sale of the land and investment of the proceeds be in the best interests of both the life tenant (Anna) and the remaindermen (three grandchildren)? Grandchildren dont want to sell it because in 4 years, it will be worth a lot more. Sale of the land isnt in the best interest of all parties it would result in great financial loss to the remaindermen. Perhaps part of the land can be sold now, but only if all parties can agree. Deterioration and waste of the property is not the exclusive and ultimate test to be used in deciding whether to sell land affected by a future interest, but also whether a sale is necessary for the best interests of all parties.
Issue: Analysis:
Rule:
a. Notes: 1. Bad decision. Grandchildren have no sentimental attachment, just greedy.
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E. Defeasible Estates (p 240) i. General rule: A holder of a fee simple defeasible is subject to a divestment, but may still hold, use, and convey forever as long as the condition is met. a. Always followed by a future interest. b. In FSD and FSSCS, grantor has a reversion (future interest) 1. Traditional: you cant transfer reversion by will or inter vivos transfer. A reversion isnt actual property. A reversion can only pass by inheritance. 2. Modern: most states allow inter vivos transfer ii. 3 types: Fee simple determinable, fee simple subject to a condition subsequent, fee simple subject to executory limitation. a. Fee simple determinable (FSD) 1. Fee simple that is divested automatically when a particular event happens. 2. Grantor gets a possibility of reverter: the grantor keeps an interest that vests automatically when the event happens. A) Transferee (who gets the future interest) has an executory interest. Transferee can be named or can be by operation of law (grantor or his heirs). 3. Words used to create: A) So long as, until, during, while, revert to grantor 4. Purpose is to prevent property from being put to a certain use, or ensure that it is only used for a particular purpose. 5. S/L for AP starts to run from the time of creation, usually very long or there is no limit. A) Laches bars relief when the grantors delay causes injury or disadvantage. b. Fee simple subject to a condition subsequent (FSSCS) 1. Doesnt automatically end when the event happens but may be divested at the grantors election when the event happens. 2. Courts prefer FSSCS and will construe ambiguous language to mean FSSCS. Court presumes largest possible estate for the grantee. Law doesnt like automatic forfeiture. A) CA: there is no FSD. If you use words to pass this fee, you are passing FSSCS. 3. Grantor gets right of entry (power of termination) the future interest retained by the transferor to divest a FSSCS when the event happens. 4. Words used to create: A) Must indicate that 1) the grant is subject to a condition: provided that, however, on the condition that AND 2) the grantor may reenter the property and terminate the estate. 5. S/L for AP starts to run when the condition happens and is usually short. c. Fee simple subject to executory limitations (p 285) 1. Estate passes to a third party instead of the grantor. 2. Example: To A, but if property used for x, then to B. 3. Can use same language as FSD and FSSCS, but shifts interest to a third party. iii. Marenholz v. County Board of School Trustees (p 242)
Facts: Huttons gave piece of land to School Board to be used for school purposes only. They transferred the whole land and the interest in the school land to Jacqmains, who later transferred both to Mahrenholzes. After Huttons death, their only heir, Henry, released any possibility of reverter or right of entry to school board, and also gave all interest in school land to Mahrenholzes. School started storing stuff on the land instead of holding classes. 1) Could Mahrenholzes have acquired any interest in the school land from Jacqmain? 2) Did the language of the deed give FSSCS or FSD? 1) You cant transfer reversion by will or inter vivos gift but only by inheritance. Reversion isnt actually property. 2) If the language of the deed gave FSD, Henry would have become owner of the property automatically when condition was broken. He would then be able to transfer all interest in the land to the Mahrenholzes. If it gave FSSCS, Henry could become owner of the property only if he rentered the property. He would be unable to transfer ownership to the Mahrenholzes. Here it was a fee simple determinable.
Issue: Analysis:
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Property Outline Fall 2003 Rule: The phrase to be used for only indicates the granting of fee simple determinable followed by a possibility of reverter, which automatically gives ownership to grantor or his heirs when condition is broken. Grantor or heirs can only transfer ownership to a third party after property has reverted to them if FSD, or if FSSCS, only after reentry.
a. Note: To quitclaim is to give whatever you have. You are not saying what you have. It is a conveyance of whatever, if any, you have. This is kind of what Henry did in transfer to Mahrenholzes. iv. Palm Springs v Living Desert Reserve (p 265)
Facts: Deed land to city as long as used as a reserve. If not, then to Living Desert Reserve. City wanted to make a golf course, so brought an action for condemnation (government taking land for fair market value). In a condemnation, party with right of reentry doesnt get anything, only the party holding the FSSCS gets paid, in this case, the govt itself.
Analysis: City is trying to get around the condition in the FSSCS. The action to build the golf course (and not use it as a reserve) is imminent, so city has violated the condition and Living Desert has a right to reenter. v. Defeasible Life Estates & the Marriage issue a. Leave to my wife until she marries again. b. This is using property to control behavior (law even more hostile to this invasion of privacy). Mahrenholz is about controlling how property is used. c. The marriage restrictions tend not to be enforced. Courts will enforce it if Hs intent was to support her while unmarried, but if H intended the restriction to keep her from getting married again, courts dont enforce.
IV. Future Interests (p 269)

A. Future interests i. Not mere expectancies but presently existing property interests. ii. Future interests do not entitle the holder to possession but may become possessory in the future B. Future Interests in the Transferor (p 270) i. Reversion the right to future possession by the transferor a. Interest left over for the owner when he carves out a lesser estate without specifying a third party remainderman. Reversion to transferor if no on is specified to get the estate after the prior estate ends. b. Ex: O conveys blackacre to A for life. O has a reversion. c. If it does not become possessory, it is divested. 1. To A for life then to B and his heirs if B survives A A) If B out lives A, reversion becomes divested from the grantor. B) If A outlives B, reversion will become possessory in the grantor. d. At common law, reversions are transferable by will, inheritance, and inter vivos transfer. ii. Possibility of Reverter The transferors interest following a fee simple determinable. a. Automatically vests when specified event happens b. Inheritable, but under common law not transferable by will or inter vivos (although modern trend is to allow). iii. Right of Entry The transferors interest following a fee simple subject to a condition subsequent. a. Transferor must reenter after event happens to vest. When transferor reenters, he terminates the fee simple.
C. Future Interests in Transferees (p 272)

i. Remainders future interest in a transferee which can become possessory only upon the expiration of a prior possessory interest created by the same instrument. Remainders never follow fee simple. a. Vested remainder remainder not subject to a condition precedent that is given to a third person who is expressly determined. 1. Indefeasibly vested remainder certain to become possessory by transferee or his heirs. A) Ex: To A for life, then to B.
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2. Vested remainder subject to partial divestment (subject to open) there are parties whose interest is certain to become possessory, but there may be other parties not yet ascertained who will share the interest. A) Ex: To A for life, remainder to Bs children and their heirs. If B already has one or more children and may have more, the existing children have a vested remainder subject to partial divestment. 3. Vested remainder subject to divestment (subject to complete disfeasance) vested remainder subject to a condition subsequent. Although transferees interest will become possessory if prior estate ended today, there is a possibility his interest will never become possessory. A) May expire: To A for life, then to B for life. While A and B are alive, B has vested remainder subject to divestment b/c he may die before his interest become possessory. B) May be divested by I) Executory interest: To A for life, then to B and his heirs, but if B dies without issue, then to C. If B died without issue, his interest, although vested now, will be completely divested and go to C. II) Right of entry: To A for life, then to B and his heirs, so long as always used for a church. (transferor can reenter if condition subsequent occurs) III) Power of appointment: To A for life, remainder to A as A appoints, but if A does not appoint any, then to B and his heirs. C) To distinguish from contingent remainders: If condition is contained within the granting clause, it is a condition precedent and therefore a conditional remainder (but ifthen to). If the granting clause stands alone and a subsequent clause takes it away, the remainder is vested (,then if). I) If unclear, vested remainder is preferred. 4. Transferable by inheritance, will, inter vivos. 5. If first future interest is a vested remainder in fee simple, the second future interest in a transferee will be a divesting executory interest. b. Contingent remainder remainder not yet vested because 1) given to a third party not yet ascertainable OR 2) made contingent on some event other than the natural termination of the prior estate (subject to a condition precedent). 1. Transferee not yet ascertainable either because not born or will be determined by future events (for instance, heirs of a living person). A) Ex: To A for life, then to As eldest son. 2. Subject to a condition precedent a condition that must be met before remainder becomes vested. (Condition subsequent condition that ends the interest) A) Ex: To A for life, then to B and Bs heirs if B survives A. 3. Alternative contingent remainders - One party subject to condition precedent, and the other to the opposite condition precedent. A) To A for life, then to B and her heirs if B survives A, and if B doesnt survive A, then to C and her heirs. 4. Destroyed if doesnt vest by the end of the previous estate. A) Can become vested 5. Subject to RAP. 6. Not transferable under common law, but transferable by inheritance, will in all JX now and by inter vivos transfer in most JX. 7. If first future interest is a contingent remainder in fee simple, the second future interest in a transferee will also be a contingent remainder. c. Courts prefer vested remainder and condition subsequent over contingent remainder and condition precedent. Court will construe ambiguous language as the former. ii. Executory Interests Future interest in a transferee that cuts short (divests) a prior interest: either 1) another transferees interest (shifting executory interest) or 2) the transferors interest (springing executory interest)
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a. Fee simple subject to an executory limitation. (p 284) 1. If fee simple determinable is followed by an interest in a third party rather than a grantor, it is a fee simple subject to an executory limitation. The executory interest doesnt, in this case, cut short the prior estate. b. Executory interests are treated as contingent interests because they are subject to a condition precedent and do not vest until they become possessory. c. Ex: To A for life, then to B and her heirs, but if A is survived at his death by any children, then to such surviving children and their heirs. A is alive and has two children, C and D. 1. B has vested remainder in fee simple subject to divestment by the executory interest in C and D if C and D outlive A. D. Rule Against Perpetuities (pp 302-306, 326-35) i. Common Law Rule (p 302) a. No interest is good unless it must vest, if at all, not later than 21 years after some life in being (validating life). 1. Ex: to D for life, then to her first child that reaches 21. D is the life in being. b. Applies to contingent remainders (subject to a condition precedent) and executory interests. Does not apply to vested remainders, reversionary interests c. Wanted to limit the control of the dead hand. 1. Often just passed through strawmen to get around it. 2. Doesnt apply when possessory estate and future interest is in charitable organizations. 3. It is a classic rule rather than a standard. It doesnt discourage wealth being controlled for a long time, just gives money to lawyers who could figure out a way around it. 4. Tax laws provide the incentive and means to limit long term control of dead hand. The more control you exercised, the more it was taxed. This has overshadowed RAP. ii. Wait-and-See Doctrine (p 326) many JX stopped using RAP or modified. a. Wait-and-See for Common Law Perpetuities Period 1. Contingent interest is valid if it actually vests within the common law period. b. Wait-and-See for 90 years: Uniform Statutory Rule Against Perpetuities (USRAP) 1. Wait and see if it vests for 90 years after interest is created. E. Trusts (pp 287-293, 335-338) i. Trusts trusts combined legal interests (law ct rigid rules) and beneficial interests (equity ct questions of justice) a. Trustee - Person who is bound by law to carry out the trust in the interest of the beneficiaries. Trustee is the legal owner and has duties spelled out in the trust instrument. 1. Held to high standard of care. 2. Trustee can respond to changing circumstances without having to go to court for permission. b. Beneficiary the equitable owner and has superior rights. Holds equitable interests or interests enforceable in equity c. Ex: O conveys to X in trust to pay income to A for life, then principal to As children who survive A. 1. A has an equitable life estate. 2. As children have an equitable contingent remainder. 3. O has an equitable reversion and gets property back if none of As children survive A ii. Swanson v. Swanson (p 288)
Facts: Swanson died testate. He created two trusts in which his wife, Gertrude, had a life estate with the remainder for their nine children. One of the children, died childless and left all his property to his wife, Peggy (P) in his will. Trust 1: allows Gertrude to designate other beneficiaries of the trust, and if not, it passes to nine children, divided equally. If any child dies, their share goes to his/her surviving children. Trust 2:Remaining assets divided equally into 9 shares, one to each child or for the then surviving issue of each deceased child. Was Bennies interest in his fathers trust a vested remainder, thereby passing to his wife after his death under his will?
Issue:
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Property Outline Fall 2003 Analysis: Trust 1: There are immediately identifiable persons who would take if the life estate ended = vested remainder interest. There are two conditions subsequent that could bring about total defeasance but neither happened, so Bennies interest is fully vested. Trust 2: Immediately identifiable beneficiaries if the life estate ended. Court takes surviving children to be a condition subsequent rather than a condition precedent because of laws strong preference. A child dying before Gertrude but leaving children who survived could bring total defeasance of the vested remainder, but this didnt happen. Bennies one ninth interest passes to his wife under his will because 1) his remainder was vested, 2) no condition subsequent occurred before life estate ended, 3) no language in will plainly shows different intent. If a beneficiary of a trust dies before the end of a life estate, his remainder can pass to a person designated under his will if his remainder was vested, and no condition subsequent that could bring about defeasance occurred before the end of the life estate.
Rule:
a. Notes: 1. Gertrude had a life estate and was a trustee. 2. Law has a preference to construe language of surviving to mean surviving the testator 3. Law has preference for condition subsequent rather than condition precedent because wants the contingency to be destroyed and the interest to vest as soon as possible. iii. Dynasty Trusts (pp 335-338) a. Dynasty trusts 1. At first, successive life estates could endure for as long as RAP allowed tax-free because no estate tax levied at end of life estate. 2. Now, generation-skipping transfer tax due at end of life estate if passes to next generation and levied at highest rate. A) But, amt up to $1 million ($2 mil for married couples) is exempt. So, can create $ 1 million trusts and successive life estates tax free: tax-exempt dynasty trust. V. Concurrent Estates Common Law Co-ownership (p 339) A. Concurrent estates two or more people have present possessory and undivided interests in the whole of the same property: Tenancy in common, joint tenancy, tenancy by the entirety. i. Tenancy in common a. Separate but undivided interests in whole of the property. 1. Interests may be unequal 2. May be conveyed separately by deed or will and at different times. 3. Each must have a right to possession of the whole. b. No right of survivorship ii. Joint tenancy a. Together are regarded as a single owner. Each, in theory, owns the undivided whole of the property. b. Four unities must be present 1. Time: each must acquire interest at the same time 2. Title: must acquire title by the same instrument or by joint AP A) Never can arise from inheritance w/o will or other act of law 3. Interest: must have equal undivided shares and identical interests measured by duration. 4. Possession: each must have a right to possess the whole. A) One can voluntarily give exclusive possession to others. B) Also required for TIC. c. Right of survivorship cannot be passed by will or inheritance. 1. Survivorship is automatic and not something you can change with your will. 2. Survivorship extinguishes the decedents interest rather than passing his interest to the survivor. Therefore, no probate. 3. Federally taxed according to portion of property due to decedents consideration. State taxes usu based on JTs share.
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d. Any transfer of interest destroys the joint tenancy and can be so destroyed without the consent of all JTs. 1. If one JT transfers interest to a third party, that party becomes a tenant in common with respect to the other tenants, but if there are two or more other Ts, they are still joint tenants with respect to each other. 2. If one JT conveys to another JT, joint tenancy is severed only for the share conveyed, not for any of the other shares. e. In some JX, there must be an express provision of survivorship in order for JT to be created 1. Law presumes tenancy in common absent clear contrary indication 2. Some JX have no JT. iii. Tenancy by the entirety (p 341) a. Can be created only by husband and wife (HI allows others). 1. Divorce terminates TE. 2. Allowed only in ~ half the states. b. Like JT (requires 4 unities) but also requires marriage. 1. Unlike JT, can only be conveyed to a third party jointly and with consent of both. c. Right to survivorship 1. No probate, marital deduction on estate taxes. d. Considered to hold as one person under the law e. Common law presumes tenancy by the entirety in conveyances to H & W. iv. Avoidance of probate (p 343) a. Probate judicial supervision of decedents property 1. Probate is costly and time consuming. 2. Creditor can seize JTs property during lifetime, severing JT and creating TIC, but if waits until after death, there is no interest to seize. b. Survivorship avoids probate b/c decedents interest is terminated. v. Riddle v. Harmon (p 345)
Facts: Mr. & Mrs. Riddle owned property in joint tenancy. Before her death, Mrs. Riddle conveyed her interest in joint tenancy to herself in order to terminate the joint tenancy and create a tenancy in common, so she could transfer her interest by her will. Can a joint tenant unilaterally terminate JT by conveying her interest to herself? Mrs. Riddle clearly intended to terminate the tenancy. It is artificial to require a joint tenant to convey interest to a third party (strawman) who will convey it back to the joint tenant in order to terminate joint tenancy. CA statute already allows JT to be created w/o strawman. Owner can convey to self and another in JT w/o strawman, so why not be able to destroy? One tenant may unilaterally sever the joint tenancy without the use of an intermediary device (strawman).
Issue: Analysis:
Rule:
a. Notes: 1. CA statute can be interpreted either way: A) For Mrs. Riddle if you can create a JT w/o strawman, why cant you destroy it. Seems like policy is no different. If legislature thought it was different, could have explained. B) Against Mrs. Riddle if legislature intended statute to apply to destroying JT, would have said it did. vi. Joint Bank Accounts (p 356) a. Bank accounts are different. They are joint for the purposes of the bank, not for survivorship under the law. b. Depends on intent 1. True joint tenancy one half to each during life, survivorship at death of one. 2. Payable on death no rights during life but survivorship upon death of the donor 3. Convenience just for bills as needed during life.
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B. Relations among Concurrent Owners i. Each tenant is entitled to possession of the whole, so often come into conflict a. Communal ownership encourages inefficient use Posner b. Rules governing co-ownership should equally distribute benefits and burdens. ii. Partition (p 359) a. Partition action can be brought if cant agree in TIC and JT, not tenancy by the entirety. 1. Partition in kind physical division of property. 2. Partition by sale property sold and proceeds divided. b. Delfino v. Vealencis (p 359)
Facts: Delfinos (P) and Vealencis (D) are tenants in common. D lives on and operates business on one acre and has ~30%, undivided interest. Delfinos want a partition by sale because the land can be made into a subdivision and is very valuable. Helen wants a partition in kind (physically divided). Would a partition in kind create material injury to parties? Partition by sale only when: 1) physical attributes of land are such that physical partition is impracticable: Here, the land only needs to be divided into two parts. 2) the interests of the parties would be better promoted by partition by sale: Here, Helens business is her livelihood. The city would probably approve the subdivision plan even if Helen kept her plot and continued her business. The possible decline in market value due to Helens business and the fact that a road would need to be rerouted is not enough to overcome Helens interests. The interests of all parties must be considered. For property owned by tenants in common, courts favor a partition in kind (physical partition) over a partition by sale, and the decision is made in best interest of all the parties.
Issue: Analysis:
Rule:
1. Notes: A) Now, the tendency is to sell and divide proceeds B) Courts dont generally take into consideration the advantage of one co-tenant acquiring the part of the property that may be next to other property owned by that party. iii. Sharing the Benefits and Burdens of Co-ownership (p 369) a. Concurrent owners can enter into K governing use and maintenance, but absent agreement, property rules apply: (p 379) 1. Cotenant paying taxes, maintenance, improvements may seek to recover some or all of costs through partition action, action for accounting, action for contribution. A) Accounting: equitable proceeding for division of costs and proceeds. 2. Rents and profits Cotenant collecting rent must account to all other cotenants. This is based on receipts, and not fair market value (absent ouster). 3. Taxes, mortgage payments Cotenant paying more than share generally has a right to contribution from other cotenants. A) CoT paying more can also get credit in accounting and partition actions. 4. Repairs No affirmative right to contribution. How much should be spent on repairs is too uncertain. A) May deduct cost of repairs from rent in accounting proceeding. B) When possession is shared, a number of JX allow direct action for contribution. 5. Improvements No right to contributions and no credit in accounting and partition actions. A) Improvers interest should be protected if wont diminish other interests: can get the portion of the property improved in partition in kind if fair division, OR can get amount improvement increased value in partition by sale (owelty). B) These remedies only look at value of improvements, not cost.
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b. Spiller v. Mackereth (p 369)

Facts: Issue: Analysis: Spiller (D) and Mackereth (P) owned building as TIC. After lessee left, Spiller started using it as a warehouse. Mackereth wrote letter demanding either half rent or to vacate half the building. Spiller didnt do either. Spiller also put new locks on the doors. Is Spiller liable to the other co-tenant for rent on building they own in common that he has full possessory use of? Adverse possession requires finding that possessing cotenant asserted complete ownership. Spiller acknowledged cotenancy relationship by filing bill for partition, precluding AP. Normally, occupying cotenant is liable to other cotenants for rent when occupier refuses demand of other cotenants to use and enjoy the land. There can be no denial of right to enter unless there is a demand or attempt to enter. Mackereths letter did not demand equal use and enjoyment of the premises and rather demanded Spiller to vacate or pay rent. Further, there is no evidence Spillers locks were intended to prevent other cotenants from entering or that other cotenants asked for a key. An occupying cotenant is not liable to other cotenants for rent unless he has 1) agreed to pay rent, 2) begun the statute of limitations for AP, OR 3) the other cotenants have attempted to enter and use the property and he has refused them (ouster).
Rule:
1. Notes: If Mackereth had tried to use the property or had asked for the keys and Spiller had refused, this would have been ouster. c. An occupying cotenant is not liable to other cotenants for rent unless he has: 1. Agreed to pay rent, 2. Begun the statute of limitations for AP, OR 3. Other co-T have attempted to enter and use the property and he has refused them (ouster). A) Some JX require rent even in absence of ouster but majority doesnt. I) Majority rule encourages better use of property. Not having to pay rent provides an incentive to use it. Under minority rule you cant agree, it may go unused. II) Cost of majority rule is litigation over what constitutes ouster. B) May be stronger case for compensation in residential property, esp. if inherited. b. Fiduciary duties generally, cotenants are not fiduciaries w/ respect to each other, but cts treat them as such in certain situations. 1. May be familial relationship of trust that requires them to act as fiduciaries 2. If one cotenant asserts superior rights, that T is compelled to act in benefit of all cotenants d. Swartzbaugh v. Sampson (p 373)
Facts: Issue: Analysis: Mr. Swartzbaugh (D) leased 4 acres of land to Sampson (D). The land was part of land owned jointly by Mr. & Mrs. Swartzbaugh. Mrs. Swartzbaugh (P) did not consent to the lease, and she sued to cancel lease. Sampson is in exclusive possession of the leased land. Can one joint tenant who has not joined in the lease executed by her cotenant maintain and action to cancel the lease? The joint tenant out of possession cant maintain any action against lessee that she could not maintain against the other joint tenant. Each joint tenant has a right to possession of the whole of the land, so Mrs. S cannot cancel the lease to Sampson. In general, lessees cannot assert AP against lessors. A joint tenant can lease property to another without the consent of the other joint tenant, but that JT can lease no more than his undivided interest.
Rule:
1. Notes: A) Sampson has no more rights to land than Mr. S, so Sampson couldnt keep Mrs. S off the land if she wanted to be on it. She still has possessory rights to the whole of the property. B) Mrs. S could have brought a partition action, possibly just for the 4 acres leased to Sampson. If she brings a partition against Sampson, then she is only partitioning the leasehold, and the underlying fee ownership would stay with Swartzbaughs. C) Mrs. S could have also sued for accounting or claim an ouster. D) When Mr. S died and Mrs. S assumed his interest, the lease continues w/ her as lessor.
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VI. Marital Interests (p 382) A. Common Law Marital Property System (p 383) i. During Marriage (Fiction that H & W are one) a. Traditional common law: W under Hs protection, and owned nothing but clothes and ornaments b. Modern: Married Womens Property Acts gave W autonomy over property, protected her property from Hs creditors. 1. But still expected that H protects and supports, W has domestic responsibilities ii. Termination of Marriage by Divorce (p 399) a. Traditional common law divorce: 1. Property of spouses remains property of spouse w/ title. 2. Tenancy by the entirety becomes TIC 3. H owes W alimony b/c he owes her a duty of support, although may be denied if she is at fault 4. No recognition of shared assets. b. Then, changes beginning in 1970 CA got rid of fault divorce, other states followed 1. Equitable division of property at cts discretion many statutes authorize all property to be divided equitably, regardless of time and manner of acquisition, others allow only marital property to be divided. A) Some states require equal division, some have presumption of equal division. 2. Marital property can be: 1) all property acquired during marriage, or 2) property acquired through earnings of either spouse during marriage (like community property) 3. Lifelong obligation to pay alimony discarded now support for limited time until spouse can be self-sufficient, dependent on others ability to pay. c. ALI: Principals of the Law of Family Dissolution 1. Middle ground: equitable distribution w/ presumption of equal distribution subject exceptions. 2. Compensatory payment for specific reasons rather than need or ability to pay. d. In Re Marriage of Graham (p 401)
Facts: During 6-year marriage, wife supported husband while he got his BA and MBA. She contributed 70% of income while he was in school. There are no marital assets. She is arguing that business degree is a marital asset she is entitled to a share of. Is an MBA marital property that is subject to division by the court in a marriage dissolution proceeding? Education is not property under the Act, although it is factor to be considered in equitable property division or alimony (but here, no other property to divide). Education cant be sold, transferred, conveyed, or pledged. It has no open market value. It is personal to the holder and not inheritable. It is a recognition of an achievement. Other JX have not found education to be marital property. Education is not marital property and cannot be divided, although can be a factor in determining alimony or equitable division of marital assets.
Issue: Analysis:
Rule:
1. Notes: A) Uniform Marriage Dissolution Act: Marital property is all property obtained during marriage except by gift, inheritance, bequest or anything in exchange for prior property, property acquired after legal separation, property excluded by valid agreement. B) Ct says educational degree isnt property b/c cant be transferred, etc., but there is other property that cant be transferred (eagle feathers). Property is a bundle of rights, not all of which need to exist. C) Wife cant get alimony b/c she can support herself. D) She may have been able to be reimbursed, but this doesnt necessarily come close to what she would have gotten from her investment. 2. Professional goodwill (persons reputation in the community) is a marital asset even in JX that dont consider professional degree and enhanced earning capacity as marital asset.
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e. Elkus v. Elkus (p 408)

Facts: Issue: Analysis: Mrs. Elkus is an opera singer whose career took off during the marriage, although she was already somewhat successful at time of marriage. Husband coached her and took care of kids, allegedly sacrificing his own singing and teaching career. Is the increase in Mrs. Elkuss celebrity and career during the marriage marital property? Things acquired during marriage are marital property even though they may fall outside the scope of traditional property concepts. The purpose is to prevent inequities marriage is an economic partnership to which both parties contribute, as spouse, parent, wage earner, or homemaker. It is the nature and extent of the contributions by the spouse seeking equitable distribution, rather than the nature of the career that should determine if it is marital property. Husband is entitled to share of the increase attributable to his efforts and contributions. Elkus/OBrian (NY) rule: Future income is property, and the supporting spouse has contributed just like a business. Takes into account intangible contributions.
Rule:
1. Notes: A) The NY statute was different from statute in Graham: including joint efforts or expenditures and contributions and services as a spouse, parent, wage earner and homemaker, and to the career or career potential of the other spouse. B) Court is broadly interpreting the statute as a whole to be fair in dividing up all things of value, which is a somewhat unconventional way of reading a statute. 2. Double counting earning potential if spouse gets some of future earning potential, what happens when the next marriage that ends in divorce? 3. Prenuptial agreements used to be illegal, although most allow now. It was felt that if the law enforces prenuptial agreements, the law is encouraging divorce. iii. Termination of Marriage by Death of One Spouse (p 416) a. Dower automatic gift to W from H at marriage of 1/3 of all land seised during marriage and inheritable by their issue. Attaches at moment of marriage but doesnt become possessory until Hs death. Considered a support share. b. Curtesy Widower entitled to life estate in all Ws property when she dies. This interest attaches when they have children. c. Modern elective share surviving spouse has elective share in all deceased spouses property, real and personal. Surviving spouse can renounce will and take share. 1. Replaced dower and curtesy in most common law states. Dower states allow choice. 2. But, property can be gifted away before death. 3. Only applies to probate property, and not to property owned as joint tenants or life insurance. B. Community Property System (p 419) i. General Rule: earnings of each spouse during marriage are owned equally in undivided shares. a. 8 states have had community property for a long time (including CA), plus WI recently, and AK has elective community property. b. Basic assumption that H & W contribute equally to the success of the marriage. c. All non community property is separate property and strong presumption that all property is community property. 1. Inheritance, gift are separate. d. Upon divorce, some states divide equally, others allow equitable distribution. e. Upon death, no survivorship, although half usu goes to spouse if no will. f. Some states allow community property with survivorship. ii. Community Property compared with Concurrent Interests a. Community property states dont recognize dower, curtesy or tenancy by the entirety. b. Neither spouse, acting alone, can convey interest in community property w/o consent of other except if conveying to the other spouse. c. No right of partition d. Tax benefit after death of one, property has stepped up tax basis. Surviving spouse only pays taxes on difference btwn purchase price and worth at death.
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iii. Management of Community Property a. Community property can only be conveyed to third party as an undivided whole. b. Usu, either H or W acting alone has management rights (before just H). 1. Manager is a sort of fiduciary and must act in good faith, although not necessarily good judgment. iv. Mixing Community Property with Separate Property a. When property is acquired before marriage but part of purchase price paid after marriage with community funds 1. Some JX: inception of right rule when acquired 2. Some JX: time of vesting rule when paid off 3. Some JX (CA): pro rata apportionment community property payments buy in a pro rata portion. v. Migrating Couples a. Character of property depends on the state in which it was acquired. Once property is characterized, doesnt change when couple moves unless both consent. 1. Property bought with $ earned during marriage takes on character of the earnings. b. At death of a spouse, law of his/her domicile at death governs. c. CA: property from a common law state is quasi community property C. Rights of Domestic Partners (p 426) i. Common law marriage cohabitating partners that manifest intent to be H& W and hold themselves out as H&W. a. Now only in 11 states. b. Contract law brought in when they dont hold themselves out as H&W. 1. In some JX, contract may be implied by conduct, in most, contract must be express. 2. Marvin v. Marvin (p427), allowing implied contracts. ii. ALI & domestic partnership: Legal rights arise from conduct with respect to each other. a. Same- or opposite-sex couple sharing for significant time primary residence and life together as a couple. But no inheritance rights. iii. Baker v. State (p 428)
Facts: Issue: Analysis: Three same-sex couples sued state & city for denial of right to benefits given to married couples. May the state of VT exclude same-sex couples from the benefits and protections that its laws provide to opposite-sex married couples? When a statute is challenged under Equal Benefits clause of VT Constitution, must 1) define part of community disadvantaged, here the law excludes same-sex couples, and 2) governments purpose in classification including some and excluding others. Principal purpose is that excluding same-sex couples from legal benefits of marriage is furthering link between procreation and child rearing. But, many opposite-sex couples marry for reasons unrelated to procreation, and many dont have children the law extends benefits of marriage to many people with no connection to stated governmental goal. Also, many same-sex couples have children, and law affirms their right to adopt children, and protects their interests when such couples terminate their relationships. VT is constitutionally required to extend the same benefits and protections to same-sex couples that flow from marriage under VT law.
Rule:
a. Notes: The framers of VTs constitution probably didnt think about same-sex marriage, but spirit
of their desire to include should be upheld. VII. Landlord-Tenant Law (p 445) A. Leasehold Estates i. Generally tenancies, or leaseholds, are nonfreehold estates. When any leasehold is created, a future interest necessarily arises. ii. Term of years estate that lasts for some fixed period of time or for a period computable by a formula that results in fixing calendar dates for beginning and ending. a. Can be any length, but some states limit b. Term must be for a fixed period but can be terminated early by some event or condition.
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c. Ends automatically, no notice of termination required. d. Death of L or T has no effect e. Words used to create: to T for one year iii. Periodic tenancy lease for a period of some fixed duration that continues for succeeding periods until either L or T gives notice of termination. a. If no notice of termination, automatically extended for another period. b. Under common law, notice must terminate tenancy on the final day of a period. 1. 6 mos notice reqd for termination of PT where period is a year or longer. 2. length equal to the period if period is less than a year, not to exceed 6 mos. c. Now, some states have shortened length of notice and allow month-to-month to be terminated any time after 30 days notice. d. Death of L or T has no effect, although may terminate residential lease if T dies b/c residential leases are personal. e. Words used to create: to T year by year iv. Tenancy at will tenancy or no fixed period that endure so long as both L and T desire. a. Both parties must have ability to terminate at will or else it is a term of years or a periodic T. b. Ends at death of one of L or T. c. Modern statutes require some length of notice to terminate (30 days or length equal to interval btwn rent payments). 1. If rent is reserved and paid periodically, in most JX, a periodic tenancy arises by implication. v. Tenancy at sufferance: Holdovers (p 451, 454) arises when T remains in possession (holds over) after termination of tenancy. a. L has two options: 1) evict and get damages, or 2) consent (express or implied) to creation of new tenancy holdover. b. In most JX, holdover gives rise to periodic tenancy 1. Length can be computed by time between rent in original lease or length of original term or period, but never more than one year. 2. Restatement: results in periodic tenancy measured by the way rent is computed, never more than one year. c. Usually subject to same terms as original lease unless new agreement or terms are inconsistent with new situation. B. The Lease (p 456) i. Generally: the transfer of a right of exclusive possession of land. This is what makes it an estate. a. T can exclude L 1. Licenses & easements dont have possessory rights in the same way cant exclude others b. Something called a lease may not be one, and something not called a lease may be one. ii. Conveyance of interest in land vs. Contract: Do you construe obligations under the lease as a property arrangement or a contract? a. A lease meets the standard definition of a contract (modern) has promises/covenants 1. Reform property law of L-T into contract law. b. A lease also concerns an estate in land (traditional) transfers possessory interest in land. 1. Traditionally: leaseholds classified as an interest in land, but were still personal property: chattels real. 2. The law was very pro-landlord. Property arrangements that came out of this system persisted through industrial revolution, into US, and well into the 20th century. iii. Statute of Frauds (p 458) a. Every state has one. b. Most: leases for > 1 yr must be in writing, allow oral leases for < 1 yr c. Oral lease + payment = periodic tenancy not subject to statute of frauds. iv. Form leases would be costly to bargain individually, but form leases can put T at a disadvantage b/c less bargaining power. a. Economic argument: doesnt matter whether or not T can haggle, just that there isnt a monopoly and that competition forces sellers to have terms that protect purchasers.
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C. Selection of Tenants (p 460) i. L generally owns property in fee simple, and generally can choose who to let use the property. Choice of T is part of right to exclude. You dont have to rent any property you have if you dont want to. ii. But, federal (& state) law controls how you cant pick and choose in sale and rent. a. Fair Housing Act 1. Exceptions for individual landlords w/o much property as long as they dont advertise or use a real estate broker, salesman. 2. Cant discriminate on basis of race, sex, color, religion, familial status, national origin, disability. A) Must allow reasonable accommodations for people with disabilities D. Subleases and Assignments (p 482) i. Sublease vs. Assignment a. Traditional formalistic view: assignment is when lessee transfers all of his interest possession for the whole term. Sublease when transfers anything less than whole term so that lessee has a reversion. 1. Partial assignment of part of premises allowed under an assignment and is not a reversion (majority view) 2. If power of termination or right of reentry is allowed for breach of obligation, in majority, it can still be an assignment but minority holds that it makes it a sublease. b. Less common view: Intention of parties Actual words are not conclusive but may be persuasive. ii. Privity of estate and privity of contract a. L and T are in privity of estate and privity of contract when there is no assignee or sublessee. b. When T subleases: 1. T has a reversion for the remainder of the term 2. L and T: privity of contract and estate, and T remains liable. 3. T and sublessee: privity of estate and contract 4. L and sublessee: no privity of estate. A) Neither L nor the sublessee can bring suit against the other. c. When T assigns: 1. L and T: privity of contract A) T is the assignees surety. A is primarily liable, and T is only secondarily liable. B) However, T impliedly assigns his privity of contract right to sue L for Ls breach of covenants whose burdens run with the land. Assignee only may sue L for the breach. 2. L and Assignee: privity of estate A) During the time assignee is in possession of the land, he is liable for covenants whose burdens run with the land. Thus A is liable for rent to L even if he didnt promise to pay. 3. A and T: privity of contract IF A makes a promise to T. A) Privity of contract liability remains even if A assigns to someone else. 4. L can release T from privity of contract and get contractual rights against assignee this is a novation. 5. A isnt liable for covenants running with the land if he is no longer in possession because he assigned his interest to someone else. d. When T subleases or assigns: 1. Tenant remains liable to L even if he assigns or subleases (privity of contract). 2. If transferee makes a promise to T, he is in privity of contract with T. T can sue transferee even if the he transfers his interest to someone else. 3. T can terminate the lease if covenant is breached and can then evict the transferee. A) But if T voluntarily gives up the original lease, transferee is still entitled to possession. In this case, the sublessee becomes in privity of estate with L. 4. L can sue transferee who has promised to pay rent or perform obligations under the lease even if transferee has transferred. L is a third party beneficiary and therefore in privity of contract with transferee.
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Property Outline Fall 2003 Privity of estate and K privity of K
T
estate and K
L
estate maybe K
T
privity of K
T1 SUBLEASE
T1 ASSIGNMENT
iii. Examples: a. L leases to T for three yrs, T subleases, transfers, and assigns interest for one year to T1. Neither T nor T1 pay rent. 1. This is a sublease because T is transferring less than complete interest. T has a reversion interest. 2. L can recover from T. L doesnt have a direct remedy against T1. L cannot sue T1 for rent because T1 has never promised to uphold original obligations of lease. L can, however, evict T1 for non payment of rent. b. L leases to T for term of 3 yrs, for monthly rent and keeping up repairs. T assigns entire interest to T1, who agrees to uphold covenants of lease. Then T1 assigns to T2, then T2 assigns to T3. T3 defaults. 1. Who is liable? A) T liable (not released from privity of K). B) T1 liable because had promised to uphold covenants, so in privity of K w/ L - L is 3rd party beneficiary. T1 is no longer in privity of estate w/ L. C) T2 escapes because T2 is not in privity of estate with L and not in privity of K. D) T3 is liable because he is in privity of estate. 2. Covenant to pay rent runs with the estate. Covenants that run with the land automatically transfer when the estate is transferred. iv. Covenants a. Covenants that run with the land (such as rent) automatically transfer when the estate is transferred. b. A burden or benefit that touches or concerns the interest in land will run with the land. 1. Burden touches or concerns if it relates specifically to the property and diminishes or limits promisors use or enjoyment of the land. Benefit touches and concerns if it relates to property and increases use or enjoyment of the land. 2. Not all promises will run with the land as to the benefit and the burden. Ex. If L promises to not have a bakery next door, a transferee would get this benefit as well b/c it runs with the land. If L assigns his reversion to L1, the burden of the promise will not transfer because the burden doesnt run with the leased land. v. Ernst v. Conditt (p 482)
Facts: Ernst (P) leased land to Rogers: cant assign or sublease w/o permission; must remove all improvements. Rogers sold business to Conditt (D). Rogers got permission from Ernst to transfer, to extend lease b/c D wanted to, and promised personal liability. Rogers and Conditts agreement sublet to Conditt for consideration and promise to fulfill requirements of Rogers lease. Conditt stopped paying rent, remained in possession until end of lease, and didnt remove improvements. Ernst sues for back rent and improvement removal. Was the agreement between Rogers and Conditt a sublease or an assignment? Court holds that this is an assignment because Rogers gave up his interest for the whole term (formalistic test) and the parties intention was to assign (intention test). Doesnt matter that the agreement said sublet. D is liable to Ernst for rent and for the improvements because he is in privity of estate (assignee is in privity of estate with L) and privity of contract (D promised he would uphold covenants of the original lease). Agreement was an assignment, and Conditt (assignee) is liable to lessor for rent and removal of the improvements b/c in privity of estate and contract with Ernst.
Issue: Analysis:
Concl:
Note: Ernst could have also sued Rogers, the original T, and then Rogers could have sued Conditt.
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vi. Restraints on withholding consent to assign for commercial property. a. Minority allow lessor to withhold consent only when the lessor has a commercially reasonable objection, even in the absence of a provision stating that consent will not be unreasonably withheld (Kendall). 1. Based on conveyance of property: common law doesnt like restraints on alienation. 2. Based on K: implied covenant that neither will do anything that will destroy others right to enjoy fruits of the K. A duty is imposed to exercise discretion in good faith and in accordance with fair dealing. b. CA statute codifies minority position. c. Termination and recapture clause T must give notice before assigning or subleasing, L could terminate lease with T and sign lease with T1. T not entitled to any profits realized. 1. Upheld for commercial leases entered into by sophisticated commercial entities operating at arms length. vii. Kendall v. Ernest Pestana, Inc. (p 490)
Facts: Pestana was assigned Ts interest in aircraft hangar space, including a 25 year sublease with Bixler. Kendall wanted to buy business from Bixler, including assignment of sublease on the space. The lease required Pestanas written consent for sublessee to assign interest. Kendall was in a better financial position than Bixler, but Pestana refused unless rent was raised. Can a lessor unreasonably and arbitrarily withhold consent to an assignment if there is no provision in the lease prohibiting withholding consent unreasonably and arbitrarily? A growing minority allow lessor to withhold consent only when the lessor has a commercially reasonable objection, even in the absence of a provision stating that consent will not be unreasonably withheld. 1) Leasehold interest: Policy against restraints on alienation pertains to nature of leases. Reasonable alienation of commercial space is important in our increasingly urban society. Lessors interests are protected by the fact that the tenant remains liable as a surety if the assignee defaults. 2) Contract: In every k, there is an implied covenant that neither party shall do anything that will have the effect of destroying or injuring the right of the other to receive fruits of the k. A duty is imposed to exercise discretion in good faith and in accordance with fair dealing. Both the policy against restraints on alienation (property law) and the implied contractual duty of good faith and fair dealing (K law) support the rule that where a commercial lease provides for an assignment only with lessors consent, consent may only be withheld where there is a commercially reasonable objection.
Issue: Analysis:
Concl:
E. Tenant who Defaults (p 500) i. Tenant in possession a. Repossession by L 1. Common Law Rule: L may rightfully use self help to retake premises from T if 1) L is legally entitled to possession or lease term allows reentry AND 2) Ls means of reentry are peaceable. 2. Modern trend self-help eviction is never an option for L to dispossess a tenant who is in possession and has not abandoned or voluntarily surrendered the premises. A) In some JX, only prohibited for residential property. Risk may be even higher in residential property. B) Most courts wont allow waiver by T b/c of differential in bargaining power. C) Policy: I) For: There are judicial means for speedy repossession and we want to discourage people from taking the law into their own hands. Self-help repossession leads to violence. II) Against: Raises rent for everyone, summary proceedings are costly and take a while, doesnt reduce risk of confrontation.
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b. Berg v. Wiley (p 500)

Facts: Wiley (D) leased commercial space, and tenant assigned to Berg. Berg made changes that allegedly affected structure w/o permission, and restaurant had health code violations. Wiley gave Berg 2 weeks to change or would retake. After 2 weeks of continued operation, Berg put up sign: Closed for remodeling. Confrontation when D saw her removing some paneling. Then Wiley changed locks while Berg was gone and wouldnt let her in. Berg sued. Wiley said she abandoned and counterclaimed for damages to premises. Trial court found for Berg didnt abandon, Wileys reentry was forcible and wrongful as a matter of law. Did Berg abandon premises, and was Wileys reentry forcible and wrongful as a matter of law? Common law: L may rightfully use self help to retake premises from T if 1) L is legally entitled to possession or lease term allows reentry AND 2) Ls means of reentry are peaceable. Berg didnt abandon. She was still using property and paying rent. Court adopts modern trend that self-help is never available to L. Furthermore, in this case, the common law rule would find this self-help reentry to be wrongful as well because the reentry was forcible. The relationship between P and D was contentious. The only reason why there wasnt violence was because Berg wasnt there and she resorted to the judicial process. Want to discourage Ls from taking law into their own hands, particularly since legislature has provided judicial means for speedy repossession. Self-help repossession leads to violence. Court adopts modern trend that self-help is never available to dispossess a tenant who is in possession and has not abandoned or voluntarily surrendered the premises.
Policy: Concl:
c. Summary Proceedings (p 507) 1. Traditionally, the only remedy was ejectment, which was long and costly 2. Summary proceedings in every state for L to evict T. A) Much quicker, but still takes a while. ii. Tenant who has Abandoned Possession a. Abandonment T vacates premises w/o justification, w/o present intention to return, and defaults on rent. b. Mitigation of damages 1. Traditional rule (majority): L may recover rent due under lease regardless of whether L had attempted to re-let the vacated premises. After T abandons, L may 1) accept surrender and terminate lease, 2) re-let on Ts behalf, or 3) leave vacant and sue for rent when it is due. A) T has a property interest in the leased premises and L cant interfere with Ts own property. B) Policy against: encourages economic waste 2. Modern: L has an obligation to make a reasonable effort to mitigate damages when T has abandoned leased residential property (may apply to commercial in some JX). T is liable for any amount L cannot recover, and L need not rent to an unsuitable T. (Sommer v. Kridel) A) If L has other vacant units, must make same effort to rent abandoned unit as makes for other units. May have to try to rent that unit first. I) JX differ on whether L or T have burden of proof of whether L mitigated damages. II) T owes for whatever L wasnt able to recover, extra costs incurred as a result, and difference if L must rent for less. B) T cannot generally waive duty to mitigate. C) Lease is more like a K. Under K law, party has obligation to make reasonable efforts to mitigate damages caused by breach of K. D) Policy against: L shouldnt be forced to choose T he doesnt want, Ts wrongdoing doesnt impose liability on L, Ls search may be seen as an acceptance of Ts surrender, encourages abandonment. I) If duty to mitigate, undermines ability to arbitrarily refuse to consent to assignment in those JX that allow b/c T could just abandon.
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E) CA statute requires duty to mitigate, but L can recover amount up to what could have been reasonably avoided (burden on T) plus any other detriment to L proximately caused by Ts abandonment. c. Surrender 1. Voluntary surrender terminates lease if L accepts it. Extinguishes liability for future rent, but not for back rent or other breaches. 2. May be implicit or explicit A) Abandonment is implied offer of surrender. 3. Acceptance of surrender by L may be implied or express A) Implied: actions inconsistent with continuation may be surrender if L doesnt notify T. d. Sommer v. Kridel (p 509)
Facts: Kridel entered into 2-year lease with Sommer and paid 1st mo + security. One week into lease, Kridel wrote letter saying could no longer afford and forfeiting amt already paid. Sommer never replied. A third party inquired about the apt, but was told it was already rented. Sommer didnt rent until after end of 2-year lease. Sommer sues for entire amount of rent due for 2 yrs. IS L under a duty to mitigate damages by making reasonable efforts to re-let an apt wrongfully vacated and abandoned by T? OLD rule: L may recover rent due under lease regardless of whether L had attempted to re-let the vacated apts. Majority (old) rule is based on principles of property law that equate a lease with a transfer of property interest in the owners estate. Thus it would be anomalous to require L to concern himself with Ts abandonment of Ts own property. Ordinary residential leases are now not as distinguishable from ordinary contracts. Application of k rules may be justified as a matter of basic fairness: recovery forbidden when damages could have been avoided by reasonable efforts. Burden of proof is usually on the party that breaches, but here L is in much better position to show that she took reasonable efforts, so burden is on L. T isnt necessarily excused from obligations L doesnt have to accept unsuitable tenant but here there was a suitable T available. L has an obligation to make a reasonable effort to mitigate damages when T has abandoned leased residential property.
Concl:
e. Landlords remedies and security devices 1. L has right to sue for unpaid rent and damages due to other breaches A) L can evict if T is still in possession. L couldnt do this under traditional. 2. Security deposit many statutes limit amount, say amt must be kept in trust, L must pay interest, L must itemize deductions. 3. Other security devices A) Payment in consideration of executing lease, advance rent, liquidated damages. B) Rent acceleration: On Ts default, all remain rent is due. F. Duties, Rights, Remedies (condition of premises) i. Moral hazard L has incentive to neglect once lease is executed b/c T bears costs of ordinary repairs, and Ls only obligation was to turn over possession. a. Traditionally, T had to do all repairs, and L was under no obligation to warrant fitness. Caveat lessee T took leased property as is. 1. Quiet enjoyment referred only to Ts access to the premises. b. Journalists exposure of the slums started to change in early 1900s c. Principles began to be modified in the 60s. ii. Covenant of Quiet enjoyment (CQE) and constructive eviction (CE) a. CQE & CE Substantial interference with Ts beneficial use (CQE) by L is constructive eviction of T, relieving T of obligation to pay rent if she vacates within a reasonable time. 1. In most JX, T can also stay and still get rent abatement under breach of CQE. A) L usually has a reasonable time to fix it after T gives L notice of the problem. 2. CQE is implied in every lease and cannot be waived.
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A) Implied CQE followed in all JX for residential and commercial leases and interpreted broadly. B) L has a duty to: disclose latent defects, maintain common areas, control other tenants. C) Interference need not be permanent, just substantial. 3. Partial CE some JX allow T to be relieved from liability for the portion of the rent for the premises that cannot be used. b. Reste Realty Corp. v. Cooper (p 522)
Facts: Cooper (D) entered 5 year lease of basement floor of building from Reste (P), agreeing that she had inspected the premises, accepted them as they were, and promised to keep premises in good condition. Lease contained express covenant of quiet enjoyment. Floor flooded every time it rained due to the construction of the driveway and foundation (not part of the leased premises), interrupting Ds business. Building manager dried out floor when D complained. A year later, Cooper entered new 5-year lease, and building manager promised to fix the flooding problem. Work was done, the problem stopped but came back worse than before. Manager continued to promptly respond to instances of flooding. Then manager died. No one responded to Ds complaints of flooding. 9 months after managers death, a particularly bad flooding incident occurred, D gave notice she was vacating, and moved out 10 days later. Landlord sued for rent for remainder of lease. Was Cooper constructively evicted, relieving her of liability for rent on remainder of the lease? The leakage problem could not have been reasonably ascertained by T and was not a problem with the actual premises she had leased. L knew or should have known of the problem and had a duty to inform her. D knew about the problem when she entered the second lease, but reasonably relied on managers promise to fix it. The interference was substantial. Vacating premises under theory of constructive eviction is a serious, so 9 months is a reasonable amount of time. Constructive eviction can occur either from a breach of the covenant of quiet enjoyment or a material breach of another covenant of the lease. Substantial interference with express or implied covenant of quiet enjoyment of the leased premises or material breach of another covenant of the lease by and act or omission of L is constructive eviction of T, relieving T of obligation to pay rent if she vacates within a reasonable time.
Issue: Analysis:
Concl:
iii. Implied warranty of habitability (IWH) a. IWH implied and unwaivable in every residential lease that L will deliver and maintain premises that are safe, clean, and fit for human habitation. 1. Typically must be major problems affecting Ts health and safety usually for low-income housing only. A) Housing code violations are evidence of breach but arent conclusive. B) Doesnt apply broadly to enforce all promises regarding condition of premises. 2. Not accepted in every JX, may be waiveable if T had equal bargaining power. 3. Remedy A) K remedies available B) T may remain in possession and sue for reimbursement and damages (possibly even punitive damages), or withhold rent and raise as a defense when L sues C) T may terminate lease and sue for damages. D) Injunctive relief rarely used by T. E) Most JX allow as a defense to eviction. F) Some JX only allow if breach is so substantial that it relieves of all liability for rent. 4. Calculation of damages A) Difference btwn value if in good condition and current condition OR B) Difference btwn agreed rent and value in condition C) Rent reduced by percentage equal to loss of value due to breach. 5. Policy against: Raises everyones rent and thus increases homelessness. 6. Different than CQE: A) CQE applies to all leases, IWH just to low-income residential leases B) IWH preferred where applicable b/c greater damages possible and easier to prove.
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C) IWH can be raised at any time, CQE must be raised within a reasonable time D) CQE generally requires vacation of premises, IWH doesnt. 7. CA: IWH for residential leases, and L cant retaliate. b. Hilder v. St. Peter (p 533)
Facts: Hilder (P) rented apt. St. Peter (D) told her she could get back her security deposit if she cleaned the apt herself. Hilder did, but D denied ever getting the deposit. The apt was in extreme disrepair, and D ignored all of Ps requests for repair. P had to repair many things at her own cost, and had to stop using part of the apt. P retained possession and sued for reimbursement of all rent paid and compensatory damages. Did the state of the apt constitute a breach of the implied warranty of habitability, entitling P to return of all rent paid plus additional damages even though P never abandoned the premises? Today, T is in an inferior bargaining position compared to L, and enters into lease to obtain safe, sanitary and comfortable housing, not arable land. Implied warranty of habitability covers all latent and patent defects in the essential facilities of the residential unit, and cannot be waived by agreement. Substantial violation of housing code is evidence of breach of IWH, and also anything that has an impact on the health and safety of T. L has a reasonable time to correct. T doesnt need to abandon premises to recover (constructive eviction), and can also get punitive damages. In the rental of any residential dwelling unit, there is an implied warranty of habitability in the lease that L will deliver over and maintain, throughout the period of the tenancy, premises that are safe, clean, and fit for human habitation.
Issue: Analysis:
Concl:
c. Retaliatory eviction (p 543) 1. Traditionally, L could terminate at will 2. Modern presumption of retaliatory eviction if L seeks to terminate or raise rent w/in set period after good-faith complaint by T based on condition of premises. A) L cannot retaliate after period, either, but T bears burden of proof. d. Ls Tort Liability (p 544) 1. Traditional: L only liable for duties arising out of CE and CQE 2. Minority: use IWH to impose general standard of care on L in all circumstances. A) CA leads the way in imposing liability for injuries that occur. 3. Majority dont recognize duty of care but recognize only common law exceptions. iv. Ts duties, Ls rights and remedies (p 546) a. Ts alterations can be waste, but not every alteration is waste. 1. Look at effect on use and value, permanence, length of remaining term of lease. 2. Fixtures, though originally chattel, become part of the land b. Permissive waste traditionally obligated T to repair. c. Destruction of premises 1. Traditional T still liable for rent b/c lease is an interest in the soil 2. Modern for rental of only part of a building, T is excused from rent if premises are destroyed. A) Explicit covenants to repair generally accept normal wear and tear as well as damage by fire or other casualty.
Land Use Controls VIII. Nuisance (p 747)

A. Intro i. Nuisance A substantial, non-trespassory invasion of anothers interest in the use and enjoyment of land that is either 1) intentional and unreasonable OR 2) unintentional result of negligent, reckless, or abnormally dangerous activity. a. Substantial invasion 1. Mere ugliness is not enough. 2. Objective standard
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b. Intentional and unreasonable measured: 1. Level of interference 2. Gravity of harm outweighs utility of actors conduct c. Intentional nuisance excused if it is reasonable or doesnt cause much harm. d. Generally only normal use of property is protected by nuisance law, not abnormally sensitive uses. 1. But may still be a nuisance if gravity of harm outweighs utility of conduct. ii. Trespass physical invasion of anothers property. a. Generally, intentional tort that results in liability regardless of harm b. Unintentional trespass is treated like an unintentional nuisance (must be result of negligent, reckless, or abnormally dangerous activity). iii. Nuisance is part tort (negligent or wrongful activity) and part property law ( interference with land) a. Sic utere One should use ones property in a way that doesnt injure the property of another. iv. Kinds of nuisances a. Fear and loathing Halfway houses and prisons may be found to be nuisances b. Light and Air c. Spite courts generally find nuisance liability for structure with no use other than to vex neighbor. v. Private vs. Public Nuisance a. Private nuisance 1. Can only be brought if it interferes with enjoyment of Ps land. 2. Still private even if there are many landowners who are affected. b. Public nuisance 1. Interferes with health, safety, peace. Protects public rights and need not interfere with land use rights 2. Action can be brought by government or member of the public who is affected and can show special injury damage different or beyond injury to the public. c. CA: Anything injurious to health. Nothing done or maintained under express authority of statute is a nuisance. 1. Public: affects at the same time an entire community or neighborhood even if harm is unequal. 2. Private: Any nuisance that isnt public B. Right to Lateral and Subjacent Support (p 754) i. Lateral Support support provided to one piece of land by the parcels surrounding it a. Cause of action doesnt arise until subsidence (sinking) occurs or is threatened and runs against the excavator, who may be a predecessor of the present possessor b. Liability is absolute, no need to show negligence c. Liable only if negligent 1. If subsidence wouldnt have occurred but for improvements by excavators successors and excavator gave notice of plans/ 2. If result of groundwater extraction d. Right to lateral support can be waived or expressly expanded. ii. Subjacent Support support underneath parcel a. Generally arises when one person has mining rights, and goes as w/ lateral support. C. Remedies for nuisances i. Injunction a. Traditional remedy for nuisance 1. Whenever the damage resulting for a nuisance is found not unsubstantial, an injunction should be granted (changed by Boomer). b. After receiving injunction, P may bargain with D to allow use to continue in exchange for $. c. Balancing the equities weigh injury that may result to D and the public by ending activity against injury sustained by P by allowing activity to continue (Estancias) standard test for injunction.
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ii. Estancias Dallas Corp. v. Schultz (p 755)

Facts: Air conditioning unit at back of Estanciass (D) apartment complex created lots of noise for neighboring Shultzes (P): couldnt carry on conversations in home, property value reduced by at lease $12.5k. Ds apts cant be rented w/o air conditioning, would have cost $40k to build air conditioning differently, and now would cost $150-200k to change. Shultzs sued for injunction based on nuisance and sought damages. Jury found damages, trial court awarded injunction. D appeals on ground that trial court didnt balance the equities. Does the injury resulting to D and the public by stopping the activity outweigh the injury to P by continuing the activity? No evidence that the public will be injured by stopping the air conditioning. There is no shortage of housing. Nuisance will not be permitted to exist based on the stern rule of necessity rather than the right of the actor to work harm on his neighbor. Even if there is a nuisance, the equities should be balanced: consider injury that may result to D and the public by ending activity as well as injury sustained by P by allowing activity to continue. Here, Ps harm still outweighs.
Issue: Analysis:
Concl:
a. Notes: 1. No zoning laws in TX. 2. By issuing injunction, ct gives Schultzes a property interest in Estanciass land. 3. P sued for damages and injunction, but they had to chose one (couldnt get both under TX law). iii. Permanent damages D must pay P permanent damages or injunction will be enforced (Boomer). a. Temporary damages may not enough if an injunction isnt granted after balancing the equities because harm may continue, giving P continual causes of action for damages. b. Remedies are often calculated on an uneven playing field 1. Easier for D to show cost of stopping than for P to show harm inflicted such as health impact. iv. Boomer v. Atlantic Cement Co. (p 759)
Facts: Atlantic (D) operates a cement factory causing air pollution for Boomer (P) and probably the public at large. An injunction would cause the plant to shut down (worth 45 mil with 300 workers). The damage to P is relatively small. Trial court found a nuisance, gave temporary damages, no injunction. Affirmed by appellate court. Where the costs to D of an injunction are high, but no injunction will result in continual damages to P, what should the court rule? Old Rule: Whenever the damage resulting for a nuisance is found not unsubstantial, an injunction should be granted. This plant is actually affecting the public at large, but it isnt for the court to decide how to fix the public harm in a private case. The damages to P will continue, so awarding temporary damages will allow P to maintain successive actions for damages. The cost to D of an injunction is so high, that isnt fair to have an injunction. Two possible remedies: 1) order an injunction but postpone it to allow time for technological advances to reduce pollution, 2) grant injunction that can be vacated on payment of permanent damages to P for all harm incurred in the future. 1) isnt feasible b/c such advances would take a long time and require the whole industrys help. Court chooses 2) because will fully redress wrong to P. Where an injunction would cost D a lot and damages to P are relatively small, court can grant injunction that can be vacated on payment of permanent damages to P for all harm incurred in the future. Should just grant injunction under old rule. This was allows and encourages wrongs to continue as long as D pays for them.
Concl:
Dissent:
v. Coming to the nuisance Abate all activity if P pays damages a. Traditionally if P came to the nuisance, this was an absolute defense for D. 1. But this meant that the first landowner determined the use for the whole area. b. The residential landowner may not have relief against agricultural business if he knowingly came into a neighborhood already used for agricultural business (Spur).
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1. If ag business must be enjoined b/c of a public nuisance, residential developer must pay for relocation. 2. The lawful use by the business is a relevant factor (zoned for agricultural use). c. P can be liable for only part of the costs if appropriate vi. Spur Industries, Inc. v. Del E. Webb Development Co. (p 766)
Facts: Spur owned a feedlot not too far from a retirement community (Youngtown). Del Webb bought a bunch of (cheap) land right next to that community and the feedlot to build a residential community (Sun City). As he built closer to the feedlot, Del Webb had trouble selling the lots close to it. Del Webb brought action of a public nuisance b/c of the flies and odors. 1) Where an operation of a business is lawful but becomes a nuisance b/c of a nearby residential community, can the business be enjoined (stopped by injunction)? 2) If so, must the developer of a new town indemnify the operator of the business who must move or stop because of the residential area created by the developer? 1) Youngtown residents not greatly affected, so just get damages. Sun City residents near feedlot are greatly affected by both public and private nuisance, so permanent enjoinder. 2) In coming to nuisances cases, the residential landowner may not have relief if he knowingly came into a neighborhood already used for agricultural business. However, Spurs action isnt just personal but b/c of damage to the residents. Del Webb must indemnify Spur for a reasonable amt of the cost of moving or shutting down. The developer of a new town must pay if the operator of a business must move or stop because the business is a public nuisance to the residential development.
Issue:
Analysis:
Concl:
D. Nuisance law and environmental controls i. Boomer court called for legislature to act to regulate pollution. a. We now have sweeping administrative and permanent regulations that address these problems. Nuisance law could still be used, but it is much easier to use these statutes and say D violated permit or didnt get a permit. 1. Under the Clean Air Act, govt finds the cleanest factory, then says all factories have to be like that one in 10 yrs. 2. Actions can be brought privately or by govt under these laws. b. Nuisance actions can still be brought even if these laws arent violated. ii. Incentives a. Pay fee for polluting (effluent fee), or given a set amt of polluting rights. E. Zoning i. Something lawful under zoning laws can still be a nuisance ii. Zoning law represents a governmental determination of the general use of the land, but not of the specific use of a specific piece of land. IX. Private Land Use Controls: Servitudes A. Easements (p782) i. Intro a. Easements are non-possessory and create property interests b. Affirmative Easement right to use anothers land c. Negative Easement right to prevent owner of another land from making certain uses of the land. d. Easements Appurtenant benefits the holder in the use of a specific piece of land. 1. Passes to successive owners of the dominant tenement. e. Easements in Gross personal to the holder and not tied to ownership of a particular piece of land. May not be transferrable or divisible. f. Dominant Tenement Property benefiting from the right to use 1. No dominant tenement in easements in gross, only dominant tenant. g. Servient Tenement Property burdened by the right to use, property on which the easement is used. h. Duration of easement 1. Easements are permanent unless limited: can be easement determinable.
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ii. Creation of Easements by express grant, by implication, by necessity, by prescription a. Easement by express grant (p 785) 1. Easements are within the Statute of Frauds b/c they are interests in land. A) By accepting, though, grantee is bound even though he didnt sign it. 2. Traditionally: Easements can only be reserved for the grantor or the grantee. A) A grantor cannot actually reserve an easement, it is regarded as given to the grantor by the grantee after receiving the full interest in the land 3. Modern: Easement can be reserved for a third party if that is the grantors intention (Willard). A) In R3d of Prop, but not followed by all cts. 4. Notice: In express easement by grant, successive owners are on notice because they can view the title records. 5. Willard v. First Church of Christ (p 785)
Facts: McGuigan owned a lot she bought so a church across the street use it for parking. Petersen persuaded her to sell it to him so he could sell it to Willard (P). McGuigan wanted church to still park there, so put subject to an easement for parking by church in the deed. She discounted the price 1/3. Petersen didnt include that in the deed he gave to Willard. Willard brought suit to quiet title, trial court found for him. Can a grantor, in deeding real property, effectively reserve an easement for a third party? Common law: grantor cannot reserve an interest in property for a stranger to the title. Old rule is based in feudal times. A reservation is treated as if it is a grant of the easement from the grantee to the grantor, creating a new interest after the whole of the interest was conveyed to the grantee. Our primary interest is in supporting the intent of the grantor. Clearly the intent was to have an easement. Facts do not support reliance on the old rule b/c Willard didnt even know about the easement. In other cases, balancing competing interests may warrant application of the old rule to presently existing deeds. In the interest of protecting the intention of the grantor, a third party interest in property may be effectively reserved in a deed of real property.
Concl:
A) Note: The easement was unclear b/c didnt specify what church purposes were or how many parking spaces needed to be reserved. b. Easement by estoppel (p 791) 1. License: oral or written permission given by occupant of land allowing the licensee to do some act that would otherwise be a trespass. A) Licenses are revocable at will. B) Exceptions to revocability of licenses I) License coupled with an interest ownership of chattel located on licensors land or right to take something like timber from the land (profit a prendere). II) License can become irrevocable when they become easements by estoppel. 2. Easements by estoppel 1) a licensee exercises right of way 2) with servient owners permission and 3) goes to considerable expense to improve the right of way A) Licensee relied on the tacit approval of licensor in going to expense of improving easement. B) Licensors inaction in the face of obvious knowledge is enough. C) If the reason for the easement disappears, the easement will generally disappear as well, but if reason continues, easement runs to successive owners of the dominant tenement. D) R3d Prop allows servitudes to be created by estoppel.
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3. Holbrook v. Taylor (p 791)

Facts: Holbrook bought property in 1942 and allowed a right of way to be used by a coal mine company, which it did for several years. There is nothing in writing. In 1964, Taylors bought property next door and used the driveway for getting in and out and hauling equipment to build their house. They also made improvements to the driveway ($100). In 1970 things started to get bad, and Holbrook wanted them to sign a document excusing Holbrook of liability. Holbrook tried to stop them from using it. There isnt another good way to get to the Taylor property. Trial court found right of use by estoppel but not by prescription Do the Taylors have a right to use the driveway by estoppel? Easement by estoppel: if licensee has exercised privilege given by licensor and erected improvements at considerable cost. No right by prescription: use not continuous or adverse. There is right by estoppel: Owner of servient estate (Holbrook) knew the Taylors spent money to improve the driveway and either gave permission or at least tacit approval. When a licensee exercises right of way with owner of the servient estates permission and spends money to improve the right of way, the license is irrevocable by estoppel.
Concl:
c. Easement implied from prior existing use 1) Use exists prior to severance: A quasi-easement exists on the quasi-servient part of grantors land
for the benefit of the quasi-dominant part.
2) Severance by a common owner: Grantor conveys part of the land or conveys both parts to
different grantees simultaneously
3) Use is continuous and/or permanent 4) Easement is reasonably necessary for enjoyment of dominant tenement (some JX require strict necessity) 5) Easement must be apparent but not necessarily visible to the grantee (of the servient T) A) English rule: grantor cant reserve an easement for himself by implication. Grantor can easily put it in the deed. B) Only applies to easements appurtenant 2. If it is reserved for the grantor, must meet stricter standards of necessity. A) Some courts say it must be absolute necessity, others say it is only a factor. B) If grantor didnt put it in the grant, the price may have been for the land w/o the easement, and we dont want to let grantor keep the easement and the money. 3. CA: Costs of repairs to such easements are shared by parties who own it by agreement or according to the proportion of use. 4. If the dominant and servient T come into common ownership, easement is extinguished. If the owner later redivides, a new easement by implication will arise if it meets requirements. A) Applies to easements implied from prior use and by necessity 5. Van Sandt v. Royster (p 796)
Facts: Bailey owed 3 lots (19, 20, and 4) and built a sewer pipe across two of the lots for a house on the third. Jones bought lot 19 and knew about the sewer pipe. Jones (19) Reynolds Van Sandt (P). Bailey conveyed lot 20 to Murphy Royster (D). Lot 4 Gray (D). No deed contained any reservations. P discovered sewage in the basement. Is there an easement implied from prior use? An owner cant have an easement in his own land, but may have a quasi easement on one part of the land for the benefit of the other part. Implied easement arises whenever grantor conveys quasi servient tenancy. The easement must be one of strict necessity in order to establish an easement implied by reservation in favor of the grantor. An easement created by implication arises as an inference of the intention of the parties, not the language of the grant. Each party is bound to his intention and what he might reasonably have foreseen the other partys intention to be. Grantors may be assumed to intend the continuance of uses known to them that are necessary to the usefulness of the land. The degree of necessity necessary to imply and easement in favor of the grantor is greater than that to imply in favor of the grantee.
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Property Outline Fall 2003 Jones knew about the sewer, and this easement was necessary to the comfortable enjoyment of the property. P made an inspection of the premises and knew there was modern plumbing. P is charged with notice of the sewer the use need not be actually visible if it is or should be apparent. An easement was created by implication because the grantor knew about it and is thus assumed to have intended its continuance, grantee should have known about it (it was apparent), and the easement is necessary for the comfortable enjoyment of the other property.
Concl:
d. Easements by Necessity 1) Severance by a common owner 2) Need for easement existed at the time of severance (necessity now isnt enough) 3) Easement is strictly necessary and not merely convenient (most JX) A) Only endures as long as necessary and is limited to extent necessary B) Typically right-of-way for landlocked parcel I) Landlocked land is economically inefficient C) Strict necessity may mean that if it is otherwise possible to get in just by foot, by boat, or by extreme expense, the easement isnt necessary. I) Burden of proof is on the alleged dominant estate: if she cant prove necessity existed at the time of severance, it is assumed not to have existed. 2. Right to condemn (western states) A) Some statutes give private owners a right to condemn a necessary right-of-way across anothers property even if it doesnt meet the other requirements of easement by necessity. Dominant owner must pay for the right of way B) Easement by necessity doesnt operate in favor of the govt. 3. Easement implies the intent of the party. 4. Othen v. Rosier (p 802)
Facts: Hill owned a bunch of land. He first conveyed part of land next to road (100 acres). There was a way across that land to the back portion. No evidence that this was the only way from his land to the road or that it was in exactly the same place as it is now. He then conveyed part of the back portion (60) but kept part of the land containing the road (16.31). Hill later conveyed the rest of the back part (53) and the rest of the land with the road. Othen (P) later got the two back parts: 50 and 63. Rosier (D) got the two front parts with the road 100 and 16.31. Rosier put up a levee by the road to protect farmland flooding that made the road unpassable. Othen sues for injunction against this and other interferences with his use of the land. Trial court found easement by necessity for Othen over 100 and 16.31. Appeals court found no easement at all across either. Does Othen have an easement by necessity or prescription across Rosiers 100 acre and 16.31 acre plots of land? Easement by necessity: 1) unity of ownership of alleged dominant and servient estates, 2) the roadway is a necessity and not a mere convenience, and 3) this necessity existed at the time of the severance of the two estates. No easement by necessity: Hill owned all land, but no easement across 16.31 plot b/c Hill still owned this at the time he conveyed the 100 plot. Owner cannot have an easement across his own land. Not clear that way across the 100 plot was necessary for Hill, as he may have had other ways out. Must be clear evidence. Land completely surrounded by the land of another doesnt give the former a way of necessity where there is no privity of ownership. No easement by prescription: Rosier used the road, too, so Othens use is permissive and cannot ripen into a prescriptive right. Othen cannot tack on the use of the road before Rosiers owned the land b/c no evidence that it was exactly the same road. Prescriptive period cannot begin when Hill still owned the land. Burden of proof is on Othen. Othen has no easement of necessity b/c roadway wasnt a necessity at the time the estates were severed, and part of the road wasnt part of land that was severed while original owner still had title. Othen has no easement by prescription b/c Rosier used the road, too, making Othens use prescriptive. Most courts dont construe exclusive use of easements by prescription so narrowly.
Issue: Rule:
Analysis:
Concl:
Notes:
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e. Easements by Prescription 1. History: A) Fiction of the lost grant, then required presumed to have existed since 1189. 2. Easements by prescription 1) Open and notorious throughout the statutory period 2) Continuous and uninterrupted 3) Adverse (not permissive) 4) Under a claim of right A) US courts set same time as S/L for AP. B) Use doesnt need to be exclusive, but right to use must arise from more that the general publics right to use it. C) A change in the manner of use may be enough to shift it from a permissive to an adverse use. Use may also change from adverse to permissive, and the S/L must start over. D) Applies only to affirmative easements, not negative easements. 3. Some American courts adopted the fiction of the lost grant: owner must acquiesce (not object) but the use cannot be permissive. A) A letter telling prescriptive user to stop is enough even if she doesnt actually stop (unlike AP). B) In JX that dont follow fiction of the lost grant, owner must effectively stop prescriptive use. 4. Public Prescriptive Easements Obtained by long continuous use by the public under a claim of right. A) Landowner must be put on notice by the kind and extent of the use, and that an adverse right is being claimed by the public, not by individuals 5. Implied dedication landowner evinces an intent to dedicate, and the state accepts by maintaining the land used by the public. 6. Beach Access A) Public prescriptive easements generally dont work for beach access b/c use generally regarded as with permission B) CA, though, allows public prescriptive easements only w/in 1000 yards of the ocean. C) Some courts have used the doctrine of customary rights existed for so long, no memory of man runneth to the contrary. iii. Public Trust Doctrine ownership of land from the shoreline to the mean high water mark is held in trust for the public by the state. a. State owns out to 3 miles out, US govt 3-12 miles and has exclusive JX up to 200 miles out or to limit of the continental shelf. 1. CA has strong public trust doctrine laws: may even regulate use of water if it causes body of water to shrink. b. Public may also use and cross area above mean high water mark that is privately owned if it is necessary for the enjoyment of the beach. 1. There is a built-in limitation to fee simple ownership just above the mean high water mark you have to let the public uses it to cross to the beach and sunbathe on it. This is an easement by the general public to cross and use your property by virtue of the common law. 2. States have different approaches. 3. Judicial decisions that modify property rights arent seen as governmental takings. Courts create property rights, and therefore can modify them. c. Matthews v. Bay Head Improvement Assoc. (p 816)
Facts: Bay Head Association owns or leases much of the dry sand area above the Bay Head beach, and restricts use and access through to members (residents of the area) and their guests during the daytime in the summer. Can D restrict membership to residents and thereby preclude public use of the dry sand area? Beach up to the mean high water mark is held in public trust by the state for the use of the public.
Issue: Rule:
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Analysis:
Concl:
In order to exercise right to use the beach land held in public trust, the public must have access to this area through the dry sand area. Additionally, public must have use of the dry sand area for sunbathing and recreational activities to fully enjoy the beach. This isnt a static right and doesnt mean the public can use all of the dry sand area, just so much as is necessary. The Association acts as a quasi-public entity and thus must open membership to the public. At this point, other private owners of dry sand areas need not allow public use, but this may become necessary if Association loses lease on a lot of the dry sand area. Where use of dry sand area is necessary for public enjoyment of the beach, the public trust doctrine warrants the publics use of this area, subject to accommodation of the use of the owner. D must open membership to the general public.
iv. Assignability of Easements (p 824) a. Easements in gross 1. Traditional: easements in gross are not alienable. A) Easements in gross are not limited to the need of the owner as easements appurtenant are 2. Modern: (Commercial) easements in gross are assignable if that is the intention of the original grantor (Miller). A) Only recreational easements (hunting, fishing) are not assignable. B) R3d Prop allows assignment regardless of commercial character, and allows them to be divided unless contrary to original intent or would create unreasonable burden. 3. Easements in gross are not divisible and must be exercised as one stock. A) This is to prevent the servient estate from being burdened beyond the extent originally contemplated. B) This only works if there is a small number of owners C) This is not the way TIC works: right to use the undivided whole. 4. Easements in gross are generally enforceable against successive owners of the servient estate. b. Profits in gross are generally alienable, but courts are reluctant to allow them to be divided. c. One of the canons of construction if you have a legal document that lists certain things, the inference is that things not listed are excluded. d. Riparian owners (land alongside natural, navigable waters) have reasonable rights to use the waters subject to the rights of the other owners. e. Miller v. Lutheran Conference & Camp Assoc. (p 824)
Facts: Pocono Spring Water Ice Co. conveyed an easement on an artificial lake for exclusive right to boat and fish to Frank Miller, his heirs and assigns forever. Frank conveyed one fourth of interest to boat, fish, bathe to Rufus (heirs and assigns forever), his brother. For 25 years they shared the costs and profits of the business they operated: recreational bathing, boating, and fishing. Rufus died, some land near the river was conveyed to Lutheran Church, bad blood developed within the Miller family, Rufuss estate gave bathing rights to Lutheran Conference. Pocono Spring Water dissolved, Katherine Miller, Franks wife, bought the lease to the lake. Frank and Katherine sued for an injunction to enjoined Lutheran from selling bathing licenses. 1) Did Frank and Rufus have bathing rights on the river? 2) Were these rights assignable from Frank to Rufus? 3) Are easements in gross divisible? 1) There are no riparian rights b/c this is an artificial lake. The deed clearly did not convey bathing rights to Frank. However, Frank and Rufus did sell bathing rights as part of their business, the owner, Katherine, as Franks wife, had knowledge of the use. Therefore, Frank and Rufus had a bathing rights easement by prescription. 2) This is an easement in gross because it was not attached to the land but was personal. There is controversy over whether an easement in gross is assignable. There is no reason not to allow if it is the intention of the parties to give the right to assign, which it was. 3) Easements in gross are not divisible out of concern of burdening the servient estate more than was originally contemplated. If there is to be more than one person exercising the right, they must do so as one stock, and cannot use the easement if it interferes with the right of the other. Therefore, Rufuss estate could not convey easement to Lutheran w/o Franks consent.
Issue:
Analysis:
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Property Outline Fall 2003 Concl: Frank and Rufus had a bathing easement by prescription because they exercised bathing rights openly, continuously, with the knowledge of the owner but without express consent for 25 years. Frank had the ability to assign his easement in gross to Rufus because it was clearly the intention of the original grantor to allow Frank to assign his interest. The bathing easement is not divisible, and must be exercised by Frank and Rufuss estate as one entity.
v. Scope of Easements (p 839) a. Easements appurtenant cannot be extended for use to other parcels to which the easement is not appurtenant, even if the parcels are adjacent and the burden is not increased at all. 1. However, one court refused to grant injunction if there is no injury to the servient owner (Brown v. Voss). A) This decision isnt followed b/c too dangerous to property rights. b. Scope of types of easements 1. by grant terms will control. If ambiguous, courts will look at circumstances surrounding creation to determine intent 2. implied by prior use use that existed prior to severance and any other similar use that the parties might reasonably have expected will be permitted. 3. by prescription restricted to same general pattern of use that existed during statutory period and consistent w/ what servient owner might have expected from not objecting. A) More restricted than other easements. c. Changing the scope of easement 1. Change must be reasonably foreseeable and reasonably necessary to enjoyment and development of the dominant T. A) Courts usually will expand use from horses to cars, but will not expand for utility lines. 2. Easements can always be enlarged by prescription. 3. There is a tension between serving the interest of the parties and the economic use of the land 4. Location A) Traditionally cannot be moved by servient owner w/o dominant owners consent B) Modern: can be moved w/o consent if servient owner pays for relocation, it doesnt significantly lessen the utility, create a burden, or frustrate the purpose of the easement d. Brown v. Voss (p 833)
Facts: Parcel B has an easement appurtenant over parcel A for access to a single-family dwelling on B. Brown, owner of B, later bought parcel C, which was adjacent to B and had no access road. Brown began work to building a new single-family dwelling straddling the border between B and C. This use didnt increase use of easement. Voss, owners of A, blocked Browns access, Brown sought injunction against their blocking, D counterclaimed for injunction against Ps use of road to get to C. Trial court denied Ds injunction, appeals reversed. Should P be allowed to used an easement appurtenant to B to get to a dwelling straddling the border between B and C if there is no increase in use? Generally, easement appurtenant to one parcel may not be extended by the owner of that parcel to other parcels, adjoining or not, to which the easement is not appurtenant. Any extension of use of an easement appurtenant is a misuse, even if it doesnt increase the burden on the servient estate. However, an essential criterion for injunctive relief is actual and substantial injury. This is a misuse of the easement, but there is no injury to D, which is required for injunction, so no injunction granted. Any use is a misuse and a trespass. The fact that there is no increase in burden doesnt warrant a denial of injunctive relief.
Concl: Dissent:
vi. Termination of Easements (p 843) a. Natural expiration most are unlimited, but grant may limit length b. Purpose no longer applies c. By prescription terminates if servient owner wrongfully and physically prevents use for statutory period.
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d. Merger if dominant and servient estates come into the same ownership e. Release dominant owner may release in writing. f. Eminent domain g. Estoppel dom owners words or conduct are reasonably likely to cause reliance, and it does. h. Abandonment must be more than non-use. Must be a present intention to relinquish or action inconsistent with future use. i. Easement not extinguished by tax sale of servient tenement. j. Preseault v. US (p 843)
Facts: RR ran across Preseaults (P) property, by grant in 1899. Grant for one part was right of way and was determined by commissioner. Other part said in fee simple and came from owner of the land. RR stopped using tracks in 1975, removed tracks. Started being used as a trail, but taxes still paid as if RR. In 1986, state took over maintenance as public trail under Rails to Trail Act, keeping RR tracks open as public trails and for possible future use as RR. Lots of people used the trail and came into Ps yard, Presault couldnt use driveway or build another one. P sued for compensation under theory that trail amounted to a 5th Amendment taking. Court of Federal Claims found for govt. Did the conversion of the RR right of way into a public trail amount to a 5th Am. taking? 1) Did RR have an easement or fee simple? 2) If easement, was it limited to RR purposes only? 3) If not limited, did easement terminate in 1975 b/c of abandonment? 1) When RR acquires estate in land for track, it is for no more than use needed. Part one: grant said right of way, so it is an easement. Part two: grant said in fee simple, but it actually wasnt b/c owners were forced to convey interest to RR, so no more use than necessary is assumed. 2) Use as trail is way different in degree and nature of burden than RR use, so use want contemplated. 3) RR abandoned b/c stopped use and removed tracks. Continued taxing just shows bureaucratic slowness. Govt owes P as a 5th Amendment taking b/c significant use of land that burdens P that created a new easement that was in any case not contemplated by original grantors. Property law is mostly state law, so Federal recognition of abandonment doesnt control.
Issue:
Analysis:
Concl: Note:
vii. Negative Easements (p 858) a. Right of the dominant owner to stop servient owner from using land in a particular way. 1. Negative easements are generally not recognized 2. Traditionally, light and air easements were enforceable. This has taken on a new twist with solar energy developments. b. All states have conservation easements property owner conveys development rights in order to conserve the land. These easements are controlled by terms of the easement itself (you can convey some or all of the development rights), perpetual or can be perpetual, binding on all successors. 1. CA: perpetual in duration, not personal, never unenforceable b/c of a lack of privity, particular characteristics follow the instrument. B. Covenants Running with the Land i. Real covenants (History) a. Because negative easements were generally not enforceable, property owners created agreements or promises restricting use of land. 1. However, contractual duties arent enforceable against non-parties to the K, so needed to have a property interest that could be enforceable against successors in interest. b. US courts created real covenants, promises respecting the land that runs with the land at law 1. Privity of estate is required, but can exist beyond the L-T relationship. 2. Test for the running of the burden is stronger than the test for the running of the benefit. A) First Restatement required horizontal privity for burden but not for the benefit to run. B) This was rejected b/c it only worked for subdivisions, but vertical privity is required I) Burden doesnt run to AP b/c no vertical privity of estate. c. Real covenant can be negative or affirmative promise (to not do or do an act).
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1. Negative covenants are treated like easements for succession purposes. 2. Benefits and burdens of affirmative covenants run to successors of estates of the same duration (traditional privity requirement) A) Burden runs to AP. d. Covenants are not enforceable against assignees who have no notice of them. ii. Equitable Servitudes (p 864) a. Equitable servitudes 1. Successive owners are bound if: 1) that was what was intended, 2) successive owner had notice, 3) promise touches and concerns the land. A) Notice can be inquiry notice apparent that there is a common plan in the neighborhood. B) If not in the deed, there must be some pattern of restriction, but it isnt clear how much is needed for the pattern to create a reciprocal easement on the properties with no restrictions in the deeds. C) Touches and concerns I) The closer the promise comes to connection to a physical use of the land, the more likely it is to touch and concern. II) An affirmative covenant may touch and concern if the benefit also serves the burdened estate as in dues for upkeep in common interest communities (Neponsit). It is way harder for an affirmative covenant to touch and concern, particularly covenants to pay. III) Restrictions on the promisors use of her own land generally touch and concern. IV) Courts split on whether covenants not to compete touch and concern. D) ES sometimes called negative easements 2. ES followed in most JX 3. R3d Prop goes farther and abandons requirement of touching and concerning. A) Allows promises to bind all future property owners who have notice unless they are illegal, unconstitutional, or violate some public policy. B) Asks if it is arbitrary or unreasonable restraint on alienation C) Some argue that touch and concern should be kept b/c we are allowing promises that will run with the land forever. 4. Can be enforced by a third party in some circumstances. b. Equitable servitudes vs. Real covenants 1. Equitable servitudes are enforceable in equity can get an injunction 2. Real covenants are enforceable at law can get damages. 3. Real covenants are stricter, have to be in writing, must have privity. 4. Privity doesnt matter as much for ES. c. Tulk v. Moxhay (p 864) A negative covenant is enforceable against subsequent purchasers even if it doesnt run with the land. 1. Otherwise, purchaser would get it for a discounted price, and then sell it for more w/o the restriction. 2. Purchaser must have notice, and only negative covenants are enforceable as equitable servitudes. d. Sanborn v. McLean (p 870)
Facts: D (McLeans) and P (Sanborn) each own part of lot 86 of a subdivision once owned by a common owner. The original owners of the subdivision lots attached a restriction to the deeds of a number of lots that the lots would be used only for residential purposes for the benefit of other lots retained by the original owners, including lot 86. D started building a gas station on their lot, P says it is in violation of the general plan of the subdivision. Is Ds land subject to a reciprocal negative easement? When the owner of two or more lots sells one with restrictions that benefit the land retained, the owner of the lots retained cannot do anything forbidden to the owner of the lot sold. Reciprocal easements require actual or constructive notice to the subsequent purchasers of the owners retained lots.
Issue: Rule:
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Property Outline Fall 2003 Analysis: Lot 86 was retained by the original owners when they sold lots with restrictions that benefited lot 86. Therefore, lot 86 became bound to reciprocal negative easement. D was put on inquiry notice that the lot was subject to restriction because all the surrounding lots were obviously uniformly built according to a common plan. If D had inquired, they would have found out that there was a reciprocal negative easement on their lot prohibiting the building of a gas station. The lot contains a reciprocal negative easement because the lot was retained by its original owners while others were sold with negative easements that benefited the lot, and the easement is enforceable because D were on inquiry notice when they purchased the land.
Concl:
e. Neponsit Prop. Owners Assoc v. Emigrant Indus Sav Bank (p 875)

Facts: Deed to land included covenant to pay money each year for maintenance of public roads, beaches in the community, unpaid money to be enforceable as a lien against the property and enforceable by all assignees. Covenant included in all deeds of the land, including Ds. Property owners association brought action to foreclose lien for non-payment. Is this covenant enforceable against subsequent purchasers? must 1) be the intention of the grantor and grantee that covenant run with the land, 2) covenant must touch and concern the land, and 3) must be privity of estate between promissee or party claiming benefit and party w/ burden. 1) From instrument, clearly intended covenant to run with the land. 2) Touches and concerns usually only applies to negative easements. However, substance rather than form allows ct to find that this does touch and concern the land b/c burden is for the benefit of the same land that is benefited, and so is inseparably attached to the land. 3) Property owners association, as a corporation that doesnt own any of the land in the community, has no privity of estate with the burdened party. However, the association exists solely for the benefit and to be the voice of the owners of the land that is benefited. Again, applying substance over form, there is privity of estate. The lien is enforceable because the grantee and grantor intended the covenant to run with the land; the land burdened is the same as the land benefited so that the burden is inseparable from the benefited land; and the association, though not in privity of estate with D, represents those in privity of estate with D.
Issue: Rule:
Analysis:
Concl:
f. Defeasible Fees and Land Use Control Devices 1. Defeasible estate is another property law based way of controlling land. These are less important in terms of land use in US. 2. Property is now more controlled by zoning and covenants than defeasible fees and easements. iii. Scope of Covenants (p 893) a. Interpretation of scope of restrictions 1. If language is ambiguous, in favor of free enjoyment A) Want to allow personal freedom, economically better to have fewer restrictions. 2. Covenant interpreted reasonably but strictly A) Words will not be construed literally if this would create absurd results. 3. Covenants are construed based on the impact to the community, not on the private activities within the home. (Hill v. Damien) A) Courts want to respect privacy but still address the community impact. B) Look at the range of impact that would be created by use under the covenant and see if Ds use falls within that range. 4. If language specifically prohibits, enforceable unless violates public policy. b. Statutes tend to be given more deference b/c they are created by an elected body.
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c. Hill v. Community of Damien of Molokai (p 893)

Facts: Community is a home for 4 people w/ AIDS living together, taking meals together, w/ nursing care coming in but not living there. P started complaining after there was a newspaper article about Community. There are other homes in violation of the covenant in the neighborhood. Neighbors (Hill +) say Community is violating covenant that land is for single residence purposes only and that there is increased traffic. D says that they are a family, and that to enforce the covenant would be a violation of the Fair Housing Act. Do the 4 residents constitute a family? Would enforcement of covenant violate FHA? Fair Housing Act: discriminatory intent whether D is treated differently from other non-disabled similarly situated people. Disparate impact Conduct actually or predictably results in discrimination. Reasonable accommodation Failure to make reasonable accommodations to allow disabled person to use home. Community is a family b/c they live together as a family. The purpose is to create a group home dissimilar to an institution. Strong public policy allowing disabled people to live outside of institutions and in residential neighborhoods, which can sometimes only be accomplished by group living. Increased traffic isnt part of the covenant. Additionally, violates FHA: There is a disparate impact, and not enforcing the covenant would be a reasonable accommodation. Community is a single-family because they live as a family. Enforcing the covenant would violate FHA b/c it would discriminate against disabled individuals by not allowing them to live in residential neighborhoods.
Issue: Rule:
Analysis:
Concl:
iv. Termination of Covenants (p 911) a. Changed conditions 1. As long as original purpose can still be accomplished and substantial benefit is derived from covenant, covenant is valid even though property has greater value if used for other purposes. A) Owners relied on the promise in purchasing the land and should be upheld even if the negative impact would be less than the increase in value if the covenant were broken. B) Conditions must change so dramatically that is doesnt make sense to enforce the covenant. 2. Changes must occur within the actual subdivision or area. Changes outside of it are not enough. 3. When zoning and private covenants are in conflict, the more restrictive one applies. 4. Land must be rezoned before covenant can be inspected for discard. 5. Enforcement may not be as economically efficient, but the objective is enforcing the promises that were made. There is a mutual restrictive benefit because, collectively, the promises running against each other creates a communal benefit. b. Abandonment and waiver (also acquiescence) 1. For community violations to constitute abandonment, they must be so general as to frustrate the original purpose of the agreement. A) Sporadic violations are not enough. c. Other defenses to equitable servitudes 1. Estoppel or acquiescence if other owners watch breach happen but dont say anything, may be held to be estopped or have acquiesced. 2. Clean hands doctrine if I violate the restriction, I will have a hard time forcing you to follow it because I have unclean hands. 3. Laches If you unreasonably delay in seeking to enforce your rights, you may not be able to enforce them. d. R3d makes covenants easier to create and easier to terminate. e. Covenants are based on more than just expectations (nuisance law). They are based on formal promises that create real, legitimate expectations much more strongly than nuisance situations.
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f. Western Land Co. v. Truskolaski (p 911)

Facts: D, subdivision developer wanted to build shopping center in one area of subdivision. Covenant that land in subdivision was for single-family homes only existed on all plots. Area around the subdivision has become more commercial and high traffic than it used to be. D argues this area has changed so radically that it has nullified the purpose. Also argues that homeowner violations of the covenant (day care in home, plot too small) are abandonment and waiver of covenant. 1) Has the area so radically changed that it nullifies the purpose of the restrictive covenant? 2) Do violations by other home owners constitute abandonment and waiver of the covenant? Residents still derive benefit from covenant not much traffic within the subdivision, homes are well-kept. Changes outside are not enough there must be changes within the actual subdivision to nullify the covenant. Even though city zoned area commercially, commercial zones allow residential uses, when zoning and private covenants are in conflict, more restrictive one applies. The violations of the covenant by homeowners are distant and sporadic. Covenant upheld. If original purpose can still be accomplished and there is still a substantial benefit, covenant is valid even though property has greater value if used for other purposes. For community violations to constitute abandonment, they must be so general as to frustrate the original purpose of the agreement.
Issue: Analysis:
Concl:
g. Rick v. West (p 916)

Facts: Rick subdivided land, sold to homeowners, but had a hard time selling all of land. Rick conveyed remaining land to P, who wanted to sell to hospital. West objected to use outside of the residential covenant. Court doesnt give damages to D in lieu of covenant enforcement. Landowner has a right to enforce a restrictive covenant in her favor as long as the use is not outmoded and it affords real benefit to owner.
Analysis:
v. Common Interest Communities (p 925) a. Uniform Common Interest Ownership Act requires a declaration of rules that are disclosed to purchasers. 1. Most CIC have homeowners associations that all owners are automatically members of. A) Enforces covenants, conditions, and restrictions and can vote in new CC&Rs. 2. Generally deeds also include attorneys fees provisions. b. Condominiums 1. Each individual interior of units are owned separately in fee simple. 2. Exterior walls, land, and common areas are owned by all as TIC. 3. Pay monthly charge for upkeep and for liability expenses. 4. Assoc has right to assess repairs and charge owners their share. c. Planned unit developments gated communities, privately owned towns d. All owners are in vertical and horizontal privity of estate. 1. Negative covenants restricting use almost always held to touch and concern. e. Standards of judging restrictions 1. Restrictions in the deed are afforded greater presumption of reasonableness than those added by association later. A) CA: restrictions in deed are valid unless wholly arbitrary or contrary to public policy. I) The restrictions are evaluated by looking at the impact on the community as a whole of any such violation of the restriction, not at the individual homeowners violation. II) The burden of proof is on the challenger. B) Restrictions added later are given less deference: shifting standard of proof or have to be reasonable. 2. Business judgment rule Focuses on the process: did they consider all the facts and make decision in good faith? A) If yes, they are protected even if there were bad consequences or the decision turned out to be a really bad decision. B) Standard used to judge decisions by corporate leaders in business matters.
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C) Courts often regard associations as corporations. They have attributes of both corporations and mini-governments. 3. R3d Prop: Restriction enforceable unless lacks rational justification, but draws a distinction between direct (who you sell the house to) and indirect restraints (paint color) A) Direct restraints must be reasonable I) If you must get permission to sell, this is probably unreasonable II) If assoc has right of first refusal (right to meet any other offer before the proposed contract is accepted), this is probably enforceable. 4. There are also privacy issues: how far into the private home does the court want to reach? f. Nahrstedt v. Lakeside Village Condo Assoc, Inc. (p 927)
Facts: Nahrstedt, owner of a condo in the Village, owns three indoor cats in violation of community restriction in the master deed against pets other than birds and fish. P says she didnt know about the restriction. Is the pet restriction unreasonable, and can it be enforced against an objecting home owner? Restrictions in the recorded declaration are enforceable unless unreasonable. Restrictions added later by the homeowners association must be reasonable. Restrictions in the recorded declaration, however, are afforded a presumption of validity that will be enforced even if they are unreasonable to some degree. The burden of proof is on the objecting homeowner. Associations must enforce restrictions in good faith. Here, the homeowners relied on this restriction in purchasing their condos, and have not repealed the restriction. Restrictions in the recorded declaration of a common interest development are enforceable unless arbitrary, the burden substantially outweighs the benefit, or violates public policy. The restrictions will be evaluated by looking at the community as a whole, not at the individual homeowner.
Concl:
g. NY Co-operative Apartments (p 942) 1. Title of land and building is held by a corporation, each resident owns stock and has a long term renewable lease, so that they are both owners and tenants. 2. All share mortgage and taxes, so that all depend on the financial stability of the others. A) Can deny entry for any reason. X. Governmental Taking A. Eminent Domain (p 1093) i. Private property cannot be taken by the government for public use without just compensation a. 5th Amendment applies to federal govt b. 14th applies to state govt (interpreted to cover state takings later) c. Understood as: govt can take your property without your consent if they pay you and its for public use, although it isnt written that way. ii. Key questions: a. Property 1. Generally look to state law (property law), but there are some federal property laws (patents). 2. Usually deals with land b/c govt doesnt generally have use for personal property b. Taking 1. Taking is limited because it is unpopular, and govt has to pay for it using taxes. c. Public use 1. Doesnt have to be physically for public use. Public purpose is enough. A) The courts defer to legislature to decide if it is for a public purpose unless there is no rational reason (HHA v. Midkiff). d. Just compensation 1. What a willing buyer would pay a willing seller A) Doesnt take personal or sentimental value into consideration. 2. Can be complicated to determine A) If govt is only taking part, and the rest will be increased in value as a result of the new use, govt can offset what it owes you. B) But the partial taking decrease the value of your other land, govt has to compensate you for that, too.
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iii. HI Housing Authority v. Midkiff (p 1098)

Facts: HHA made law forcing private owners to sell homes to T in order to more equitably distribute property ownership in HI. Law required a certain number of T interested and able to buy from a single owner. If owner and T couldnt agree, price could be set by condemnation trial. HI set it up as a taking so that the owners wouldnt have to pay as much taxes. Is forcing sale to individual tenants a public use allowing a taking under the 14th Amendment? Subject to constitutional limitations, if the legislature has determined that a taking has a public purpose, the courts must defer to this decision. The courts role in reviewing this decision is narrow, even when the govt is exercising a police power. It is the belief of the legislature at the time of passage that is examined, not whether the law in fact accomplished its goal. Courts must defer to legislatures decision of what constitutes public purpose unless the use is palpably without reasonable foundation.
Issue: Analysis:
Concl:
B. Regulatory Takings (p 1151) i. Regulatory takings: Govt so restricts the uses to which land may be put that it has effectively been taken. a. The owner still has title, ownership, the right to exclude, but there are limits on the uses that the owner may make of the land. ii. Test: Ct considers several factors when determining whether a taking has occurred (Penn Central): a. The economic impact of the regulation on the claimant b. The extent to which the regulation has interfered with distinct investor expectations 1. Look at expectations: If they knew it was restricted when purchased, maybe lower expectations. c. The character of the governmental action. 1. Can the action be characterized as a physical invasion? 2. Is there a reason like health and safety? d. Per se rule: When the regulation deprives property of all value, it is a per se taking that requires compensation unless background principles of state nuisance law in the state would have prohibited the use. 1. Tahoe-Sierra Preservation Council Imposed 5-year building moratorium. Court: moratorium is not a permanent deprivation of all value. This limited Lucas. (Semipermanent may be enough) 2. Causby military landing base next door wasnt a taking b/c it wasnt on their land. But, they had a chicken farm, and the chickens couldnt take the noise of the planes flying overhead, so found a taking of the airspace above. iii. Reciprocity of advantages zoning laws are ok b/c restricted property benefits, too. iv. The parcel is looked at as a whole, not whether segments have been completely taken a. But, if planes flying through airspace negates ability to continue use of the land, farming, may be a taking (US v. Causby, p 1160). b. Otherwise, govt would have to compensate for set back regulations saying how close buildings can get to roads. c. If the part (like the airspace) was sold to another party, then it may be a taking b/c it would be taking all of the property owned by that party. However, ct would look at buyers awareness of the law to see what the investor expectation was (Lucas v. SC Coastal Council). v. Distinguished from nuisances a. Neednt pay if enjoining from harmful activities. But line may not be clear: are they preventing a harm or securing a nuisance? vi. Taxation isnt taking. vii. Regulation of personal property by destroying a strand in the bundle (eagle parts) is not a taking b/c not all bundle needs to exist. viii. Dolan govt rezoned so P could build new store on condition that she allowed a public bike path. Court found a taking b/c the harm must be proportional to the condition if govt is going to do that (higher burden to factually show public need).
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ix. Loretto required compensation when states required landlords to permit cable companies to install cable facilities on their property. But only got $1. x. Penn Central Transp Co. v. City of NY (p 1151)
Facts: NYCs law to protect historic buildings covers Grand Central Station. Plans for modification of historic buildings must get a certificate of no effect on features, a certificate of appropriateness, or a certificate of appropriateness on the ground of insufficient return. All are judicially reviewable. Development rights for historic parcels may be transferred to nearby parcels. Penn Central put two plans for a 50 story tower through the first two review processes and were denied. They did not seek judicial review. The plans would have made millions per year. Is NYCs regulation a judicial taking that requires just compensation? If so, is the transferability of development rights enough to constitute just compensation? Regulations are judged largely on the particular circumstances of the case. The Commission did not completely restrict the use of the air space above the station; it merely rejected two proposed uses. The station may still be used as it was originally. Takings law doesnt divide a parcel up into discreet segments to see which sections have been completely taken. Property is looked at as a whole. The court will consider several factors when determining whether a taking has occurred: the economic impact of the regulation on the claimant, the extent to which the regulation has interfered with distinct investment-backed expectations and the character of the governmental action. NY historic landmarks law did not create a regulatory taking of Grand Central Station.
Issue: Analysis:
Concl:
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Property Outline Fall 2003

II. First Possession: Acquisition by Discovery, Capture, Creation

Property Outline Fall 2003

Policy: Dissent: Rule:

Issue: Analysis: Policy: Rule:

Property Outline Fall 2003

Property Outline Fall 2003

iii. Cheney Brothers v. Doris Silk Corp. (p 64)

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iv. Virtual Works v. Volkswagon (p69)

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iv. Hannah v. Peel (p 111)

v. McAvoy v. Medina (p 118)

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Issue: Rule: Analysis:

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iv. Howard v. Kunto (p153)

System of Estates III. Possessory Estates (p 197)

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a. Notes: 1. Bad decision. Grandchildren have no sentimental attachment, just greedy.

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IV. Future Interests (p 269)

C. Future Interests in Transferees (p 272)

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b. Spiller v. Mackereth (p 369)

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e. Elkus v. Elkus (p 408)

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Property Outline Fall 2003 Privity of estate and K privity of K

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b. Berg v. Wiley (p 500)

Issue: Rule: Analysis:

Property Outline Fall 2003

Issue: Rule: Analysis:

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Property Outline Fall 2003

Land Use Controls VIII. Nuisance (p 747)

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ii. Estancias Dallas Corp. v. Schultz (p 755)

Issue: Rule: Analysis:

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Property Outline Fall 2003

Issue: Rule: Analysis:

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3. Holbrook v. Taylor (p 791)

Issue: Rule: Analysis: