Property Outline Been Spring 09 Jason Hardy

Cases 40 W. 67th St. v. Pull an! ".#. $%00&'! 79&................................................................................60 (da s v. )leveland*)li++s ,ron )o.! -i.h. (pp. $/999'! 9&0......................................................6/ (dverse Possesion o+ )hattels1 Song2yrd! ,n.. v. 3state o+ 4ross an! ".#. $/990'! %/4...........%& (dverse Possession * good +aith re5uire ent1 )arpenter v. 6uperto! ,o7a $/90%'! %0&..............%% (dverse Possession ordinary use and ta.8ing1 Ho7ard v. 9unto! Wash. $/970'! %00..............%& (dverse Possession1 :essee o+ 37ing v. Burnet! ;.S. $/0&7'! /94..............................................%% (rtist<s 6ights1 -oa8ley v. 3ast7i.8! -ass.! %76........................................................................%9 Base2all Pu2lishing )o. v. Bruton! -ass. $/9&0'! 97%..................................................................66 Berg v. Wiley! -inn. $/970'! 4%0.................................................................................................&4 Bla.8ett v. Olano++! -ass. $/977'! 70&.........................................................................................=/ Bolotin v. 6indge! )al (pp $/964'! /04%......................................................................................7/ Boo er v. (tlanti. )e ent )o.! "# $/970'! 9=6.........................................................................64 Bro8a7 v. >air.hild! ".#. Sup )t. $/9%9'! =97.............................................................................4% Bro7n v. :egal >dtn. O+ Wash.! ;S $%00&'! /&&&........................................................................70 )ave .ase1 3d7ards v. Si s! 9y. $/9%9'! /7=.............................................................................../9 )hi ney s7eep<s +ound ?e7el1 (r ory v. @ela irie! 3ng. $/7%%'! %%0......................................%4 )onservation o+ 3states1 )ity o+ 9la ath >alls v. Bell! Oregon $/97/'! =60...............................&0 )opyright1 3ldred v. (sh.ro+t! ;.S. $/99&'! /009........................................................................./4 )opyright1 :essig.........................................................................................................................../4 )ornea .ase1 "e7 an v. Sathyavagls7aran! 9th $%00%'! %4=......................................................%6 )usto and Pu2li. 6ights1 State o+ Oregon eA rel. Bhornton v. Hay! Or. $/969'! &&&.................&/ @el+ino v. Cealen.is! )onn. $/900'! 6&7.......................................................................................47 @e setD! Bo7ard a Bheory o+ Property 6ights $/967'! %9%...........................................................0 @olan v. )ity o+ Bigard! ;S $/994'! /&&9.....................................................................................70 @u.8 .ase1 9ee2le v. Hi.8eringill! 3ng. $/707'! 9%........................................................................7 3agle 3nterprises! ,n.. v. 4ross! "# $/976'! /0&0.......................................................................69 3ase ent estoppel1 Hol2roo8 v. Baylor! 9y. $/976'! 997.............................................................67 >irst 3nglish 3vangeli.al :utheran )hur.h v. )ounty o+ :.(.! ;S $/907'! /&49........................70 >ontaine2leau Hotel )orp. v. >orty*>ive B7enty*>ive! ,n..! >la. (pp. $/9=9'! /00/..................67 >ound 2roo.h1 Hannah v. Peel! %&4...............................................................................................%= >ound logs1 (nderson v. 4ould2erg! -inn. $/09%'! %%4..............................................................%4 >ound logs1 )lar8 v. -aloney! @el. $/040'! %%%...........................................................................%4 >roDen sper .ase1 He.ht v. Superior )ourt! )ali+.! %60..............................................................%9 4hen v. 6i.h! $@ist. )t.! -ass. /00/'! 00........................................................................................6 4ill or $>loren.e' v. 4ill or $3d7ard :eslie'! ;tah $/904'! 64=...............................................40 Har s v. Sprague! ,ll. $/904'! 6=0................................................................................................40 High.hair .ase1 Brenton ,ndustries v. (.3. Peterson -+g. )o.! S.@. )ali+. $/9=0'! /=4............../0 Ho erun 2all .ase1 Popov v. Hayashi! San >ran.is.o $%00%'! /00.................................................0 Honey.o 2 .ase1 >isher v. Ste7ard! %%7......................................................................................%4 ,n re 3state o+ >il+iley $?oint 2an8 a..t'! 6=0.................................................................................49 ,n re 9err........................................................................................................................................=% ,ndian land .ase1 Johnson v. -<,ntosh! ;.S. $/0%&'! //0.............................................................// ,"S1 ,nt<l "e7s Serv. v. (P! ;.S. /9/0! p/&=............................................................................../=

,ntel )orp. v. Ha idi! )ali+. $%00&'! 4/%......................................................................................&& ,BEs .ase1 (llian.e (gainst ,>Es v. Bro7n! 9th )ir. $/996'! //%7............................................./0 Ja.5ue v. Steen2erg Ho es! ,n..! Wis. $/997'! /..........................................................................&% Javins v. >irst "t<l 6ealty )orp.! @.). $/979'! 7/9.......................................................................=& Johnson v. Whiton! -ass. $/09&'! =07..........................................................................................40 9endall v. 3rnest Pestana! ,n..! )al. $/90='! 7==..........................................................................=0 :oretto v. Belepro pter -anhattan )(BC )orp.! ;S $/90%'! /%06............................................74 :u.as v. S.). )oastal )oun.il! ;S $/99%'! /%99..........................................................................7= :uens ann v. Fi er*Fa pese G (sso..! BeA. (pp. $%00&'! 9=&.............................................6& -.)oni.o v. Singleton! S.). $/0/0'! 44%......................................................................................&= -edi.o*@ental Building v. Horton! )al. $/94%'! 7/%....................................................................=% -eteorite .ase1 4oddard v. Win.hell! %%9....................................................................................%= -idler v. >ord -otor )o.! $9th )ir. /900'! /47............................................................................/7 -oore v. 6egents o+ the ;niv. o+ )ali+.! )ali+.! %==.....................................................................%7 -ountain Bro7 :odge "o. 0%! ,ndependent Order o+ Odd >ello7s v. Bos.ano! =th $/967'! 6074& "ahrstedt v. :a8eside Cillage )ondo (ss<n! ,n..! )al. $/994'! 70%.............................................=9 "eponsit Property O7ners< (ss.<n! ,n.. v. 3 igrant ,ndustrial Savings Ban8! "# $/9&0'! /0/9 ...................................................................................................................................................69 O<Brien v. O<Brien! "#! 66=........................................................................................................49 PalaDDolo v. 6hode ,sland! ;S $%00/'! /&&4.................................................................................77 Paradine v. Jane! 3ng.! 69/............................................................................................................=0 Penn Bo7ling 6e.reation )tr. v. Hot Shoppes! ,n..! @.). (pp. $/949'! /009.............................60 Penn. )ent. Bransp. )o. v. )ity o+ ".#.! ;.S. $/970'! /%69.........................................................7& Penn. )oal )o. v. -ahon! ;.S. $/9%%'! /%=9................................................................................7% Personhood! -argaret Jane 6adin $%90'.......................................................................................%6 Phillips v. Wash. :egal >dtn.! ;S $/990'! /&&/............................................................................77 Pierson v. Post! ".#. $/00='! 0/......................................................................................................= Ploo+ v. Putna ! Ct. $/900'! 4&9...................................................................................................&4 Prune#ard Shopping )tr. v. 6o2ins! ;S $/900'! 4=4n6 G /&46............................................&=! 70 Pu2li. 6ights..................................................................................................................................&0 Pu2li. trust do.trine1 ,llinois )ent. 6.6. )o. v. ,llinois! ;.S. $/90%'! &/=....................................&/ Pu2li. trust do.trine1 :a8e -i.higan >ederation v. ;nited States (r y )orps o+ 3ngineers! ".@. ,ll. $/990'! &%4...........................................................................................................................&/ 6iver 2order .ase1 "e2ras8a v. ,o7a! ;.S. $/09%'! /0&................................................................%0 San2orn v. -.:ean! -i.h. $/9%='! /0&4.......................................................................................70 S.h7a2 v. Bi ons! Wis. $/999'! 979.........................................................................................66 S ith v. -.3nany! -ass. $/097'! 694..........................................................................................=/ So er v. 9ridel! ".J. $/977'! 7&=..............................................................................................== Spur ,ndustries! ,n.. v. @el 3. We22 @evelop ent )o.! (riD. $/97%'! 964..................................64 St. Helen<s S elting )o. v. Bipping! 3ng. $/06='! 940.................................................................6% State v. Sha.8! ".J. $/97/'! 40/....................................................................................................&& Sun8en treasure .ase1 3ads v. BraDelton! (r8. $/06/'! /0%............................................................7 Sutton v. Be ple! 3ng. $/04&'! 696...............................................................................................=/ Sy phony Spa.e! ,n.. v. Pergola Properties! ,n..! "# (pp. $/996'! 6%0....................................4& Bahoe*Sierra Preservation )oun.il! ,n.. v. Bahoe 6egional Planning (gen.y! ;S $%00%'! /&&=77 Bahoe*Sierra Preservation )oun.il! ,n.. v. Bahoe 6egional Planning (gen.y! ;S $%00%'! /&==79 Bhird*party rights1 Je++ries v. Bhe 4reat Western 6y.! 3ng. $/0=6'! %%6......................................%4 Bi 2er .ase1 Wether2ee v. 4reen $/66'......................................................................................../9

Bul8 v. -oAhay! 3ng. $/040'! /0/4..............................................................................................69 ;nited States v. )aus2y! ;.S. $/946'! &/&....................................................................................&0 ;ston v. 6esorts ,nt<l Hotel! ,n.....................................................................................................&= Warsa7 v. )hi. -etalli. )eilings! ,n..! )al. $/904'! 906.............................................................66 Waste1 -el s v. Pa2st Bre7ing )o.! 600.....................................................................................4/ Willia s v. >ord -otor )redit )o pany! 0th $/90%'! 4&4...........................................................&4 Wills1 Willia s v. the 3state o+ Willia s! Benn. $/99&'! =6&......................................................&0
Overvie7 Property H a set o+ legal relationships $a 2undle o+ sti.8s or rights' rather than a thing. o IJtKhe eA.lusive right o+ possessing! en?oying! and disposing o+ a thing.L Bla.8<s :a7 @i.tionary. o Sin.e property is .onteAt*dependent $Iit<s all relativeL'! 7e .annot say A or y resour.e is propertyM 7e have to say that ( has an interestNright in regard to A to the eA.lusion o+ B. ISpontaneousL or Igro7nL property rights H those that have 2een around so long that their origin is un8no7n! 7hereas I-ade property rightsLH those that are relatively ne7! deli2erately*.reated rights. 3Ahausti2le vs. ineAhausti2le $.annot 2e used up' resour.es.

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,. (llo.ating 6esour.es Bhrough the :a7s o+ Property (. Original (.5uisition o+ Property 2y * >irst Possession $0/' /. Wild (ni als * Bhe 6ule o+ )apture1 o IPossession is 9N/0ths o+ the :a7.L -ere pursuit o+ a 7ild ani al does not .onstitute possession o+ that ani al. $I(.tual 2odily seiDure!L 8illing! or I ortal 7oundingL ay 2e su++i.ient to esta2lish possession.' Pierson v. Post $0/'. $a poli.y! not +a.tual .onsideration' ( person re.eives possession! or a property interest! 7hen poli.y goals are served 2y granting su.h possessory rights. o (dvantages to the 6ule o+ )apture ,n.entiviDes produ.tivity! e++i.ien.y $+aster not ne.essarily ore e++i.ient'. )ertainty! .larity $as opposed to right to pursuit! 7hi.h 7as the rule i posed in PopovNho erun 2all .ase! see 2elo7'. 3n.ourages transa.tions 2N. .larity and .ertainty allo7s individuals to a8e transa.tions involving the property interest. o @isadvantages to the 6ule o+ )apture ,ne++i.ient 2N. o in.entiviDes overuse o+ resour.es or overinvest ent under regulatory s.he es. 3.g. o+ over*invest ent under +irst*to*.apture s.he e1 9u7ait invests O/00- in drilling +or oil underneath its territory! 2ut ,ra5 slant*drills and rea.hes oil +irst. @rillers in BA and :a! eager to se.ure oil and gas! too8 it +ro the ground! 7here it 7as relatively sta2le and sa+e! and stored it along the "J Burnpi8e! 7here it is relatively unsa+e. o dis.ourages .o petition +ro less*resour.ed parties. o )ase1 Pierson v. Post! ".#. $/00='! 0/. >a.tsNPro.1 P $Post' started! pursued! and hunted a +oA 7ith his dogs and hounds on 7aste and uninha2ited ground. While P 7as in vie7 o+ the ani al! @ $Pierson' 8illed and .arried o++ the ani al! and @ 8ne7 that P 7as in pursuit o+ the ani al. J +or P. 6<d. 6easoning1 o >oA is ferae naturae $a 7ild ani al'! so property ?ust re5uires o..upan.y. P did not have o..upan.y o+ said ani al. o I,+ the +irst seeing! starting! or pursuing su.h ani als! 7ithout having so 7ounded! .ir.u vented or ensnared the ! so as to deprive the o+ their natural li2erty! and su2?e.t the to the .ontrol o+ their pursuer! should a++ord the 2asis o+ a.tions against others +or inter.epting and 8illing the ! it 7ould prove a +ertile sour.e o+ 5uarrels and litigation.L 0&<& . o P 7ould only have had o..upan.y! and there2y ade the +oA his property! i+ he had a.tually ta8en hold o+ the ani al physi.ally. Bhe .ourt ight have ruled in his +avor i+ he had ortally 7ounded the ani al and aintained his pursuit. ,+ the +oA had 2een on so eone<s property! that person .ould argue it 7as his property 2y ratione soli $literally! Ia..ording to the soilL'. @issent1 Bhe .ourt should .onsider the so.ietal 2ene+it o+ destroying a I7ild and noAious 2east.L By +inding in +avor o+ @! potential hunters o+ 7ild ani als ay 2e deterred +ro pursuing and 8illing su.h ani als i+ so eone else .an steal their vi.tory and 8ill the ani al ?ust as the pursuer is a2out to. Bhough the appeals .ourt<s ruling is 2ased upon long*standing do.trine! 7hen en the selves .hange 7ith the ti es! the la7s should .hange as 7ell. "otes1 o :o.8e argued that a person o7ns his o7n 2ody and! 2y eAtension! the 7or8 o+ his 2ody $his la2or'. Bhus! 7hen a person<s la2or is e++e.ted on an uno7ned thing! that person .an .lai o7nership o+ the thing. (t least! he has ore o+ a .lai to the thing than others 7ho have not eApended the sa e a ount o+ la2or to7ard the thing. o P)lass "otes1 P 2ased his argu ent not upon possession 2ut that an interloper had stolen IhisL .at.h. Why does possession atterQ P<s .lai 7as +or trespass on the .ase! 7hi.h involves inter+eren.e 7ith one<s property. 6eally P 7as see8ing the right to 2e +ree +ro inter+eren.e +ro .apturing property that he 7as pursuing.

@ essentially argued a 6/%$2'6 -otion that P +ailed to state a .lai upon 7hi.h relie+ .ould 2e granted. Bhe ain 5uestion at issue is 7hether P had a.5uired a property interest in the +oA or a right to pursue the +oA su.h that P .ould sue @ +or 8illing and ta8ing a7ay the ani alQ >irst! the .ourt has to esta2lish that P had o..upan.y. Hypo1 What i+ P had invested any hours and dollars into the hunting eApeditionQ -odern eAa ple is 4reenpea.e! 7hi.h li8e Bert in -ary Poppins! tries to save ani als despite others< pursuit. Standard argu ent o+ the a?ority * +o.us upon o +or al pre.edent and o poli.y argu ents o in support o+ Ipreserving pea.e and order in so.iety.L Bo atta.8 this! P .ould argue that o pre.edent is not .lear or ne.essarily 2inding! or is ?ust plain silly. ,t does not pro ote .ertainty i+ it is against eApe.tations! possi2ly due to .usto . @espite the a?ority<s .ontention! the rule ay not lead to less disputes. o Iti es have .hangedL $tempora mutantur' and our la7 should .hange 2N.1 poli.ies have .hanged! te.hnology has .hanged! so.ial stru.ture has .hanged! or our understanding o+ in.entives have .hanged. Ho7 do legal rules pro ote .ertaintyQ o )lari+y 7hat the rules are. o 6edu.ing the nu 2er o+ issues to 2e de.ided. o :i iting the types o+ issues that the .ourt has to de.ide! to li it the opportunities +or error 2y the .ourt.R >irst*in*ti e rules G )usto 1 When arguing a2out in.entive e++e.ts! a ore eAtensive 8no7ledge o+ an industry or +ield is needed than other7ise. Who is engaged in the a.tivity and 7hyQ "ote that! per n7 on p00! Ia +irst*in ti e rule S see s to 7or8 2est 7hen a .lear 7inner 7ill e erge 5ui.8ly 2e.ause o+ that person<s spe.ial s8ill or relationship to the resour.e.L >ast*+ish*loose*+ish o the +irst harpooner possesses a 7hale that re ains +astened to his ship. o (pplied to relatively slo7* oving 7hales. o (..ords 7ith nor s o+ possession. o (ppears to have 2een the Ide+aultL .usto ! eA.ept in areas 7here sper 7hales $apparently ore di++i.ult to se.ure' predo inate. ,ron*holds*the*7hale or >irst*iron rule o the +irst harpooner re.eives eA.lusive rights to the 7hale as long as the harpooner 7as in +resh pursuit $per the .usto o+ the +ishing industry'. o 4hen v. 6i.h! $@ist. )t.! -ass. /00/'! 001 o >a.tsNPro.1 4hen shot and 8illed a 7hale and le+t it to sur+a.e on the 2ea.h. Bhe .usto o+ the ti e 7as +or the +inder o+ a 7hale to re.eive a salvage +ee +or noti+ying to7n o++i.ials! 7ho noti+ied the 8iller! 7ho as the assigned o7ner 2e.ause a lan.e 7ith his ar8 on it 7as +ound in the 7hale had the right to re ove the 2lu22er and a8e a pro+it on it. 3llis! apparently ignorant o+ the .usto and ignorant o+ the +a.t that 4<s harpoon had 8illed the 7hale! au.tioned the 7hale! 7hi.h 7as sold to 6i.h. J +or P $4hen'. @a ages1 ar8et value o+ oil o2tained +ro the 7hale! less the .ost o+ trying it out and preparing it +or ar8et. o 6easoning1 Pre.edent1 o JSpragueK in Taber v. Jenny held that 7hen a 7hale 7as 8illed! it 2e.o es the property o+ its .aptors a+ter it has 2een an.hored and le+t 7ith ar8s o+ appropriation. IJ(Kll 7as done 7hi.h 7as then pra.ti.a2le in order to se.ure it.L o J:o7ellK in Bartlett v. Budd1 +irst possession esta2lishes property rights! even i+ the 7hale later 2e.o es unan.hored.

J:o7ellK in Swift v. Gifford $re+erred to JSpragueK in Bourne v. Ashley'1 lo.al .usto held that the +irst iron $harpoon' in the 7hale esta2lished possession! 7hether or not the iron re ained atta.hed. Bhe .usto is Ione o+ very li ited appli.ation. Bhe 7hale +ishery is the only 2ran.h o+ industry o+ any i portan.e in 7hi.h it is li8ely to 2e u.h usedM and i+ a usage Jor .usto K is +ound to prevail generally in that 2usiness! it 7ill not 2e open to the o2?e.tion that it is li8ely to distur2 the general understanding o+ an8ind 2y the interposition o+ an ar2itrary eA.eption.L ,n the sa e 7ay! the .usto invo8ed in 4hen is IeAtre ely li itedL in s.ope and I.an a++e.t 2ut a +e7 persons.L >urther ore! it has I2een re.ogniDed and a.5uies.ed in +or any years.L ,n.entive .onsideration i+ this .usto 7ere not in pla.e! Ithis 2ran.h o+ industry ust ne.essarily .ease! +or no person 7ould engage in it i+ the +ruits o+ his la2or .ould 2e appropriated 2y any .han.e +inder.L o When should 7e +ollo7 .usto and 7hyQ )onsider 7hat eAternalities result. Per 6o2ert 3lli.8son $9/n/'! .lose*8nit groups 7ill devise and en+or.e nor s a ong the selves that aAi iDe their 7ealth 2ut ay .ause un.o pensated har to outsiders $outgroup eAternalities'. )onsider the reasoning 2ehind the .usto "iAon argued that he should 2e .o pensated +or the ta8ing o+ his Watergate papers! 2ased upon 4hen v. 6i.h. Other possi2le rules1 o ;nitiDation )ounty residents de.ide as a group ho7 to a..ess a resour.e! su.h as oil. Bhis in.entives .ooperative a.tion! 7hi.h 7ill result in a larger pie and greater return +or all. o Provide salvage +ees to +inders. o Split the di++eren.e! as in Popov $2elo7'. o @istur2an.e o+ another<s right to livelihood ay in.ur lia2ility i+ doing so is outside the s.ope o+ +urthering one<s o7n livelihood. @u.8 .ase1 9ee2le v. Hi.8eringill! 3ng. $/707'! 9%1 o >a.tsNPro.1 P $9ee2le' o7ned property .alled -inott<s -eado7! 7hi.h .ontained a pond out+itted 7ith nets and .hannels in a anner used to .at.h large nu 2ers o+ .o er.ially via2le du.8s. Bhis type o+ pond served as a sort o+ Tdu.8 trapT and 7as 8no7n as a de.oy! unli8e odern du.8 de.oys! 7hi.h are erely +a8e du.8s used to 2eguile the so.ial 2ird. On three o..asions! @ $Hi.8eringill'! 7hile on his o7n land! dis.harged +irear s to7ard 9ee2leUs pond in order to s.are a7ay the du.8s. J +or P. (<d. o 6easoning1 JHoltK1 IJ3Kvery an that hath a property ay e ploy it +or his pleasure and pro+itSL IJWKhen a an useth his art or his s8ill to ta8e the ! to sell and dispose o+ +or his pro+itM this is his tradeM and he that hinders another in his trade or livelihood is lia2le to an a.tion +or so hindering hi .L 3A.eption1 inter+ering 7ith another<s livelihood 2y la7+ully esta2lishing one<s o7n 2usiness in .o petition. o "otes1 Pierson v. Post .hara.teriDed the reasoning +or Keeble as 2ased upon ratione soli. Ho7ever! this version indi.ates that the opinion did not hold that P had possessionM rather the de.ision 7as 2ased upon distur2an.e. ( si ilar de.ision in Carrington v. Taylor involving du.8s driven +ro P<s de.oy 2y @<s I7ill+ul distur2an.eL 7hen @ deli2erately shot at the 2irds. o ,+ the .ourt in Pierson had the ore Ia..urateL re.ord! 7ould the result have 2een the sa eQ (rgu ents1 o the +a.ts are di++erent $du.8s are not +oAes'! o the poli.ies are di++erent $7ant to 8ill +oAes +or sport or eradi.ationM 8ill du.8s +or pro+it'! o the resulting in.entive stru.ture is di++erent! o the legal issues are di++erent $Post 7as see8ing the +oA +or hi sel+ 2ut Hi.8eringill 7as only trying to s.are a7ay the du.8s' Bhe a?ority in Keeble eApli.itly loo8ed at poli.y .onsiderations! as opposed to the a?ority in Pierson. %. :ost or (2andoned Property
o

o Sun8en treasure .ase1 3ads v. BraDelton! (r8. $/06/'! /0%1

>a.tsNPro.1 BraDelton $P' +ound a sun8en ship and ar8ed its lo.ation. Be+ore he .ould retrieve any o+ the 7re.8age! though! 3ads G "elson $@s' 2egan to re.over it. Bhe re.ord does not indi.ate that @s used P<s signals to +ind the 7re.8age. J +or @s. 6easoning1 o P had not ta8en possession o+ the sun8en ship a..ording to its nature and situation 2N. he had no eans to raise the treasure. o >inder 7ould have to eAer.ise due diligen.e to aintain a property right! re1 pedis possessio $/07 and ining rights! 2elo7 under I@is.overyL'. )lass notes1 o ,nterloper<s argu ent1 ,+ our goal is to get the goods to ar8et! ho7 does allo7ing the +inder a property right +urther that goalQ o >inder<s argu ent1 @on<t 7ant to disin.entiviDe people +ro +inding valua2le 7re.8age. )ounter )ould grant +inder a salvage +ee to .o pensate. o ,n.onsistent 7ith Keeble 2N. the nature o+ the invest ent in this .ase! a relatively large invest ent did not prote.t the loser<s property interest. o Ho erun 2all .ase1 Popov v. Hayashi! San >ran.is.o $%00%'! /001 >a.ts1 Base2alls are generally .onsidered property o+ the ho e tea . ,+ a 2all leaves the +ield! though! it is .onsidered to 2e a2andoned. ,n %00/! Barry Bonds< 7&rd ho e run 2all hit Popov<s glove 2e+ore P +ell to the ground and 7as o22ed 2y other 2ystanders. (t so e point 2e+ore or during a s.u++le that ensued! the 2all 2e.a e loose. Hayashi! 7ho 7as not part o+ the o2! re.overed the 2all. P sued H. Bhe .ourt de.reed +or the 2all to 2e sold and the pro.eeds to 2e split a ong P and H. 6easoning1 o P had esta2lished a pre*possessory interest and should have 2een allo7ed to .at.h the 2all 7No inter+eren.e. o H 7as not involved in the o2 that inter+ered 7ith P<s .at.hing and 7as the +irst to una 2iguously esta2lish possession o+ the 2all. o P and H have e5ual .lai s against ea.h other and superior .lai s against all the 7orld. )lass notes1 @id Popov possess the 2all in the sa e 7ay as PiersonQ Bhe video and eye7itness testi ony is un.lear. ,t .an<t de.ide on the 2asis o+ the rule o+ .apture! so it held that he had a right to 2e +ree +ro inter+eren.e in his atte pt to .at.h the 2all $redu.ing the re.ourse to his use'. ,s this .onsistent 7ith the prior .asesQ Why are 7e using property la7 instead o+ .ri inal or other la7 to regulate 2ehaviorQ Ho7 do 7e dra7 the line 2et7een 7rong+ul inter+eren.e and inter+eren.e 2y .o petitionQ (nd 7hy should 7e do that through property la7Q &. @e setD! Toward a Theory of Property ights $/967'! %9% o P@e+initions1 3Aternalities1 eAternal .osts and eAternal 2ene+its! 2oth pe.uniaryN onetary as 7ell as nonpe.uniary. $eAa ples1 putting up +en.es! onitoring property! eA.luding others +ro land! pursuing legal a.tion against trespassers! et..' ,nternaliDing1 a pro.ess that ena2les eAternalities to 2e +elt $to a greater degree' 2y all intera.ting persons. Bhe .ost o+ internaliDing ust 2e eA.eeded 2y the gain to a8e it e++i.ient.R o ( syste o+ private property is .reated 7hen a resour.e 2e.o es su++i.iently*valua2le and it 2e.o es .ost* e++e.tive to use property rights to +or.e internaliDation o+ eAternalities. $7ealth* aAi iDing'. $"ote that de.reases in .osts to ena.t and en+or.e a property rights s.he e su.h as redu.ed .osts +or +en.ing .an lead to private property! regardless o+ 7hether or not the value o+ the resour.e has .hanged.' o IProperty rights are an instru ent o+ so.iety and derive their signi+i.an.e +ro the +a.t that they help a an +or those eApe.tations 7hi.h he .an reasona2ly hold in his dealings 7ith others. S (n o7ner eApe.ts the .o unity to prevent others +ro inter+ering 7ith his a.tions! provided that these a.tions are not prohi2ited in the spe.i+i.ations o+ his rights.L 6e.ogniDing that Iproperty rights spe.i+y ho7 persons ay 2e 2ene+ited and har ed S leads easily to the .lose relationship 2et7een property rights and eAternalities S So e person or persons al7ays su++er or en?oy these e++e.ts.L o Hypo1 Syste 7here /00 e 2ers o+ a group have a right to +ish in a parti.ular la8e to the eA.lusion o+ others $ a8es it .o unal property! not open a..ess'. ,+ one e 2er V ta8es a +ish! 7hat does he have .o pared to 7hat he had 2e+oreQ ( +ish. What has he lostQ His eApended e++orts and /N/00th o+ the +ish in

the pond. So! .learly! he has gained ore. What i+ no ar8et eAists +or the +ish outside o+ the .o unityQ V 7ould not li8ely ta8e ore +ish than he needs +or su2sisten.e. What i+ a signi+i.ant ar8et developsQ V 7ould ta8e ore +ish 2N. his losses 7ould 2e negligi2le .o pared to his gains. Others in the .o unity 7ould do the sa e! and over*+ishing 7ould result. Why 7ould the .o unity loseQ Bhey re.eived oney! 2ut the overall utility 7as de.reased .o pared to i+ +ish had 2een le+t in. Why 7ouldn<t e 2ers o+ the .o unity have gotten together to a8e an arrange ent to li it the +ishingQ 3ven i+ su.h a syste 7ere developed! it 7ould re5uire onitoring due to the ina2ility to restrain others 7ho have individual sel+* interest that ay .on+li.t 7ith the group*interest! and onitoring is eApensive. o 3Aa ples1 3leanor :ea.o.8<s study o+ the -ontagnes near Eue2e. $%94' +ound that the develop ent o+ private property rights in land o..urred alongside the develop ent o+ the .o er.ial +ur trade. o Prior to the esta2lish ent o+ the +ur trade! hunting 7as pri arily +or the purpose o+ +ood and a s all a ount o+ +urs +or ea.h hunter<s +a ilyM thus! the eAternalities o+ hunting 7ere relatively s all. o (+ter the value o+ +urs in.reased due to trade! the s.ale o+ hunting also in.reased! thus in.reasing the eAternalities. (round this ti e! +a ilies 2egan to develop a property syste o+ territorial hunting and trapping arrange ents. )ontrast the situation 7ith the ,ndians o+ the south7estern plain $%96' 7ho did not esta2lish a private property regi e to the eAtent that +ur*hunters did1 o "o plains ani als 7ere o+ .o er.ial i portan.e .o para2le to the +ur*2earing ani als o+ the +orest $until 3uropeans 2rought .attle'! and o (ni als o+ the plains 7ere pri arily graDing ani als 7ho 7andered over 7ide eApanses o+ land. o Bhus! the .ost o+ esta2lishing territorial 2oundaries 7as relatively high .o pared to the .o er.ial trade value o+ the ani als in the region. ,+ an in.rease in the value o+ an asset .o pared to the .ost o+ esta2lishing and aintaining property rights should lead to the esta2lish ent o+ private property! should a de.rease in the value .o pared to the .ost lead to the redu.tion or loss o+ property rights $%97'Q o (nderson and Hill do.u ent that as land and ani als in.reased and then de.reased in value in the nineteenth*.entury ( eri.an West! property rights regarding the land and ani als 2e.a e .orrespondingly ore and then less arti.ulated. (s the value o+ 2eaver pelts has de.reased! un.lai ed 2eavers have proli+erated in -anito2a Ito the point 7here they are o+ten .onsidered pestsSL o @e setD argues that govern ent 7ill have to .reate the property syste 2e.ause people 7ill not 2e a2le to agree upon the syste . )riti.is s o+ @e setD1 o He re+ers to a syste o+ .o unal property 2ut treats it as open a..ess. o He a.8no7ledges that there are .osts to +or ing agree ent! 2ut he dis isses those .osts. o He says that govern ent is needed to ena.t private property rights syste ! 2ut i+ a group .an agree upon a govern ent and every2ody 7ill 2e 2etter o++ under a private property syste ! 7hy .an they not agree upon an allo.ation syste Q So e possi2le eAplanations1 @istri2utional disparities $see ,BEs .ase 2elo7' Bransa.tional .osts o "eed a..urate in+or ation to rea.h and en+or.e agree ent o -eeting pla.eNti eNstru.ture o Have to rea.h agree ent >ree*riders spend little or nothing to a.hieve agree ent 2ut 2ene+it nonetheless! 7hile Hold*outs 8eep agree ent +ro 2eing rea.hed and Ihold outL +or in.reased .o pensation in return +or their .on.ession to the agree ent. o (gree ent has to 2e e orialiDed in order to 2e en+or.ea2le o Syste has to 2e onitored and en+or.ed o Prior agree ents! su.h as Doning rules! ay li it or 2ar .ertain transa.tions. 3A1 "#; had to agree to an I3dgar (llen PoeL roo 7ith e entos related to the author in order to 2uild one o+ its s.hool 2uildings. Bhis is an ine++i.ient solution that 7as ade ne.essary 2y a property right. 4. Open (..ess and the )o ons I;no7ned PropertyL

o 4enerally $9='1
Open a..ess o ,nvolves +ree entry 7here theoreti.ally anyone .an use the resour.eM o ;sers have neither the rights nor u.h in.entive to anage the resour.e or invest in i proving itM o (sso.iated 7ith depletion and disinvest ent due to Ino7*or*neverL attitude. )o on property regi es o ,nvolve rules and en+or.e ent e.hanis s that regulate eA.lusion and $internal' governan.eM o ;sers 7ith eA.lusive rights have in.entive to anage and i prove the resour.e! provided the .ost o+ doing so is out7eighed 2y its 2ene+itsM ,ndividual Brans+era2le Euotas ,BEs .ase1 (llian.e (gainst ,>Es v. Bro7n! 9th )ir. $/996'! //%71 @e onstrates the di++i.ulty o+ rea.hing agree ent over private property syste 7hen i position o+ any syste has disproportionate distri2utional e++e.ts. >a.tsNPro.1 Ps $(llian.e (gainst ,>Es' +iled suit to .hallenge +ederal regulations that the Se.retary o+ )o er.e pro ulgated under authority o+ the -agnuson (.t! 7hi.h provided +or ,BEs .alled ,>Es $individual +ishing 5uotas' 2ut only +or those 7ho had +ished during a .ertain ti e period $/900*/99/'. Ps represented prospe.tive +isher en 7ho 7ere eA.luded due to the regulatory s.he e! 7hi.h li ited a..ess to sa2le+ish and hali2ut +isheries in the 4ul+ o+ (las8a! the Bering Sea! and areas surrounding the (leutian ,slands. J +or @. (<d. Holding1 Bhe 6egulatory s.he e is allo7ed 7hen the ad inistrator has .onsidered the relevant +a.tors and arti.ulated a rational .onne.tion 2et7een the +a.ts +ound and the .hoi.e o+ regulation. !ashington Crab Produ"ers# $n". v. %osba"her $9th )ir. /990'. 6easoning1 o Pierson v. Post esta2lished that a +isher an has to .at.h a +ish +irst in order to esta2lish title. Bhis in.entiviDes +isher en to over+ish $+ish as +ast and as u.h as possi2le'. IBhe result is lo7er pro+its +or the too any +isher en investing in too u.h to .at.h too +e7 +ish.L $Berry (nderson and @onald :eal! &ree %ar'et (nvironmentalism! /99/'. )ongress passed the -agnuson (.t to prevent over+ishing! re2uild over+ished sto.8s! ensure .onservation! and realiDe the +ull potential o+ the .ountry<s +ishing resour.es. o While so e o+ the Se.retaryUs de.isions did push the Tli its o+ reasona2leness!T they 7ere not ar2itrary and .apri.ious. o IWe .annot su2stitute our ?udg ent o+ 7hat ight 2e a 2etter regulatory s.he e! or overturn a regulation 2e.ause 7e disagree 7ith it! i+ the Se.retary<s reasons +or adopting it 7ere not ar2itrary and .apri.ious.L Alas'a &a"tory Trawler Ass)n v. Baldridge! 9th )ir. $/907'! //&%. "otes1 o :egislative response to ,BE syste 1 ;pon re*authoriDation o+ the -agnuson*Stevens (.t in /996! a oratoriu 7as esta2lished on the .reation o+ ne7 ,BEs under the (.t until at least %000 $later rene7ed until %00%'. o Other possi2le regulatory s.he es1 >irst*in*ti e 7ith shortened +ishing seasons Ito allo7 +ish to es.ape and reprodu.e.L (llo.ation o+ 5uota shares .ould have 2een 2ased upon ore re.ent years. Euota shares .ould have 2een allo.ated to all +isher en! in.luding .re7! Iso that the nono7ning +isher en 7ould have so ething valua2le to sell to vessel o7ners.L o (..ording to @e setD< theory! 7hen the rule o+ .apture leads to eAternalities and the value o+ +ish in.reases! a private property syste should result. (round the 7orld! adoption o+ private property rights has 2een sporadi.! though. Why 7ould this 2eQ Pro+. Wy an! //&41 o Botto *up pro.ess +or a..eptan.e a8es it di++i.ult +or a heterogenous group to .o e to .onsensus. $,n .ases 7here a distin.t su2group has +inan.ial and politi.al resour.es! though! heterogenaiety is not ne.essarily as u.h o+ a 2arrier.' o 3ssentially an anti*.o ons eAists in the ;.S. due to the prevalen.e o+ ?udi.ial and legislative points in the pro.ess 7here regulation itsel+ has 2e.o e a Itragedy o+ the .o ons.L o Bhe transa.tional .osts are less in )anada or (ustralia 7here a private property syste has 2een i ple ented. o PPs< argu ents1 Bhe rule violated /6 ;.S.). W/0=& $2'$6'$(' 2e.ause it did not ta8e into a..ount present parti.ipation.

Statute1 W/0=& I)ontents o+ +ishery anage ent plansL )ongress esta2lished that any regulatory s.he e pro ulgated 2y the Se.retary ay! on a dis.retionary 2asis1 $2'S $6' esta2lish a syste +or li iting a..ess to the +ishery in order to a.hieve opti u yield i+! in developing su.h syste ! the )oun.il and the Se.retary ta8e into a..ount o $(' present parti"ipation in the fishery! o $B' histori.al +ishing pra.ti.es in! and dependen.e on! the +ishery! o $)' the e.ono i.s o+ the +ishery! o $@' the .apa2ility o+ +ishing vessels used in the +ishery to engage in other +isheries! o $3' the .ultural and so.ial +ra e7or8 relevant to the +ishery! and o $>' any other relevant .onsiderationsS o )ourt<s response1 ( ne.essary delay 2et7een +or ulation o+ the plan and i ple entation ensuedM i+ the years 2et7een +or ulation and i ple entation 7ere ta8en into a..ount! +ishers .ould tailor their pra.ti.es to +all under the pending rules Ieven though that 7ould have eAa.er2ated over.apa.ity and ade no e.ono i. sense independently o+ the regulatory 2ene+it.L )ongress did not de+ine IpresentL and it should not Iprudently 2e .onte poraneous 7ith the pro ulgation o+ the +inal regulations.L (llo.ating the ,>Es to 2oat o7ners and lessees o+ 2oats! to the eA.lusion o+ .re7 e 2ers! violated the I+air and e5uita2le standardL o+ /6 ;.S.). W/0=/ I"ational standards +or +ishery .onservation and anage ent.L o Statute1 Bhe statute states that allo.ation o+ +ishing privileges! i+ ne.essary! shall 2e I+air and e5uita2le to all su.h Jvarious ;nited StatesK +isher enSL. /0=/$a'$4'$('. o )ourt<s response1 (..ording to the re.ord! the Se.retary 7eighed the .osts and 2ene+its o+ potentially*.on+li.ting standards and eAplained ho7 a 2alan.e 7as deter ined. IBhe )oun.il<s rationale +or this parti.ular allo.ation is that vessel o7ners and lease holders are the parti.ipants 7ho supply the eans to harvest +ish! su++er the +inan.ial and lia2ility ris8s to do so! and dire.t the +ishing operations.LR Bhe Pro2le o+ the (nti*.o ons Boo any people have a right to get involved in the disposition o+ a resour.e and .an 2lo.8 a..ess to the resour.e. 3A1 >ourteen people have a patent over an aspe.t o+ a parti.ular phar a.euti.al pro.ess. Hold*outs 7ill result 7hen the drug ar8eter needs all /4 to agree on .o pensation.
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B. Original (.5uisition o+ Property 2y @is.overy $//0' Bhe @is.overy @o.trine o 3uropean nations assu ed +ree title $do inion' to lands they Idis.overed.L "ative peoples on those lands! a..ording to this do.trine! retained the right o+ o..upan.y $li8e tenants in an apart ent 2uilding'! 2ut had never really 2een .onsidered Io7nersL o+ the land. o Bhe do.trine esta2lished a restri.tion on aliena2ility $trans+era2ility' o+ the "ative ( eri.an tri2es< o..upan.y rights! 7hi.h eant that tri2es .ould sell their li ited rights o+ o..upan.y only to the dis.overing sovereign $or its assignee'. o ,ndian land .ase1 Johnson v. -<,ntosh! ;.S. $/0%&'! //0 >a.tsNPro.1 Bho as Johnson 2ought land +ro Pian8esha7 ,ndian tri2es in /77& and /77=. Bhe de+endant! Willia -<,ntosh $pronoun.ed I-.,ntoshL'! su2se5uently o2tained a land patent to this sa e land +ro the ;nited States +ederal govern ent. Bhe plainti++s 7ere lessees o+ Bho as JohnsonUs des.endants! 7ho had inherited the land! and they 2rought an a.tion +or e?e.t ent $essentially to 5uiet title' against de+endant -<,ntosh in the ,llinois @istri.t )ourt! .ontending that the land 2elonged to the 2y virtue o+ Bho as JohnsonUs pur.hases in /77& and /77=. Ps +urther .ontended that their title 7as superior to @s< title 2e.ause Ps< title ran dire.tly +ro "ative ( eri.ans. Bhe distri.t .ourt held that de+endant -<,ntosh<s .lai 7as superior on the grounds that the Pian8esha7 7ere not a2le to a.tually .onvey the land 2e.ause they never Io7nedL it in the legal sense o+ the 7ord. J +or @. (++ir ed. Holding1 Bhe "ative ( eri.ans did not have the a2ility to sell the land to Johnson! so his title 7as not upheld. 6easoning1 J-arshallK1

/0

IBhe potentates J$rulers unrestrained 2y la7'K o+ the old 7orld +ound no di++i.ulty in .onvin.ing the selves that they ade a ple .o pensation to the inha2itants o+ the ne7! 2y 2esto7ing on the .iviliDation and )hristianity.L o Bo esta2lish property rights to the eA.lusion o+ other potential dis.overing nations! a rule 7as set +orth that gave a2solute title to the initial $3uropean' dis.overer. o When 3ngland! a+ter a Ilong and 2loody 7ar!L .eded lands in the "e7 World 7est o+ the -ississippi 6iver to >ran.e! it Ihas never 2een supposed that she J$3ngland'K surrendered nothing! although she 7as not in a.tual possession o+ a +oot o+ land. She surrendered all right to a.5uire the .ountryM and any atte pt to pur.hase it +ro the ,ndians! 7ould have 2een .onsidered and treated as an invasion o+ the territories o+ >ran.e.L o I(ll our J( eri.anK institutions re.ognise Jsi.K the a2solute title o+ the .ro7n J$the +ederal govern ent'K! su2?e.t only to the ,ndian right o+ o..upan.y! and re.ognise the a2solute title o+ the .ro7n to eAtinguish that right. S ,t is not +or the )ourts o+ this .ountry to 5uestion the validity o+ this title! or to sustain one 7hi.h is in.o pati2le 7ith it.L $//4'. o IBhat la7 7hi.h regulates! and ought to regulate in general! the relations 2et7een the .on5ueror and .on5uered! 7as in.apa2le o+ appli.ation to a people under su.h .ir.u stan.es. Bhe resort to so e ne7 and di++erent rule! 2etter adapted to the a.tual state o+ things! 7as unavoida2le.L o Stare de.isis1 IHo7ever eAtravagant Jthis ruleK S ay appearM i+ the prin.iple has 2een asserted in the +irst instan.e! and a+ter7ards sustainedM i+ a .ountry has 2een a.5uired and held under itM i+ the property o+ the great ass o+ the .o unity originates in it! it 2e.o es the la7 o+ the land! and .annot 2e 5uestioned.L "otes1 o :ater .ase! Tee*+it*Ton $ndians v. ,nited States! ;.S. /9==! p/%0n91 )ongress .an ta8e ,ndian lands 7No .o pensation. )lass "otes1 o ,+ -<,ntosh 7ent to the land and +ound it 7as o..upied 2y "ative ( eri.ans! .ould he evi.t the 2y +or.e or pay the o++! given his titleQ Only the ;.S. 4overn ent! the .on5ueror! has the right to odi+y or eAtinguish the o..upan.y rights o+ the "ative ( eri.ans. (lthough /79= treaties 2et7een the ,llinois and Pian8esha7 tri2es and the ;.S. .eded to the +ederal govern ent! 7ith the eA.eption o+ .ertain lands as reservations! lands they had previously o..upiedM the "ative ( eri.ans ay have retained o..upan.y rights to lands that they no longer had title to. o Other argu ents1 Bhe "ative ( eri.ans< use o+ the land did not su++i.e to a..ord the o7nership rights $per (nglo*SaAon standards'. o -arshall +ra es the 5uestion as * )an the .on5uered peoples trans it any interests in the land other than 7hat the .on5ueror has 2e5ueathed upon the su.h that the .ourts o+ the .on5ueror 7ill re.ogniDe those rights. He did this 2e.ause his vie7 7as that the ?udi.iary is institutionally* in.o petent to go against the ;.S. 4overn ent ho7 .ould the ?udi.iary en+or.e a di++erent ruleQ thousands o+ people have 2uilt their lives around an in?usti.e that! i+ undone! 7ould .ause in?usti.e itsel+. i+ the .itiDens disli8e the .urrent rule! it is up to the ! not the .ourt! to overturn the rule via the legislature. o -arshall atte pted to itigate the harshness o+ the de.isions 2y only .on.eding that the ;.S. a.5uired title 2y .on5uer and did not ne.essarily eAtinguish the o..upan.y rights o+ the "ative ( eri.ans. o :i8e the pra.ti.e o+ rent .ontrol! even though a person ay a.5uire title to a property does not allo7 that person to inter+ere 7ith the o..upan.y rights o+ "ative ( eri.ansM only the ;.S. .an eAtinguish those rights. So! the 5uestion o+ the govern ent<s interest in the land re ains open. o Bhe "ative ( eri.ans .ould also argue that they do not +it the des.ription given 2y -arshall as to the reasoning +or 7hy they 7ere not allo7ed to aintain ore property rights! as had histori.ally 2een allo7ed +or other peoples 7ho 7ere reportedly less I+ier.eL and I7arli8eL and ore open to 2eing assi ilated. o -oral .lai issue1 One attorney argued that the "ative ( eri.ans did not IuseL the property in the 7ay that usually .on+ers property rights per the 7ay in 7hi.h 3uropeans use the land. :and 4rants G the >ederal Pu2li. @o ain $Paul 4ates'1 Bhe $at*ti es*.on+li.ting' purposes o+ +ederal land grant poli.ies $/%7'1 o O2tain revenue to pay o++ 7ar de2ts!
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Pro ote rapid develop ent o+ the interior o+ the .ontinent! and (void san.tioning either Ispe.ulatorsL or Is5uatters.L S5uatters< rights1 o ,n the .olonial era! s5uatters 7ere so prevalent in so e areas that Cirginia and "orth )arolina even ena.ted la7s allo7ing s5uatters a right o+ Ipree ption!L 7here2y they had the option to pur.hase land they o..upied prior to a sale or au.tion. $/%4'. o Bhe Pree ption (.t o+ /04/ granted a general prospe.tive pree ption right on +ederal land! provided that ,ndian title had 2een eAtinguished and the land had 2een surveyed. Prospe.tive 2uyers also used anti*.o petitive pra.ti.es! su.h as 2ri2ing other prospe.tive 2uyers! to o2tain +ederal lands at au.tion. $/%='. Ho estead (.t o+ /06%1 allo7ed +or any .itiDen to Igo 7est7ardL and .lai /60 a.res o+ unsold surveyed +ederal land. By inha2iting and .ultivating the land +or +ive years! the .itiDen .ould o2tain title 7ithout any pay ent other than +iling +ees. :ater a.ts authoriDed larger .lai s o+ up to 640 a.res. -ining 6ights $4ary :i2e.ap! Contra"ting for Property ights! /909'! /%01 /040 * Ore dis.overies at Sutter )ree8! )ali+. "o rules esta2lished at +irst. -ining .a ps held eetings to esta2lish order. 6easons +or the rapid esta2lish ent o+ ining rights1 o 4ains1 3Ape.ted aggregate gains +ro the esta2lish ent o+ private property rights $less violen.e! ore .ertainty o+ title! and invest ent in ore*.apital*intense ining' 7ere large. o -a8e*up1 Bhe nu 2er o+ .ontra.ting parties 7as relatively s all perhaps %0 or &0 individuals in an early ining .a p. Bhe groups 7ere relatively ho ogenous in regard to ra.e! .ulture! s8ill! and te.hnology so that they had si ilar eAperien.es and eApe.tations regarding legal institutions and private o7nership. Bhe relative a2sen.e o+ vested non* ining interests eant that state legislatures and .ourts did not have to 2e very .on.erned a2out distri2utional .osts outside o+ the ining .o unity. o :a.8 o+ I.riti.al in+or ational asy etriesL $/&0<D'1 ,n+or ation regarding land values 7as relatively evenly*spread a ong the .ontra.ting parties. Ore 2odies 7ere stationery and their value .ould 2e esti ated relatively +airly. o -ost o+ the .ontra.ting parties eApe.ted to share in the gains +ro esta2lishing property rights 2e.ause the value o+ ore deposits 7as 2elieved to 2e large relative to the nu 2er o+ .lai ants and a politi.al .onsensus eAisted that +ederal land should 2e distri2uted 5ui.8ly and at lo7 .ost to individuals on an egalitarian 2asis. $"ote that un7or8ed ining .lai s 7ere generally .onsidered to 2e a2andoned and open +or other .lai ants! per the do.trine o+ pedis possessio! 7hi.h grants eA.lusive rights only to so eone 7ho is eAploring diligently and in good +aith +or inerals $/07'.' >ederal 6esponse1 o (t +irst! )ongress eAperi ented 7ith the poli.y o+ aintaining the +ederal govern ent<s title to ineral lands and leasing the lands to prospe.tors. o High en+or.e ent .osts! ho7ever! led to the in.orporation o+ private rights. o -ining .a p rules that distri2uted private o7nership 7ere later in.orporated into the +ederal -ining :a7s o+ /066 $/&&'1 Se.tion / dropped any re5uire ents +or +ederal royalty re5uire ents and opened +ederal ineral lands to private .lai ing. Se.tions % and & spe.i+ied the pro.edures 2y 7hi.h individuals .ould o2tain title. o Bhe -ining :a7 o+ /07% re ains in e++e.t +or patenting private hard ro.8 ineral .lai s on +ederal land.
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). Original (.5uisition o+ Property 2y )reation $/&4' /. )opyright and Patents Ba.8ground o (rti.le ,. W01 IBhe )ongress shall have po7er ... Bo pro ote the progress o+ s.ien.e and use+ul arts! 2y se.uring +or li ited ti es to authors and inventors the eA.lusive right to their respe.tive 7ritings and dis.overiesL

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Bhe I+air useL de+ense against in+ringe ent $/7 ;.S.). /07' allo7s +or +ree use o+ eApression in .opyrighted aterial under .ertain .ir.u stan.es1 o Purposed*2ased +a.tors1 Ipurposes su.h as .riti.is ! .o ent! ne7s reporting! tea.hing $in.luding ultiple .opies +or .lassroo use'! s.holarship! or resear.hL o ;se*2ased +a.tors1 I$/' the purpose and .hara.ter o+ the use! in.luding 7hether su.h use is o+ a .o er.ial nature or is +or nonpro+it edu.ational purposesM $%' the nature o+ the .opyrighted 7or8M $&' the a ount and su2stantiality o+ the portion used in relation to the .opyrighted 7or8 as a 7holeM and $4' the e++e.t o+ the use upon the potential ar8et +or or value o+ the .opyrighted 7or8.L )opyright prote.tion gives the holder a right to eA.lude others +ro 7ritten 7or8 7ithin a .ertain $i' s.ope and $ii' ter $ti e li it'. History $:essig! /00='1 /790 /st ;.S. .opyright la7 /4 year ter s! aAi u %0 years upon rene7al. /0&/ /st ter dou2led to %0 years. /990 +ollo7ing a trend o+ eAtending ter s! the Sonny Bono )opyright Ber 3Atension (.t ena2led 9=*year ter s. o I( eri.an la7 no longer had an auto ati. 7ay to assure that 7or8s that 7ere no longer J.o er.iallyK eAploited passed into the pu2li. do ain.L ,n /97&! the average .opyright ter 7as &% yearsM no7 triple that! ?ust thirty years later. Poli.y .onsiderations o+ patents and .opyrights ter *li ited to in.entiviDe inventors and .reators to dis.over ne7 inventions and .reate ne7 7or8s o+ eApression 7hile also not granting a onopoly that unduly inter+eres 7ith the +lo7 o+ in+or ation availa2le to the pu2li.! 7hi.h allo7s others to .reate and develop. Purpose o+ .opyright and patent la71 3n.ourageNin.entiviDe .reators! re7ard la2or! and en.ourage autono y 2alan.ed 7ith the .ost to the pu2li. at large $2y dis.ouraging other .reation or i posing .osts upon others to identi+y! see8 per ission +ro ! or other7ise negotiate 7ith the property right holder'. ,n regard to previously*.reated 7or8s! the la7 serves to en.ourage their ongoing .o er.ialiDation. (rgu ent in +avor o+ property rights1 o I<J)Kopyright la7 "elebrates the pro+it otive! re.ogniDing that the in.entive to pro+it +ro the eAploitation o+ .opyrights 7ill redound J$.ontri2ute'K to the pu2li. 2ene+it 2y resulting in the proli+eration o+ 8no7ledgeS< J5uoting Am. Geophysi"al ,nion v. Te-a"o $n".K S .opyright la7 serves pu2li. ends 2y providing individuals 7ith an in.entive to pursue private onesSL (ldred v. Ash"roft! /094+n/0. o IJ)Kopyright<s purpose is to promote the .reation and pu2li.ation o+ +ree eApression.L $d. /096* /8. >urther! /7 ;.S.). W /0%$2' notes that .opyright prote.tion does not eAtend to Iany idea S JorK prin.iple S e 2odied in su.h 7or8.L I@ue to this distin.tion! every idea! theory! and +a.t in a .opyrighted 7or8 2e.o es instantly availa2le +or pu2li. eAploitation at the o ent o+ pu2li.ation.L (ldred. /096<%D. o Bhe I+air useL eA.eption allo7s +or +ree use o+ .opyrighted aterial under .ertain .ir.u stan.es. (rgu ent against property rights +or in+or ation and in +avor o+ a I)reative )o onsL1 o Be.ause in+or ation is Inonrival!L it .an 2e .onsu ed at no eAtra arginal .ost to its produ.er. ,+ 7e are .on.erned only 7ith the e++i.ient allo.ation o+ in+or ation and not the provision o+ in.entives +or its produ.tion! then! the pri.e +or utiliDing in+or ation should 2e O0. $/000n%'. o 3ven i+ so eone 7ants to use aterial +or a +air use! i+ that aterial is not availa2le in a data2ase or li2rary due to .opyright .osts! the person 7ill e++e.tively 2e prohi2ited +ro using the aterial. $Breyer<s dissent in (ldred! //0/</'. (rgu ents against eAtending property rights to previously*.reated 7or8s1 o /' 6etroa.tively eAtending prote.tion on eAisting .opyrights .annot possi2ly en.ourage their .reation. 6esponse1 )reators ay have relied on the assu ption that rights 7ould 2e eAtended! as they have histori.ally 2een. (lso! eAtending rights 7ill en.ourage .reators and .opyright holders to invest in aintaining a 7or8<s via2ility and en.ourage people to invest in ar8eting re* dis.overed I+orgottenL aterial $the prospe.t theory! /09&'! thus +urthering .o er.ial interests.

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%' @ue to the dis.ount rate! the value o+ in.re ental royalties is negligi2le. >urther ore! ost 7or8s 7ill not aintain u.h value over ti e any7ay su.h that no one is see8ing to .o er.ialiDe the . $Ho7 any -i.8ey -ouse<s are thereQ' o &' 3Atending .opyrights retroa.tively is un.onstitutional 2e.ause doing so does not adhere to the )onstitutional teAt 7hi.h re5uires Ili itedL .opyright prote.tion. JBhis argu ent is not i portant +or our purposes.K o 4' Bhe :egislature a.ted irrationally. 6esponse1 6ational 2ases .an 2e .on.eived that 7ould have otivated the retroa.tive eAtension o+ .opyright prote.tion. o 3Atending prote.tion to previously .reated 7or8s1 )ongress has the authority to eAtend retroa.tively the duration o+ eAisting .opyrights! pla.ing the in parity to +uture .opyrights. )opyright1 3ldred v. (sh.ro+t! ;.S. $/99&'! /0091 >a.tsNPro.1 ;nder the )opyright and Patent )lause o+ the )onstitution! (rt, W0! I)ongress shall have Po7er...to pro ote the Progress o+ S.ien.e...2y se.uring Jto (uthorsK +or li ited Bi es...the eA.lusive 6ight to their...Writings.L ,n the /990 )opyright Ber 3Atension (.t $)B3('! )ongress enlarged the duration o+ .opyrights 2y %0 years! a8ing .opyrights no7 run +ro .reation until 70 years a+ter the author<s death. Petitioners! 7hose produ.ts or servi.es 2uild on .opyrighted 7or8s that have entered the pu2li. do ain! argued that the )B3( violates 2oth the )opyright )lause<s Ili ited Bi esL pres.ription and the >irst ( end ent<s +ree spee.h guarantee. Bhey .lai ed )ongress .annot eAtend the .opyright ter +or pu2lished 7or8s 7ith eAisting .opyrights. Bhe @istri.t )ourt and the @istri.t o+ )olu 2ia )ir.uit disagreed. (<d. 6easoning J4ins2urgK1 o (pplying the .opyright eAtensions to eAisting .opyrights in addition to +uture .opyrights a++ords a 7riter 7ho sold his 7or8 a 7ee8 ago the sa e 2ene+it as a 7riter 7ho sells his 7or8 a day a+ter the ne7 legislation is passed. o IJ,Kt is generally +or )ongress! not the .ourts! to de.ide ho7 2est to pursue the )opyright )lause<s o2?e.tives.L @issent JStevensK1 o Bhe a?ority is ista8en in its pre ise that Ithis )ourt has virtually no role in revie7ing .ongressional grants o+ onopoly privileges to authors! inventors! and their su..essorsSL o (llo7ing )ongress to retroa.tively grant ter eAtensions +or eAisting .opyrights ay lead to the +un.tional e5uivalent o+ perpetual .opyrights. @issent JBreyerK1 o Bhe )opyright )lause<s 2asi. o2?e.tive is to Ipro ote the Progress o+ S.ien.eL $8no7ledge and learning'. Bhe re7ard o+ .opyright prote.tion is a eans to that end! not an end in itsel+. o I, .annot +ind any .onstitutionally legiti ate! .opyright*related 7ay in 7hi.h the statute 7ill 2ene+it the pu2li.. ,ndeed! in respe.t to eAisting 7or8s! the serious pu2li. har and the virtually noneAistent pu2li. 2ene+it .ould not 2e ore .lear.L %. -isappropriation and the Euasi*Property 6ight in Hot "e7s1 o 6ule1 >a.ts are .o on property and not .opyrighta2le. Ho7ever! due to the e.ono i. value o+ hot ne7s! a .o pany .an have li ited proprietary interest in it against a .o petitor $2ut not the pu2li.' 7ho 7ould atte pt to ta8e advantage o+ the in+or ation. ,"S1 ,nt<l "e7s Serv. v. (P! ;.S. /9/0! /&=1 >a.tsNPro.1 B7o .o peting ne7s servi.es 7ere in the 2usiness o+ reporting on World War , in the ;S. Bheir 2usiness hinged on getting +ast and a..urate reports pu2lished. >ollo7ing un+avora2le reporting on British losses 2y the ,"S! that ne7s servi.e 7as 2arred +ro using (llied telegraph lines to report ne7s e++e.tively shutting do7n their 7ar reporting. Bo .ontinue pu2lishing ne7s a2out the 7ar! ,"S gained a..ess to (P ne7s through 2ri2ery! ne7s 2ulletin 2oards! and early editions o+ ne7spapers. ,"S e 2ers 7ould then re7rite the ne7s and pu2lish it as their o7n! 7ithout attri2ution. (lthough ,"S ne7spapers had to 7ait +or (P to post ne7s 2e+ore going to press! ,"S ne7spapers 7est o+ ".#. had no su.h disadvantage relative to their (P .ounterparts. Bhe (P 2rought an a.tion see8ing to en?oin ,"S +ro .opying ne7s. Holding JPitneyK1 ,"S isappropriated (P<s 5uasi*property right in the ne7s. Bhe 5uasi*property right is against .o petitors 2ut not against the pu2li. and 7as a.5uired 2e.ause the ne7s is a Isto.8 in trade to 2e gathered at the .ost o+ enterprise! organiDation! s8ill! la2or and oney! and to 2e distri2uted and sold to those 7ho 7ill pay oney +or it.L Bhus! on a..ount o+ the e.ono i. value o+ the ne7s! a .o pany .an have li ited proprietary interest in it against a .o petitor $2ut not the pu2li.' 7ho 7ould atte pt to ta8e advantage o+ the in+or ation.
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6easoning1 o ,+ the .ourt 7ere to per it Iindis.ri inate pu2li.ation 2y any2ody and every2ody +or the purpose o+ pro+it in .o petition 7ith the ne7s*gatherer! it 7ould render pu2li.ation pro+itless! or so little pro+ita2le as in e++e.t to .ut o++ the servi.e 2y rendering the .ost prohi2itive in .o parison 7ith the return.L $/40' o P argued that ne7s should have property rights 2e.ause it .osts oney and la2or to produ.e $/4/* 42'. @ should not 2e a2le to reap 7hat he did not so7 $analogy to 7heat'. $)ounter1 Ho7 do you de+ine the +ruits o+ one<s la2orQ ,sn<t (P .harging +or its la2or and +or the value o+ the in+or ationQ >urther! authors al7ays rely upon the +ruits o+ others< la2or $Istand on the shoulders o+ giantsL'.' @issent JHol esK1 3A.luding another +ro using one<s .o 2ination o+ thoughts or +a.ts .annot 2e +ounded upon property rights 2ut ust 2e +ounded upon so e other ground. Hol es suggests that @ should 2e en?oined +ro using the in+or ation +ro P +or a .ertain period o+ ti e. @issent JBrandeisK1 IBhe .reation or re.ognition 2y .ourts o+ a ne7 private right ay 7or8 serious in?ury to the general pu2li.! unless the 2oundaries o+ the right are de+initely esta2lished and 7isely guarded. ,n order to re.on.ile the ne7 private right 7ith the pu2li. interest! it ay 2e ne.essary to pres.ri2e li itations and rules +or its en?oy entM and also to provide ad inistrative a.hinery +or en+or.ing the rules.L Bhe legislature is 2etter suited to re.eive testi ony +ro various parties to a8e su.h a poli.y de.ision. )lass "otes1 o $/' Was the out.o e +airQ ,+ ,"S is allo7ed to .opy 7or8 that (P has invested ti e and oney into a.5uiring $allo7ed to so7 7hat (P has reaped'! (P 7ill 2e disin.entiviDed to .ontinue to use resour.es to a.5uire in+or ation 2e.ause Iper itting indis.ri inate pu2li.ation 2y any2ody and every2ody +or purposes o+ pro+it in .o petition 7ith the ne7s*gatherer S 7ould render pu2li.ation pro+itless Jor essentially pro+itlessK.L What i+ (P had 2een a.ting anti* .o petitively and 8eeping the ,"S e 2ers +ro ?oining (PQ (s it happened! ,"S .ould not a..ess in+or ation a2out the 7ar due to British .ensorship. What a2out the rights o+ the pu2li. to ne7sQ ,+ the ;.S. eApends oney and la2or to 2e the +irst .ountry to land on the oon! should it then have possession o+ the oonQ :o.8e had a proviso a2out property rights as long as you leave as u.h and as good to everyone else! then you .an ta8e 7hatever you 7ant. I"othing 7as ade 2y 4od +or an to spoil or destroy.L 3A1 (li.e 6andall 7rote a novel .alled The !ind .one Gone! 2ased upon the sa e set o+ +a.ts in Gone with The !ind 2ut +ro the perspe.tive o+ a slave. 6andall argued that she 7as not in+ringing the .opyright o+ the original novel 2N. $a' she 7as using the in+or ation in a I+air useL parody! and $2' the +a.ts o+ the original novel .annot 2e o7ned. o $%' ,s it e++i.ientQ 4enerally! in our .apitalist e.ono y! .o petition is en.ouraged 2e.ause it<s thought to spur i prove ent and to drive pri.es do7n. Ho7ever! 7e also 7ant to in.entiviDe la2or 2y providing re7ards +or it! 7hi.h ay .ounter*2alan.e .o petition o2?e.tives. o $&' Ho7 do 7e 2alan.e +airness and e++i.ien.yQ o $4' What is the appropriate institution to a8e the de.isionQ Brandeis< dissent argues that .ourts should tread lightly. o IJBKhe +a.t that a produ.t o+ the ind has .ost its produ.er oney and la2or! and has a value +or 7hi.h others are 7illing to pay! is not su++i.ient to ensure to it this legal attri2ute o+ property. Bhe general rule o+ the la7 is! that the no2lest o+ hu an produ.tions 8no7ledge! truths as.ertained! .on.eptions! and ideas 2e.a e! a+ter voluntary .o uni.ation to others! +ree as the aire to .o on use.L 3A.eptions in.lude Iprodu.tions 7hi.h! in so e degree! involve .reation! invention! or dis.overy.L o IHe 7ho +ollo7s the pioneer into a ne7 ar8et! or 7ho engages in the anu+a.ture o+ an arti.le ne7ly introdu.ed 2y another! see8s pro+its due largely to the la2or and eApense o+ the +irst adventurerM 2ut the la7 san.tions! indeed en.ourages! the pursuit.L -any .ases are +a.t*sensitive! and the .ourt1 o ay not have u.h e piri.al in+o $.o pared to the legislature'M o ay not have all the interested parties represented 2e+ore itM andNor

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ay not even have all the +a.ts o+ the .ase 2e+ore it due to pro.edural reasons $su.h as! .onsidering a otion to dis iss'. ,n this .ase! the .ourt appears to 2e have 2een .onstrained 2y a partial +a.tual re.ord! pro2a2ly due to the +a.t that the .ase 7as on appeal +ro a preli inary in?un.tion. $,t also 7ould have had a li ited +a.tual re.ord on appeal +ro a 6/%$2'$6' -otion to @is iss or a Su ary Judg ent'. Without all the in+or ation! su.h as 7hy ,"S 7as ta8ing (P<s property! .ould the .ourt a8e a proper assess ent o+ the 2alan.e 2et7een interestsQ )hoi.e o+ 6elie+1 Property rule vs. :ia2ility rule1 o $a' ( property rule! su.h as an in?un.tion! gives the holder o+ the right the de.ision o+ 7hether or not to sell or trade. o $2' :ia2ility rule prote.tion grants da ages 2ut does not allo7 the holder to prevent another +ro ta8ing the holder<s o2?e.t. Bhus! the non*holder .an intervene 2ut at a pri.e. o (dvantages o+ $a' over $2'1 O7ner gets to set a non* ar8et pri.e! 7hi.h is 2etter +or the o7ner 7hen the value is not re+le.ted in the ar8et or is other7ise di++i.ult to assess. 6edu.es transa.tion .osts asso.iated 7ith litigation. -ore e++e.tive 7here the violation is ongoing. (llo7s the holder to use the resour.e +or reasons other than ar8et value $su.h as religious reasons'. o (dvantages o+ $2' over $a'1 When any parties are involved! i+ @ .an use the resour.e and pay da ages later! the transa.tion .osts o+ negotiating are o2viated. o $.' ( third option is +or the .ourt to esta2lish the resour.e as inaliena2le $non* trans+era2le' used in regard to 2odily organs or seA. o ,n a Cheney Bros. v. .oris Sil' Corp.! %d $/9%9'! a id*level .lothing designer had .opied a dress design 2y a high*+ashion designer! and P argued that ,"S v. (P .alled +or a li ited in?un.tion to give P a ti e period during 7hi.h P .ould eAploit its design 2e+ore any other designers. JHandK disagreed 2e.ause1 "e7s is not an eAhausti2le resour.e! 2ut the value o+ a relatively uni5ue dress is. Bhe ar8et o+ the .opier ay not 2e the sa e as the originator! thus the in.entive stru.ture ay 2e diluted. Will there 2e enough pro+it i+ .opies are allo7edQ Will a lead ti e advantage a8e a di++eren.eQ 3ven i+ not given a lead ti e! the originator 7ill have a natural lead ti e 7hen the dress is on the ar8et 2e+ore the .opier .an get a .opy to the ar8et. &. )opyright G Bhe 6ight o+ Pu2li.ity o 6ule1 ( voi.e is a distin.tive and personal +eature o+ a person<s identity! 7hi.h a person has the right to .ontrol +ro inter+eren.e that o..urs +ro appropriation 7ithout his or her per ission. -idler v. >ord -otor )o.! $9th )ir. /900'! /471 o Ba.8ground1 )opyright prote.ts Ioriginal 7or8s o+ authorship +iAed in any tangi2le ediu o+ eApression.L /7 ;.S.). W /0%$a'. I( voi.e is not .opyrighta2le Jli8e a songK. Bhe sounds are not X+iAed.<L But I( voi.e is as distin.tive and personal as a +a.e.L o >a.tsNPro.1 @ advertised .ars 7ith a series o+ tv .o er.ials. @i++erent popular songs o+ the 70s 7ere used! and the agen.y tried to get the original singers to sing the . Where it +ailed to get the original singer! the agen.y used Xsound*ali8es.< @ re5uested that P sing the song! and P re+used. @ hired a sound ali8e! instru.ting her to i itate P to the 2est o+ her a2ility. (+ter the .o er.ial aired! P and the sound ali8e 7ere told 2y nu erous people that it sounded eAa.tly li8e P. P<s na e and li8eness 7ere not used in the .o er.ial! and @ had o2tained per ission +ro the .opyright holder to use the song. @istri.t )ourt said there 7as no legal prin.iple preventing i itation o+ P<s voi.e and granted su ary ?udg ent in +avor o+ @. 6<d and re anded. (ppellate .ourt held that P<s uni5ue and re.ogniDa2le voi.e 7as a part o+ her identity! and thus prote.ted +ro appropriation. o Holding1 IWe hold only that 7hen a distin.tive voi.e o+ a pro+essional singer is 7idely 8no7n and is deli2erately i itated in order to sell a produ.t! the sellers have appropriated 7hat is not theirs SL Jinter+ered 7ith the holder<s property rightK.
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6easoning1 I,+ the use o+ a person<s identity is Xin+or ative or .ultural< the use J ay .on+er lia2ilityKSM Xi+ it serves no su.h +un.tion 2ut erely eAploits the individual portrayed! i unity 7ill not 2e granted.<L $5uoting >el.her G 6u2in! Priva"y# Publi"ity and the Portrayal of eal People by the %edia! 00 #ale :.J. /=77! /=96 $/979'.' I<-ere i itation o+ a re.orded per+or an.e 7ould not .onstitute a .opyright in+ringe ent even 7here one per+or er deli2erately sets out to si ulate another<s per+or an.e as eAa.tly as possi2le.<L $5uoting "otes on )o ittee on the Judi.iary! /7 ;.S.).(. W //4$2''. )ontrast Sinatra v. Goodyear Tire / ubber Co. 7here "an.y Sinatra lost on su ary ?udg ent against the sa e ad agen.y +or alleged i itation o+ the her rendition o+ IBhese Boots (re -ade +or Wal8in<ML P in this .ase is not see8ing to prevent @s +ro using the song or see8ing da ages +or use o+ the song. )ontrast 0ahr v. Adell Chemi"al Co.! 7here Bert :ahr su..ess+ully sued +or a vo.al i itation 2e.ause the .ourt +ound Ithat @<s .ondu.t saturated P<s audien.e! .urtailing his ar8etML television ads 7ere not a ar8et that -idler .o peted in! so no un+air .o petition. )o pare %ots"henba"her v. .J. eynolds Toba""o Co.! 7here a slightly altered photo o+ P<s ra.ing .ar 7as used in a .igarette .o er.ial and the .ourt re.ogniDed lia2ility +or Iappropriation o+ the attri2utes o+ one<s identity.L o "otes1 I,ntelle.tual property rights aren<t +ree1 Bhey<re i posed at the eApense o+ +uture .reators and o+ the pu2li. at large. S Bhis is 7hy intelle.tual property la7 is +ull o+ .are+ul 2alan.es 2et7een 7hat<s set aside +or the o7ner and 7hat<s le+t in the pu2li. do ain +or the rest o+ us1 Bhe relatively short li+e o+ patentsM the longer! 2ut +inite! li+e o+ .opyrightsM .opyright<s idea* eApression di.hoto yM the +air use do.trineM the prohi2ition on .opyrighting +a.tsM S.L J9oDins8iK in !hite v. Samsung (le"troni"s Am.# $n". involving Canna White $/=/n%'. Bhe .ourt invented a tort o+ inter+eren.e 2N. it .ould +ind no appli.a2le la7. PropertiDing so ething via a tort is pro2le ati. 7hat in.entive e++e.ts is that .reating .o pared to pu2li. useQ 4. Patents1 6e5uire ent o+ "ovelty and "ono2viousness o High.hair .ase1 Brenton ,ndustries v. (.3. Peterson -+g. )o.! S.@. )ali+. $/9=0'! /=41 Ba.8ground1 o &= ;.S.). W&0/ tests o+ patenta2ility1 (re the di++eren.es 2et7een the su2?e.t atter sought to 2e patented and prior art su.h that the su2?e.t atter as a 7hole 7ould not have 2een o2vious at the ti e the invention 7as ade to a person having ordinary s8ill in the art to 7hi.h said su2?e.t atter pertainsQ >a.tsNPro.1 Brenton provided in+or ation to Peterson regarding (dler<s patent! 7hi.h had 2een assigned to Brenton. Peterson 2egan to anu+a.ture a high .hair 2ased upon the patent! and Brenton sued +or in+ringe ent as 7ell as un?ust enri.h ent o+ @. J +or @ on in+ringe ent 2ut +or P on the tort .lai . Holding1 o P<s patent is not valid. IJBKhe alleged novel +eature o+ the plainti++Us invention 7as 8no7n and dis.losed 2y the prior art!L and thus! Iis the produ.t o+ e.hani.al s8ill rather than the result o+ the eAer.ise o+ inventive +a.ulty...L o $On the se.ond .ount o+ un?ust enri.h ent1 I,+ a person .o uni.ates a novel idea to another 7ith the intention that the latter ay use the idea and .o pensate hi +or su.h use! the other party is lia2le +or su.h use and ust pay .o pensation i+ a.tually he appropriates the idea and e ploys it in .onne.tion 7ith his o7n a.tivities.L' 6easoning1 o I"aturally! one has sy pathy +or a person 7ho develops an ingenious idea! e 2odies it in a produ.t that he su..ess+ully pla.es on the ar8et! and +inds that so eone else is i itating it and a8ing use o+ his 2rain .hild. Bhe other person! o+ .ourse! is trying to reap 7here he did not so7.L o "evertheless! patent la7 is designed I<to re7ard those 7ho a8e so e su2stantial dis.overy or inventionS<L in order to en.ourage invention and i prove ent. Atlanti" !or's v. Brady! ;.S. ,t is not designed to prote.t i prove ent or advan.e ents that are erely I7ithin the a2ility o+ the average reasona2le person +a iliar 7ith the art in 7hi.h he 7or8s and in 7hi.h he is reasona2ly s8illed.L
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+y"on %fg. Co. v. +. Ko"h / Sons! S.@. )ali+.1 I<,n a patent .ase there are three interested parties! o the patent holder! o the user o+ an a..used devi.e! and o the pu2li.. Bhe interest o+ the last is para ount.<L )lass "otes1 o 4enerally! .ourts de+er to rulings o+ ad inistrative agen.ies due to separation o+ po7ers .on.erns as 7ell as the eApertise o+ the agen.y personnel! .o pared to the 8no7ledge o+ the .ourt. Why 7ould .ourts a8e an eA.eption to this de+eren.eQ $/' Patent appli.ation 7ith the agen.y is typi.ally not as adversarial as litigation in the .ourts! so all o+ the relevant +a.ts ay not 2e presented to the agen.y. $%' Bhe odel that the ad inistrative agen.y 7ith a highly te.hni.al eApertise .o pared to the .ourt is not the reality! 7hi.h is that the patent o++i.e is vastly over7or8ed and not as spe.ialiDed as the odel. ,+ e- ante! the patent o++i.e i proved its pro.esses! it 7ould still see any patents that do not 2e.o e .o er.ially*via2le! 7hereas a .ourt is ostly going to 2e .onsidering patents that are via2le! even though the deter ination o+ the validity o+ the patent is e- post. o Why! i+ the patent is held invalid! does the .ourt grant relie+ +or a tort .lai that doesn<t re5uire a valid patentQ Property rule prote.tion 7ould stri8e a di++erent 2alan.e $eA.luding all others 2y granting a onopoly to the patent holder' than lia2ility rule prote.tion $da ages +or un?ust enri.h ent that only e++e.ts the de+endant! and not Ithe 7orldL'. o What i+ the patent o++i.e had denied (dler<s patentQ )ould he still have had an un?ust enri.h ent .lai Q IBhe do.trine is appli.a2le to a situation 7here! as here! the produ.t o+ an inventor<s 2rain is 8no7ingly re.eived and used 2y another to his o7n great 2ene+it 7ithout .o pensating the inventor.L %atarese v. %oore*%"Corma"' 0ines $/6/'.
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@. (.5uisition 2y (..ession! (d )oelu ! and (..retion $possession o+ a s aller thing 2y possession o+ a related larger thing'

/. ,n.rease $/6='1 o Hu e1 Ithe o++spring o+ our .attle ... JareK estee <d our property! even 2e+ore possession.L o IJ,Kn the a2sen.e o+ an agree ent to the .ontrary ... the o++spring or in.rease o+ ta e or do esti. ani als 2elongs to the o7ner o+ the da or other...L Carruth v. (asterling. %. Bhe @o.trine o+ (..ession1 (n o7ner o+ property .an a.5uire o7nership o+ other property that is atta.hed to his original property or 2y .onverting the other property to his use! as in1 o 3le ents to .onsider1 intentN8no7ledge $7as the property a2andonedQ' enough value added 2y the i prover o $i+ the original o7ner is granted the property 7hen it<s value has in.reased greatly! it 7ould .o pensate hi I2eyond all reason +or the in?ury he has sustained.L' o la2or and personality .onsiderations +or @ $see 2elo7' * tra.ingNtrans+or ation are the .o ponents identi+ia2le as the original resour.e or have they 2een trans+or ed to su.h eAtent that identi+i.ation is i pra.ti.a2leQ Poli.y1 o 6espe.t individuality1 i+ the resour.e has not 2een trans+or ed! 7e 7ant to grant the original o7ner the .hoi.e o+ ho7 to use his resour.eM o :a2or1 i+ it has 2een trans+or ed! 7e 7ant to prote.t the la2or the i prover has investedM o "e.essity1 oreover! trans+or ation is so eti es a proAy +or ne.essity i+ you trans+or ed the resour.e to your use! the .ourt .an 2e ore .ertain that the de+endant needed the resour.e to do so. o )reativityNpersonhood1 ,+ @ has eApended .reative la2or! the produ.t ay 2e tied up 7ith his personality. )onversely! i+ love letters 7ere trans+or ed into ash! the .reative aspe.t o+ the resour.e ay not 2e re.overa2le 2y si ply returning the .urrent produ.t to the original o7ner. o Bi 2er .ase1 Wether2ee v. 4reen $/66' 1 >a.tsNPro.1 W .ut 4<s ti 2er in good +aith! relying upon per ission +ro so eone 7ho W 2elieved had the right to grant per ission. W then .onverted the ti 2er into 2arrel hoops! thus adding great value to the 7ood. Bhis eviden.e 7as eA.luded 2y the trial .ourt and J +or Ps $W 7as ordered to return

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the 7ood! regardless o+ the added value'. 6<d and re anded to allo7 .onsideration o+ ho7 u.h @ had .hanged the property. o )lass "otes1 6ight o+ a..ession not nor ally applied to real property or land. Bhus! i+ so e2ody else 2uilds upon your land! they are not nor ally allo7ed to 8eep the stru.ture 2y a..ession. @eno inator pro2le 1 ho7 do you de+ine the 2oundaries o+ real propertyQ ,+ , ista8enly 2uilt a garage on so e2ody else<s land! 7ould that entitle e to a portion o+ the yard neAt to itM i+ so! ho7 u.hQ J&. 3Aplaining the Prin.iple o+ (..essionK 4. (d )oelu 6ule $>ro the depths to the s8y' o 4enerally! a sur+a.e o7ner has the presu ptive right to drill +or 7ater or inerals 2elo7 the sur+a.e! Ias long as the drilling apparatus stays 7ithin the X.olu n o+ spa.e< pro?e.ted do7n +ro the sur+a.e.L o Cu1us est solum# e1us est us2ue ad "oelum et ad inferos $Ito 7ho ever the soil 2elongs! he o7ns also to the s8y and to the depthsL'. 3A.eption1 One<s land .annot 2e used to inter+ere 7ith or to the detri ent o+ a neigh2or<s rights. o )ave .ase1 3d7ards v. Si s! 9y. $/9%9'! /7=1 6ule1 ( .ourt o+ e5uity has the po7er to .o pel a .ave o7ner to per it inspe.tion 7hen $i' another party has sho7n reasona2le ground +or suspi.ion that his lands are 2eing trespassed upon in the .ave! thus ne.essitating the inspe.tion! and $ii' the adverse o7ner has had an opportunity to 2e heard. >a.tsN@isp1 :.P. 3d7ards dis.overed a .ave 7hose entran.e 7as on his land. He developed the .ave into a tourist site. :ee! a neigh2or! sued 3d7ards +or da ages! .lai ing that a portion o+ the land 7as underneath his $:ee<s' land! and +or an in?un.tion +ro +urther trespass or eAhi2iting o+ the portion o+ the .ave under :ee<s land. Bhe .han.ellor ordered a survey o+ the .ave! and 3d7ards +iled this appeal to re5uest a 7rit o+ prohi2ition to prevent Judge Si s +ro en+or.ing the survey. @enied. Holding1 Bhe .ourt did not err in ordering a survey o+ the land! despite the o7ner<s o2?e.tion. 6easoning J)o issioner StanleyK1 o ;nli8e a past .ase! Co- v. Colossal! 3d7ards appears to o7n his land 2y a2solute right 7ith no severan.e $e.g. separate o7nership o+ sur+a.e rights and ineral rights'! and "u1us est solum.... o Ho7ever! a .ourt o+ e5uity has the po7er to .o pel a ine o7ner to per it inspe.tion 7hen $i' another party has sho7n reasona2le ground +or suspi.ion that his lands are 2eing trespassed upon in the ine! thus ne.essitating the inspe.tion! and $ii' the adverse o7ner has had an opportunity to 2e heard. o Bhere see s to 2e no di++eren.e in prin.iple! in regard to the issues o+ this .ase! 2et7een ines and .aves. Bhus! sin.e the t7o .onditions a2ove 7ere et! the in?un.tion +or inspe.tion is la7+ul. o 3ither result o+ the inspe.tion 2ene+its @1 $i' i+ it is +ound that all the .ave 2elongs to hi ! title 7ill 2e 5uietedM $ii' i+ it is +ound he has 2een trespassing! he Ishould 2e ?ust as glad to .ase trespassing...L @issent J:oganK $/79'1 o (llo7ing the survey 7ill do da age to 3d7ards 2ut 7ill reap no 2ene+it +or :ee. o I, .an su2s.ri2e to no do.trine 7hi.h a8es the o7ner o+ the sur+a.e also the o7ner o+ the at osphere +illing illi ita2le spa.e. "either .an , su2s.ri2e to the do.trine that he 7ho o7ns the sur+a.e is also the o7ner o+ the va.ant spa.es in the 2o7els o+ the earth.L o IBhe rule should 2e that he 7ho o7ns the sur+a.e is the o7ner o+ everything that ay 2e ta8en +ro the earth and used +or his pro+it or happiness.L o ,n the .ase o+ a .ave or .avern! it Ishould 2elong a2solutely to hi 7ho o7ns its entran.e... When the sur+a.e o7ner has dis.overed a .ave and prepared it +or purposes o+ eAhi2ition! no one ought to 2e allo7ed to distur2 hi in his do inion over that 7hi.h he has .on5uered and su2?e.ted to his use.L o (irplanes should 2e allo7ed to use the air a2ove a person<s property Iso long as JtheK airplanes do not in?ure hi ! or inte+ere 7ith the use o+ his property...L o =. (..retion IO7ners o+ riparian land that gro7s through the operation o+ a..retion or reli.tion J$7hi.h are relatively gradual pro.esses'K auto ati.ally gains title to the ne7 land. O7ners o+ riparian land that shrin8s due to erosion auto ati.ally lose title to the lost land.L (vulsion $a sudden .hange' results in no .hange o+ 2oundary lines. @e+initions1

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a..retion H the Igradual deposit 2y 7ater o+ solid aterial! 7hether ud! sand! or sedi ent! produ.ing dry land 7hi.h 7as 2e+ore .overed 2y 7ater.L o avulsion H Ithe sudden .hange o+ the 2an8s o+ a strea su.h as o..urs 7hen a river +or s a ne7 .ourse 2y going through a 2end! the sudden a2andon ent 2y a strea o+ its old .hannel and the .reation o+ a ne7 one! or a sudden 7ashing a7ay +ro one o+ its 2an8s o+ a .onsidera2le 5uantity o+ land and its deposit on the opposite 2an8.L o reli.tion H re+ers to Iland that has 2een .overed 2y 7ater! 2ut 7hi.h has 2een un.overed 2y the i per.epti2le re.ession o+ the 7ater.L o erosion H Ithe gradual and i per.epti2le 7earing a7ay o+ land $2ordering on 7ater' 2y the natural a.tion o+ the ele ents.L o riparian H Iland 2ordering on any type o+ 7ater rivers! strea s! la8es! ponds! and ar s o+ the o.ean.L 6iver 2order .ase1 "e2ras8a v. ,o7a! ;.S. $/09%'! /0&1 o >a.ts1 Bhe states o+ "e2ras8a and ,o7a had a 2oundary dispute 2e.ause the lo.ation o+ the -issouri river<s .hannel .hanged. o Holding JBre7erK1 Be.ause the pro.ess o+ di unition and a..retion o+ land along the 2an8s o+ the -issouri river is relatively gradual! so as not to 2e per.epti2le 7hile it is o..urring! the 2oundary line 2et7een "e2ras8a and ,o7a varies 7ith the lo.ation o+ the river. o 6easoning1 4ain and loss 2alan.e out1 Per 3ew 4rleans v. ,.S.! I"o other rule .an 2e applied on ?ust prin.iples. 3very proprietor 7hose land is thus 2ounded J2y a strea that gradually .hanges its .ourseK is su2?e.t to loss 2y the sa e eans 7hi.h ay add to his territoryM and! as he is 7ithout re edy +or his loss in this 7ay! he .annot 2e held a..ounta2le +or his gain.L
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3. (.5uisition o+ Property 2y (dverse Possession 3le ents o+ (dverse Possession1 o (dverse possession re5uires possession that is o $/' a.tual $,s BO deprived o+ possessionQ Has (P possessed the land as a BO 7ouldQ'! o $%' open and notorious $@id BO have noti.e or should BO have had noti.eQ Was (P<s use indi.ative that (P 7as using the land produ.tively su.h that he 7ould atta.h personhood to it and others .ould rely on his useQ'! o $&' adverse or hostile $Has BO not given (P per ission to use the propertyQ -aine 6ule1 Was @ a.ting in 2ad +aith! 8no7ing he 7as trespassingQ O2?e.tiveN)onne.ti.ut $ a?ority' rule Sho7ing good or 2ad +aith is not re5uired.'! o $4' under .lai o+ right $@id (P su2?e.tively 2elieve he had a legal right to poss<n! due to I.olor o+ title!L 7hi.h re+ers to a legally*de+i.ient do.u ent that the (P does not 8no7 is de+i.ient! or so e other reason! su.h as an un.lear or ista8en 2oundaryQ ,n so e ?Ans! 7as (P<s .lai in good*+aithQ 3A1 H 8no7s his title is de+i.ient 2ut .lai s to have adverse possession via .olor o+ titleM this is in 2ad +aith! though. S5uatters do not have .olor o+ title'! o $=' eA.lusive $,s BO deprived o+ possession in su.h a 7ay that (P<s use provides noti.e to BO and indi.ates (P<s spe.ial atta.h entQ'! o $6' .ontinuous $a..ording to its usual nature and .ondition! +oward v. Kunto'! and o $7' +or the period o+ ti e o+ the statute o+ li itations $ta8ing into a..ount any eA.eptions due to disa2ility o+ BO! su.h as inor status! insanity! legal in.o peten.e! or in.ar.eration at the ti e (P entered the land %/4'. Other (spe.ts o+ (P o (dverse Possession .an either 2e evo8ed as an a++ir ative de+ense or as a re2uttal to a .lai +or relie+. 3A1 Brue o7ner $IBOL' 2uys property! leaves it 7ild in /96=. (dverse Possessor oves onto the land 7ith his o2ile ho e in /960. What interest does (P have 7hen she oves onto the landQ -ay have so e against (P% 2ut none against BO. BO 7ould have eA.lusion rights against all others! in.luding (P. What i+ (P says I, 7ant to o++er you +air* ar8et value +or the land.L BO .an still re+use to sell. (ssu ing a /=*yr. sol +or re.overy o+ possession o+ property! i+ BO 2rings an a.tion o+ e?e.t ent against (P in /90&1 o 3ither BO is ti e*2arred +ro 2ringing the .lai ! or o (P .an argue +or a shi+t o+ title +ro BO to (P 2y o++ering a de+ense o+ adverse possession.

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o 6elation Ba.81 BO loses rights. ,s she entitled to da agesQ "o! 2e.ause (P relates title 2a.8 to the +irst
day the adverse possessor enters the land. (s a result! the (Por ight in.ur any taA or other lia2ility. )ontrast this to Wether2ee $ti 2er .ase' 7here a..essor a.5uired right to property 2ut had to pay the value o+ the original resour.e to the original o7ner. Be.ause adverse possession is state la7! it varies 2y variation o+ the nature o+ the land. $,n the West 7here u.h land is o7ned 2y the govern ent! property tends to 2e eAtensive! and railroads histori.ally o7ned u.h o+ the land! (P generally has to have paid taAes on the land.' 4enerally! adverse possession .annot 2e asserted against the govern ent.

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Poli.y )onsiderations +or (dverse Possession $so e on %00*0%'1 o Produ.tivity @o 7e 7ant to in.entiviDe greater produ.tivity on landQ But this runs .ontrary to a .onservationist ethos and an individualist ethos. o "e.essity (Por ay need to use the land o -arginal utility de.reased +or the o7ner 7ho doesn<t see to 2e a7are o+ or .on.erned a2out use o+ her land $assu ing BO is 7ealthier than (P'. o Statute o+ li itations eviden.e is IstaleL and ore di++i.ult to as.ertain a+ter a .ertain period o+ ti e! in.reasing the .ost o+ proving and de+ending .lai s $or .lai ant .ould 7ait until the latest possi2le ti e to 2ring their .lai '. But this argu ent .ould only 2e used to ?usti+y a li itation on ho7 +ar 2a.8 a .lai should allege adverse possessionM it also does not ?usti+y s7it.hing title +ro BO to (P. (lso 7ant reposeN+inality. o Bitle .learing +un.tionN ar8eta2ility transa.tion .osts asso.iated 7ith lo.ating title holder and negotiating 7ith her are redu.ed. o 4ate8eeper +un.tion in order to aintain so.ial order! the true o7ner should onitor and en+or.e their land rights rather than Isleep on his rightsLM other7ise! so.iety 7ill in.ur greater .osts. 3A.eption +or govern ent land results +ro a .on.ern that error 2y govern ent e ployees .ould signi+i.antly alter the rights o+ the pu2li.*at*large. o 3A1 @eveloper proposed to 2uild on the ;3S and sho7ed plans +or 2uilding per it and re.eived per it in error 2N. // additional stories 7ere 2uilt than allo7ed 2y the Doning .ode. Bhe .ourt ordered the developer to tear do7n the eAtra stories at their eApense! even though the error 7as on the govern ent e ployee. o 6elian.e interestsN :oss aversion (tta.h ent1 People gro7 roots around property they possess and .o e to thin8 o+ it as their! even i+ they 8no7 they don<t o7n it. Bhus! displa.ing a possessor +ro land that he has possessed +or a relatively long ti e 7ould .ause un?ust har to hi . Based upon psy.hologi.al studies! 7e 8no7 that ta8ing a7ay possession +ro the (P is li8ely to 2e eAperien.ed ore a.utely 2y the (P than the denial o+ the BO<s right 7ill 2e +elt 2y the BO. Bhe asset is li8ely to 2e ore +ungi2le to the BO than the (P 2e.ause o+ the IpersonhoodL 7rapped up 7ith the land +or the (P! .o pared to the BO. (lso 7ant to prote.t .reditors! 7ho ay have relied on (P<s .ollateral to eAtend .redit. (dverse Possession )ases1 o @evelop ent or residen.e upon land is not ne.essary to esta2lish possession $7hen the land is used +or so e purpose'. (dverse Possession1 :essee o+ 37ing v. Burnet! ;.S. $/0&7'! /941 ,ssues1 What .onstitutes a.tual! oGn! and eA.lusive usageQ What .ounts as possessionQ >a.ts1 ,n /970 Sy es eAe.uted a deed to a par.el o+ land to >or an! 7ho .onveyed it to Willia s! 7hose right 2e.a e invested in 37ing upon Willia s< death. ,n /00&! Sy es eAe.uted a deed to the sa e par.el o+ land to Burnet $@'! 7ho had resided a.ross +ro the lot sin.e /004 and had paid taAes on the lot +ro /0/0*/0&4. 37ing instituted an a.tion o+ e?e.t ent against Burnet in /0&4. @ .lai ed adverse possession +or over %/ years. @ had .lai ed the lot as his o7n +ro the date o+ the original deed up until the trial. Bhe property 7as used only +or digging sand and gravel. @ had .lai ed eA.lusive right to the gravel on and gave per ission to others to re ove sand and gravel. @ 2rought a.tions in trespass against those 7ho did so 7ithout per ission. Bhere 7as eviden.e that Willia s had 2een a7are o+ @<s a.tivity 2ut there 7as no eviden.e that Willia s had ever opposed @<s entry! de anded possession! or assu ed any eAer.ise o+ o7nership over the lot. J +or @. (<d. Holding JBald7inK1 Bhe .ourt did not err in letting the 5uestion go to the ?ury as to 7hether @ had o2tained title through adverse possession 2e.ause a reasona2le ?ury .ould have +ound that @ had o2tained title! 2ased upon the +a.ts presented. (.ts o+ visi2le and notorious o7nership under .olor o+ title over pre ises +or %/ years are su++i.ient to de onstrate the notorious re5uire ent o+ adverse

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possession. I"either a.tual o..upation! .ultivation nor residen.e! are ne.essary to .onstitute a.tual possession! 7hen the property is so situated as not to ad it o+ any per anent use+ul i prove ent! and the .ontinued .lai o+ the party has 2een eviden.ed 2y pu2li. a.ts o+ o7nership! su.h as he 7ould eAer.ise over property 7hi.h he .lai ed in his o7n right! and 7ould not eAer.ise over property 7hi.h he did not .lai .L (dverse Possession * good +aith re5uire ent1 )arpenter v. 6uperto! ,o7a $/90%'! %0&1 >a.tsNPro.1 Plainti++ .lai s title to a pie.e o+ land north o+ her o7n lot and easuring 60<A/%=<. P had planted 2ushes! installed a propane tan8! .onstru.ted a dirt tan8 to divert 7ater! and 2uilt a drive7ay +or over a &0 year period on the disputed land! although @s had re.ord title to the land. J +or @ $P had not a.5uired the lot 2y adverse poss<n! 2ut the .ourt did order @ to I<do e5uity< 2y deeding to her the strip o+ land her drive7ay 7as on and to pay the .osts o+ oving the propane tan8 to JP<sK lotL'. (<d. Holding1 P .ould not a.5uire the land 2y adverse possession 2e.ause she did not esta2lish a good +aith .lai o+ right. IShe 8ne7 her lot did not in.lude the .orn+ield ... She 8ne7 so eone else had title to it and she had no interest in it or .lai to it.L 6easoning1 o IBhis is not a .ase o+ .on+usion or ista8e.L o IBo per it a s5uatter to assert a .lai o+ right 7ould put a pre iu on dishonesty.L o ,n Goulding v. Shon2uist! ,o7a $/974'! @ had .leared land ad?a.ent to his house and used the land. I@ 8ne7 that he had no title and that he had no .lai o+ title! and no right 7hatever to enter into the possession! and his possession 7as not in good +aith +or that reason.L J.A. Pye 54-ford6 0td. v. The ,nited Kingdom! 3uropean )t. o+ Hu an 6ights $%00='! %07n%1 )ourt agreed 7ith BO that granting adverse possession .onstituted a Ita8ingL against the rights o+ the BO. ,ssues1 o Bhe ( eri.an syste has never held that a ?udi.ial a.tion .ould .onstitute a ta8ing that re5uires .o pensation under the =th ( end ent. o When does the ta8ing 2egin in su.h a .aseQ When possession 2egan! 7hen BO o2?e.ted! or 7hen .ourt granted apQ o Why do 7e re.ogniDe ap as giving the (P property prote.tionQ Why don<t 7e allo7 (P to ta8e the land a+ter the sol eApires 2ut re5uire (P to pay the BO the value o+ the land ta8en $a lia2ility rule'! 7hi.h Pye ight lead toQ Bo the eAtent that ap rules are a anner o+ .learing title! instituting a lia2ility rule reintrodu.es those pro2le s $su.h as .al.ulating the value o+ the land %= years ago 7hen (P entered the land'. Bhe la.8 o+ a lia2ility rule otivates BOs to 2e ore diligent in their prote.tion o+ their rights. (dverse Possession ordinary use and ta.8ing1 Ho7ard v. 9unto! Wash. $/970'! %001 >a.tsNPro.1 Ho7ard<s title 7as to land ?ust to the 7est o..upied 2y -oyerM -oyer<s title 7as to the land ?ust to the 7est o+ hi o..upied 2y 9untoM and 9unto<s title! +ro his prede.essor! 7as to the land ?ust 7est o+ hi . ;pon realiDation o+ the error in his title! Ho7ard .onveyed his deed to -oyer +or the land o..upied 2y -oyer. ,n return! -oyer .onveyed his deed to Ho7ard +or the land o..upied 2y 9unto. Ho7ard then sued to 5uiet title to the lot o..upied 2y 9unto. J +or P $Ho7ard' 2N. 9unto<s $@<s' possession 7as not I.ontinuousL a..ording to the trial .ourt. 6<d. @<s title should 2e 5uieted. ,ssue1 o I$/' ,s a .lai o+ adverse possession de+eated 2e.ause the physi.al use o+ the pre ises is restri.ted to su er o..upan.yQL o $%' -ay person 7ho re.eives a ista8en title use the periods o+ possession 2y his i ediate possessors $i.e. is ta.8ing allo7ed' +or the purpose o+ esta2lishing adverse possessionQ Holding1 o $/' "o. Su er possession o+ a su er ho e is su++i.ient. Bhe re5uisite possession re5uires su.h possession and do inion Ias ordinarily ar8s the .ondu.t o+ o7ners in general in holding! anaging! and .aring +or property o+ li8e nature and .ondition.L !halen v. Smith! ,o7a $/9/0'. o $%' #es. @espite the te.hni.al la.8 o+ privity! a reasona2le .onne.tion 2et7een su..essive o..upants o+ real property to per it ta.8ing and thus esta2lish adverse possession as a atter o+ la7. 6easoning1 o Bhe privity li itation appears to have 2een instituted to 8eep s5uatters +ro 2ene+iting +ro their trespass. IHo7ever! it appears to this .ourt that there is a su2stantial di++eren.e 2et7een the s5uatter or trespasser and the property pur.haser! 7ho along 7ith several o+ his neigh2ors! as a

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result o+ an ina..urate survey or su2division! o..upies and i proves property eAa.tly =0 +eet to the east o+ that 7hi.h a survey so e &0 years later de onstrates that they in +a.t o7n.L o ,+ (Ps are a2le to adversely possess ore land than their deed des.ri2es! then @ in this .ase should 2e a2le to o2tain possession! even though the deed ista8enly des.ri2ed the ad?a.ent land. )lass "otes1 o "ote that the Ho7ards are trying to get a 2etter pie.e o+ land $the 9unto<s' and give the 9untos their land! 7hi.h does not have a house on it. (dverse Possesion o+ )hattels1 Song2yrd! ,n.. v. 3state o+ 4ross an! ".#. $/990'! %/41 >a.tsNPro.1 Henry Byrd<s assignee Song2yrd sued +or onetary da ages and de.laratory relie+ regarding several re.ordings o+ Byrd<s usi. that 7ere possessed 2y Bearsville 6e.ords! the 2usiness na e +or (l2ert 4ross an. -otion +or su ary ?udg ent in +avor o+ 4ross an granted due to eApiration o+ statute o+ li itations. Holding1 Be.ause the statute o+ li itations had eApired! Song2yrd 7as pre.luded +ro 2ringing an a.tion +or .onversion. $,n e++e.t! 4 had adversely possessed the physi.al re.ordings.' 6easoning1 o )onversion rule1 IBhe statute o+ li itations +or .onversion 2egins to run at the ti e o+ the .onversion.L Sporn v. %CA e"ords# $n". ,n Sporn! P! Ithe su..essor in interest to the purported o7ner o+ rights in .ertain aster re.ordings! sued @ re.ord .o pany +or .o er.ially eAploiting the aster re.ordings .ontrary to P<s interests.L Be.ause the &*yr sol 2egan to run at the ti e @ 2egan using the aster re.ordings .ontrary to P<s interests! @ 7as granted su ary ?udg ent. o @e and rule1 ,+ the possessor 7ere a good +aith pur.haser! the statute o+ li itations 7ould not 2egin to run until the true o7ner a8es a de and +or the return o+ the property and the de and is re+used. "N( in this .ase! though. "otes1 o @is.overy rule1 Statute o+ li itations 7ould 2egin to run 7hen the BO dis.overs or 2y eAer.ise o+ reasona2le diligen.e and intelligen.e should have dis.overed +a.ts 7hi.h +or the 2asis o+ an a.tion. )lass "otes1 o Odd result that sol +or the+t is shorter than sol +or ore inno.ent ta8ing. )ontrast to dis.overy rule in 4)Keefe $%/9n&'.

>. >inders< or Stealers< 6ightsN ,ssues o+ Se5uential Possession 6ule1 o Possession o+ property! even i+ 7rong+ully o2tained! is su++i.ient to entitle the possessor 7ith rights against a third party 2ut not against the true o7ner. Armory. o Bhus! a third party .annot re.over stolen property +or another1 Jus tertii $the rights o+ a third party' .annot 2e used as a de+ense +or trespass or trover $an a.tion +or the re.overy o+ the value o+ 7rong+ully*ta8en property'. Jeffries. Justi+i.ations1 o Su2stantive1 Bhe rule is Iessential +or the interests o+ so.iety! that pea.ea2le possession should not 2e distur2ed 2y 7rongdoers.L Jeffries. I(ny other rule 7ould lead to an endless series o+ unla7+ul seiDures and reprisals in every .ase 7here property had on.e passed out o+ the possession o+ the right+ul o7ner.L Anderson v. Gouldberg. o Pro.edural1 )o on*la7 litigation is 2ilateral 2y nature. (llo7ing one o+ the involved parties to 2ring in the issue o+ third party rights 7ould present potential di++i.ulties o+ proo+! parti.ularly given the .onteAt o+ li ited or no title registration. )ases1 o )hi ney s7eep<s +ound ?e7el1 (r ory v. @ela irie! 3ng. $/7%%'! %%01 )hi ney s7eeper 2oy $P' +ound a pie.e o+ ?e7elryM an e ployee o+ a ?e7elry store $@' stole the stones out o+ the setting. J +or P. IJBKhough he J$the +inder'K does not 2y su.h +inding a.5uire an a2solute property or o7nership! yet he has su.h property as 7ill ena2le hi to 8eep it against all 2ut the right+ul o7ner! and .onse5uently ay aintain trover J$an a.tion +or re.overy o+ .hattels'K.L o IJ(Ks P has sho7n a spe.ial property in these logs! 7hi.h he never a2andoned! and 7hi.h ena2led hi to 8eep the against all the 7orld 2ut the right+ul o7ner! he is entitled to a verdi.t.L >ound logs1 )lar8 v. -aloney! @el. $/040'! %%%1 )lar8 $P' +ound /0 7hite pine logs +loating in the @ela7are Bay a+ter a tha7

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and se.ured the in the -ispillion .ree8. -aloney $@s' later a.5uired the logs and re+used to return the to P! alleging they had +ound the logs adri+t and +loating up the .ree8. J +or P. o >ound logs1 (nderson v. 4ould2erg! -inn. $/09%'! %%41 (nderson $P' .ut do7n 9& pine logs on a strangers< property 7ithout the o7ner<s .onsent. 4ould2erg $@s' re.overed the logs at a ill and .lai ed that they had per ission +ro the true o7ner! although the ?ury +ound other7ise. J +or P $P had rights against third parties! even i+ not against the BO.' o Bhird*party rights1 Je++ries v. Bhe 4reat Western 6y.! 3ng. $/0=6'! %%61 @ sought to de+end an a.tion +or re.overy o+ railroad .ars 2y proving the title to the .ars had 2een assigned to so eone other than P $1us tertii rights o+ a third party'. J +or P. "otes1 o ,n .ontrast to the reasoning in Anderson! 7ouldn<t su.h a rule lead to un+avora2le results in .ertain .ases! su.h as a .ase involving a 4ood Sa aritan 7ho re.overs a stolen purse +or the true o7nerQ $%%=n%'. (..ording to ussell v. +ill! ".). $/099'! %%=n& $7hi.h rea.hed the opposite result o+ Anderson given si ilar +a.ts'! the rule +ro Armory v. .elamirie 7as in regard to a pie.e or property 7hose o7ner 7as un8no7n! IJ2Kut the .ourt said the .ase 7ould have 2een very di++erent i+ the o7ner had 2een 8no7n...L

4. )o peting Prin.iples o+ Original (.5uisition )ases1 o :a2or per+or ed upon so eone else<s property does not entitle the la2orer to eA.lude the o7ner +ro his rights. Honey.o 2 .ase1 >isher v. Ste7ard! %%71 >a.tsNPro.1 P .lai ed to have +ound and ar8ed 2ees and their honey.o 2 in a tree on @<s land 7hi.h @ appropriated 7hen he .ut do7n the tree. J +or @. 6easoning1 o IBhe ar8ing o+ the tree J2y the PsK 7as a trespass! and .onse5uently .an avail the Ps nothing.L o IBill the 2ees o..upied the tree in 5uestion! it is not pretended that Ps had any right in it. What gave the a rightQL "otes1 o @<s .lai to the 2ees in the tree arose +ro raione soli! a type o+ a..ession. o &avorite v. %iller! %%9n41 J +or P lando7ner against trespasser @ 7ho! through so e e++ort! +ound on P<s property an e5uestrian statue o+ 4eorge ,,, that had 2een toppled during the 6evolutionary War. o By a..retion! 7hatever enters upon an o7ner<s land 2e.o es part o+ the o7ner<s land! vesting rights in the o7ner. -eteorite .ase1 4oddard v. Win.hell! %%91 >a.tsNPro.1 ( eteorite +ell to earth and 2uried itsel+ & +eet into the soil o+ 4oddard<s $P<s' pasture. Hoagland $&dP' +ound the eteorite 7hile in the presen.e o+ the lessee o+ the pasture $3li.8son' and dug it up. &dP sold the eteorite to Win.hell $@'. P then .lai ed o7nership o+ the eteorite 2e.ause it +ell into his land. J +or P. (<d. 6easoning1 o @<s argu ent1 Sin.e the eteorite 2elonged to no one 2e+ore it landed! @ o2tained o7nership 2y his o..upan.yNpossession. )ourt<s response1 Just as 7ater .auses riparian lands to gain and lose land through a..retion! 7ind and 7ater .ause non*riparian lands to gain and lose land through the ove ent o+ soil. o @<s argu ent1 Bhe eteorite had no use on the land! 2ut ay have a very su2stantial use +or s.ienti+i. purposes. Bhe .ourt .ould not +ind! as a atter o+ la7! that a +inder 7ould put the property to 2etter use than the o7ner. ,n +a.t! 2e.ause o+ the onetary value o+ this type o+ property! the o7ner is li8ely to use it +or so ething other than ordinary use. "otes1 o %&&n&1 Si ilar dispute involving a eteorite in /9=4 (la2a a that hit -rs. Hodges! a tenant on -rs. 4uy<s land. -rs. 4uy .lai ed o7nership o+ the eteorite! 2ut relin5uished her .lai to -rs. Hodges +or O=00 a+ter -rs. Hodges threatened to sue +or personal in?ury i+ -rs. 4uy 7on title to the eteorite. o (.tual physi.al possession o+ land is re5uired in order to o2tain possession o+ anything +ound on the land. >ound 2roo.h1 Hannah v. Peel! %&41

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>a.tsNPro.1 Hannah 7as a tenant in Peel<s ho e and +ound a 2roo.h $pie.e o+ ?e7elry' 7hose o7ner 7as un8no7n. (s the +inder o+ the 2roo.h! Hannah .lai ed title against everyone 2ut the true o7ner. Armory. @ .lai ed o7nership 2y virtue o+ the 2roo.h<s 2eing +ound on his property. J +or P. 6easoning1 o >inders 8eepers! even i+ +ound on another<s property1 Bridges v. +aw'esworth held that the pla.e in 7hi.h a lost ite 7as +ound is i aterial +or purposes o+ deter ining o7nership rights. Bridges noti.ed a par.el lying on the +loor 7hile leaving H<s o++i.e and dis.overed oney in the par.el. B gave the par.el to H to 8eep until its true o7ner .lai ed it! 7hi.h did not happen a+ter three years. B re5uested the oney 2e given 2a.8 to hi ! 2ut H re+used. J +or @ $H'. 6<d. Bhe +a.ts did not indi.ate that the par.el 7as le+t on H<s property intentionally and H only 8ne7 o+ the par.el 2e.ause B in+or ed hi . ,+ B had not in+or ed hi ! H 7ould have no .lai 2e.ause he 7ould never have had .ustodyM thus! he should have no .lai against B 7hen B voluntarily in+or ed hi and 2esto7ed upon hi .ustody only +or the purpose o+ atte pting to lo.ate BO. 3A.eption / Servant or agent o+ the lando7ner is the +inder1 S. Staffordshire !ater Co. v. Sharman held that I7here a person has possession o+ house or land! 7ith a ani+est intention to eAer.ise .ontrol over it and the things 7hi.h ay 2e upon or in it! then! i+ so ething is +ound on that land! 7hether 2y an e ployee o+ the o7ner or 2y a stranger! the presu ption is that the possession o+ that thing is in the o7ner o+ the lo.us in 5uo.L Shar an $@' +ound t7o rings e 2edded in the 2otto o+ a pool on P<s land that @ had .leaned out at the orders o+ P. 3A.eption % Bhe lando7ner 7as already in possession o+ the thing! despite his ignoran.e o+ it1 (lwes v. Brigg Gas Co. held that a land o7ner had possession o+ an ite that 7as lo.ated on his property 7hen he trans+erred the land to another through a lease even though the o7ner 7as not a7are o+ the ite <s eAisten.e 7hen the lease 7as ade. 3l7es $P' had trans+erred the land in 5uestion to @ 7ith the eA.eption o+ all ines and inerals upon that land! and @ dis.overed a prehistori. 2oat 7hile digging on the land. 3A.eption &1 >inder o2tains possession through trespass or other a.t o+ 7rongdoing. o ,n Peel<s .ase! he had not 2een in prior possession o+ the 2roo.h $eA.eption Y%' 2e.ause he never o..upied the house and I7as never physi.ally in possession o+ JtheK pre ises at any ti e.L -islaid ite s When the o7ner intentionally pla.es and ite so e7here 2ut +orgets 7here $su.h as 7allet islaid on a store .ounter'! ( eri.an .ourts tend to a7ard property o+ the islaid ite to the o7ner o+ the land 7here the ite is +ound! 7hereas un.lai ed IlostL ite s $in 7hi.h the o7ner is not a7are o+ losing possession o+ it' go to the +inder.

,,. Calues Su2?e.t to $or "ot Su2?e.t to' O7nership (. Personhood $Body Parts! ,nti ate 6elations! Personal ,dentity! et..' Personhood! -argaret Jane 6adin $%90' o Personal property1 IJ(Kn o2?e.t is .losely related to one<s personhood i+ its loss .auses pain that .annot 2e relieved 2y the o2?e.t<s repla.e ent.L o >ungi2le property1 Iproperty that is held purely instru entallyL Ian o2?e.t that is per+e.tly repla.ea2le 7ith other goods o+ e5ual ar8et value.L o I,t intuitively appears that there is su.h a thing as property +or personhood 2e.ause people 2e.o e 2ound up 7ith Xthings.< But this intuitive vie7 does not .o pel the .on.lusion that property +or personhood deserves oral re.ognition or legal prote.tion! 2e.ause argua2ly there is 2ad as 7ell as good in 2eing 2ound up 7ith eAternal o2?e.ts.L o Personhood depends upon the realiDation o+ eApe.tations a2out +uture plans.

,naliena2ility $"on*trans+era2ility! &0&' o Justi+i.ations +or not allo7ing property o7ners to trans+er or sell .ertain types o+ property1 6edu.es the possi2ility o+ negative eAternalities to third parties! , proves the 5uality o+ in+or ation $or 5uality o+ produ.t donated! in the .ase o+ 2lood! 7here non* paid donors are presu a2ly ore li8ely to dis.lose 8no7n pro2le s 7ith their 2lood rather than donors see8ing pay ent'! and -ini iDes I.o on*poolL pro2le s involving non*eA.lusive o7nership o+ a single resour.e 7here the danger o+ over*.onsu ption or eA.essive use eAists. o 6adin<s ?usti+i.ations1

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Phyla.ti. argu ent Bhis vie7 presu es that .o odi+i.ation o+ .ertain types o+ property is so destru.tive that ost instan.es o+ it ust 2e .oer.ed! and the ris8 o+ ista8enly .onstraining the eAer.ise o+ +ree .hoi.e is +ar out7eighed 2y the ris8 o+ har to personhood 2y .oer.ed transa.tions that ight appear to 2e voluntary. Prohi2ition o+ the .o odi+ied version o+ a thing 2e.ause .o odi+i.ation o+ it o eAposes 7ealth* and .lass*2ased .ontingen.ies +or o2taining things that are .riti.al to li+e itsel+ $e.g. health .are' and thus under ines a .o it ent to the san.tity o+ li+e or o I.reates and +osters an in+erior .on.eption o+ hu an +lourishingL 2e.ause o+ the so.ial disapproval that is .onne.ted 7ith ar8eting one<s 2ody. @o ino theory ( .o odi+ied version o+ a thing .annot .oeAist 7ith and 7ould eAtinguish its non* .o odi+ied version! 7hi.h is orally pre+era2le. Whereas the prohi2ition theory +o.uses on the i portan.e o+ eA.luding +ro so.ial li+e .o odi+ied versions o+ .ertain things! the do ino theory +o.uses on the i portan.e +or so.ial li+e o+ aintaining the non.o odi+ied versions. One o+ the paradoAes o+ prohi2ition is that .hoosing ar8et*inaliena2ility I ight deprive a .lass o+ poor and oppressed people o+ the opportunity to have ore oney 7ith 7hi.h to 2uy ade5uate +ood! shelter! and health .are in the ar8et! and hen.e deprive the o+ a 2etter .han.e to lead a hu ane li+e.L

)ases1 o Ba8ing possession o+ hu an 2ody parts ust adhere to due pro.ess o+ la7! as 7ould ta8ing o+ any property! in order to prote.t the dignity o+ the hu an 2ody. )ornea .ase1 "e7 an v. Sathyavagls7aran! 9th $%00%'! %4=. @ue pro.ess! at least! re5uires individualiDed noti.e 7henever pra.ti.a2le 2e+ore the state .an eAtinguish property rights. >a.tsNPro.1 Parents! 7hose de.eased .hildren<s .orneas 7ere re oved 2y the :.(. )oroner<s o++i.e 7No noti.e or .onsent! alleged a ta8ing o+ their property 7ithout due pro.ess o+ la7. )lai dis issed. 6<d G re anded. Holding1 I;nder traditional .o on la7 prin.iples! serving a duty to prote.t the dignity o+ the hu an 2ody in its +inal disposition that is deeply rooted in our legal history and so.ial traditions! the parents had eA.lusive and legiti ate .lai s o+ entitle ent to possess! .ontrol! dispose and prevent the violation o+ the .orneas and other parts o+ the 2odies o+ their de.eased .hildren.L 6easoning1 o ( .lai under 4% ;S) W /90& +or an un.onstitutional deprivation o+ property ust sho71 $/' a deprivation $%' o+ property $&' under .olor o+ state la7 $4' 7ithout due pro.ess $noti.e and pre* or post*deprivation hearing'. o Bo .lai a property right to possess! use! and dispose o+ a physi.al thing! a person ust have a legiti ate .lai to the thing! 7hi.h the parents had. o IJBKhe +a.t that )ali+ornia +or2ids the trade o+ 2ody parts +or pro+it Jdoes notK ean that neAt o+ 8in la.8 a property interest in the . Bhe Supre e )ourt has Xnever held that a physi.al ite is not IpropertyL si ply 2e.ause it la.8s a positive e.ono i. or ar8et value.<L o IWith )ali+ornia<s adoption o+ the ;(4(! )al. Health and Sa+ety )ode W 7/=/.=! it statutorily re.ogniDed other i portant rights o+ the parents in relation to the 2odies o+ their de.eased .hildren the right to trans+er 2ody parts and re+use to allo7 their trans+er.L $%49<&8'. o Bhe statute at issue even re.ogniDed the parents< property interest 2y authoriDing the .oroner to re ove de.easeds< .orneas only i+ he Ihas no 8no7ledge o+ o2?e.tion.L o IJOKur )onstitution re5uires the govern ent to assert its interests and su2?e.t the to s.rutiny 7hen it invades the rights o+ its su2?e.ts.L @issent1 o Bhe IrightL to dispose o+ a 2ody is ore a duty than a right. o I)ali+ornia<s statutory s.he e ... de.idedly does not .on+er a property right upon anyone.L Bhe statutory s.he e Ihas JnotK .on+erred a .onstitutionally prote.ted property right upon +a ily e 2ers. ... it has erely given the enough o+ a right to allo7 the to +ul+ill their duty! and it has li ited that in a nu 2er o+ 7ays. One o+ those 7ays has to do 7ith .orneal tissue.L JZZBut the a?ority does not say the state has .on+erred a rightM only that it re.ogniDed a right $7hi.h presu a2ly already eAisted'.K )lass "otes1

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By the ti e this suit had 2een 2rought! )ali+ had a ended the statute to re ove the Ipresu ed .onsentL provision +or re oving .orneas. ,+ the parents are suing +or da ages then! ho7 7ill the loss 2e valuedQ Sin.e it<s so ething di++i.ult to value! this raises a red +lag a2out the possi2ility o+ a property interest. Why did the parents sue under a property .ause rather than a li2erty interest $li8e the right to .ontrol a .hild<s edu.ation'Q Perhaps 2N. property is seen as a ore .on.rete prote.tion against the State. People ay sy 2oli.ally vie7 property as ore tangi2le than a li2erty right! and tangi2les are usually prote.ted via property rules rather than li2ertyNlia2ility rules. o Bhe .ourt<s reasoning is that the parents have rights and o2ligations in a resour.eM there+ore! the parents have a property interest. Ho7 is this ?usti+ied 2ased upon the usual argu ents in +avor o+ private property rightsQ ,+ the propertiDation is to prote.t individuals against the State! 7hy is the state allo7ed to do autopsies .ontrary to parents< 7ishes 2ut the state .annot harvest organs that are needed +or pu2li. 2ene+itQ Bhe .ourt does not address this pro2le . o ,+ you 7ere advising the .ourt! is there a 2etter 7ay to thin8 a2out 7hether or not the parents have a property right $su.h as the .ases regarding a..ession'Q "ote that a gov<t .annot ?ust +ind that a parti.ular resour.e is not property! and there2y .ir.u vent due pro.ess re5uire ents. ,+ 7e use the I2undle o+ sti.8sL analogy $that property is a 2undle o+ the right to sell! eA.lude! possess! et..'! ho7 do 7e deter ine 7hi.h rights are su++i.ient to la2el so ething propertyQ (lso! 7hy should 7e assu e that .alling so ething IpropertyL results in all the sti.8s o+ the 2undle 2e.o ing availa2le to the o7nerQ Bhe tort o+ .onversion is not ne.essary to prote.t the right o+ a person to a8e autono ous de.isions a2out the use o+ hisNher 2ody parts in edi.al or s.ienti+i. resear.h 2e.ause Ien+or.e ent o+ physi.ians< dis.losure o2ligations 7ill prote.t patients against Juse o+ 2ody parts +or purposes not approved 2y the person.KL -oore v. 6egents o+ the ;niv. o+ )ali+.! )ali+.! %==. ;nli8e pu2li.ityNpersona property interests! a person<s .ells are not uni5ue. %oore. Produ.ts developed +ro one<s .ells $e.g. a patented .ell line' are legally distin.t +ro the .ells the selvesM thus! even i+ -oore had an interest in his .ells! he 7ould not have an interest in the .ell line developed through the resear.hers< la2or. %oore7 >a.tsNPro.1 @ $physi.ian and others' used P John -oore<s .ells in potentially lu.rative edi.al resear.h 7ithout P<s per ission! although P had .onsented to the surgery 7hi.h re oved his spleen +or leu8e ia treat ent purposes. P alleged @ did not dis.lose the pre*eAisting resear.h and e.ono i. interest in P<s .ells prior to o2taining .onsent +ro P to eAtra.t his .ells. I-oore +le7 +ro Seattle to ;):( several ti es 2et7een /976 and /90&! having 2een told +alsely that these visits! 7hi.h 7ere designed to .olle.t ore resear.h aterials! 7ere Xne.essary and re5uired +or his 7ell*2eing.<L @s shared in the pro+its that resulted +ro a patent on a .ell line originated +ro P<s .ells. P sued +or $/' 2rea.h o+ dis.losure o2ligations and +or $%' .onversion. @enied. 6<d. (<d $/' $P does have a .ause o+ a.tion +or 2rea.h o+ dis.losure' 2ut 6<d $%' $P does not have a .lai +or .onversion'. 6easoning JPanelliK1 o $/' Balan.e o+ Poli.y )onsiderations1 $a' Prote.t a .o petent patient<s right to a8e autono ous edi.al de.isions. $2' $Bragedy o+ anti*.o ons giving too any property rights' Provide in.entives +or produ.tivity G avoid i posing lia2ilities upon inno.ent parties engaged in so.ially*use+ul a.tivities! su.h as resear.hers 7ho have no reason to 2elieve that their use o+ a .ell line is! or ay 2e! against a donor<s 7ishes1 4ranting .onversion in a .ase li8e this 7ould Ii pose a tort duty on s.ientists to investigate the Jhistory o+ .onsentK o+ ea.h hu an .ell sa ple used in resear.h.L Su.h an i position 7ould have greater ra i+i.ations that ost t7o*party .ases o+ .onversion and! thus! involves .o pleA poli.y de.isions. o $%' Su.h de.isions Iare ore appropriately the su2?e.t o+ legislative deli2eration and resolution.L Bhe legislature is 2etter a2le to gather e piri.al eviden.e! soli.it eApert opinions! and hold hearings at 7hi.h all interested parties .an parti.ipate. o $&' 3Atending the .on.ept o+ .onversion is not ne.essary to prote.t patients< rights in this type o+ .ase. I:ia2ility 2ased upon eAisting dis.losure o2ligations ... prote.ts patients< rights o+ priva.y and autono y 7ithout unne.essarily hindering resear.h.L o Bo esta2lish .onversion! P 7ould have to Iesta2lish an a.tual inter+eren.e 7ith his o7nership or right o+ possessionL o+ the .ells. Sin.e he .learly did not eApe.t to retain possession! he ust esta2lish that he retained o7nership.
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Su.h a .lai is not supported 2y any reported ?udi.ial de.isions or statutory la7. ,n +a.t! the la7 has treated 2ody parts as Io2?e.t sui generis! regulating their disposition to a.hieve poli.y goals rather than a2andoning the to the general la7 o+ personal property.L >urther ore! the patented .ell line and the produ.ts derived +ro it .annot 2e -oore<s property 2e.ause they are! 2y de+inition o+ the patent! the result o+ inventive e++ort and! thus! are +a.tually and legally distin.t +ro -oore<s eA.ised .ells. o ;nli8e .ases o+ pu2li.ity rights! 7hi.h involve a uni5ue personal trait! the .ells and geneti. aterial at issue in -oore<s .ase are Ino ore uni5ue to -oore than the nu 2er o+ verte2rae in the spine or the .he i.al +or ula o+ he oglo2in.L )on.urren.e J(ra2ianK1 o Siding 7ith P 7ould lead to an open ar8etpla.e +or 2ody parts! 7hi.h is a poli.y de.ision 2est le+t to the legislature. @issent JBroussardK1 o Bhe ;ni+or (nato i.al 4i+t (.t $)ali+. Health G Sa+ety )ode! W 7/=0 et se5.' grants a patient the right! 2e+ore a 2ody part is re oved! to .hoose a ong the per issi2le uses to 7hi.h the part ay 2e put a+ter re oval. Braditional .o on la7 prin.iples also re.ogniDe the right o+ a patient to .ontrol the +uture use o+ his 2ody parts. @issent J-os8K1 o Bhe la7 generally re.ogniDes a 2road .on.ept o+ property rights 7ith so e li itations. Bhose li itations! though! do not ne.essarily eAtinguish all property rights in a thing. I<@e+endants< position that P .annot o7n his tissue! 2ut that they .an! is +raught 7ith irony.<L o Poli.y interests that 7ould 2e advan.ed 2y property rights in 2ody parts1 $/' IJ6Kespe.t the hu an 2ody as the physi.al and te poral eApression o+ the uni5ue hu an person.L I<Bhe dignity and san.tity 7ith 7hi.h 7e regard the hu an 7hole! 2ody as 7ell as ind and soul! are a2sent 7hen 7e allo7 resear.hers to +urther their o7n interests 7ithout the patient<s parti.ipation 2y using a patient<s .ells as the 2asis +or a ar8eta2le produ.t.<L $%' "otions o+ +unda ental un+airness .onde n the un?ust enri.h ent o+ one e 2er o+ so.iety at the eApense o+ another. o Bhe ;(4( does not prohi2it the sale o+ 2ody parts +or the purposes o+ I edi.al or dental edu.ation! resear.h! or advan.e ent o+ edi.al or dental s.ien.e.L Bhis i plies that Iit is also legal +or anyone to sell hu an tissue to a 2iote.hnology .o pany +or resear.h and develop ent purposes.L )lass "otes1 o ,s the a?ority<s di++erentiation o+ pu2li.ity rights a good argu entQ ,n -oore<s .ase! his 2ody 7as produ.ing ore than the average a ount o+ ly pho8ynes due to his leu8e ia and! thus! the .ells 7ere easier to identi+y. Bhe .ells the selves 7ere not ne.essarily spe.ial. Ho7ever! the .ourt re.ogniDed that the .ells 7ere spe.ial 7hen the .ourt held that -oore should have 2een in+or ed o+ the do.tor<s e.ono i. interest in the .ells. o "ote that the .ourt .on+uses -oore<s .lai as one see8ing a property interest on the patented .ell line rather than a .lai to .ontrol the use o+ his .ells! at least against edi.al resear.hers. His .lai 7as perhaps ore narro7 than a property .lai . When a person .ontra.ts to retain an interest in re oved 2ody parts or eA.reted 2odily +luids $su.h as se en'! those partsN+luids are .onsidered his property +or pro2ate purposes! under pro2ate la7 7hi.h de+ines property 2roadly as Ianything that ay 2e the su2?e.t o+ o7nership and in.ludes 2oth real and personal property and any interest therein.L >roDen sper .ase1 He.ht v. Superior )ourt! )ali+.! %601 >a.tsNPro.1 @e.eased $Willia 9ane' had +roDen sper sa ples 7ith )ali+ornia )ryo2an8 to 2e used 2y his girl+riend @e2orah He.ht! i+ she desired! to 2e.o e i pregnated a+ter -r. 9ane<s death. He later 8illed hi sel+! and -s. He.ht sought possession o+ the sper . Pro2ate .ourt ordered destru.tion o+ the sper . (ppeals .t. reversed +or a2use o+ dis.retion. Holding1 IJ(Kt the ti e o+ his death! de.edent had an interest! in the nature o+ o7nership! to the eAtent that he had de.ision a8ing authority as to the use o+ his sper +or reprodu.tion. Su.h interest is su++i.ient to .onstitute Xproperty< 7ithin the eaning o+ Pro2ate )ode se.tion 6%.L 6easoning1 o >ollo7ing the logi. o+ the Bennessee .ourt in .avis v. .avis $7hi.h involved the disposition o+ +roDen pree 2ryos'! .ells that have the potential +or hu an li+e should 2e a++orded spe.ial respe.t in the la7. ISper 7hi.h is stored 2y its provider 7ith the intent that it 2e used +or arti+i.ial
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inse ination is thus unli8e other hu an tissue Jli8e -oore<s spleen .ellsK 2e.ause it is Xga eti. aterial< ... that .an 2e used +or reprodu.tion.L o I(s re.ently stated 2y Jthe )ali+orniaK Supre e )ourt ...<,t is not the role o+ the ?udi.iary to inhi2it the use o+ reprodu.tive te.hnology 7hen the :egislature has not seen +it to do soM any su.h e++ort 7ould raise serious 5uestions in light o+ the +unda ental nature o+ the rights o+ pro.reation and priva.y.< $Johnson v. Calvert'...L )lass "otes1 o Bhe donor had a .ontra.t in this .ase! 7hi.h di++ers +ro -oore<s .ase! 2ut 7hy did he have the right to enter into a .ontra.tQ Bhe .ourt argues that 9ane<s .ells 7ere spe.ial due to their reprodu.tive potential! as opposed to -oore<s +ungi2le .ells. >urther ore! a history o+ private .ontra.ts points to7ard a so.ial .usto o+ granting property rights in sper .

B. (rtists< -oral 6ights ,+ authoriDed 2y statute! an artist ay aintain oral rights to a .reated 7or8 a+ter it is no longer in his possession. -oral rights! 7hi.h are inaliena2le rights 7ith respe.t to the odi+i.ation or destru.tion o+ one<s artisti. .reations! are designed to prote.t the personal and reputational! rather than purely onetary! value o+ a 7or8 to its .reator. $see %0&'. (rtist<s 6ights1 -oa8ley v. 3ast7i.8! -ass.! %761 o >a.tsNPro.1 ,n /97/! -oa8ley $P' .reated a s.ulpture o+ a siAty*eight +oot long .on.rete 2lo.8 7ith 600 separate .era i. tiles +or the >irst Parish ;nitarian )hur.h in 3ast Bridge7ater! -ass. ,n /909! the .hur.h property 7as sold to the 4ra.e Bi2le )hur.h >ello7ship! ,n..! 7ith pastor 3ast7i.8 $@'. @ intended to re ove the 7or8! and testi+ied that the s.ulpture 7as o2?e.tiona2le on religious grounds. ;nder the -ass. (rt Preservation (.t! P sought an in?un.tion against destru.tion o+ the 7or8. Bhe (.t I.reateJedK ne7 duties +or o7ners o+ +ine art! 7ho ay not alter! destroy! or grossly negle.t a 7or8 o+ +ine art in their possession that is su2?e.t to the provisions o+ the (.t.L J +or @. (<d. o Holding1 Bhe statute did not apply to art at issue 2e.ause the statute 7as not intended to apply retroa.tively to 7or8s .reated 2e+ore the e++e.tive date o+ the statute. o 6easoning1 Brial .t. +ound that the artist Ihad invested su2stantial ti e and e otional resour.es in the 7or8! and that it 7as Xan eApression o+ JP<sK personality.<L 4enerally! statutes are interpreted to 2e I<prospe.tive in their operation! unless an intention that they shall 2e retrospe.tive appears 2y ne.essary i pli.ation +ro their 7ords! .onteAt or o2?e.t 7hen .onsidered in light o+ the su2?e.t atter! the pre*eAisting state o+ the la7 and the e++e.t upon eAistent rights! re edies and o2ligations.<L (lthough the (.t 7as .learly odeled upon )ali+ornia<s (rt Preservation (.t! the -ass. (.t di++ers in regard to t7o relevant provisions o+ the )ali+. (.t1 $i' the )ali+. (.t eApressly relates to I7or8s o+ +ine art 7henever .reatedL 7hile the -ass. (.t does not .ontain this provisionM $ii' +or an artist to retain oral rights in a 7or8 o+ art atta.hed to a 2uilding! the -ass. (.t re5uires a de.laration o+ the artist<s rights to 2e 7ritten and signed 2e+ore the art is installed! 7hereas the )ali+. (.t does not re5uire su.h a de.laration to 2e re.orded 2e+ore the art<s installation. IBhe legislative history o+ the J-ass.K (.t strongly suggests that the .hanges ?ust des.ri2ed 7ere deli2erate and! .onse5uently! supports the vie7 that the :egislature did not intend the (.t to apply retrospe.tively to 7or8s .reated 2e+ore its ena.t ent.L Bhe :egislature ay have .on.luded that the ne7ly*.reated duties should not 2e i posed upon people 7ho a.5uired the art prior the la7<s ena.t ent! parti.ularly sin.e artists .ould not have relied on the prote.tions o+ the la7 prior to its eAisten.e. ). Pu2li. 6ights /. Bhe "avigation Servitude $servitude H the right to use another<s land' o a. "aviga2le Waters $&00' History1 o Jus publi"um in 3ngland held that the pu2li. had rights to naviga2le 7aters that super.eded sovereign or private o7nership. o /709 Judi.iary (.t granted ad iralty ?urisdi.tion eA.lusively to the +ederal .ourts. o /0%4 Gibbons v. 4gden $;.S.' esta2lished that )ongress has plenary authority to legislate on the su2?e.t o+ .o er.ial navigation.

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/0=/ * The Propeller Genesee Chief v. &it8hugh $;.S.' eAtended ad iralty ?urisdi.tion +ro ?ust tidal 7aters to all 7aters that are naviga2le in +a.t. Servitude1 Bhe )o er.e )lause o+ the )onstitution $art. ,! W0! .l.&' i poses a navigation servitude on all 7aters o+ the ;.S. that are in +a.t naviga2le! 7here2y no state govern ent! or individual or .orporation a.ting under the authority o+ state la7! has the po7er to o2stru.t or inter+ere 7ith the pu2li.<s right to +ree use o+ naviga2le 7aters +or transportation. o IBhus! 7ithout 2eing .onstitutionally o2ligated to pay .o pensation! the ;nited States ay .hange the .ourse o+ a naviga2le strea ! State of South Carolina v. State of Georgia! ... or other7ise i pair or destroy a riparian o7ner<s a..ess to naviga2le 7aters! Gibson v. ,nited States ... even though the ar8et value o+ the riparian o7ner<s land is su2stantially di inished.L ,.S. v. ands! ;.S. $/967'. o Open 5uestion as to 7hether )ongress .ould override the pu2li. right to navigation +or eAa ple! to +urther an environ ental goal. o 2. "aviga2le (irspa.e $&/&' eAtension o+ "aviga2le Waters prin.iple Outlined in ;nited States v. )aus2y! ;.S. $/946'! &/&1 o ;nder the (ir )o er.e (.t o+ /9%6! as a ended 2y the )ivil (eronauti.s (.t o+ /9&0! the ;.S. has I.o plete and eA.lusive national sovereignty in the air spa.eL over the nation. 49 ;.S.). W/76$a'. o 3very .itiDen has Ia pu2li. right o+ +reedo o+ transit in air .o er.e o through the naviga2le air spa.e o+ the ;nited States ...L $49 ;.S.). W40&' 7here Inaviga2le air spa.eL is de+ined as Iairspa.e a2ove the ini u sa+e altitudes o+ +light pres.ri2ed 2y the )ivil (eronauti.s (uthorityL $49 ;.S.). W/00'. o Justi+i.ation1 )ontrary to the do.trine o+ ad "oelum! i+ the .ourts 7ere to re.ogniDe that a private lando7ner o7ns the air spa.e a2ove his property! Ievery trans.ontinental +light 7ould su2?e.t the operator to .ountless trespass suits ... J7hi.h 7ouldK .log these high7ays! seriously inter+ere 7ith their .ontrol and develop ent in the pu2li. interest! and trans+er into private o7nership that to 7hi.h only the pu2li. has a ?ust .lai .L o I>lights over private land are not a ta8ing! unless they are so lo7 and so +re5uent as to 2e a dire.t and i ediate inter+eren.e 7ith the en?oy ent and use o+ the land.L Bhe )ourt ruled in Causby that over+lights 2y ilitary planes inter+ered 7ith P<s use and en?oy ent o+ his land $.hi.8en +ar ' and! thus! .onstituted a ta8ing o+ P<s property 7arranting .o pensation 2y the ;.S. govern ent. %. Bhe Pu2li. Brust @o.trine $1us publi"um or Ipu2li. rightL' o Bhe pu2li. trust do.trine is the prin.iple that .ertain resour.es are preserved +or pu2li. use! and that the govern ent is re5uired to aintain it +or the pu2li.Us reasona2le use. Best +or violation o+ pu2li. trust $0a'e %i"higan &ederation'1 o $/' )riti.ally s.rutiniDe Iatte pts 2y the state to surrender valua2le pu2li. resour.es to a private entity.L o $%' IJBKhe pu2li. trust is violated 7hen the pri ary purpose o+ a legislative grant is to 2ene+it a private interest.L o $&' IJ(Kny atte pt 2y the state to relin5uish its po7er over a pu2li. resour.e should 2e invalidated under the do.trine.L o )ases1 Pu2li. trust do.trine1 ,llinois )ent. 6.6. )o. v. ,llinois! ;.S. $/90%'! &/=1 Bhe )ourt invalidated the trans+er o+ /000 a.res o+ su2 erged lands in :a8e -i.higan to the ,ll. )ent. 6.6. and held that title over su2 erged lands is Idi++erent in .hara.ter +ro that 7hi.h the State holds in lands intended +or sale. ... ,t is a title held in trust +or the people o+ the State that they ay en?oy the navigation o+ the 7aters! .arry on .o er.e over the ! and have li2erty o+ +ishing therein +reed +ro the o2stru.tion or inter+eren.e o+ private parties.L Just as the State .annot a2di.ate its poli.e po7ers in the ad inistration o+ govern ent and the preservation o+ pea.e! the State .annot a2di.ate its trust over pu2li. property! su.h as naviga2le 7aters and the land underneath the ! Iso as to leave the entirely under the use and .ontrol o+ private parties...L Pu2li. trust do.trine1 :a8e -i.higan >ederation v. ;nited States (r y )orps o+ 3ngineers! ".@. ,ll. $/990'! &%41 :oyola ;niversity o+ )hi.ago! a not*+or*pro+it private edu.ational institution! developed plans to +ill*in a portion o+ :a8e -i.higan in order to eApand its la8eshore .a pus. :oyola sought and re.eived lo.al! state! and +ederal govern ent approval +or the pro?e.t. Bhe .ourt +ound that the property
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7as .onveyed to :oyola Iin violation o+ the pu2li. trustL and granted the >ederation<s re5uest to en?oin :oyola +ro .ontinuing 7ith the pro?e.t. IWhat 7e have here is a transparent givea7ay o+ pu2li. property to a private entity.L[ o :oyola argued that! i+ it 7ere allo7ed to .o plete the la8e+ill a..ording to the proposal! the pu2li. 7ould 2e in a 2etter position to en?oy the la8e $a pu2li. resour.e' than .urrently! sin.e :oyola .urrently o7ns the eAisting shoreline and has granted no right o+ pu2li. a..ess. Bhe .ourt disagreed! though! and +ound that the pu2li. 7ould 2e sa.ri+i.ing /0.= a.res o+ su2 erged lands to gain a..ess to a la8e that the pu2li. already has Iunrestri.ted a..essL to. ,n addition to inherent pu2li. o7nership! other 7ays to esta2lish pu2li. rights in a resour.e1 I@edi.ationL the o7ner eApresssly or i pliedly gi+ts or grants land to the govern ent +or pu2li. use and the o7ner loses rights to the land that are in.onsistent 7ith the eAer.ise and en?oy ent o+ the pu2li. uses to 7hi.h the land has 2een .o itted. o 6e?e.ted in Thornton v. +ay $2elo7' 2e.ause until /967! the o7ners 7ould not have even thought they had a property interest to dedi.ate Pres.riptive ease ent .reated in +avor o+ one person in another<s land 2y uninterrupted use and en?oy ent o+ the land in a parti.ular anner +or the statutory period! so long as the user is open! adverse! under .lai o+ right! 2ut 7ithout authority o+ la7 or .onsent o+ the o7ner. o Bhe .ourt in Thornton v. +ay stated this theory .ould apply 2ut pre+erred the theory o+ .usto 2e.ause it .ould esta2lish a right to use over a larger region! 7hereas Ipres.ription applies only to the spe.i+i. tra.t o+ land 2e+ore the .ourt! and dou2t+ul pres.ription .ases .ould +ill the .ourts +or years 7ith tra.t*2y*tra.t litigation.L )usto per Bla.8stone! esta2lished 2y o $/' anti5uity! or Ilong and generalL usage o $%' uninterrupted eAer.ise o+ the right o $&' pea.ea2le and dispute*+ree use o $4' reasona2le use o+ the land o $=' .ertainty o+ 2oundaries o $6' o2ligatory use! or use that is uni+or a ong si ilarly*situated lands o $7' .ondu.t that is not repugnant! or in.onsistent! 7ith other .usto s or 7ith la7. )usto and Pu2li. 6ights1 State o+ Oregon eA rel. Bhornton v. Hay! Or. $/969'! &&&1 o Bhe Hays o7ned a tourist +a.ility on )annon Bea.h and sought to .onstru.t a +en.e in the Idry* sandL area 2et7een the vegetation edge o+ their property and the ordinary high*tide line o+ the 2ea.h ad?a.ent to their property. Bhe state o2tained an in?un.tion preventing the Hays +ro .onstru.ting the +en.e or other i prove ents in the dry*sand area. (<d. o 6easoning1 @ue to histori.al .usto ! Ithe general pu2li. has assu ed that the dry*sand area 7as a part o+ the pu2li. 2ea.h! and the pu2li. has used the dry*sand area +or pi.ni.s! gathering 7ood! 2uilding 7ar ing +ires! and generally as a head5uarters +ro 7hi.h to supervise .hildren or to range out over the +oreshore as the tides advan.e and re.ede.L -oreover! state and lo.al o++i.ers have poli.ed the land! and uni.ipal sanitation 7or8ers have .leaned it. )riti5ues! as detailed 2y )arol 6ose $&4%'1 3Atending the pu2li. trust do.trine o+ naviga2le 7ater7ays and high7ays to re.reational use goes 2eyond the ?usti+i.ations +or pu2li. trust. ,+ the pu2li. has su.h a high desire or need +or .ertain land! the govern ent should pur.hase the land +ro its private o7ners. ;n.ertainty a2out property rights .ould lead to .on+li.ts! su.h as 2y instigating o7ners to ta8e aggressive easures to restri.t a..ess a.ross their land. :a.8 o+ private rights .an lead to a Itragedy o+ the .o onsL 7here Ino one has any in.entive to pur.hase the property! invest in it! or .are +or it! 2ut only to .onsu e as u.h as possi2le all o+ 7hi.h leads to deterioration and 7aste.L Bhe ?usti+i.ation that .ertain resour.es are so plenti+ul or un2ounded as to not erit a syste o+ resour.e anage ent does not .on.ur 7ith the li itation on private rights under the pu2li. trust do.trine +or 7ater7ays! road7ays! pu2li. s5uares! et.. 6egarding the .on.ept o+ the tragedy o+ the anti*.o ons! 7here too any rights holders $rather than too +e7' eAist to anage the syste e++i.iently! .onsider1 o Bhe 4overn ent ust a..urately identi+y su.h instan.es o+ ar8et +ailureM o IJ,Kt ust 2e .lever enough to eAer.ise its po7ers so as to redu.e the ine++i.ien.yM

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it ust avoid errors or politi.al te ptations to eAer.ise its po7ers in 7ays that .reate ne7 ine++i.ien.iesM and o the .osts o+ e++e.tive state intervention ust not eA.eed the in.rease in produ.tion it 2rings a2out.L $&44<&'. (rgua2ly! re.reation +osters de o.rati. so.ial intera.tion and is sus.epti2le to private hold*out pro2le s. :and used +or these purposes .ould 2e .onsidered Iinherently pu2li.L $not anaged privately or 2y the govern ent! 2ut 2y the pu2li.'.
o

,,,. O7ner Sovereignty and ,ts :i its

Ba.8ground1 Bhe 6ight to 3A.lude o Bhe right to eA.lude is sa.rosan.t. Ja.5ue v. Steen2erg Ho es! ,n..! Wis. $/997'! /1 @espite ada ant protests 2y the property o7ners $P'! @ plo7ed a path through their sno7*.overed +ield and delivered a o2ile ho e to their neigh2or. P had re.ently lost possession o+ land in an adverse possession suit! and did not grant per ission to @ +or use o+ their land. @ .ut a.ross their land any7ay and gloated a+ter7ards. @ 7as issued a .itation +or O&0 +or the trespass. Brial .t. a7arded O/ in no inal da ages and O/009 in punitive da ages to Ps. Bhe appellate .ourt overturned the punitive da ages. Sup )t. reversed and reinstated the punitive da ages! holding that the O&0 +ine 7as insu++i.ient to vindi.ate the o7ner<s right to eA.lude. o Poli.y issues1

3++i.ien.y Preventing sel+*help o $(lthough the Ja.5ues< .ondu.t ay not have 2een e++i.ient in this .ase! 7e respe.ting o7ners< rights 7ill 2e e++i.ient in the long*run or 2ig pi.ture.' Prote.tion o+ personality interest in land Produ.tivityN:a2or theory ,ndividual rightsN autono yN politi.al 2ul7ar8 $prote.tion' )o on eApe.tation $that 7hat<s ine is ine' )ivil (.tions1

ay 2elieve that

Brespass "uisan.e $7hen the sour.e o+ in?ury originated outside P<s land' Personal Property 7rits1 o Brespass de 2onis asportatis $d.2.a.' applied to +or.i2le .arrying o++ $asportation' o+ P<s goodsM o @etinue applied to un?ust detain ent o+ spe.i+i. goods 7hi.h re ained in @<s possession and 7hi.h P sought to 2e returnedM o Brover applied to 7rong+ul .onversion to @<s o7n use $trover later 2e.a e supplanted 2y the tort o+ .onversion'M o 6eplevin originally applied 7hen a landlord had seiDed P<s property as a distraint +or unpaid rent and allo7ed P to post a 2ond +or i ediate return o+ property until ad?udi.ation deter ined a +inal result! and it later .a e to 2e used 7henever P sought re.overy o+ possessionM o Brespass to .hattels applied in the a2sen.e o+ asportation 2ut 7hen @ had allegedly in?ured or inter+ered 7ith P<s property 7hile it re ained in P<s possession. (. :i its to the 6ight to 3A.lude o When the hu an rights $e.g. right to priva.y and li2erty' out7eigh property rights1 IBitle to real property .annot in.lude do inion over the destiny o+ persons the o7ner per its to .o e upon the pre ises. ... JPropertyK rights are relative and ... ne.essity! private or pu2li.! ay ?usti+y entry upon the lands o+ another.L State v. Sha.8! ".J. $/97/'! 40/1 @s 7ere 7or8ing +or t7o nonpro+it govern ent su2sidiDed organiDations that 7ere esta2lished to provide legal and edi.al aid to seasonal +ar 7or8ers. @ 7ent to P<s +ar to render edi.al attention to one +ar 7or8er and legal advi.e to another. P stopped the and told the that legal advi.e 7ill only 2e given in his o++i.e and in his presen.e. @ re+used. P .alled the poli.e and @s 7ere .onvi.ted under a trespass statute. 6eversed. 6easoning1

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IJ;Knder our State la7 the o7nership o+ real property does not in.lude the right to 2ar a..ess to govern ental servi.es availa2le to igrant 7or8ers and hen.e there 7as no trespass 7ithin the eaning o+ the penal statute.L o IProperty rights serve hu an values. Bhey are re.ogniDed to that end! and are li ited 2y it.L o )ongress provided +or Iassistan.e +or igrant and other seasonally e ployed +ar 7or8ers and their +a iliesL 7ith se.tion %06/ o+ Bitle ,,,*B o+ the 3.ono i. Opportunity (.t o+ /964! 7hi.h stated that Ithe purpose o+ this part is to assist igrant and seasonal +ar 7or8ers and their +a ilies to i prove their living .onditions and develop s8ills ne.essary +or a produ.tive and sel+* su++i.ient li+e in an in.reasingly .o pleA and te.hnologi.al so.iety.L ... IBhese ends 7ould not 2e gained i+ the intended 2ene+i.iaries .ould 2e insulated +ro e++orts to rea.h the .L o IBhe +ar er! o+ .ourse! is entitled to pursue his +ar ing a.tivities 7ithout inter+eren.e ... But 7e see no legiti ate need +or a right in the +ar er to deny the 7or8er the opportunity +or aid availa2le +ro +ederal! State! or lo.al servi.es! or +ro re.ogniDed .harita2le groups see8ing to assist hi .L )lass "otes1 o Hypo1 What a2out a trespasser 7ho doesn<t have as strong o+ a .ase as so eone 2ringing edi.al or legal help to a igrant 7or8erQ o Standards ta8e ti e to 7eigh the relevant +a.tors and are less predi.ta2le! as opposed to a .learer $eA ante' rule. (lthough the .ourt<s di.ta indi.ate a 2road standard is applied! the holding +or this .ase applies only to edi.al and legal assistan.e to igrant 7or8ers. ,+ the standard is to 2alan.e the o7ner<s interests 7ith pu2li. or govern ent interests on the other! 7here is the line dra7nQ When the disruption to the o7ner<s rights are de minimus. When the resulting 2alan.e 7ould not lead to perverse in.entives. B. :i its on (nalogy to Brespass o Bhe tort o+ trespass to .hattels does not en.o pass ele.troni. .o uni.ation that does not da age or i pair the +un.tioning o+ another<s physi.al property. ,ntel )orp. v. Ha idi! )ali+. $%00&'! 4/%1 >a.ts1 Ha idi! an eA*,ntel e ployee! e ailed .urrent e ployees to .riti.iDe ,ntel<s H6 pra.ti.es. H<s .o uni.ations .aused no physi.al interruption or da age to ,<s syste s. , sued +or trespass to .hattels. Js +or P $in?un.tion'. (<d. 6<d. (rgu ents re1 eAtending property rule prote.tion to IvirtualL property (gainst JHa idi a?orityK ,n +avor JdissentK Su.h ele.troni. .o uni.ation Idoes not inter+ere Bro7n1 )ali+. la7 and 6SB allo7 an o7ner to use 7ith the possessor<s use or possession o+! or any reasona2le +or.e to prote.t against any other legally prote.ted interest in! the personal inter+eren.e! even i+ it .auses no da age. property itsel+.L CompuServe $an anti*spa ing .ase' involved har B1 ,ntel<s o2?e.tion 7as not to the .ontent o+ H<s to legally prote.ted interests! su.h as 2usiness essages 2ut the .o uni.ation o+ that .ontent reputation and .usto er good7ill. using ,<s 2usiness resour.es. :a.8 o+ ne.essity1 Other tools o+ tort la7 prote.t :a2orNprodu.tivity* B1 O7ners should not have to e.ono i. interests and reputation in?ured 2y spend ti e and energy to .lean up a+ter un7anted .o uni.ation. .o uni.ation. ,nstitutional .o peten.y1 Su.h a poli.y .hange -os81 )an allo7 trespass a.tions +or private should pro2a2ly 2e ade 2y the legislative 2ran.h. net7or8s $not pu2li. net7or8sN.o on .arriers'. $4%/<&'. -1 Bhe a?ority<s rule o+ re5uiring physi.al da age 7ill still deter ass e ailers +ro using others< syste s +or +ear o+ in.urring lia2ility i+ da age o..urs. -1 ,+ ?udi.ial re edy is not allo7ed 7hen sel+* help has 2een ine++e.tive! o7ners li8e , 7ill have no re.ourse unless a al+un.tion or .rash results.
o

o )lass "otes1 +amidi raises the issue o+ the eAtent to 7hi.h 7e 7ant to use real property prin.iples in .ases
involving ne7er te.hnologies. :essig argued against! 7hile others argue that the issues are very si ilar! su.h as the issue o+ eAternalities. ). :i its on Sel+*Help

&&

o 6eal property $not a unani ous rule'1 ( landlord .annot use sel+*help 2ut ust resort to the ?udi.ial pro.ess
to dispossess a tenant 7ho has not a2andoned or voluntarily surrendered her leasehold and .lai s a right to possession adversely to the landlord<s .lai o+ 2rea.h o+ a 7ritten lease. Berg v. Wiley! -inn. $/970'! 4%01 Ba.8ground1 Prior to this .ase! the la7 7as that a : .ould not reenter to ta8e possession o+ real property unless $i' the lease .ontained a reentry .lause! $ii' B had violated the lease! and $iii' :<s eans o+ reentry 7as pea.ea2le. >a.ts1 Wiley leased a .o er.ial spa.e to Berg<s prede.essor! 7ho assigned the lease to B. B operated a restaurant in the spa.e. (+ter a .ouple year! W. 2elieved that B had violated the ter s o+ the lease! and W .hanged the lo.8s on the 2uilding. B sued +or lost pro+its and loss o+ .hattels. Jury +or P on the 2asis that she had not a2andoned or surrendered the leasehold 2e+ore 2eing lo.8ed out! and W<s entry 7as +ound to 2e +or.i2le as a atter o+ la7. (<d 2N. : did not resort to ?udi.ial eans. 6easoning1 o Bhe only reason W<s a.tion did not result in violen.e is 2N. B 7as not present 7hen W .hanged the lo.8s and B su2se5uently resorted to ?udi.ial eans. o Judi.ial eans are ade5uate 2N. they are readily availa2le and eApeditious. 3ven i+ potential destru.tion o+ property 7ere at issue! W .ould have sought a te porary restraining order. o Personal property1 ( se.ured party has the right to ta8e possession! upon de+ault! o+ .ollateraliDed personal property 7ithout ?udi.ial pro.ess i+ possession .an 2e o2tained 7ithout a 2rea.h o+ the pea.e. Willia s v. >ord -otor )redit )o pany! 0th $/90%'! 4&41 >a.ts1 (+ter a divor.e! W<s hus2and stopped a8ing pay ents +or her .ar. >-))! through a 7re.8er .o.! repossessed the vehi.le. J +or P 2ut J"OC +or @. (++<d. 6easoning1 (lthough W argued that the repossession 7as a..o plished 2y the ris8 o+ in.iting violen.e $and! thus! .onstituted a 2rea.h o+ the pea.e'! W testi+ied that the repossessors 7ere polite and did not threaten her in any 7ay and that she did not ver2ally o2?e.t to the ta8ing. @issent1 o Bhe trial .ourt +ound that 7hen W realiDed her .ar 7as 2eing repossessed! Ishe ran outside to stop the ... J2utK ade no strenuous protests to their a.tions.L Bhe ?ury reasona2ly +ound a 2rea.h o+ the pea.e. o Bhe a?ority<s rule in.entiviDes repossessors to pro.eed Iunless and until violen.e results.L @. >urther li its on the right to eA.lude o $/' "e.essity Ploo+ v. Putna ! Ct. $/900'! 4&91 o @ un oored P<s 2oat! 7hi.h P had oored at @<s do.8 7ithout @<s .onsent due to ne.essity as a result o+ a Isudden and violent te pestL that threatened in?ury to the passengers and destru.tion to the 2oat and its other .ontents. P sued +or trespass +or 7hen @<s e ployee un oored P<s 2oat. @ de urred! .ontending that P did not have to enter upon his do.8. J +or P $P<s entry onto @<s property 7ould 2e allo7ed 2y ne.essity! 7hi.h is a +a.tual deter ination to 2e ade at trial'. o Pre.edent1 %iller v. &andrye @ 7as not guilty o+ trespass even though his dog 7ent onto P<s land 2N. @<s dog 7as .hasing sheep o++ o+ @<s land! and @ did 7hat he .ould to .all the dog 2a.8 +ro .rossing onto P<s property. ( traveler on a high7ay ass pass an o2stru.tion 2y going onto another<s land i+ doing so is ne.essary to .ontinue do7n the high7ay. ,n preservation o+ hu an li+e! trespass 2y ne.essity is allo7ed. o Su2se5uent1 :ia2ility rule in 9in"ent v. 0a'e (rie! -inn. $/9/0'! 44/n% $@ 8ept his 2oat oored at P<s do.8 longer than P 7anted 2N. @ 7as 7orried a2out an i pending stor ! and the 2oat .aused da age to P<s do.8. J +or P da ages! even though @<s a.tions 7ere ?usti+ied 2y ne.essity.' o $%' )usto @ue to .usto ! hunters have a general right to enter unen.losed rural land in pursuit o+ ga e 7ithout +irst o2taining per ission +ro the o7ner! unless I"o HuntingL or I"o BrespassingL sign have 2een pro inently posted. -.)oni.o v. Singleton! S.). $/0/0'! 44%1 $@ had rode a horse onto P<s property and hunted deer on the unen.losed and un.ultivated land despite P<s 7arning and .o and to @ not to. J +or @. (<d.'

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>en.ing*out la7s in any 7estern states re5uire .on.erned lando7ners to ta8e a++ir ative easures to prote.t their land! 7hile +en.ing*in la7s in any eastern states re5uire livesto.8 o7ners to ta8e a++ir ative easures to insure their livesto.8 do not es.ape and .ause da age to others< property. $444n&'. $&' Pu2li. (..o odations :a7s (reas open to pu2li. use ust grant reasona2le a..ess to all .usto ers on a nondis.ri inatory 2asis! unless the o7ner .an sho7 that a .usto er 7ould Idisrupt the regular and essential operations o+ the Jpre isesKL or threaten the se.urity o+ the pre ises and its o..upants. ;ston v. 6esorts ,nt<l Hotel! ,n..! ".J. $/90%'! 440 $5uoting State v.S"hmid! 4=/'1 o >a.ts1 ;ston had 2een eA.luded +ro 6esort<s 2la.8?a.8 ta2les 2N. he .ounted .ards. ; sued! .lai ing that 6 had no la7+ul right to eA.lude hi . J +or P! 2ut te porary restraining order +or 90 days in .ase the )asino )ontrol )o ission o+ "e7 Jersey .hanges their rules in a 7ay that 7ill allo7 6 to eA.lude ;. o 6easoning1 Bhe )o ission has the eA.lusive statutory right to deter ine rules o+ li.ensed .asino ga es! and they had not pro ulgated a rule to eA.lude .ard .ounters. "o allegations have 2een ade that ; violated any )o ission rules. Other .ourts have held that the o7ner o+ an entertain ent venue .an eA.lude anyone +ro the pre ises +or any reason other than dis.ri ination 2ased on ra.e! .olor! .reed! national origin! or seA. Broo's v. Chi"ago .owns Assn.# $n".! 7th $/906'! 4=&n& $reasoning that +ree ar8et +or.es 7ill prote.t against Ioutrageous eA.essesL'. "ote that the ;.S. Supre e )ourt held that a ta8ing had not o..urred 2y a )ali+. Supre e )ourt de.ision that re5uired a shopping .enter to allo7 politi.al eApression on the property. Prune:ard Shopping Ctr. v. obins! ;S $/900'! 4=4n6 G /&46 $+inding no reason to 2elieve @s< eApression as li ited 2y per itted restri.tions on ti e! pla.e! and anner o+ eApression 7ould Iunreasona2ly i pair the value or use o+ JP<sK property as a shopping .enter.L'

,C. Bhe ( eri.an 3state Syste (. >oundational Prin.iples 3states re+er to ultiple o7nership 2y divisions o+ ti e $as opposed to division 2y physi.al attri2utes 7ith sur+a.eN ineral rights or division 2y use 7ith situations li8e State v. Sha"' or Ja"2ue v. Steenberg'. o 3states allo7 +or a ore e++i.ient use o+ the value o+ property 2y allo.ating property to users 7ith spe.ialiDed s8ills 7ho .an a.tualiDe the potential value. o 3states distri2utes the ris8s o+ o7nership.

Ber s1 o Present possessory interest H the right to .urrently possess a pie.e o+ land. o >uture possessory interest H the right to possess a pie.e o+ land in the +uture $e.g. ay 2e upon the o..urren.e o+ a .ondition or the end o+ a spe.i+ied ter '. ( +uture interest has value that is taAa2le upon assign ent. o "onpossessory interest H the right to use a pie.e o+ land 7ithout the right to ever ta8e possession $e.g. ease ents and .ovenants'. o >reehold $e.g. +ee si ple' vs. non*+reehold $leases' o Words o+ li itation de+ine the type o+ interest given to the grantee $e.g. Iand his heirsL gives no +uture interest to the heirs apparent' o Words o+ pur.hase de+ine 7ho the grantee is $e.g. to (' 7hen property is .onveyed 2y deed or 7ill. See I)hara.teristi.s o+ Present Possessory 3statesL handout. o Bypes o+ ,nterests in 6eal Property1 "on*possessory or Possessory o >uture or o Present >reehold $e.g. +ee si ple! li+e estate' "on*+reehold $see Se.. C,,,' o Benan.y +or years $ter o+ years'

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Benan.y at 7ill Periodi. tenan.y $e.g. onth*to* onth or year*to*year' Prin.iple o+ )onservation o+ 3states1 7hen an estate is su2divided into estates o+ lesser duration! the su2*estates ust add up to the sa e duration as the original estateM thus! a li+e estate ust have a +uture interest. Poli.y .onsiderations1 o ,n.entiviDe .reation o+ 7ealth! 2ut o @istri2ute that 7ealth 2roadly.
o o

B. @ivisions 2y Bi e 3states in :and o Present Possessory ,nterests $==0' >reehold o /. >ee si ple a2solute -ost rights! privileges! and i unities o+ all the estates. "o natural endM only i+ o7ner dies intestate 7ithout heirs $at 7hi.h the land es.heats to the state'. O7ner .an designate a su..essor o7ner! 2y gi+t! sale! or 7ill $e.g. O grants Bla.8a.re Ito ( and her heirsL or Ito ( in +ee si pleL or Ito (.L' o %. :i+e estate and li+e estate per $or pur' autre vie "aturally ends 7ith the death o+ a na ed personM that person .an sell the property! 2ut the pur.haser only re.eives a li+e estate pur autre vie $Ia..ording to the li+e o+ anotherL' and 7ill lose the property upon the death o+ the na ed person. )an only 2e designated 2y gi+t or sale $not 2y 7ill' $e.g. O gives Ba Ito ( +or li+e! and then to B.L ( o2tains a li+e estate 2y the gi+t! 2ut B o2tains a re ainder in +ee si ple'. Jure uAoris $I2y right o+ the 7i+eL'1 o ;pon arriage! a an a.5uired a li+e estate in all his 7i+e<s real property. Bhis estate! 8no7n as 1ure u-oris! gave the hus2and the use and o..upation o+ the land! as 7ell as all rents and pro+its +ro the land! +ree +ro any .lai 2y the 7i+e. Bhe li+e estate lasted until the arriage 7as dissolved 2y divor.e! either spouse died! or a .hild 7as 2orn alive. o ,+ no .hild 7as 2orn alive o+ the arriage! the an<s li+e estate .a e to an end upon his 7i+e<s death. o ,+ a .hild 7as 2orn alive o+ the arriage! the hus2and<s estate 7as enlarged to a li+e estate +or his o7n li+e. Bhis type o+ li+e estate 7as 8no7n as a Benan.y 2y the )urtesy 2e.ause the hus2and held it .urtesy o+ the la7. Bhe la7 granted that .ourtesy to en on the theory that hus2ands 7ere the guardians o+ their 7ives! and that a 7o an .eased to 2e a separate person 7hen she got arried! instead she 2e.o e part and par.el o+ her hus2and. o Bhe -arried Wo enUs Property (.ts passed in the /000Us .hanged all this. o &. @e+easi2le +ees -ay end upon the happening o+ a na ed .ontingen.y Bypes1 o >ee si ple deter ina2le ends upon the o..urren.e o+ a na ed event! 7hereupon the grantor or grantor<s su..essor ta8es the property $e.g. J grants Ba Ito "#; as long as it is used +or instru.tion in the la7! then to JL'. o >ee si ple su2?e.t to .ondition su2se5uent upon happening o+ a na ed event! .an 2e ended 2y a.tion $sel+*help or la7suit' 2y the grantor or grantor<s su..essor $e.g. J grants Ba Ito "#;! 2ut i+ it is not used +or instru.tion in the la7! then J has the right to reenter and ta8e the pre isesL'. o >ee si ple su2?e.t to eAe.utory li itation upon happening o+ a na ed event! the property interest is granted to a party other than the grantor $e.g. J grants Ba Ito "#; as long as it is used +or instru.tion in the la7! then to )olu 2iaL or Ito "#;! 2ut i+ it is not used +or instru.tion in the la7! then to )olu 2iaL'. o Other deter ina2les! su.h as a li+e estate deter ina2le $e.g. Ito 3 +or li+e so long as al.ohol is not .onsu ed on the pre isesL'.

&6

>ee tail (2olished or noneAistent in ost states. 4rants a nontrans+era2le li+e estate to 2e +ollo7ed 2y a si ilar interest in the 2lood des.endants $issue' o+ that person! so long as the 2loodline .ontinues $e.g. Ito 3 and the heirs o+ her 2odyL or Ito 3 and her issueL'. "on+reehold o :ease $see Se.. C,,,' >uture ,nterests $==4' ,nterests retained 2y the grantor $so eti es .alled Ireversionary interestsL' o 6eversion +ollo7s a li+e estate or other .onteAt in 7hi.h the o7ner has not disposed o+ the entire +ee. o Possi2ility o+ 6everter +ollo7s a +ee si ple deter ina2le. 3ven though this involves an auto ati. +or+eiture! i+ the grantor does not a.tually sue +or e?e.t ent 2y the ti e the statute o+ li itations ended! the possessor .ould o2tain a +ee si ple a2solute 2y adverse possession. o 6ight o+ 3ntryN a8a Po7er o+ Ber ination +ollo7s a +ee si ple su2?e.t to .ondition su2se5uent. ,+ the grantor does not assert his right to re*entry 7ithin a reasona2le ti e $generally! 7ithin the ti e o+ the s.o.l.'! the possessor .ould o2tain an e5uita2le ?udg ent that 7ould 2ar re* entry 2y the do.trine o+ la.hes! in e++e.t .reating a +ee si ple a2solute. ,nterests )reated in a 4rantee o 6e ainder +ollo7s a li+e estate 2ut is in a grantee! not the grantor. ,nde+easi2ly vested the identity o+ the ta8er$s' is 8no7n! no other .ontingen.y has to 2e +ul+illed 2e+ore the interest 2e.o e possessory! and no .ondition su2se5uent .an shorten the re ainder. )ontingent leaves so e un.ertainty as to the identity o+ the ta8ers $I3<s .hildren and their heirsL' or the o..urren.e o+ a .ondition $Ito 3 i+ she graduates +ro high s.hool 2y /9L'. Cested su2?e.t to .o plete de+easan.e $Ito 3 +or li+e! then to BM 2ut i+ B +ails to graduate +ro high s.hool 2y age /9! then to :L'. Cested su2?e.t to partial de+easan.e! or su2?e.t to open $Ito 3 +or li+e! then to her .hildren and their heirsL 2ut 3 has not had her &rd .hild yetM the t7o .hildren in eAisten.e at the ti e have a vested re ainder su2?e.t to partial divest ent'. o 3Ae.utory interest interest in a trans+eree $not retained 2y the grantor' that divests or .uts short a previous interest $e.g. Ito 3! 2ut i+ al.ohol is .onsu ed on the pre ises! then to BL'. o shi+ting eAe.utory interest +ollo7s an interest o+ a third party. o springing eAe.utory interest +ollo7s an interest retained 2y the grantor.
o

Present Possessory Interest $/' >ee si ple a2solute **************************** $%' :i+e estate ************************* ZdeathZ $&a' >ee si ple deter ina2le ****************************************************** Zli itation eventZ $&2' >ee si ple su2?e.t to .ondition su2se5uent ************************** Z.onditionZ $&.' >ee si ple su2?e.t to eAe.utory li itation ********************************* Zli itation eventZ

Future Interest ****************************************************\ *\ 6eversion $to grantor' or *\ 6e ainder $to grantee' *\ Possi2ility o+ reverter $to grantor' *\ 6ight o+ entryN po7er o+ ter ination *\ 3Ae.utory interest $to granteeQ'

). -aintaining the Syste /. )onservation o+ 3states $=6%' o By the prin.iple o+ .onservation! all pie.es o+ an estate ust 2e a..ounted +or $7hen an estate is trans+erred'. ,n a .onveyan.e! the IlastL interest ust 2e a +ee si ple 7hen it 2e.o es possessory. ,+ the +ee si ple holder dies 7ithout heirs $IintestateL'! the property es.heats $trans+ers' to the state.

&7

)ourts try to give e++e.t to the intent o+ grantors $in order to en.ourage the grant o+ 7ealth to .harita2le .auses and to +a ilies'! 7ithin li its deter ined 2y poli.y goals. o Wills1 Willia s v. the 3state o+ Willia s! Benn. $/99&'! =6&1 >a.tsNPro.1 (+ter 4.(. Willia s< death! three daughters o+ the testator $the de.eased 7ho le+t a 7ill' aintained possession o+ their +ather<s +ar . #ears a+ter t7o o+ the daughters have died! the re aining one! 3thel Willia s! aintains that she has a li+e estate 7ithout li itation. Bhe trial .ourt and appeals .t. held that the three daughters! 7ho had 2een na ed in the 7ill! o7ned a one*third undivided interest in +ee si ple. Bhe Benn. Supre e )t. reversed and re anded. Holding1 Bhe testator intended to .onvey upon the na ed daughters a li+e estate! de+easi2le or deter ina2le upon arriage and an eAe.utory interest in ea.h o+ the other t7o daughters< one* third interest! 7hi.h 7ould vest in her possession upon death or arriage o+ her sister. IBhe heirs*at*la7 J$@s in this .ase'K held a reversion in +ee si ple! su2?e.t to the deter ina2le li+e estates and the eAe.utory interests in the na ed daughters! 7hi.h reversion 7ould vest in possession! at the latest! upon the death o+ the survivor o+ the na ed daughters.L JHe .ould have done this 2y Ito (! B! and ) +or li+e! 2ut i+ either should arry then to the a+ore entioned still*un arried daughters +or li+e...LK 6easoning1 Bhe 7ill<s .lear purpose is to provide a ho e +or the three na ed daughters during their li+eti es and 7hile they re ained un arried! not to 2esto7 an a2solute estate upon the daughters. "otes1 o =64<& )o plaint alleged that 3thel .ould have re.eived a li+e estate 7ith a Ire ainder interestL 2y intestate su..ession. Ho7ever! a re ainder has to 2e .reatedM so this 7as not 8osher 2e.ause .ourts don<t nor ally .reate a ne7 2oA $a ne7 +or '. o ,n general! the la7 dis+avors property trans+ers that dissuade arriage or punish arriage. 3A.eptions are 7hen arriage appears to 2e used as a proAy +or Ia..ess to resour.esL and 7hen hus2ands divest property +ro their 7ido7s i+ she re arries $or is un+aith+ul' $e.g. Ior until she re arries and then to y dogL 7ill 2e seen as punitive! 7hile Ior until she re arries and then to y .hildrenL is seen as a..epta2le'. o Histori.ally! .ourts have .onsidered that i+ they don<t e++e.tuate the intent o+ grantors! potential grantors ight 2e dis.ouraged +ro giving oney to their 7ido7s or to .harita2le organiDations. Bhus! .ourts generally avoid inter+eren.e 7ith the intent o+ donors. o )onservation o+ 3states1 )ity o+ 9la ath >alls v. Bell! Oregon $/97/'! =601 >a.ts1 ( .orporation divided its +ee si ple a2solute into a +ee si ple su2?e.t to eAe.utory li itation! gi+ted to the )ity Iso long as they use it +or a li2rary!L and the eAe.utory interest! .onveyed to the prin.ipal shareholders o+ the .orporation. Bhe .ity 2uilt and used the land +or a li2rary +or +orty years. (+ter the .ity .eased using the li2rary! though! it sued +or de.laratory ?udg ent against the heirs o+ the eAe.utory interest holder. Holding1 (+ter the eAe.utory interest 7as de.lared void 2y the 6ule against Perpetuities! the .ourt .hose to .onserve the re aining interest 2y de.laring it a possi2ility o+ reverter 7hi.h had vested in -ari?ane >lit.ra+t $7ho had o2tained the interests +ro the heirs o+ the .orporation'. 6easoning1 o When an eAe.utory interest! +ollo7ing a +ee si ple! is de.lared void under the rule against perpetuities! the prior interest 2e.o es a2solute unless the language o+ the .reating instru ent .learly indi.ates that the prior interest is to ter inate 7hether or not the eAe.utory interest ta8es e++e.t. Sin.e the language o+ the grant et this .ondition! the .ity o2tained a +ee si ple deter ina2le 7ith a possi2ility o+ reverter in the .orporation. o Oregon did not allo7 a possi2ility o+ reverter to 2e alienated! 2ut the .ourt held that an atte pt 2y a grantor to trans+er his possi2ility o+ reverter did not destroy it. o Bhe possi2ility o+ reverter 7as! thus! passed on to the shareholders upon dissolution o+ the .orporation and to their des.endants upon death o+ the shareholders. "otes1 o (lternative possi2ilities +or .onserving the original estate $/' 3Apand the )ity<s li ited interest into a +ee si ple a2solute! sin.e the +or+eiture e.hanis +or the )ity<s interest 7as de.lared void. $But this goes against the apparent intent o+ the grantor.'

&0

$%' , ply a possi2ility o+ reverter to the grantor. $)learly the grantor 7as trying to .reate a de+easi2le +ee! not a +ee si ple a2solute. Bo not go against the grantor<s intent! the neAt*2est*thing to a +ee si ple S3: 7ould 2e a >SS)S or >S@S)S' ( pro2le resulted 2N. the grantor .orporation 7as no longer in eAisten.e. While the possi2ility o+ reverter .ould 2e inherited! it<s not .lear that it .ould 2e assigned inter vivos! as had o..urred 7ith the other assets o+ the .orporation. $Bhe rule against inter vivos aliena2ility o+ the possi2ility o+ reverter 7as designed to prevent people +ro essentially 2uying the rights to litigation to eAer.ise that right.' Bhe .ourt +ound that an atte pt to alienate the interest did not destroy it. Su2se5uently! Oregon la7 .hanged to allo7 the aliena2ility o+ a possi2ility o+ reverter. 4iven the .hange! it .ould then 2e a7arded to the shareholders sin.e the )orporation had dissolved. $&' 3s.heat the possi2ility o+ reverter to the state. o Why does it atter 7hat la2el is put on the interestQ ,+ it 7as a +ee si ple deter ina2le! i+ the .ondition +ailed! the property 7ould have reverted to the grantor $the holder o+ the possi2ility o+ reverter'. o Ho7ever! i+ the grantor does not a.tually sue +or e?e.t ent 2y the ti e the statute o+ li itations ended! the possessor .ould o2tain a +ee si ple a2solute 2y adverse possession. ,+ it 7as a +ee si ple su2?e.t to .ondition su2se5uent! i+ the .ondition +ailed! the grantor 7ould have a right to entry 2ut 7ould have to eAer.ise that right. o ,+ the grantor does not assert his right to re*entry 7ithin a reasona2le ti e $generally! 7ithin the ti e o+ the s.o.l.'! the possessor .ould o2tain an e5uita2le ?udg ent that 7ould 2ar re*entry 2y the do.trine o+ la.hes! in e++e.t .reating a +ee si ple a2solute. ** )ourts pre+er to interpret that a grant .reates a +ee si ple su2?e.t to .ondition su2se5uent 2e.ause the la7 a2hors an auto ati. +or+eiture! and a +or+eiture is less li8ely to result 7hen the holder o+ a right to entry has to ta8e a.tion to o2tain possession $as opposed to an auto ati. reversion'. 3ven ore pre+era2le is a +inding that it is a pro issory .ovenant! su2?e.t to re edy 2y da ages. (s a +ee si ple su2?e.t to eAe.utory interest! 7hen the .ondition +ailed! the eAe.utory interest goes to the na ed third party or parties. o )ontrary to the poli.y o+ a2horring +or+eiture. o "oti.e that the eAe.utory interest violates the 6ule against Perpetuities 2N. the eAe.utory interest ay not vest 7Nin %/ yrs. "otes on WillN@eed )onstru.tion1 o (dhere to the eApressed purpose1 IBhe +un.tion o+ a suit to .onstrue a 7ill is to as.ertain and e++e.t the intention o+ the testator. Bhe deter inative intention is the predo inant purpose eApressed 2y the testator in the 7ill. State ents regarding the eans 7here2y the predo inant purpose o+ the 7ill is to 2e a..o plished 7ill not 2e given literal e++e.t i+ they 7ould de+eat the predo inant intention.L Stated another 7ay! one se.tion o+ the 7ill should not 2e interpreted su.h that it .ontradi.ts Ithe evident purpose and intent sho7n 2y the 7hole 7ill.L !illiams. o 4enerally! 7ills are interpreted to avoid intesta.y! or the deter ination that a 7ill does not address the property and! there+ore! de+ault rules apply. o Holographi. 7ills $hand7ritten 2y the testator' are generally interpreted less +or alisti.ally. o IJBKhe o2?e.t o+ .onstruing a deed is to as.ertain the intention o+ the grantor +ro 7ords 7hi.h have 2een e ployed and +ro surrounding .ir.u stan.es.L Tos"ano $607'. o @is.lai er $re+using to a..ept property' $=7='1 ( potential re.ipient o+ property .an re+use to a..ept it! or dis.lai it. IStatutes typi.ally re5uire a .lear and une5uivo.al eApression! and a..epting any 2ene+it o+ the asset in 5uestion de+eats any atte pt at dis.lai er.L %. Bhe >leAi2ility o+ the Syste $=76' o 6e.ursiveness1 @espite the +iAed nu 2er o+ +or s o+ o7nership! people .an $in theory' esta2lish an in+inite nu 2er o+ possi2ilities. >or eAa ple! IO to ( +or li+e! then to B +or li+e! then to ) +or li+e ...L et.. Bhis is re.ursive 2N. it essentially utiliDes the +or ula o+ I$i' >ee si ple *\ li+e estate ] reversion. $ii' 6eversion *\ li+e estate ] reversion...L et.. o 3state Planing

&9

;tiliDes the +or s o+ o7nership! even 7hen assets are .o 2ined into a trust 7hi.h gives legal title in +ee si ple to a single trustee 7ho ad inisters Ie5uita2le interestsL +or the true 2ene+i.iaries. >or eAplanations o+ de+ault intesta.y rules! see =70*79. &. :i its on >leAi2ility1 "u erus )lausus $I.losed nu 2erL o+ +or s' $=79' o 6ule1 Property designations are li ited to a .losed set. When interpreting a 7ill or other designation o+ property! .ourts try to +igure out 7hi.h +or o+ property is .losest to the intent o+ the testator! even i+ that di++ers +ro the spe.i+i. intent o+ the testator. !illiams. $Bhis di++ers +ro deter ining the intent o+ a .ontra.t! 7here .ourts 7ill re+or the .ontra.t.' o Per @e setD! ne7 2oAes 7ill 2e .reated 7hen the value o+ having a ne7 +or out7eighs the .osts. o (dvantages1 (liena2ilityNBrans+era2ility o+ property is in.reased. ,+ too any +or s are allo7ed! the in.rease in eAternalities and transa.tion .osts 7ould hinder trans+ers. $e.g.! i+ ( sells his 7at.h to B +or -ondays only! and B sells that -onday right! the property interests 2e.o e very .u 2erso e. But then! i+ @ 7ants to 2uy a 7at.h +ro )! @ 7ould have to veri+y i+ the 7at.h is )<s .o pletely or 7hether or not ) has sold a -onday*right to another.' o )ounter1 Bhe syste o+ estates in land is su++i.iently +leAi2le that .o pli.ated .onveyan.es .an still 2e e++e.ted. o @isadvantages1 @oes not al7ays give e++e.t to a party<s intent or +reedo to .ontra.t. See Johnson $2elo7'. o )ounter1 4iven the +leAi2ility o+ the syste ! ost o2?e.tives .an still 2e a..o plished despite the .losed nu 2er o+ +or s. o )ases1 I( an .annot .reate a ne7 8ind o+ inheritan.e.L "u erus )lausus1 Johnson v. Whiton! -ass. $/09&'! =071 o >a.ts1 6oyal Whiton granted land to his +ive grand.hildren! and the land 7as sold to Johnson. 6egarding the land at issue! Whiton<s 7ill stated as +ollo7s1 I(+ter the de.ease o+ all y .hildren ... to y granddaughter Sarah (. Whiton and her heirs on her +ather<s side one*third part o+ all y estate! ... and to y other grand.hildren and their heirs! respe.tively! the re ainder! to 2e divided in e5ual parts 2et7een the .L Believing that Sarah .ould not .onvey a +ee*si ple a2solute! Johnson sued to re.over his deposit. o Holding1 Bhe phrase Ion her +ather<s sideL 7as deter ined to 2e 7ords o+ li itation 2e.ause it .ould not 2e a ne7 +or o+ .onveyan.e. Bhus! Sarah 7as deter ined to have an un5uali+ied +ee si ple to sell to Johnson. o 6easoning JHol esK1 Bhe poli.y pre+eren.e is in +avor o+ aliena2ility! 7hi.h is 7hy the +ee tail had 2een eli inated in -assa.husetts. o "otes1 Will .onstru.tion1 ,t does not see that the grantor 7as trying to prevent Sarah +ro trans+erring her interest! 2ut ?ust 7anted to prote.t it +ro going to Sarah<s other<s +a ily in the .ase that Sarah did not .reate a 7ill. Sarah<s interest appeared to 2e a 8ind o+ +ee tail! 7hi.h .ould not 2e .onveyed. 3Apress intent o+ a lease 7ill 2e given e++e.t1 IJSKee ingly perpetual leases ... 7ill not 2e en+or.ed unless the lease .learly grants to the tenant or his su..essors the right to eAtend 2eyond the initial ter 2y rene7ing inde+initely.L +off v. oyal %etal &urniture Co. $=9%<%'. Bhus! denying e++e.t to the literal 7ords o+ a lease! 7hi.h .onveyed a tenan.y*at*7ill o+ the lessee only! to 2e a tenan.y*at*7ill ter ina2le 2y either the lessor or lessee is Ian anti5uated notion 7hi.h violates the ter s o+ the agree ent and +rustrates the intent o+ the parties.L :eases1 4arner v. 4errish! ".#. (pls. )t. $/904'! =091 o @onovan leased his house to :ou 4errish in /977 7ith the provision that the lease 7ould last until the tenant ter inated it $a tenan.y*at*7ill +or the tenant only' as long as he paid rent. (+ter @onovan died in /90/! 4arner! as the eAe.utor o+ @onovan<s estate! sought to evi.t 4errish. ( previous .ase held that a lease I+or so long as the lessee shall please! is said to 2e a lease at 7ill o+ 2oth lessor and lessee.L !estern Transp. Co. v. 0ansing $/07%'. Bhus! the lo7er .ourt and the appeals .ourt ruled in 4arner<s +avor. Ho7ever! this rule arose 7hen livery o+ seisin 7as still re5uired as a +or ality to esta2lish a li+e tenan.y! 7hi.h 7as .onsidered a +reehold interest. "o7 that the +or al re5uire ent has .hanged! .o entators have urged that the rule 2e .hanged.

40

IJBKhe lease eApressly and una 2iguously grantsL a li+e tenan.y ter ina2le at the 7ill o+ the tenant only. $6eversed'. o "otes1 6estate ent eAa ple1 : leases a +ar to B I+or as long as B desires to stay on the land.L Bhis .reates a Ideter ina2le li+e estate in B! ter ina2le at B<s 7ill or on his death.L ,s a Ideter ina2le li+e estateL an optionQ Personal Property Bhe estate syste and the numerus "lausus do.trine applies to e5uita2le interests in personal property held in trusts $=94<%'. Perhaps due to the perisha2le nature o+ personal property! not u.h .ase la7 eAists regarding +uture interests in personal property. But .ourts do adhere to the rule that a +uture interest .annot 2e .reated in a I.onsu a2leL .hattel. )onsider also that registries 7hi.h provide noti.e o+ property rights are ore li8ely +or ore valua2le! dura2le! and i o2ile assets! 7hi.h is 7hy planes! auto o2iles! and so e valua2le art 7or8s have su.h registries.

C. -ediating )on+li.ts Over Bi e (. Waste $=9=' Waste H Iany a.t o+ the li+e tenant 7hi.h does per anent in?ury to the inheritan.e.L Bhe li+e tenant Ishall en?oy his estate in su.h a reasona2le anner that the land shall pass to the reversioner or re ainder an as nearly as pra.ti.a2le uni paired in its nature! .hara.ter! and i prove entsL Bro'aw $2elo7'. 6ights1 o :i+e tenant has a reasona2le right to undistur2ed possession o+ the land and is entitled to in.o e that results +ro that property during hisNher possession. o Bhe holder o+ the +uture interest ight have a right to enter land at reasona2le ti es to ensure the property is 2eing prote.ted! depending upon the state and the .ir.u stan.es. o 6ule o+ reasona2leness use the property in a anner that is nor al or ordinary +or the type o+ property. Bhis re5uire ent has adapted over ti e e.g.! in the early ;.S.! nor al use 7as to .lear land +or +ar ingM one easure 2e.a e 7hether or not the Iresour.eL o+ slaves 7as put to use. o (nalogy o+ a savings a..ount * :i+e tenant is entitled to the interest on prin.ipal! and re ainderpersons are entitled to the prin.ipal. o Bhe nature of the interests a++e.ts a ruling regarding 7aste Bhe stronger interest that a present possessor has! su.h as a +ee si ple deter ina2le versus a li+e estate! the greater +leAi2ility he has to use the land. )onversely! i+ the +uture interest holder$s' has a strong interest! i.e. its not highly spe.ulative! the present possessor has a higher 2urden. Bypes1 o (++ir ative 7aste H al+easan.e .onsisting o+ a++ir ative a.tion that is unreasona2le! in light o+ the nor al use o+ the property! and .auses IeA.essL da age to the reversionary or re ainder interest. 3.g. any ining o+ inerals is a++ir ative 7aste! unless the ining resour.e 7as 8no7n and ining 7as already ongoing 7hen the li+e estate 2egan. o ( eliorative 7aste1 spe.ial type o+ a++ir ative 7aste 7hi.h results in an in.rease in a property<s ar8et value. See Bro'aw. So eti es allo7ed under .hanged .ir.u stan.es. See Waste1 %elms v. Pabst Brewing Co.! 600 $Ieviden.e sho7JedK that the property 2e.a e valueless +or the purpose o+ residen.e property as the result o+ the gro7th and develop ent o+ a great .ityL'. o Per issive 7aste H non+easan.e that o..urs 7hen a li+e tenant +ails to ta8e so e a.tion that is reasona2le! in light o+ nor al 2ehavior! and the +ailure to a.t .auses eA.ess da age to the reversionary or re ainder interest. 3.g. not repairing a roo+ and 7ater da age o..ursM not paying taAes 7hen they are dueM or allo7ing an adverse possessor to re ain on the land. o 6everse 7aste >uture interest holders i pair present possessor +ro utiliDing her rights.

Poli.y .onsiderations1 o Single a.tor1 Bhe present possessor is li8ely to +avor .urrent .onsu ption and invest ents that produ.e a 5ui.8 return. He ay not .onsider eAternalities! su.h as the e++e.t on +uture interests! 7ho are ore li8ely

4/

to +avor .onservation o+ the asset and longer*ter invest ents. So! the la7 o+ 7aste essentially internaliDes those eAternalities to the present possessor. Bhe stronger a present interest! the ore li8ely the present possessor 7ill ta8e into a..ount eAternalities $sin.e he 7ill li8ely have the land +or a long ti e'. )onversely! the less se.ure the +uture interest! the ore li8ely the +uture interest holder$s' 7ill not ta8e into a..ount the .osts to the present possessor. Bhus! the la7 o+ 7aste .auses all the a.tors to a8e de.isions as i+ they 7ere one a.tor 7ith a +ee si ple a2solute. o Why .an<t they 7or8 it out 2y .ontra.tQ Bhe +uture interest holders ay not 8no7 7ho they are or ay not even 2e 2orn yet. Parties are +or.ed to deal 7ith ea.h other due to a 2ilateral onopoly $li8e t7o neigh2ors 7ho have to rea.h agree ent'! so a party .annot go to .o peting parties to stri8e a 2etter agree ent. o "ote that the do.trine against 7aste values the autono ous de.isions o+ property o7ners over e.ono i. e++i.ien.y. Posner has suggested that e++i.ien.y should 2e the rule $604n6'. o ,ntent1 ,+ the grantor gave the present possessor a stronger estate! the grantor<s intent 7as li8ely to give the possessor ore +leAi2le use o+ the land. $)ourts don<t ne.essarily adhere to this! though.' 6e edies1 o ,n .ases o+ 7anton 7aste and 7hen the +uture interest is strong $a reversion or inde+easi2le'! the present interest ay 2e +or+eited. So e ?urisdi.tions i pose dou2le or tre2le da ages. o ,n other .ases! da ages depend or in?un.tions depend upon the relative strengths o+ the present and +uture interests. $e.g. highly spe.ulative +uture interest holders 7ho ay never ta8e possession are not li8ely to re.eive an in?un.tion and 7ill only re.eive da ages in the event that they do ta8e possession.' 6ules and )ases1 o ( li+e estate .on+ers Iuse! not do inionL o+ a property. Bro8a7 v. >air.hild! ".#. Sup )t. $/9%9'! =971 ,saa. C. Bro8a7 had 2uilt +our ad?a.ent ansions! and he le+t to ea.h o+ his +our .hildren a li+e estate in one o+ the +our houses! 7ith the li+e estates +ollo7ed 2y a .ontingent re ainder in their issue and an alternative .ontingent re ainder in the three other .hildren i+ no issue 7as availa2le. -r. Bro8a7 sought to raDe the ansion he had an interest and 2uild an apart ent d7elling in its pla.e! to re.oup the .osts o+ aintaining the property. Bhe de+endants argued that su.h an a.t 7ould .onstitute 7aste against the other interests in the property. Bhe .ourt agreed 2e.ause the 7ill .learly granted the Iresiden.e!L not ?ust the land. 3ven though the @s ay 2e un7ise in .ontesting P<s plan and @s ay not even get the estate! they have the sa e right to o2?e.t to .hanging the estate to the eAtent that its nature or .hara.ter 7ould 2e aterially or per anently altered. o >ollo7ing this de.ision! the ".#. legislature passed a la7 that allo7ed a li+e tenant 7ith +ive or ore years o+ eApe.tant interest to a8e .hanges that are i prove ents that are not spe.i+i.ally prohi2ited 2y the .onveyan.e. o "otes1 O *\ 4 +or li+e! then to 4<s heirs! 2ut i+ 4 has no issue $no surviving .hildren'! then to 4<s si2lings. ,saa. had +our ansions. So! 7as 4<s the only residen.eQ ,+ so! did the .ontingent re ainders in 4<s ansion .onvey ore to the holders than 4 had in the .ontingent re ainders on the other three ho esQ Bhe .ases that the .ourt .ites in support o+ its position 7ere all landlord*tenant .ases. (rgua2ly! a li+e tenant has ore rights than a te porary lessee. Bhe 2a.8story o+ this .ase is that there 7as a pu2li. interest in histori. preservation. (lso! .onsider 7hy the +uture interest holders did not 7ant the value o+ the property in.reasedQ Perhaps they had plans +or an apart ent 2uilding on all +our lots. (lternative to the :a7 o+ Waste o (2olish li+e estates! as in 3ngland. o )reate e5uita2le li+e estates $trusts' rather than li+e estates. o (llo7 li+e tenants to sell the property! as long as they invest the pro+it prudently and only 8eep the interest.

B. Bhe Pro2le o+ @ead Hand )ontrol @ead Hand )ontrol H .ontrolling property a+ter one<s death.

(dvantages o+ @ead Hand )ontrol

4%

o Bestator<s ay see8 dead hand .ontrol 2N. they don<t trust donees to a8e 7ise .hoi.es a2out the property
or a2out their 2ehavior in general.

o Bestator gains assuran.e o+ post* orte use and ay 2e in.entiviDed to .reate ore 7ealth.
@isadvantages o+ @ead Hand )ontrol o :i itations to alienation .ause di++i.ulty +or o7ners. o Bestator .annot eAperien.e utility post orte . o Bestator .annot +oresee all the +uture .ontingen.ies. -ethods o+ li iting dead hand .ontrol o , pose strong .onstru.tional pre+eren.e $7No auto ati. +or+eitureM da ages vs. reversion'. o @isallo7ing restraints upon alienation or other restraints! su.h as restraints on arriage $eA.ept 7hen arriage is a proAy +or need'. o :i it restraints on aliena2ility o+ reversion interests. o -ar8eta2le title a.ts interest holders are re5uired to register their ongoing interest. o Statute o+ li itations on right o+ entry or possi2ility o+ reverter. o "on*en+or.e ent o+ no inal restraints $restraints 7ithout value' Pro2le ati. 2N. it 7as i portant to the testatorM and ho7 does the .ourt deter ine valueQ o 6ule (gainst Perpetuities $se. @ 2elo7' )ase1 Options to pur.hase .o er.ial property are not eAe pt +ro the statutory 6(P. Sy phony Spa.e! ,n.. v. Pergola Properties! ,n..! "# (pp. $/996'! 6%01 o >a.tsNPro.1 SS $P' is see8ing de.laratory ?udg ent to disallo7 @ +ro eAer.ising an option assigned +ro Broad7est 6ealty )orp. Broad7est had sold a 2uilding to P +or 2elo7* ar8et value and leased 2a.8 the in.o e*produ.ing portion o+ the 2uilding! in order that SS! as a non*pro+it organiDation! .ould re.eive a taA 2rea8 +or the property. J +or P. o Holding1 Bhe option that @s see8 to en+or.e violates the statutory prohi2ition against re ote vesting $6ule (gainst Perpetuities' and is! there+ore! unen+or.ea2le. o "otes1 >or alisti.N,nstitutional .o peten.y approa.h1 the statute does not eAe pt options! and the legislature 7ould have to re+or the statute. Other approa.hes1 o :ogi.al1 @oes it a8e sense to su2?e.t an option to the 6(PQ ,t<s not applied in analogous situations su.h as .o*ops and .ondos. (re the purposes o+ the 6(P servedQ Bhis is a .o er.ial venture! not a +a ilial one. Su2?e.ting an option to the 6(P I.reates a disin.entive +or the lando7ner to develop the property and hinders its aliena2ility! there2y de+eating the poli.y o2?e.tives underlying the 6(P. ,s it +air that SS paid O/0- and end up 7ith O%7- valueQ Well! Broad7est 7as trying to 2e .lever and dodge taAes. o Wait*and*see rule1 Wait %/ years $or spe.i+ied ti e' to see i+ the interest vestsM i+ it does! o8.M i+ it does not! violation o+ 6(P.

). 6estraints on (lienation ( grantor o+ a gi+t ay pla.e restri.tions on ho7 land .an 2e used 2ut not upon its< aliena2ility $7ho .an use it'. -ountain Bro7 :odge "o. 0%! ,ndependent Order o+ Odd >ello7s v. Bos.ano! =th $/967'! 6071 o P sought to 5uiet title to land it a.5uired 2y gi+t deed +ro the -r. and -rs. Bos.ano! no7 dead. @eed stated ISaid property is restri.ted +or the use and 2ene+it o+ the se.ond party J$-tn Bro7 :odge'K! onlyM and in the event the sa e +ails to 2e used 2y the se.ond party or in the event o+ sale or trans+er 2y the se.ond party o+ all or any part o+ said lot! the sa e is to revert to the +irst parties herein J$the grantors'K! their su..essors! heirs J$@s'K or assigns.L J +or @ $sin.e the grant only restri.ted ho7 the land .ould 2e used'. o 6easoning1 Bhe .ourt agreed 7ith @s that the deed .reated a +ee si ple su2?e.t to .ondition su2se5uent. I"o +or al language is ne.essary to .reate a +ee si ple S)S as long as the intent o+ the grantor is .lear.L o @issent1 Prag ati. Best ,+ the restri.tion on use has the pra.ti.al e++e.t o+ i pairing alienation $ho7 any 2uyers does it allo7Q'! then the restri.tion should 2e invalidated. ,n this .ase! 2y the language o+ the

4&

.ovenant! restri.ting that the land .an only 2e used +or the :odge has the sa e e++e.t as restri.ting 7ho .an use it. "otes1 Bhe language is .onditional! so the grant appears to 2e a >SS)S. Bhe +uture interest should 2e a right o+ entry! 2ut the .ourt read the grant to give a possi2ility o+ reverter. Why shouldn<t 7e allo7 a grantor to .ondition gi+ts upon a prohi2ition against saleQ o >ra.tionation tragedy o+ the anti*.o ons. o 6edu.es .o petition 2N. less people are li8ely to 2uy land 7ith use restri.tions. o ,n+or ation .osts1 )ost o+ deter ining and e++e.tuating intent in.reases 7ith ti e. (s 7ith nu erus .lausus ?usti+i.ations! the .osts in.rease +or potential 2uyers to deter ine 7hat! i+ any! restri.tions eAist on a property. o Prote.t against dynasties. o Prote.t against dis.ri inatory restri.tions or other restri.tions that li it a .harita2le organiDation<s +un.tioning. o Produ.tivity aliena2ility allo7s +or others to put land to 2etter use. o :i+e is +or the living^ Why should 7e allo7 su.h .onditionsQ o "ote that property la7 generally does not restri.t the e++e.tuation o+ grantor<s intent unless eAternalities are not internaliDed $e.g.! note that li ited produ.tivity 7ill 2e re+le.ted in the ar8et value o+ land'. o (lthough li+e is +or the living! grantors a8e gi+ts 7ith the eApe.tation they 7ill 2e used in the re5uested anner. Bhus! i+ their intent is not respe.ted! people ay not a8e gi+ts to .harity. o )ultural .hangesN.hanged .ir.u stan.es. o Produ.tivity o+ present possessor. ,n.reased ortgage*a2ility allo7s present possessor to use the property as .ollateral +or invest ent and i prove ent.

@. Bhe 6ule (gainst Perpetuities $6/%' 6ule1 I"o interest is good unless it ust vest! i+ at all! not later than t7enty*one years a+ter so e li+e in 2eing at the .reation o+ the interest.L $( person .an .ontrol the use o+ property +or one generation into the +uture plus the neAt generation up to the traditional age o+ a?ority.' o Bhe ti eline 2egins upon .reation o+ the interest. o Bhe easuring lives $/st generation' ust 2e reasona2ly 8no7a2le $e.g.! .annot use Iall the residents o+ ".#.L or Ieveryone in the "#) phone2oo8.L' o 4enerally! assu e that Iun2orn 7ido7L or I+ertile o.togenarianL situations 7ill not arise. o 3A.eption1 the Irule o+ t7o .haritiesL +or a gi+t to one .harity! even i+ an eAe.utory interest in a se.ond .harity 7ill not vest 7ithin the perpetuities period! it 7ill not 2e invalidated under 6(P. 6(P Best1 o /. What is the +uture interestQ ,+ .ontingent re ainder! vested re ainder su2?e.t to open! or eAe.utory interest *\ go to step %. ,+ not! it is not su2?e.t to the 6(P. o %. (re the easuring lives in 2eing at the ti e o+ the grantQ ,+ not! it is invalid under 6(P. ,+ yes *\ go to step &. o &. Will the .ondition ne.essarily vest 7ithin %/ years o+ the last death o+ the easuring li+eQ ,+ not! it is invalid under 6(P. ,+ yes! it is valid under 6(P. $( .o on*la7 alternative rule evaluates the reasona2leness o+ restraint on aliena2ility not 2y passage o+ ti e 2y 2ased upon the restraint<s duration! purpose! and designated ethod +or +iAing the pur.hase pri.e. $6%4<%''. 6ationale1 o Bhe people t7o generations into the +uture are the only people 7ho a testator .ould have any 8no7ledge o+ or 2enevolen.e to7ard. Bestator is allo7ed to .ontrol those he 8no7s $2N. he 8no7s their pro.livities' and their .hildren 2N. their inors and need prote.tion.

44

o Balan.e this against the re oval o+ un.ertainty that 7ould other7ise result i+ interests vest too re otely
and the li itation o+ dead hand rule $see Se.. @ 2elo7'. IJ,Kt is so.ially undesira2le +or property to 2e inaliena2le +or an unreasona2le period o+ ti e.L Symphony Spa"e $6%&<4?'. o Bo re ove un.ertainty1 >or a .ontingent re ainder * the identity o+ the ta8er ust 2e 8no7n and all .onditions satis+iedM >or an eAe.utory interest * the interest holder ust ta8e possession $.utting short the prior interest'M >or a vested re ainder su2?e.t to partial divest ent $su2?e.t to open' * +or a .lass gi+t! the .lass ust 2e .losed. Prote.tion against 6(P1 o Parties insert Iperpetuities savings .lausesL into the relevant instru ent. o )ourts reinterpret do.u ents to avoid invalidation under 6(P. 6e+or approa.hes1 o $i' Wait and see +or the .o on*la7 6(P period $or so e related period'. o $ii' Wait and see +or the .o on*la7 period or 90 years. o $iii' ,nterpretation and , pli.ation $e.g. not invalidating! using an all*or*nothing approa.h! a vested re ainder su2?e.t to open 2e.ause a e 2er o+ the .lass ight vest too re otelyM instead! ?ust that e 2er<s interest +ails.' o ;ni+or Statutory 6ule (gainst Perpetuities $;S6(P' .o 2ines $ii' and $iii'1 ,n part! provides +or .y pres approa.h! 7here an interested person .an petition a .ourt to Ire+or disposition in the anner that ost .losely approAi ates the trans+eror<s ani+ested plan o+ distri2ution and is 7ithin the 90 years allo7ed.L o Si ply prohi2it the suspension o+ the po7er o+ alienation.

Pra.ti.e Pro2le s $6/7'1 o /. to H )ollege! as long as it used +or instru.tional purposesM then to y son ( and his heirs. H * >ee si ple su2?e.t to eAe.utory li itation. ( eAe.utory li itation * ,nvalid $e.g. ( has a .hild (<! ( dies a+ter O! and H +ails the .ondition ore than %/ years a+ter ( dies! the property is 7illed to go to (<! 7ho 7as not in 2eing 7hen the interest 7as .reated'. Bhus! trying to .reate an eAe.utory li itation 2ut pro2a2ly .reates a deter ina2le! leaving H a possi2ility o+ reverter. o %. to (M 2ut i+ ari?uana is inhaled on the pre ises! then O has right to reenter. Calid >SS)S. BN. the right o+ entry is retained 2y the grantor! it is vested! and there+ore not su2?e.t to 6(P. o &. to (M 2ut i+ ari?uana is inhaled on the pre ises! then to B and her heirs. ( >S3: B eAe.utory li itation invalid under 6(P +or the sa e as Y/. Bhus! ( is le+t 7ith a >S(. o 4. to ( +or li+e! then to B<s grand.hildren 7ho rea.h the age o+ %/ $and B has died at the ti e the interest is .reated'. ( :3 in >S B<s 4) .ontingent re ainders su2?e.t to 6(P! 2ut valid $Sin.e B is dead! he .an<t have any ore .hildrenM so their lives are all in eAisten.e at the ti e o+ the grant! and their .hildren 7ill all 2e %/ 7Nin %/ yrs o+ their deaths.' O * reversion o =. to ( +or li+e! then to y grand.hildren 7ho graduate +ro high s.hool $O has .hildren B and ) 2ut no grand.hildren at the ti e o+ the grant'. ( :3 4. .ontingent re ainders invalid 2y 6(P $2N. O .ould have another .hild a+ter the devise or grant! and that .hild<s .hild ay not graduate 7Nin %/ yrs o+ the death o+ the last li+e in 2eingN easuring li+e'. O reversion o 6. I I eA.ept 2y devise $grant o+ real estate in a 7ill'. ( :3

4=

4. .ontingent re ainders invalid 2y 6(P $(lthough O .an<t have any ore .hildren a+ter his death! his 4. 7ill not ne.essarily graduate +ro high s.hool 7Nin %/ yrs o+ the death o+ the last easuring li+e'. O * reversion

C,. -ediating )on+li.ts Bet7een )o*O7nersN )on.urrent ,nterests $6&&'

When property is .o*o7ned! .osts are only partially internaliDed to ea.h o7ner. o Bhus! nor s +or proper use arise! possi2ly +or aliDed in a .ontra.t! to regulate the use and .are o+ the property. o Bhe la7 also provides re edies! su.h as an a..ounting in partition $e5uita2le division'. o (n alternative to .on.urrent o7nership is +or ing a partnership or .orporation that o7ns the propertyM issues are then resolved through partnership or .orporation la7. Bypes o+ estate divisions1 o HoriDontal divisions over ti e. o Certi.al divisions at any given o ent in ti e ea.h possessory interest holder has an e5ual right to possession. o )o 2ined divisions $e.g. .on.urrent li+e estates'. Bypes o+ )o*o7nership o Benan.y in )o on @e+ault .onveyan.e $e.g. Ito ( and B.L' 3a.h tenant in .o on has a separate 2ut undivided interest1 o Separate H independently des.endi2le! .onveya2le! and devisa2le o ;ndivided H the right to possess the 7hole property. Share o+ rentNpro+it and taAes deter ined 2y per.entage share o+ interest. o Joint Benan.y )onveyed eApli.itly $e.g. Ito ( and B as ?oint tenants 7ith right o+ survivorship and not as tenants in .o on.L' :i8e a tenan.y in .o on! ea.h ?oint tenant has a separate 2ut undivided interest. 6ight o+ survivorship1 o ;nli8e a tenan.y in .o on! a surviving ?oint tenant auto ati.ally a.5uires the interest o+ another ?oint tenant 7hen the other tenant dies. o (voids pro2ate! 7hi.h is .ostly! .u 2erso e! and ti e*.onsu ing. 6e5uire ents! the four unities1 o Bi e ea.h interest ust 2e a.5uired or vest si ultaneously. o Bitle ea.h ust 2e a.5uired 2y the sa e interest or adverse poss<n! not intestate su..ession or other a.t o+ la7. o ,nterest ea.h ust 2e ali8e $although does not have to 2e identi.al +ra.tional shares'M e.g. +ee si ple! li+e estate. o 6ight to Possession $the only re5uire ent +or a Benan.y in )o on' ea.h ust have the right to possess the 7hole. Pro2le 1 Both have the right! 2ut 2oth .annot al7ays eAer.ise it. Severan.e ( trans+er or atta.h ent o+ one interest .an sever a ?oint tenan.y 2y destroying one o+ the unities! thus leaving a tenan.y in .o on. o But .ourts are relu.tant to +ind a severan.e unless the parties .learly intended to destroy the right o+ survivorship. Best used only +or .lose relationships. o Benan.y 2y the 3ntirety )onveyed eApli.itly $e.g. Ito ( and B as tenants 2y the entirety.L' Only availa2le +or arried .ouples $ arriage is the I+i+th unity.L' Only eAists in a inority o+ states. :i8e a tenan.y in .o on and a ?oint tenan.y! eA.ept so e states only allo7 a unilateral trans+er or en.u 2er ent o+ one spouse<s property 7ithout .onsent o+ the other.

46

"o unilateral eAit! eA.ept divor.e. $(lthough! 2oth spouses .an .onvey to a third person! or Istra7!L and the stra7 .an .onvey 2a.8 to the as tenants in .o on.' o )o unity Property ,n li ited ?urisdi.tions! ea.h spouse auto ati.ally o2tains a right to possess any property a.5uired during arriage or any property a.5uired prior to arriage that .o ingles 7ith .o unity property. Spouses are generally li ited +ro trans+erring or en.u 2ering .o unity property 7ithout the .onsent o+ the other spouse. )o unity property is su2?e.t to e5ual division upon divor.e. o Joint Benan.y in Ban8 (..ounts $6=7' 6edu.ed .osts 2y si pli+ied +or at1 Bypi.ally 2an8s use a Ione*siDe*+its*allL approa.h to diverse situations in order to avoid the ris8s and .osts! su.h as eAtensive +a.t*+inding +or thousands o+ s all a..ounts! that go along 7ith ore .o pli.ated arrange ents. :i8e ?oint tenan.y o+ real property! a right o+ survivorship eAists. ;nli8e ?oint tenan.y o+ real property! either party .an alienate the 7hole $7ithdra7 the a ount o+ the entire a..ount' 7ithout per ission o+ the other. 3a.h tenant has1 o a present aliena2le interest in one hal+ o+ the +und! o a present inaliena2le and in.hoate interest o+ the 7hole! .ontingent upon his survivorship )hoosing the 2est type o+ .o*o7nership o Joint tenan.y 7ith right o+ survivorship avoids pro2ate. o Joint tenan.y and tenan.y 2y the entirety .an a++ord prote.tion +ro .reditors. o BaA i pli.ations vary. Options +or 3Aer.ising :everage a ong )o*Benants $64&'1 o Coi.e using +or al or in+or al eans to eApress dissatis+a.tion and agitate +or .hange. o :oyalty in.entiviDing parti.ipants to avoid leaving 2ut to leave 5uietly i+ they do. o 3Ait 2y partitionM the threat o+ eAit .an also 2e used strategi.ally.

(. Parting WaysNPartitionN3Ait $6&7' "o reason or ?usti+i.ation needed.

)an 2e re5uested at any ti e 2y a .o

on or ?oint tenant.

(vaila2le to tenants 2y the entirety only 2y .onversion o+ the property into a tenan.y in .o on or ?oint tenan.y 2y utual agree ent or 2y divor.e. Bypes1 o Partition in 8ind H division o+ the property. IO7eltyL ay 2e re5uired to .orre.t i 2alan.es. o Partition in sale H +or.ed sale o+ the land! +ollo7ed 2y a division a ong the tenants o+ the pro+its realiDed +ro the sale. @espite the 2la.8*letter rule 2elo7! in pra.ti.e! .ourts usually treat land as a +ungi2le asset and order partition in sale! eA.ept in .ases o+ very strong personality interests! 2e.ause partition in 8ind involves surveying and other .osts. o With present and +uture interests! .urrent parties are not usually allo7ed to +or.e a sale. Bhe reasoning is that the +uture interest is too un.ertain! and an un8no7n +uture interest ay have a di++erent desire. But! should so eone 7ho ay not even have 2een 2orn yet have a sayQ o Why should .ourts get involved at allQ ;sually! parties are in +a ilial .on+li.t and are not a.ting rationally. Se.ondly! so e parties ay 2e 2etter situated due to oney and resour.es. (lso! generally spea8ing! the syste pre+ers a single o7ner over .on.urrent interests. ( partition in 8ind is +avored over a partition in sale. $IJ(K sale o+ one<s property 7ithout .onsent is an eAtre e eAer.ise o+ po7er 7arranted only in .lear .ases.L' Bhe party see8ing a partition in sale over a partition in 8ind has the 2urden o+ proving that1 o $/' Partition in 8ind 7ould 2e i pra.ti.a2le or ine5uita2le! or o $%' the interests o+ all o7ners 7ould 2e 2etter pro oted $not pre?udi.ed' 7ith a partition 2y sale. @el+ino v. Cealen.is! )onn. $/900'! 6&71

47

>a.tsNPro.1 Brial .ourt ordered a partition 2y sale a+ter .on.luding that a partition in 8ind 7ould not 2e I+easi2leL 2e.ause @<s gar2age re oval 2usiness 7ould .on+li.t 7ith the plans that Ps< have +or their %N&rd portion o+ the land. 6eversed. 6easoning1 o Brial .t erred in in+erring that @ 7ould pro2a2ly 2e una2le to .ontinue her 2usiness in the +uture and that the .ity<s planning .o ission 7ould pro2a2ly not approve a su2division plan +or the re ainder o+ the property i+ @<s 2usiness 7ere to .ontinue. o Brial .t +ailed to give due .onsideration to @<s a.tual and eA.lusive possession o+ the land! the +a.t that her ho e is on the land! and that her 2usiness depends upon the land. J"ote that this did not a8e the land physi.ally i pra.ti.al to partition. Bhe land 7ould not lose all o+ its value i+ partitioned.K "otes1 o :et<s say @ did not have a trash 2usinessM 7hat reasons 7ould Ps have +or 7anting a partition 2y sale rather than a partition in 8indQ Ps .ould o2tain @<s portion o+ the property at au.tion! 7hi.h 7ould presu a2ly 2e .heaper than pur.hasing it dire.tly +ro @. Bhis is a .o on pro2le 7ith .on.urrent interest property 7here only one party .an +or.e a partition 2y saleM thus! the party 7ith ore li5uidity .an 2uy out less li5uid .otenants. o ( histori.al pro2le a ong +a ilies o+ 2la.8 +ar ers! 7ho typi.ally died intestate! 7as that their land ended up in a very +ra.tionated state generations later. >or eAa ple! a +a ily e 2er 7ho o7ned /N&0th o+ the land 7as planning to ove! and a prospe.tive 2uyer o++ers the a IgenerousL pri.eM they sell the land to the 2uyer! and the 2uyer later +or.es a partition 2y sale to 2uy the re aining land at au.tion. o )onsider that @ ay not 2e a2le to ove her 2usiness 7ithin the .ity due to a li itation o+ .o er.ial properties availa2le. o 3ven though a .ourt ay try to respe.t personality interests! a partition in 8ind does not al7ays allo.ate! +or eAa ple! the sa e plot o+ land that a person 7as living on prior to the partition. o -easure o+ 3++i.ien.y1 Pareto opti ality $everyone<s 2etter o++ and no2ody<s 7orse o++' vs. 9aldor*Hi.8s opti ality $the party or parties that are 2etter o++ are 2etter o++ 2y ore than other parties are 7orse o++M thus! those ade 2etter o++ .ould .o pensate those 7ho end up 7orse o++'. Property la7 typi.ally i poses 9*H 2N. Pareto opti ality gives one party a veto*po7er that inter+eres 7ith .o er.e. Ho7ever! it does not re5uire the 2etter*o++ party to .o pensate the 7orse*o++ party. ,n this .ase! the trial .t +o.used upon the value o+ the 7hole and didn<t 7orry a2out distri2utional .on.erns. Bhe appellate .ourt see ed ore .on.erned a2out the value o+ @<s personality interests. o On re and! the trial .ourt granted @ 7ith less than 7hat she 7as pro2a2ly o7ed. >urther ore! they ordered her to pay Ps as i+ @ 7ere .reating a nuisan.e! even though no har has o..urred yet and even though @<s use is per+e.tly legal.

B. Settling ;p $64=' ,+ ousted +ro possession o+ .o on property! a .o*tenant .an sue +or his share o+ rents and pro+its. Bo esta2lish ouster! P ust esta2lish that @ $.otenant' has used the property in su.h a 7ay that ne.essarily denies P +ro eAer.ising his rights in the property. 4ill or $>loren.e' v. 4ill or $3d7ard :eslie'! ;tah $/904'! 64=1 o >a.tsNPro.1 (+ter >ran8 died! he le+t his hal+ o+ the property to ). >ran8 and @. (+ter 3d7ard died! he le+t his hal+ to P. P sued @ +or i puted rent! .lai ing that @ ousted P +ro eAer.ising her right to use the property. J +or P. (+<d 2ut re anded +or a odi+i.ation o+ the re7ard. o 6easoning1 @ eAer.ised eA.lusive possession o+ the property 7ith his .attle. When P re5uested @ to .hange his pattern o+ use so that she .ould graDe .attle 2ut that the land 7ould not 2e overgraDed! @ re+used. 6egardless o+ 7hether @ resorts to +or.e or destru.tion o+ property! a .otenant is entitled to relie+ 7hen she I a8es a .lear! une5uivo.al de and to use land that is in the eA.lusive possession o+ another .otenant! and that .otenant re+uses to a..o odate the other tenant<s right to use the land . . .L 6egarding the da ages! they should 2e redu.ed 2y the .ost o+ repairing a +en.e and dit.h. o "otes1

40

Would P have 2een eligi2le +or partition in 8indQ (lthough the land is relatively easy to divide! dividing it 7ould de.rease the value 2e.ause graDing ani als ay not 2e possi2le 7ith less land. ,ssues raised 2y (..ounting1 o 6ents +ro third parties. ,+ one tenant leases! the pro+it is divided a ong .o*tenants. o 4enerally! the tenant*in*possession does not have to pay rent to the tenant*out*o+*possession! unless the +or er ousts the latter! 2N. 2oth have a right to live there. Bhus! re+using to pay rent does not .onstitute an ouster. Ho7ever! re+using to rent to a third*party ay .onstitute an ouster in so e ?Ans. "ote i+ a tenant*in*possession re5uests the value o+ i prove ents at an a..ounting! the value ay 2e dis.ounted 2y rental value +or his use. o 6epairs o , prove ents value! not .ost. o "e.essary pay ents! su.h as taAes! to avoid loss. (.tion +or )ontri2ution during the .o*tenan.yM generally! not allo7ed unless a loss o+ property 7ill result. (.tion +or (..ounting +ollo7ing a partition. ( .otenant in sole possession is not entitled to .o pensation 2y the other .otenants +or repairs or i prove ents unless1 o the .otenants not in possession .onsented to the repairsNi prove ents! o the .otenants not in possession 8ne7 o+ the repairsNi prove ents and per itted the ! o the .otenant in possession a.ted in good +aith I7ith the 2ona +ide 2elie+ that he 7as the sole o7ner o+ the property!L o the repairs 7ere ne.essary to preserve or prote.t the .o on property.

). Severan.e $6=0' ( ?oint tenan.y is not severed 7hen less than all o+ the ?oint tenants ortgage their interest$s' in the property! sin.e a ortgage is ore o+ a lien than a +ull .onveyan.e o+ title $a Ili ited titleL vie7' and does not destroy any o+ the +our unities. Har s v. Sprague! ,ll. $/904'! 6=01 o >a.tsNPro.1 Willia and John Har s had ?oint tenan.y 7ith right o+ survivorship. John ortgaged his interest on a loan that he and his +riend Sprague too8 out to 2uy another property. When John died! he le+t all his property to Sprague. (s a result! Sprague re+used to give title to Willia Har s. Willia sued to 5uiet title. o Holding1 Be.ause the ortgage does not sever the ?oint tenan.y! Willia o2tained! 2y his right o+ survivorship! John<s interest upon John<s death and 2e.a e the sole o7ner o+ the estate in its entirety. Bhe ortgage 2e.a e nulli+ied upon John<s death! sin.e his interest .eased to eAist. o "otes1 ,+ the ortgage had severed the ?oint tenan.y! John<s interest .ould pass via his 7ill to his +riend 2N. Willia <s right o+ survivorship 7ould have 2een nulli+ied. Ho7 else ight the .ourt have thought a2out this situation other than 7hether or not title 7as trans+erredQ 3Ape.tan.y theory1 What did the parties eApe.tQ 3.g.! did John eApe.t that his ortgage severed the ?oint tenan.y! or did the lenders 2elieve soQ "one pro2a2ly did. Poli.y .on.ern1 Bransa.tion .osts are in.reased i+ .ourts +or.e lenders to o2tain agree ent +or a ortgage 7ith all .o*tenantsM priva.y issues are also raised 2y 2ringing in parties that 7ere not ne.essarily involved in the initial transa.tion. )onsider that 7e 7ould not ne.essarily 7ant non* spouses to 2e re5uired to get involved in their .o*tenant<s 2usiness. On the other hand! 7e 7ant to prote.t unsophisti.ated lenders su.h as the .ouple that se.ured the ortgage! 7ho pro2a2ly did not realiDe that John<s interest 7as li ited. What happens to the ortgage 7hen the .o*tenant 7ho o2tained the ortgage diesQ @oes the ortgage no7 .over the entire interest! given the right o+ survivorshipQ Or does only the initial portion o+ the property re ain ortgagedQ What i+ Willia had diedQ )ourts tend to +avor .reditors and allo7 the ortgage to then .over the entire interest. ( ?oint tenan.y .annot 2e severed through a 7ill.

49

( ?oint tenan.y .annot 2e severed in se.ret! generally! in order to prote.t against +raud due to la.8 o+ registrationM 2ut! 7hat i+ in+or ing the .o*tenant 7ould pla.e the severer in dangerQ Bo address 2oth .on.erns! a ?oint tenant is generally allo7ed to .onvey to a stra7 7ho .an then .onvey the property 2a.8 to the severer as a tenant in .o on. o Pro2le 1 the non*severer 7ould reasona2ly assu e that a 7ill is unne.essary due to the ?oint tenan.y! 7hi.h is! in +a.t! no longer in eAisten.e. Joint Savings (..ounts1 o @uring the li+eti e o+ 2oth ?oint tenants in a savings a..ount! either tenant .an 7ithdra7 oney unilaterally 2ut 7ill o7e relie+ to the other +or the a ount 7ithdra7n 2eyond his oiety $his hal+ o+ the +und'. ,n re 3state o+ >il+iley $?oint 2an8 a..t'! 6=0. IBhe unilateral 7ithdra7al o+ one ?oint tenant o+ less than his oiety severs the ?oint tenan.y as to the portion 7ithdra7n 2ut it does not ter inate the . . . right o+ survivorship.L $n re (state of &ilfiley. o ,+ one o+ the .o*tenants dies! the living .o*tenant o2tains an interest in the entire +und 2y right o+ survivorship $unless the estate proves +raud! undue in+luen.e! or a prior agree ent that the +unds 7ere not held as a true ?oint tenan.y'. ,+ the de.eased had 7ithdra7n a2ove her oiety! su.h a transa.tion 7ould 2e nulli+ied! and the survivor 7ould 2e entitled to the entire a ount in the a..ount prior to the 7ithdra7al. $n re (state of &ilfiley1 >a.ts1 On the day 2e+ore her other! -rs. >il+iley! died! (li.e 7ithdre7 the entire a..ount o+ O/9!000 +ro their ?oint 2an8 a..ount and deposited into her o7n a..ount. -r. >il+iley +iled a noti.e o+ ele.tion to ta8e against -rs. >il+iley<s 7ill and sought to 2ring the entire a..ount into the estate. 3ven though ( 7ithdre7 ore than her oiety! thus nulli+ying the transa.tion! she still 7as entitled to the 7hole a..ount upon -rs. ><s death 2e.ause o+ (<s right o+ survivorship. o (lternative approa.h $Kleinberg v. +eller! "#! 66&n/'1 Highly +a.t*spe.i+i. 2alan.ing test. $664n& suggests that 2an8s should not have to a8e +a.t*spe.i+i. deter inations a2out 7hether a ?oint tenant .an 7ithdra7 or not! 2ut .ourts .ould do so 7hen a dispute arises.'

@. -arital Property ,nterests $a I"e7 PropertyL' ( li.ense o2tained as a result o+ support +ro one<s spouse 2e.o es arital property and! as su.h! is su2?e.t to e5uita2le distri2ution upon divor.e. O<Brien v. O<Brien! "#! 66=1 o >a.ts1 -r. O<Brien o2tained a li.ense to pra.ti.e edi.ine shortly 2e+ore he and -rs. O<Brien divor.ed. @uring their arriage! the parties oved to -eAi.o so that -r. O<Brien .ould attend edi.al s.hool! and -rs. O<Brien .ontri2uted 76_ o+ 2oth parties< in.o e. o "otes1 Why should 7e or shouldn<t 7e .onsider the li.ense as propertyQ o i. :a2or theory1 Bhe spouse .ontri2uted her la2or to provide +or the other spouse and ay have +orsa8en the a2ility to +urther her o7n .areer. o ii. Produ.tivity theory1 We 7ant to re7ard this type o+ invest ent 2N. the produ.t is use+ul to so.iety. o iii. 6elian.e and eApe.tation -rs. +orsoo8 the a2ility to +urther her .areer and in.rease her earning potential 7ith the eApe.tation that her e++orts 7ould 2e re7arded 2y her hus2and<s in.reased earning potential. o iv. 3++i.ien.yQ What should 2e the de+ault rule vs. 7hen should rules 2e ade eApli.itQ Should arital property 2e .onsidered 7ithin the .onteAt o+ .ontra.t la7Q )onsider that you 7or8 +or a +e7 years +or a la7 +ir then go 2a.8 to get an ::- in taAation! +or 7hi.h the +ir pays +or. On.e you o2tain your degree! you serve a noti.e o+ resignation. Bhe +ir .ould argue that it is entitled to so e o+ the added value that you o2tained as a result o+ the edu.ation! 2ased upon their eApe.tation. Should the sa e logi. 2e applied to a arriageQ (re the eApe.tations the sa e $a +orever .ovenant vs. a li ited partnership'. Poli.y .on.erns1 o We 7ant to re.ogniDe ne7 property! su.h as edi.al li.enses. o @o 7e 7ant to use endga e*strategy rules or relationship*2uilding rulesQ o We 7ant to en.ourage people to invest in others. o )on.ern a2out .o odi+i.ation o+ sa.ri+i.e and the .heapening that results.

=0

Should 7e +o.us on the value o+ the eApe.ted +uture earnings or the lost earningsQ Ho7 do 7e deter ine the valuesQ

C,,,. 3ntity Property1 :andlord*Benant :a7 $604'

We .ould thin8 o+ leases li8e a li+e estate 7ith a reversion. But 7hy don<t 7eQ What are the di++eren.esQ o >uture interest holder $:' pro2a2ly has ore o+ a anagerial role 2N. they 7ill pro2a2ly get the property 2a.8 sooner. (s a result! they have ore tools than a +uture interest holder in regard to a li+e estate. (lso! 2e.ause the : has a higher value +or his +uture interest sin.e it is li8ely to aterialiDe soonerM thus! his interests are ore in line 7ith B<s and 7ill strive to a8e B happy! in theory. o 6e ainder en generally do not have u.h o+ a relationship 7ith the present possessor! as opposed to an ongoing relationship that landlords typi.ally have 7ith tenants. o :eases are o+ten used ore as a anage ent tool! rather than a grant o+ property. o Why o7nQ Predi.ta2ility o+ .osts. BaA*2ene+its. ,nvest ent potential. )ontrol over property o Why have leases rather than o7nershipQ Why do 7e have long*ter .o er.ial leases 2ut not residential leasesQ >leAi2ilityM ini iDe ris8s $neigh2orhood goes 2adM a2ility to ove'. :ess responsi2ility. (llo7 spe.ialiDation :ease types1 o Ber o+ years1 +iAed end*ti e. o Periodi. tenan.y1 auto ati.ally rolls over +or a stated period o+ ti e $e.g. onth*to* onth lease'. o Benan.y at 7ill1 ter ina2le at any ti e 2y either party +or any reason. o Benan.y at su++eran.e1 tenant! 7ho on.e had right+ul possession! holds over a+ter the right has ended $e.g. due to nonpay ent o+ rent'.

(. Original ;nderstanding o+ the :ease ,ndependent )ovenants G )aveat :essee o When a tenant has entered into a .ovenant to pay rent! he is o2ligated to that .ovenant even i+ he is no longer a2le! through no +ault o+ the landlord! to re.eive the 2ene+it o+ the agree ent. Paradine v. Jane! 3ng.! 69/ $Prin.e<s o..upation o+ property +or.ed B out o+ the ho e! and he did not pay rent +or three years'. 6easoning1 Just as a tenant re.eives the 2ene+it o+ in.reased value $e.g. in.reased .rop pri.es' 7ithout sharing it 7ith the landlord! he 2ears the ris8 o+ de.reased value. $B o2tained te porary o7nership'. "otes1 o Broadening the rule! one party<s nonper+or an.e does not eA.use the other party +ro per+or ing his .ovenant$s' $in the a2sen.e o+ a +or+eiture .lause'. 6ather than a re.ipro.al nonper+or an.e! B<s or :<s re edy +or 2rea.h! under the independent .ovenants odel! 7ould 2e to sue. o :egislation in ost ?Ans has li ited the s.ope o+ the .o on la7 rule so that losses +ro destru.tion $2y +ire! earth5ua8e! +lood! 7ar! et..' generally ter inates the lease! releasing the tenant +ro .ovenant to pay rent. (lternatively! .ourts have held that the .ontra.t do.trines o+ i possi2ility and +rustration o+ purpose ay apply to relieve a tenant o+ +urther o2ligations 7hen the pre ises are destroyed. o @e+ault rule1 4enerally! though! the allo.ation o+ ris8 o+ .asualty loss is a de+ault rule su2?e.t to .ontra.tual odi+i.ation. o ,n the a2sen.e o+ an i plied 7arranty o+ +itness! a tenant is lia2le +or rent upon land! even i+ that land 2e.o e un+it +or his intended use! as long as the landlord 7as not at +ault or a7are o+ the de+e.t. Sutton v. Be ple! 3ng. $/04&'! 6961 >a.ts1 :essee<s .o7s died +ro paint on the land! so 7hen : sued +or nonpay ent o+ rent! B<s de+ended that he .ould not have en?oy ent o+ the land +or the purpose +or 7hi.h it 7as leased.

=/

6easoning1 o @istinguished +ro Smith v. %arrable! 7here the : 7as +ound to have an o2ligation to provide personal property $+urniture' in a .ondition +it +or use 2e.ause the lease 7as short*ter +or a +urnished apt 7ith the o2vious purpose o+ en?oying the personal property. "otes1 o Poli.y .onsiderations +or deter ining the 2est de+ault rule ,n.entive stru.ture 3Ape.tationsNintent (..ess to in+or ationNa2ility to inspe.t B or :Q o a2out the .ondition o+ the land o a2out B<s intended purpose ;sage .o er.ial or residentialQ :ength o+ lease short*ter vs. long*ter Bargaining po7er a2ility +or .olle.tive a.tion vs. e++i.ien.y Partial physi.al evi.tion! even i+ it does not a8e a property unusa2le +or the purpose +or 7hi.h it 7as leased! .an sever an independent .ovenant and suspend rent 2e.ause the : has 2rea.hed an i plied 7arranty o+ 5uiet en?oy ent 2y inter+ering 7ith the B<s right to possession o+ the 7hole property. Su.h evi.tion does not end the lease and sever other .ovenants! su.h as the .ovenant to repair. S ith v. -.3nany! -ass. $/097'! 6941 >a.ts1 -.3nany rented property 7ith a shed to store his 7agons in +ro S ith. S 2uilt a 2ri.8 7all +or a 2uilding on ad?a.ent land! and the 7all en.roa.hed upon the property in 5uestion 2y a2out /*% +eet +or a length o+ a2out &0 +t. When S sued +or rent and 2rea.h o+ .ovenant to repair! - de+ended that S had evi.ted hi 2y ta8ing a7ay a portion o+ the land he had leased. 6easoning1 o ,n line 7ith the .onveyan.e paradig o+ leases! rather than the .ontra.t paradig ! 7hen the : 2rea8s the .ovenant o+ allo7ing B the 7hole o+ the pre ises! B<s rent is suspended. o Why su.h a stri.t ruleQ (8in to the stri.t rule a2out the right to eA.lusion possessed 2y an o7ner. $;nder a .onveyan.e paradig ! B is the o7ner.' Constructive eviction $not physi.al evi.tion 2ut I ight as 7ell 2eL'! 7hi.h severs a tenant<s .ovenant to pay rent! .ould 2e1 o $i' landlord is+easan.e su++i.iently severe enough that it 7ould .ause a reasona2le tenant to va.ate due to deprivation o+ the B<s en?oy ent or o..upation o+ at least part o+ the leased pre ises. o $ii' landlord non+easan.e! $a' 7hen : 2rea.hes a duty spe.i+ied in the lease! or $2' 7hen : allo7s +or the .reation o+ a situation des.ri2ed in $i' and has a right to .ontrol o2?e.tiona2le .onditions $even those .reated 2y a third party' 2ut does not eAer.ise that right. Bla.8ett v. Olano++! -ass. $/977'! 70&1 o >a.ts1 : entered into a lease +or a night.lu2Nlounge in a 2uilding ad?a.ent to Bs< residential 2uilding! 7hi.h : also o7ned. Bhe lounge<s patrons .reated noise that inter+ered 7ith Bs< 5uiet en?oy ent! despite a .lause in the lease that re5uired any noise +ro the lounge not distur2 tenants o+ the ad?a.ent 2uilding. ,n response to :<s .o plaints to the lounge! the noise a2ated at ti es! 2ut it nevertheless o..urred at other ti es. "otes1 o &dP )ri es1 ,+ : has reason to 8no7 o+ the possi2ility o+ .ri inal a.tivity! and does not ta8e reasona2le a.tion to try and prevent it! : .ould 2e lia2le +or &dP .ri inal a.tivity. o Partial .onstru.tive evi.tion .an sever an independent .ovenant in so e ?Ans. o Proving .onstru.tive evi.tion1 B has to have le+t the property! 7hi.h leads to pro2le s in any .ases1 o ,+ the .t +inds B 7as not .onstru.tively evi.ted! he then o7es 2a.8 rent! ay 2e lia2le +or la.8 o+ noti.e o+ va.ating the pre ises! and he has 2een paying to live else7here. o 4enerally! B doesn<t 7ant to ove 2ut ?ust 7ants : to re edy the situation! su.h as 2y a8ing needed repairs. o : is not +or.ed to a8e repairs or allo7 B to ove 2a.8 in. o : .ould retaliate 2y not rene7ing a onth*to* onth lease $under a periodi. tenan.y or tenan.y*at*7ill'.

=%

,+ B is allo7ed da ages! ho7 to .al.ulate and prove the valueQ One solution to the pro2le s 7ith .onst.evi.. is to allo7 B a de.laratory ?udg ent or te porary in?un.tion! although this .ould 2e eApensive and ta8e too long. So e .ourts have allo7ed a +inding o+ ..e. 7No va.ating o+ the apt. $706n4'. o )onstru.tive evi.tion ay not address pro2le s that 7ere in eAisten.e at the ti e the lease 7as initiated. >or this! Bs ust rely on ,WH $see se.tion 2elo7'. Surrender * .an sever B<s .ovenant to pay rent! * o..urs 7hen1 o $/' B o++ers a surrender 2y va.ating the pre ises 7ith no intent to return and : a..epts the surrender 2y ta8ing a.tion that is in.onsistent 7ith B<s .ontinuing right to the leasehold interest $e.g. .hanging the lo.8s or reletting the unit'M 2ut o $%' ;nder a Ireenter and reletL .lause $as in $n re Kerr! S@"# $/9&9'! 707'! B is generally lia2le +or the re ainder o+ his lease during 7hi.h the pre ises is not relet! although the : has a duty to itigate da ages. ,n re 9err >a.ts1 @uring the 4reat @epression! Bs entered a t7o*year lease 2ut only paid on it +or t7o onths 2e+ore de+aulting on 4N0/N&7M shortly a+ter7ard! they entered 2an8rupt.y. : entered another lease +or the sa e pre ises on =N06N&7 +or a ter ending t7o years a+ter the end o+ the initial lease 7ith Bs. :s also agreed to no rent +or the +irst three onth! and a redu.ed rate 2eyond that. (+ter : sued and 7on in 2an8rupt.y .ourt! the trustee o+ B<s 2an8rupt.y 2rought this a.tion. : .ontended that the Ireenter and reletL .lause in the Bs< lease allo7ed : to a8e a lease on Bs< 2ehal+ +or the re ainder o+ Bs< lease 7ithout a..epting Bs< surrender. Bhe .ourt disagreed and +ound that :<s a8ing o+ a lease that eAtended 2eyond the original end date eant that : 7as a.ting on its o7n 2ehal+ and! there+ore! a..epted the surrender 7hen it relet the unit. "otes1 o Justi+i.ations +or Surrender @o.trine1 ,+ B is 8no7n to 2e 2an8rupt! the : 7on<t 2e a2le to o2tain oney 2y a ?udg ent any7ay. ,n the a2ove .ase! the re*letting provision ade the .ovenants dependent. o Why did the .ourt release B +or all rent even though : 7as not going to a8e up +or the short+all 2y the su2se5uent B<s rentQ Bo disin.entiviDe strategi. 2ehavior 2y :.
o o

B. @ependent )ovenants $Bhe :andlord*Benant 6evolution' When a 2rea.h o+ a .ovenant is so su2stantial as to go to the 7hole o+ the .onsideration $2y de+eating the entire o2?e.t o+ the lease'! the other party is eA.used +ro per+or an.e $e.g. paying rent' 2N. it is a dependent .ovenant. -edi.o*@ental Building v. Horton! )al. $/94%'! 7/%1 o >a.ts1 ;nder a siAteen*year lease 7ith Horton G )onverse o2tained the eA.lusive right to aintain a phar a.y in their 2uilding. When the lessor! -edi.o*@ental! learned o+ another tenant<s selling phar a.euti.als! the : said he .ould not stop that tenant<s a.tions. B stopped paying rent! and : sued. Judg ent +or B $@' a++ir ed. o "otes1 :oo8 to parties< intentions to deter ine i+ a .ovenant is dependent. Options +or party not in 2rea.h1 o a' 6es.ind $e.g. stop paying rent' o 2' )o plete lease and sue +or da ages $e.g. lost pro+it' o .' )onsider the .ontra.t 2rea.hed and sue +or eApe.tation da ages. (dvantages o+ .ontra.t la7 over property la71 o Sin.e ulti*tenant 2uilding! .o pleA intera.tions 2etter handled 2y +leAi2le re edies rather than the si ple eA.lusion postulates o+ property la7. ,WH * , plied Warranty o+ Ha2ita2ility $non7aiva2le'1 B<s o2ligation to pay rent in a residential! ur2an leasehold is dependent upon :<s +ul+ill ent o+ health and sa+ety o2ligations under a non7aiva2le i plied 7arranty o+ ha2ita2ility. Javins v. >irst "t<l 6ealty )orp.! @.). $/979'! 7/91 o )ourt held that :s are re5uired to aintain the pre ises in .o plian.e 7ith housing regulations. Bhus! B is eA.used +ro paying rent due to a 2rea.h o+ i7h 7hen1 $i' the alleged violations o..urred during the period o+ non*pay ent! and $ii' :<s 2rea.h 7as su2stantial enough to ?usti+y non*pay ent or rent.

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o ,WH does not ne.essarily apply +or single*+a ily ho es! parti.ularly in rural areas. o 6e edies availa2le +or 2rea.h o+ i7h1
$i' res.ission o+ lease 2y B! allo7ing B to va.ate 7No paying rent and sue +or da ages. $ii' B re ain in possession and sue +or spe.i+i. per+or an.e $e.g. repairs' 2ut .ourts don<t li8e to re ain involved 7ith parties long*ter and onitor per+or an.e. $iii' B re ain in possession and sue +or da ages 2ut ho7 to .al.ulateQ $iv' B .an assert 2rea.h o+ i7h as a de+ense to unpaid rent or evi.tion pro.eedingsM again! ho7 to .al.ulate the set*o++ to rentQ $v' B is allo7ed to 7ithhold rent until a .ondition is et $e.g. the violation is .orre.ted or B arranges +or repair'. $vi' B repairs and dedu.ts the .ost as a set*o++ +ro rent! 2ut o B ay not 2e a2le to a..ess the ne.essary areas o+ the 2uilding! B ay not have a..ess to ne.essary +inan.ing +or the repair! B ay end up 2earing unrei 2ursed .osts! and B .ould in.ur lia2ility +or repairs i+ har later results. Ho7 to .al.ulate re edies $see 7&0n7'1 o @a ages .ould in.lude +oreseea2le .onse5uential da ages! in.luding oving eApenses or hotel eApenses. o $/' Su2tra.t the value o+ the da aged apart ent $@(' +ro the rent reserved $66'! 7hi.h is the agreed*upon rental pay ent. But due to the e++i.ien.y o+ rental ar8ets! they tend to a..ount +or the da aged .ondition o+ apart ents in the 66! despite the un7aiva2ility o+ ,WH. Bhus! Bs ay re.eive O0 da ages under this ethod. o $%' Su2tra.t the @( +ro the +air ar8et value i+ the apart ent 7ere in .o plian.e $>-C' But! +or the reasons noted a2ove! this ay result in a 7ind+all +or the B that sNhe did not 2argain +or. $using Ys 2elo7! da ages 7ould 2e /=00*7=0 H O7=0'. (lso! it ay 2e di++i.ult to deter ine >-C i+ .o para2le apart ents are also not in .o plian.e 7ith .ode. o $iii' Per.entage 6edu.tion +or ula1 J$>-C @('N>-CK Z 66 Por $66N>-C' Z da ages! 7here da ages H >-C*@(R 3A1 >-C is O/=00! @( is O7=0! and 66 is O/000! o @a agesNredu.tion H J$/=00*7=0'N/=00KZ/000 H $/N%'Z/000 H O=00 Pro2le 7ith this ethod is that :s ay get a7ay 7ith lo7 66s on the assu ption that Poli.y .onsiderations +or .hanging +ro the +eudal Ino i plied repairL rule1 3++i.ien.y1 3n+or.e ent o+ the housing .ode .an 2e i proved 2y shi+ting the 2urden to :s to a8e repairs. But 7ho 7ill ulti ately pay +or the in.reased responsi2ilityQ Spe.ialiDation1 (lthough leasehold la7 developed in relation to rural leases +or land! ost ur2an lessees are less 8no7ledgea2le and less a2le to a8e repairs than :s. 6esour.es1 : is 2etter a2le to a..ess .o on areas and is ore li8ely to have the proper tools +or repair. 3Ape.tations1 Bs eApe.t that the .ondition o+ the property 7ill 2e aintained at the sa e level as it 7as in 7hen initially leased $or 7ill 2e repaired! i+ : has led the to 2elieve as su.h'. (s in Smith v. %arrable $dis.ussed in Sutton'! Bs reasona2ly eApe.t property in good repair +or short*ter leases! espe.ially +or +urnished units. :a2or1 Bs short*ter interest in the land does not ?usti+y investing as u.h into it as .o pared to the :. )heapest )ost (voider1 : is a2le to inspe.t +or and 2e a7are o+ pro2le s ore easily. 6elative 2argaining po7er1 @ue to a la.8 o+ legal sophisti.ation! Bs are not li8ely to have the sa e 2argaining po7er as a :! 7ho a8es a living 7ith leases. What .onstitutes a 2rea.h o+ ,WHQ ( violation o+ the housing .ode not ne.essarily i+ the violation results in de minimus i pair ent to ha2ita2ility or is related to .os eti. issues rather than sa+ety or health issues. o )riti5ue Bhe 2uilding .ode 7as not intended to provide a 7arranty o+ ha2ita2ility and does not ne.essarily re+le.t sa+ety issues 2e.ause it is the produ.t o+ politi.al pro.esses! involving .o pro ises a ong interest groups $e.g. a re5uire ent to use PC) pipe rather than etal pipe due to lo22ying 2y a PC) pipe +g'. So e .ourts! regardless o+ the housing .ode! loo8 to ha2ita2ility .on.erns1 o the nature o+ the de+e.t $re1 sa+ety or health rather than .os eti.'

=4

the length o+ ti e the de+e.t has persistedN length o+ ti e : has had to repair $7as noti.e provided to :Q' o the age o+ stru.tureNdi++i.ulty to aintain o @id B play a role in .ausing the da ageQ o What 7as the rentQ advantage o+ this +a.tor B ay have agreed to a lo7er rent in eA.hange +or 7aiving the ,WH! even though it is te.hni.ally un7aiva2le. disadvantage : ay use unresponsiveness to push out lo7*rent BsM also! allo7s ,WH to 2e 7aived! .ontrary to Javins rule. o Was the da age .aused 2y 2uilding sta++ or :<s +ailure to .oordinate or agree 7ith sta++Q o Should ,WH 2e 7aiva2leQ @isadvantages to 7aiva2ility o $i' 3Aternal .osts ay 2e i posed and Bs 7on<t ta8e that into a..ountM $e.g. lost produ.tivity! 2ro8en 7indo7s indi.ate a la.8 o+ .ontrol or en+or.e ent and ay under ine deterren.e o+ .ri e! health e++e.ts to .hildren or elderly' o $ii' B<s ris8 assess ent is not li8ely to 2e a..urate )ounter1 We don<t +or.e people to get edi.al help or go to .ollege! +or 7hi.h the sa e argu ents .ould 2e ade. (dvantages o+ 7aiva2ility o $i' 6espe.ts .hoi.e o+ Bs to prioritiDe di++erently. o $ii' 6e.ogniDes that the .osts o+ ,WH ay 2e 2orne 2y Bs and that personality issues ay a++e.t e++i.ien.y. o Pro2le s1 ,s pla.ing the 2urden upon :s +airer than pla.ing it upon so.iety as a 7holeQ Bhe a2ove poli.y .onsiderations are not as strong in relation to /*4 +a ily tenan.ies anaged 2y a .ity d7eller 7ho also la.8s 8no7ledge o+ ho7 to a8e repairs. 6esear.h indi.ates that the su2set o+ Islu lordL :s ta8ing advantage o+ poor Bs represents only a s all su2set o+ residential! ur2an leases. ,+ an asy etri. in+or ation pro2le is part o+ the issue! re5uiring dis.losure is the usual ethod o+ addressing su.h an issue. )onsider that the la.8 o+ housing .ode en+or.e ent 2y the agen.y tas8ed 7ith en+or.ing it re+le.ts a dis.retionary ?udg ent that :s 7ill a2andon 2uilding i+ +or.ed to .o ply stri.tly 7ith the .ode! resulting in )ity .ontrol andNor higher rent! neither o+ 7hi.h is a solution to the underlying pro2le s. Bhe non7aiva2le i7h does not allo7 +or su.h dis.retion or +leAi2ility! other than B<s de.ision o+ 7hether or not to pursue legal a.tion! 7hi.h has its o7n .osts. ,nstitutional .o peten.y1 (lthough the legislature $)ity )oun.ilQ' and the regulatory s.he e did not provide +or a private right o+ a.tion to en+or.e .ode violations! the )ourt ena.ted one via ?udi.ial +iat. ,+ 7e analogiDe to the i plied 7arranty o+ +itness under .ontra.t la7! ho7 .ould the i7h 2e strengthened as a ruleQ o -a8e it depend upon 7hether : is a repeat player or not. o -a8e it a de+ault rule! not un7aiva2leN andatory. o :i it :<s .ontinued o2ligation to repair! espe.ially regarding routing 7ear and tear. ,llegal :ease @o.trine1 o ,+ : enters a lease +or a property that is in violation o+ the housing .ode! the lease is .onsidered void! and unpaid rent is not due. o Bhe do.trine o+ ,WH is +avored over the illegal lease do.trine in residential settings 2e.ause a deter ination o+ an illegal lease .auses a B 7ho re ains in possession o+ a property to 2e.o e a tenant at 7ill or a tenant at su++eran.e! su2?e.ting hi to evi.tion. (lso! under the illegal lease do.trine! B .ould still 2e lia2le +or so e rent under a 2uantum merit $un?ust enri.h ent' argu ent. 6etaliatory evi.tion1 : .annot evi.t or not rene7 a lease 2ased upon B<s allegations o+ non.o plian.e 7ith housing .ode regulations $7%0'.
o

). Bhe 3.ono i.s o+ :andlord*Benant :a7 $7&/' @oes the ,WH i prove the 7el+are o+ lo7*in.o e tenants! as it 7as intended toQ o -i.ro*e.ono i. theory argues that an ,WH

==

in.reases the de and +or lo7*.ost housing $due to i proved 5uality' 7hile de.reasing the supply $due to in.reased .osts o+ .o plian.e'! thus in.reasing rent! leading Bs possi2ly to Idou2le upL i+ they .an<t a++ord ore rent. o :egal s.holars argued that the supply o+ lo7*.ost housing is relatively stati. $inelasti.' due to unusual +a.tors in the lo7*.ost apart ent ar8etM e.g.1 Bs 7ill re+use to Idou2le upL or pay ore rent $2e.ause they .an<t a++ord to'! 2ut :s 7ill not eAit the ar8et due to sun8 invest ent .osts. o 3 piri.al eviden.e is s.ar.e! 2ut so e resear.h indi.ates that elderly indigent tenants +are 2etter than (+ri.an*( eri.an tenants. Landlords Duty to Mitigate (DtM o When a landlord see8s to re.over rent +ro a tenant in de+ault on a residential lease! the landlord has a duty to itigate losses 2y a8ing reasona2le e++orts to re*let the apart ent! even though it 7as 7rong+ully va.ated. So er v. 9ridel! ".J. $/977'! 7&=1 o >a.ts1 B signed lease on &N/0 +or =N/N7%*4N&0N74. B sent letter dated =N/9N7% and une5uivo.ally surrendered the lease. : agreed to rent to a ne7 tenant! starting 9N0/N7&. : then sued B +or the entirety o+ the lease. J *\ P. 6<d. 6<d $J *\ @! tenant'. o 6easoning1 Prior la7 not re5uiring itigation re+le.ted the .on.ept o+ a lease as a .onveyan.eNtrans+er o+ a property interest 7hi.h +ore.losed .ontrol 2y the landlord. -odern trend has 2een to treat leases as contracts! rather than property interests! and to analyDe the in light o+ the parties< intentions. (lthough not the 2rea.hing party! the : 2ears the 2urden o+ proving that he used reasona2le diligen.e in atte pting to itigate! sin.e : 7ill 2e in a 2etter position to de onstrate as su.h. o "otes1 @e+ault rule Pro2le 1 ,+ : has other! .o para2le availa2le units! is he o2ligated to re*let the va.ant one 2e+ore renting thoseQ Why 7ouldn<t the : itigate any7ay! given the .ost o+ suing B and the +a.t that B ay 2e insolvent any7ayQ o )ost o+ +inding a ne7 B and a8ing repairs to re*let $depends upon the ar8et and the .ondition o+ the unit' o : doesn<t 7ant to set a pre.edent that allo7s other Bs to es.ape their leases o : ay have other units that are va.ant and is +o.used on renting those +or a +ull lease period. o : thin8s he .an rent to another B on his o7n 2ehal+ and re.eive rent +ro that B as 7ell as the original B. When is a B 2etter o++ under the Surrender @o.trine vs. the @t- do.trineQ o Hypo1 B enters a /% o lease +or O/000N o 2ut only pays % os. 2e+ore surrendering. : does not a.t until o. =! a+ter .hanging the lo.8s at the end o+ o. 4. : +inally rents +or os. 7*/% at O900N o. ;nder the Surr @o.t! : a..epted B<s surrender o++er 7hen : .hanged the lo.8s! so B o7es O%000 $rent +or os. &G4'. ;nder @t-! the .ourt 7ould loo8 to 7hat 7as reasona2le +or :! so B 7ould not li8ely 2e lia2le +or :<s ina.tion in os. &G4! 2ut B ay still 2e lia2le +or =G6! advertising eApenses to relet! and the O600 short+all 2et7een B<s lease a ount and the ne7 B<s onthly rent. So! B 7ould 2e lia2le +or at least O%600. o So e .ourts allo7 Bs to argue in the alternativeM thus! 7hi.h ever ethod +avors the B! the B is allo7ed to use that one. 6ent )ontrol1 o 6ent +reeDe * prohi2ition against in.reasing the .urrently*.harged rent1 in anti.ipation o+ in.reased de and +or rental housing! to prote.t tenants +ro uneApe.ted hardships! and to prevent 7ind+all pro+its +or landlords. o "o va.an.y de.ontrol! as dis.ussed 2elo7. 6ent 6egulationNSta2iliDation

=6

o (llo7s +or ad?ust ents1

I>air rentL syste ena.ts a set rent! deter ined 2y the govern ent! 2ased upon +a.tors su.h as o :<s .osts! o B<s a2ility to pay! andNor o rents .harged +or .o para2le un.ontrolled units. Ca.an.y de.ontrol syste o restri.ts rent in.reases 7hile a parti.ular B re ains in possession o+ a parti.ular unit! 2ut usually o allo7s +or annual per.entage in.reases in a..ordan.e 7ith an indeA esta2lished 2y a regulatory 2ody. o ,+ parti.ular B va.ates! : .an ad?ust rent to ar8et levels. o : ay also 2e a2le to in.rease rent 2ased upon : hardship or signi+i.ant i prove ents to the property. Bene+its o+ 6ent 6egulation1 , proves the e++i.ien.y o+ the ar8et! 7hi.h su++ers +ailure 2e.ause o (pts are not +ungi2le due to personhood interests But Bs have po7er! too! 2N. rene7ing leases is less .ostly +or :s than +inding a ne7 B. o Signi+i.ant .hange in de and $due to 7ar! hurri.ane! et..' o :a.8 o+ in+or ationM e.g. due to the uni5ueness o+ apart ents and the .ost o+ sear.hing +or apart ents in "#! :s .an .harge pre iu s as a result o+ their onopolisti. po7er. o Housing ar8et is s8e7ed $supply and de and do not .orrelate a..ording to assu ptions o+ .o petition! +ungi2le .o odities! +ull in+or ation! and rationalNpro+it* aAi iDing a.tors' 2N.1 $a' rent is only a portion o+ :<s pro+it! sin.e in.rease in invest ent value plays a role as 7ellM $2' :s ay 2e highly leveragedM $.' :arge Ys o+ renters .o pared to relatively +e7 :s $in .ontrast to an assu ption o+ 2alan.e' $d' :s share in+or ation and 7or8 together $through landlord organiDations'! leading to in+or al pri.e*+iAing. $e' Foning rules li its :s< a2ility to 2uild and! there2y! arti+i.ially de.rease supply. )ounter1 "o ar8et is per+e.t! and rent regulation ay disin.entiviDe :s +ro 2uilding ore and in.reasing the supply! 7hi.h 7ould address so e o+ the pro2le . 6ent .ontrol allo7s +or and en.ourages Bs to re ain in .o unities! developing an atta.h ent to their ho e and neigh2orhood $per 6adin! 769'. )reates a ni.he industry +or attorneys $e.g.! helping deter ine 7ho gets a unit upon divor.e'. )osts o+ 6ent 6egulation1 ,n.reased syste .osts1 o ( syste o+ .o prehensive regulation and en+or.e ent is re5uired to aintain .o plian.e 7ith 2uilding .odes! o in part 2N. :s have in.entive to indu.e Bs to va.ate! su.h as 2y 7ithholding servi.es! o thus in.reasing the .ost o+ rent. @e.reased supply1 :s are in.entiviDed to .onvert apart ents to other uses! thus de.reasing the supply o+ housing. @e.reased 5uality1 :s are in.entiviDed to allo7 the 5uality o+ housing to deteriorate! thus de.reasing the supply o+ good 5uality housing. @e.reased o2ility1 o Bs are in.entiviDed to re ain in their .urrent apart ents! even though they ight have 2etter o..upational prospe.ts else7here! so eone else ay need the unit $e.g. a &*2edroo apt' ore $e.g. than grand a'! su2*letting or re5uiring I8ey oneyL to ove out is illegal. )ross*su2sidy1 o 3 piri.ally! rent regulation redu.es the aggregate 7ealth o+ so.iety $it is not 9aldor*Hi.8s e++i.ient' and does not have a redistri2utive e++e.t. o Within a 2uilding! tenants in non*regulated units pay +or the arti+i.ially*depressed rent o+ regulated units. o @e.reased supply o+ non*.ontrolled apart ents tends to .ause rent to in.rease in those 2uildings. o BaApayers pay +or servi.es to people 7ho are ade ho eless. o ,n.o e taA +or :s and property taA on 2uildings de.reases due to lo7er rents.

=7

Possi2ility o+ ine++i.ient in.rease o i+ the regulatory 2ody in .harge o+ the in.rease 7rongly assesses the ar8et o and 2e.ause Bs do not have the sa e .hannel +or eApressing dis.ontent $su.h as 2y oving'. o 3 piri.ally! outside o+ -anhattan! rates +or rent*regulated units are higher than ar8et rates. )lass "otes1 -ar8et +ailure alone does not ?usti+y regulation 2N. ost ar8ets are ine++i.ient in so e 7ay. )ourts should .onsider the ris8 o+ regulation and alternatives to regulation.

@. :easehold Brans+ers $746' Ber s1 (ssign ent >ee si ple ***************************************************************************************************** Pri e lease ******* /st (ssign ent ******* %nd (ssign ent ***************** Su2*:ease >ee si ple **************************************************************************************************** Pri e lease ************************ Su2*lease ******************* Su2*su2lease *********

o (ssign ent
Stru.ture1 ( portion o+ a +ee si ple is .arved out to a8e a pri ary lease! 7hi.h is alienated to .reate a $/st' assign ent. ,+ the /st assign ent is alienated! it 2e.o es a %nd assign ent! and so on. o $(t ):! i+ pB trans+ers all o+ his interest! .ourts interpreted the grant as an assign ent.' "o privity o+ .ontra.t 2et7een assignee and the original : $unless they have dire.tly .ontra.ted or assignee has agreed to an Iassu ptionL'. Privity o+ estate 2et7een assignee and the original : 2N. o (<s interest is dire.tly .arved out o+ :<s o ( or : is in a.tual possession o+ the property. (ssu ption H /st assignee agrees to 2e 2ound 2y the ter s o+ pB<s original lease $to 2e 2ound 2y privity o+ estate and privity o+ .ontra.t'. "ovation H : and ( agree to release pB +ro privity o+ .ontra.t lia2ility Why isn<t an assign ent li8e a li+e estateQ numerus "lausus! 7ant to 8eep things un.o pli.ated. o Su2*:ease Stru.ture1 Out o+ a +ee si ple! : .arves out a Pri e lease! then Pri e B .arves out a Su2*lease! et.. o $(t ):! i+ pB retained any interest! even / day! .ourts interpreted the grant as a su2*lease.' "o privity o+ .ontra.t 2et7een su2*lessee and the original : $unless they have dire.tly .ontra.ted'! 2ut o Privity o+ .ontra.t 2et7een pri ary lessee $pB' and : and o Privity o+ .ontra.t 2et7een pri ary lessee $pB' and su2*lessee $sB' "o privity o+ estate 2et7een su2*lessee and the : 2N. o sB<s interest is not dire.tly .arved out o+ :<s! even i+ o sB or : is in a.tual possession o+ the property. Privity o+ estate 2et7een pri ary lessee and su2*lessee 2N. o sB<s interest is dire.tly .arved out o+ pB<s! and o sB or pB is in a.tual possession o+ the property. o Su ary1 !y"e Privity of Contract Privity of #state (ssign ent :*pB! pB*(/ :*(/ 7N (ssu ption ] :*(/ I I 7N "ovation * :*pB I I Su2*:ease :*pB! pB*sB pB*sB

o @i++eren.es1

=0

>or a su2lease1 ,+ sB +ails to pay rent! : .an sue pB under privity o+ .ontra.t or privity o+ estate. : .annot go against sB 2N. no privity o+ .ontra.t or estate $eA.ept under a &dP 2ene+i.iary argu ent'. >or an assign ent1 ,+ sB +ails to pay rent! : .an sue sB under privity o+ .ontra.t $i+ there has 2een an assu ption' or privity o+ estate. : .an go a+ter pB under privity o+ .onra.t! unless a novation has 2een e++e.ted. ;nder privity o+ estate1 sB is lia2le +or o2ligations that re ain 7ith the land $i.e. .ovenants that Itou.h and .on.ernL the land' and that parties intended to run 7ith the land $e.g. i+ pB agrees to 7ater :<s plants! this does not run 7ith the land'. ,+ pB 7ants a reversion! sNhe should su2let rather than assign. o Hypo1 Pri e B 7ants to eAit 2e+ore the end o+ a lease 7ith :. Should pB su2let or assignQ o ,+ : is not as a.tive in gt o+ the land! he 7ould pre+er a su2lease. )onversely! he 7ould pre+er an assign ent i+ he is a.tive in the gt o+ the land. o ,+ pB does not 7ant to deal 7ith the sB 2ut 7ants the to deal dire.tly 7ith :! then pB 7ould pre+er an assign ent. $ inority rule'1 Where a .o er.ial lease provides +or assign ent only 7ith the prior .onsent o+ the lessor! su.h .onsent ay 2e 7ithheld only 7here the lessor $pri ary tenant' has a .o er.ially reasona2le o2?e.tionZ to the assign ent! even in the a2sen.e o+ a provision in the lease stating that .onsent to assign ent 7ill not 2e unreasona2ly 7ithheld. 9endall v. 3rnest Pestana! ,n..! )al. $/90='! 7==1 o Z .o er.ially reasona2le is a 5uestion o+ +a.t! 2ased upon1 the +inan.ial responsi2ility o+ the proposed assignee! the suita2ility o+ the proposed use +or the parti.ular property! the legality o+ the proposed use! the need +or alteration o+ the pre ises! and the nature o+ the o..upan.y $e.g.! o++i.e! +a.tory! .lini.! et..'. $not so that the lessor ay .harge a higher rent or 2ased solely upon personal taste! .onvenien.e! or sensi2ility' o >a.ts1 )ity o+ San Jose leased hangar spa.e to ,rving and Jani.e Perlit.h! 7ho entered a su2*lease 7ith 6o2ert BiAler. (+ter the Perlit.hes assigned their interest to 3rnest Pestana! ,n.! BiAler 7anted to sell his 2usiness and assign his su2*lease to Ja.8 9endall and 4rady and Ci.8i O<Hara. BiAler<s su2*lease provided that .onsent +ro the lessor $pB' 7as needed to assign the su2*lease. Pestana re+used to .onsent unless the assignee agreed to pay an in.rease rent and agree to Iother ore onerous ter s.L o 6easoning1 ,n +avor o+ aliena2ility $and in +avor o+ allo7ing reasona2le assign ents'1 o Bhe la7 generally dis+avors unreasona2le restri.tions on +reedo $see Tos"ano' o ,n our in.reasingly ur2an $and o2ile' so.iety! alienation .ontri2utes to progress and .o er.e. o 3spe.ially in the .o er.ial setting! relationships 2et7een lessors and lessees are in.reasingly i personal. o :essee too8 the ris8 o+ a depression in the ar8et value o+ his lease! so he should 2e a2le to get the 2ene+it o+ the 2argain $the I2onus valueL o+ the lease' as 7ell. o ( duty o+ good +aith and +air dealing is inherent in all .ontra.ts! $and leases are interpreted ore and ore as .ontra.ts'. (gainst aliena2ility $and in +avor o+ allo7ing lessor to restri.t assign ent ar2itrarily'1 o Preservation1 Bhe lessor is a2le to prote.t his reversionary interest. o Per+or an.e o+ lease .ovenants1 Bhe lessor aintains ore .ontrol over his a2ility to o2tain in.o e +ro the property. o >reedo o+ .ontra.t. o 6elian.e1 -any parties have relied upon the old rule 7hen a8ing .ontra.ts. o "otes1 Bhere is not usually a @t- in a .o er.ial .onteAt! so ar2itrary dis.retion re1 assign ent .ould 2e very detri ental to Bs. -ap o+ the interests1 )ity o+ SJ +ee si ple *********************************************************** leased to Perlit.hes ******assigned reversionary interest to Pestana Su2leased to BiAler *******proposed assign ent to 9endall

=9

,V. 3ntity Property1 )o

on*,nterest )o

unities! in.luding )o*ops G )ondos

)lass "otes1 o )o*ops tend to 2e pre*7ar and .ondos ore re.ent in "#. o Histori.ally! "# has .ondos due to ra.ial and religious dis.ri ination $against Je7s' 7hen la7s 2egan to restri.t against the overt eAer.ise o+ dis.ri ination. Presently! .o*op 2oards are su2?e.t to the >air Housing (.t! although proving a violation is nearly i possi2le. o -odern e5uivalent in su2ur2an areas ho e asso.iations! planned .o unities. Overvie7 $77%*0%' o Bypes1 )o*op1 B o7ns shares in a .orporation 7hi.h o7ns the 2uilding! and B has a proprietary lease +or the unit in 7hi.h he lives. J.orporate ortgageK )ondo1 B o7ns a parti.ular unit and shares in hall7ays! elevators! grounds! and other .o on areas. Jindividual ortgage 2etter ris8*sharing than .o*ops.K o >eatures1 (lthough .o on areas are o7ned .olle.tively! an individual<s o7nership interest is li8e a +ee si ple. -anage ent is relatively de o.rati.. Perpetual! eA.lusive! and +reely*trans+era2le property right in the o..upied unit. o (dvantages1 Be.ause de.ision* a8ers typi.ally o..upy the 2uilding long*ter ! they have in.entive and opportunity to invest in in+or ation a2out the 2uilding. >reedo o+ sel+*deter ination1 o 6esidents .an .ontrol .hanges to their ho es $repairs! upgrades'. o 6esidents have ore .ontrol over a enities $e.g.! s.hools! se.urity' and restri.tions that aintain the value o+ an individual<s invest ent. BaA 2ene+its to o7nership $ ortgage interest and property taA dedu.tions'. 6is8s and .osts are distri2uted. o @isadvantages1 )olle.tive a.tion ine++i.ien.ies due to divergent interests. o -ultiple de.ision a8ers are less li8ely to a8e de.isions that aggregate resident pre+eren.es. o Ba8es ore ti e to a8e a group de.ision. "egative eAternalities to the .o unity as a 7holeZM o 3.g.! residents in an anaged .o unity 7ith their o7n poli.e +or.e are li8ely to 2e relu.tant to in.reased general taAes to provide +or the general poli.e +or.e. 6esidents are restri.ted +ro a8e de.isions! su.h as ho7 any .ats they 7ill have in their ho e. o Z Why 7ould 6)(s $residential .o unity asso.iations' 7ant to supplant lo.al govern entQ :o.al govern ents a8e de.isions 2y o popular vote $re+erendu s' 2ut those are .ostly and only re+le.t the edian voter or an interest groupM also! people ay rely on a +ree*ride. o Bie2out hypothesis argues that uni.ipalities .o pete +or residents! thus resulting in ho ogenous populations that sel+*sele.t .ertain neigh2orhoods. 6estri.tions in a de.laration are presu a2ly reasona2le Iunless the restri.tion is ar2itrary! i poses 2urdens on the use o+ lands it a++e.ts that su2stantially out7eigh the restri.tion<s 2ene+its to the develop ent<s residents! or violates a +unda ental pu2li. poli.y.L "ahrstedt v. :a8eside Cillage )ondo (ss<n! ,n..! )al. $/994'! 70%1 o >a.tsNPro.1 -s. " o7ns a .ondo in :a8eside Cillage. When the o7ners< asso.iation learned she had .ats! 7hi.h 7ere prohi2ited 2y the develop ent<s de.laration $I aster deedL'! it de anded re oval o+ the pets and +ined -s. ". She sued +or a de.laratory ?udg ent that the restri.tion 7as unreasona2le and! there+ore! unreasona2le as applied to indoor .ats that do not enter the .o on areas or a8e a nuisan.e. J +or @ $:a8eside Cillage'. 6<d. 6<d and re anded $+or @'. o Holding1 Be.ause :a8eside C<s restri.tion Iis rationally related to health! sanitation and noise .on.erns!L it is reasona2le.

60

o 6easoning1
6elian.e interest 4iving de+eren.e to originating do.u ents $2y not su2?e.ting the to .ourt revie7' prote.ts the eApe.tations o+ developers and investors! thus +urthering .o er.ial goals. :egal .osts ,+ individual o7ners .an sue to deter ine 7hat is reasona2le! other o7ners 7ill have to in.ur the .osts o+ handling su.h disputes. So.ial $+a2ri.' .osts ,+ .o*op 2oards have to a8e +a.tual deter inations a2out 7hi.h pets are or are not reasona2le! the de.isions .ould 2e Ide.isive or su2?e.t to .lai s o+ partiality.L o @issent1 IWhat is gained +ro an un.o pro ising prohi2ition against pets that are .on+ined to an o7ner<s unit and .reate no noise! odor! or nuisan.eQL ( .ategori.al 2an on pets is unreasona2le. ,n this .ase! the individual<s 2ene+it is .lear! 2ut the har to others is not. o "otes1 79%n=1 ( developer<s restri.tions are presu a2ly reasona2le +ro an e.ono i. vie7point 2N. he has an in.entive only to in.lude restri.tions that 7ill in.rease the value o+ the units as a 7hole. When evaluating de.isions ade 2y a residential .ooperative .orporation! the standard o+ ?udi.ial revie7 is the 2usiness ?udg ent rule that .ourts should de+er to a .ooperative 2oard<s deter ination as long as Ithe 2oard a.ts +or the purposes o+ the .ooperative! 7ithin the s.ope o+ its authority and in good +aith.L 40 W. 67th St. v. Pull an! ".#. $%00&'! 79&. o Bhus! the .ourt should revie7 2oard de.isions i+ it is sho7n that the 2oard a.ted1 $a' outside the s.ope o+ its authority! $2' in a 7ay that did not legiti ately +urther the .orporate purpose! or $.' in 2ad +aith. o >a.ts1 @ engaged in nu erous a.ts o+ Io2?e.tiona2leL .ondu.t! su.h as spreading ru ors a2out the .o*op president<s 7i+e! +iling 2aseless la7suits against e 2ers o+ the 2oard! and a8ing 2aseless .lai s a2out his upstairs neigh2ors. (+ter a a?ority vote 2y the shareholders! the Board sent @ a noti.e o+ ter ination. When he did not va.ate his unit 2y the deadline! the .o*op +iled suit +or possession and e?e.t ent! a de.laratory ?udg ent .an.eling @<s sto.8 in the .o*op! and a oney ?udg ent +or use and o..upan.y! as 7ell as attorney<s +ees and .osts. Bhe trial .ourt de.lined to uphold the 0evandus'y 2usiness ?udg ent rule! +inding it in .on+li.t 7ith "# statute 6P(P: $6eal Property (.tions and Pro.eeding :a7' W 7//$/'! 7hi.h provides that an a.tion see8ing to re.over possession +ollo7ing a ter ination o+ .ertain leases Ishall not 2e aintaina2le unless the landlord shall 2y .o petent eviden.e esta2lish to the satis+a.tion o+ the .ourt that the tenant is o2?e.tiona2le.L Bhe (ppellate @ivision! ho7ever! held that the rule Iprohi2ited ?udi.ial s.rutiny o+ a.tions o+ .ooperative 2oards Xta8en in good +aith and in the eAer.ise o+ honest ?udg ent in the la7+ul and legiti ate +urtheran.e o+ .orporate purposes.<L (++ir ed. o 6easoning1 Bhe statutory language o+ 6P(P: 7//$/' re5uiring provision o+ .o petent eviden.e to the .ourt is et 2y the .o*op<s deter ination. I,+ that 7ere not so! the .ontra.t provision +or ter ination o+ the lease to 7hi.h de+endant agreed 7ould 2e eaningless.L o Poli.y .onsiderations1 ,n +avor o+ the rule1 o ,t allo7s the governing stru.ture to +ul+ill its intended purpose prote.ting the interest o+ the entire .o unity in an environ ent anaged 2y the 2oard +or the .o on 2ene+it. o Prote.ts .o*ops +ro Iundue .ourt involve ent and ?udi.ial se.ond*guessing.L $Predi.ta2ilityN.o er.iala2ilityNe++i.ien.y'. o Benants voluntarily .hoose to su2?e.t the selves to the de.isions o+ .o*op 2oards! 8no7ing that the 2oard I ay signi+i.antly restri.t the 2undle o+ rights a property o7ner nor ally en?oys.L Pro2le s 7ith the rule1 o ,t .ould allo7 a2use through ar2itrary or ali.ious de.ision* a8ing! unla7+ul dis.ri ination! et.. o )lass "otes1 3ahrstedt relates to the developer<s .ovenant! 7hile !. ;<th St. relates to a 2oard de.ision. Other alternatives to the rule1 o (llo7s de.isions that in.rease the property values as a 7hole. o )ase*2y*.ase analysis o+ reasona2leness $su.h as a nuisan.e standard'. o )ontra.t do.trine only li ited 2y un.ons.iona2ility! i possi2ility! or +rustration o+ purpose.

6/

)onsider the 6)( as a private gov<tM thus! i+ the gov<t is restri.ted +ro a.ting ar2itrarily and .apri.iously $in violation o+ due pro.ess'! the 6)( should 2e. (lso! the 6)( 7ould not 2e a2le to violate the /st ( end ent 2y restri.ting +reedo o+ spee.h. Situations in 7hi.h disputes .ould arise1 o -e 2er needs per ission to do so ething! su.h as su2let! and is denied. o -e 2er disagrees 7ith per ission granted to a neigh2or. o -e 2er disagrees 7ith deter ination that he has violated a rule. o -e 2er .an .lai that a neigh2or has violated the rule and disagrees 7ith the 6)(<s re+usal to en+or.e. o -e 2er disagrees 7ith 6)(<s de.ision a2out ho7 the 6)( should represent the interests o+ the .o unity $e.g. 2elieves 6)( should get involved in a lo.al land*use .ontroversy'. o 6)( .hanges the rules to a++e.t a inority interest $ a?ority a2use'. o 6)( see8s oney in eA.hange +or per issions $e.g. i posing a I+lip taAL +or agreeing to su2let'.
o

V. Bhe :a7 o+ "eigh2ors

)o pare 7ith do.trine o+ 7aste and do.trine o+ .o*interests $.elfino' ,n so e .ases! a .ovenant .an prevent or +orestall a nuisan.e a.tion. "uisan.eNlegal a.tion .ons $vs. +ree ar8et 2argaining'1 o 6igid! ti e*.onsu ing o 3n.ourages rent*see8ing $party anipulation'

(. "uisan.e ,ntrodu.tion1 o Private nuisan.e H intrusions to land that do not a ount to trespass 2N. they only go to the use and en?oy ent! not physi.al possession o+ the land! or 2e.ause they involve intangi2les o2?e.ts rather than tangi2le ones. 6easona2leness test1 2alan.e .o peting interests in?ury vs. so.ial utility o+ a.tivity. o Pu2li. nuisan.e1 Ia++e.tJsK a .onsidera2le nu 2er o+ people or an entire .o unity or neigh2orhoodL $967'M en.o passes threats to pu2li. health! sa+ety! and .o +ortM 2ut a.tion .an 2e 2rought only 2y a pu2li. o++i.ial or a Ispe.ially*in?uredL private individual $970n/'. o "uisan.e re+le.ts a Pigouvian analysis $taA the party at +ault to internaliDe eAternalities'1 ,+ you have t7o land uses in .on+li.t! the la7 .an deter ine 7hi.h use is 7rong and then deter ines ho7 to stop the 7rong. (lternatives to Piguovian analysis1 o >o.us upon so.ial utility $ ost valua2le use to so.iety'! 2ut ho7 to deter ineQ o >irst possession rule. o )usto . o :east )ost (voider. o (.tivity that is other7ise per issi2le 2ut .onstitutes a nuisan.e 2e.ause o+ 7hen or 7here it o..urs H nuisan.e per a""idens. /. ,ntrusions o+ dust! noise! or vi2rations do not .onstitute trespass 2ut ay .onstitute a nuisan.e. (da s v. )leveland*)li++s ,ron )o.! -i.h. (pp. $/999'! 9&01 o >a.ts1 3 pire -ine +or iron ore produ.ed air2orne parti.les 7hi.h! although in .o plian.e 7ith air*5uality standards! .ause near2y residents to su++er in.reased 7ear on their ho es $indoor and outdoor'! in.luding 2ro8en pipes! even rendering so e ho es Iun ar8eta2le.L Ps sued +or trespass. J +or P. 6<d. o 6easoning1 Brespass re5uires dire.t intrusion 2y a tangi2le! 7hi.h does not in.lude dust .arried 2y the 7ind $94%'! although so e .ourts have allo7ed indire.t intrusion 2y intangi2les 7hen a.tual and su2stantial da age has resulted. Bhis rule preserves the aspe.t o+ traditional trespass analysis 7hi.h regards the invasion o+ another<s right to eA.lude as tortious per se. o "otes1

6%

Brespass H IunauthoriDed dire.t or i ediate intrusion o+ a physi.al! tangi2le o2?e.t onto land over 7hi.h the plainti++ has a right o+ eA.lusive possession.L "uisan.e H @ su2stantially and unreasona2ly inter+eres 7ith P<s use and en?oy ent o+ the land. o )lass notes1 Why argue trespass! as opposed to nuisan.eQ o (ny intrusion is a trespass $violation o+ right to eA.lude'! 2ut nuisan.e re5uires a 2alan.ing o+ +a.tors. o (l7ays allo7s da ages. o :onger statute o+ li itations 3viden.e gro7s stale! although not as strong in a non*da age intrusion. Be.ause trespass is lin8ed to adverse possession! the sol +or trespass is li ited 2y the sol +or ap. "uisan.e is ore related to tort la7! 7hi.h generally has shorter sol than property la7. o P .an o2tain in?un.tive relie+ +or trespass ore easily than +or nuisan.e! 7hi.h is ore a8in to anti.ipatory har . Was the .ourt right to 8eep trespass and nuisan.e separateQ o )ourts that have .o ingled the .on.epts have en.ountered pro2le s 2N. o+ the S: aspe.t o+ trespass vs. the negligen.e aspe.t o+ nuisan.e! although su.h .ourts generally 8eep the .on.epts separate at the re edial stage. %. Bo deter ine the reasona2leness o+ a .o er.ial a.tivity that is an alleged nuisan.e! the trier o+ +a.t should .onsider the +ollo7ing +a.tors1 o the ne.essity o+ the a.tivity! o the suita2ility o+ the lo.ation in 7hi.h the a.tivity o..urs $lo.ality rule'! and o 7hether the a.tivity 7as .arried on in a reasona2le anner or negligently. )ase1 $(lthough @<s plant 7as in an industrial area and not .ondu.ted negligently! it<s use 7as not appropriate 2N. it inter+ered 7ith neigh2ors.' St. Helen<s S elting )o. v. Bipping! 3ng. $/06='! 9401 o >a.ts1 P $Bipping' pur.hased a large portion o+ an estate near @<s s elting plant. P sued! .lai ing that the plant I.aused large 5uantities o+ noAious gases! vapours! and! other noAious atter! to issue +ro the said 7or8s! and di++use the selves over the land and pre ises o+ the P!L .ausing in?ury to his plants and preventing P +ro Ihaving so 2ene+i.ial a use o+ the said land and pre ises as he 7ould other7ise have en?oyed . . .L P ad itted he had seen @<s .hi ney 2e+ore he pur.hased the land! I2ut he 7as not a7are 7hether the 7or8s 7ere then in operation.L J +or P. (<d A%. )lass notes1 o Ho7 is reasona2leness under nuisan.e di++erent than the usual negligen.e standard $Hand +or ula'Q "ot .lear 2N. So e .ourts loo8 +or a threshold o+ in?ury $threshold test'! 2ut So e .ourts use a 2alan.ing test! 7here utility \ har H legal. o Per 6SB W0%7 $%6+n6'! gravity o+ har $P:' +a.tors in.lude1 I$a' the eAtent o+ the har involvedM $2' the .hara.ter o+ the har involvedM $.' the so.ial value that the la7 atta.hes to the type o+ use or en?oy ent invadedM $d' the suita2ility o+ the parti.ular use or en?oy ent invaded to the .hara.ter o+ the lo.ality1 and $e' the 2urden on the person har ed o+ avoiding the har .L o Per 6SB W0%0 $%6+n6'! utility o+ .ondu.t $*BQ' +a.tors in.lude1 I$a' the so.ial value that the la7 atta.hes to the pri ary purpose o+ the .ondu.tM $2' the suita2ility o+ the .ondu.t to the .hara.ter o+ the lo.alityM and $.' the i pra.ti.a2ility o+ preventing or avoiding the invasion.L Pro2le s1 o Judg ents o+ so.ial utility ay 2e 2iasedM e.g. ?udges allo7 pollution to +urther industrial develop ent. o Ba8ings1 3ven i+ so.iety is 2eing 2ene+ited! 7hy should the person 2eing har ed have to payQ o >ault deter ination is not as use+ul! per )oase! as deter ining 7ho is the least .ost avoider.

6&

,+ the dispute .ould have 2een 7or8ed out on the +ree ar8et! 7hat 2argain is li8ely to have 2een rea.hed! per )oaseQ o Bhe ad inistrative .osts o+ resolving these disputes ay not 2e 7orth the 2ene+it. $re1 , pli.it in*8ind .o pensation! Ilive and let liveL ,+ ,< doing so ething today that .auses da age to -<s property 2ut she<s going to da age ine neAt year! then 7hy should any .o pensation 2e givenM e.g. .leaning out a septi. syste is a nuisan.e! 2ut their neigh2ors 7ill have to do so as 7ell.' o (lthough so e uses ay have 2een suita2le in the lo.ality in the past! the syste does not al7ays allo7 +or .hanges in in+or ation $su.h as learning that houses on the sand dunes don<t +are 7ell during hurri.anesM see 0u"as'. o So e people ay 2e overly*sensitive or parti.ularly sensitive $e.g. in8s! and thus! in8 o7ners'. o ,nstitutional .o peten.y1 ,+ Doning la7s allo7 uses! 7hy should .ourts a8e a di++erent deter inationQ ,s nuisan.e la7 plugging gaps in Doning la7s or re edying politi.al +ailingsQ o What<s at sta8e in nuisan.e is not how you .ondu.t 2usiness 2ut where you .ondu.t it. o >or the +inding o+ nuisan.e Separate it +ro trespass @eter ine ho7 reasona2leness is gauged. o (ssu ing the +a.tory 7as in the area 2e+ore P oved in! should he have an a.tion +or nuisan.eQ ,ssues1 o )ontrary to Pigou! neither party is a.tually at +aultM i+ they 7eren<t in .on+li.t! their a.ts 7ould 2oth 2e o.8. o ,+ nuisan.e a.tion is not allo7ed and o7ner sells! he ta8es the loss. o )an people 2e nuisan.es! su.h as in the .ase o+ pu2li. housing or supportive housing +or seA o++endersQ )ourts have said no! only a.tivity .an 2e a nuisan.e. o )an an in.orre.t per.eption ?usti+y a nuisan.e .lai ! su.h as in the .ase o+ a +a.tory that allegedly e itted pollution into an a5ui+er underneath a ho eo7ner<s property! even though it 7as later proved that it had notQ "o. o Poli.y .onsiderations1 )o er.iality1 Bo restri.t usage too stri.tly 7ould greatly inter+ere 7ith 2usiness. Property Calue1 ;sage should not 2e allo7ed that .o pletely or .onsidera2ly devalues surrounding property. &. "uisan.e per se1 Ciolation o+ a statute .o 2ined 7ith a nuisan.e does not .onstitute nuisan.e per se. 6ather! the .ourt ust as81 o $/' ,s the a.tivity a nuisan.e at all ti es! under any .ir.u stan.es! and in any lo.ationQ or o $%' ,s the a.tivity prohi2ited 2y statute or ordinan.e as a nuisan.e and .onsidered a nuisan.e at .o on la7Q :uens ann v. Fi er*Fa pese G (sso..! BeA. (pp. $%00&'! 9=&1 >a.ts1 Ps! 7ho had lived in their ho es +or over %= years! unsu..ess+ully sought an in?un.tion against @<s .onstru.tion o+ a drag ra.ing strip near Ps< ho es. Ps no7 see8 relie+! .lai ing that ra.es at the ra.e7ay are loud and .ause vi2rations that sha8e Ps< ho es! that light +ro the ra.e7ay .an 2e seen +or iles! and that s o8e produ.ed 2y .ars at the ra.e7ay Ii pedes visi2ility on the ad?oining streets and 2lo7s onto JPs<K property.L J +or @. (++ir ed. 6easoning1 o ;nder $/'! @<s .ondu.t 7as not a nuisan.e per se 2N. it only o..urred on .ertain nights and the ra.e7ay 7as not a.tive at other ti es. o ;nder $%'! operation o+ a ra.e7ay 7as not prohi2ited 2y statute! and violation o+ disorderly .ondu.t 7as not provided. "otes1 Ps< ho es are also in the +light path o+ an (ir >or.e 2ase and near a shooting range! railroad tra.8s! a a?or high7ay! and a .o er.ial airport. 4. 6e edies1 o )ale2resi*-ela ed grid 6e edy1 Property 6e edy1 :ia2ility 3ntitle ent P $/' ,n?un.tion vs @ $%' @a ages
o

64

$&' "o in?un.tion

$4' @a ages +or @ +or stopping use

Property rules $in?un.tion' vs. :ia2ility rules $da ages' to address nuisan.e1 o >a.tors in deter ining the appropriate rule1 ,s the .ourt li8ely to .al.ulate da ages .orre.tlyQ Bhen da ages. (re transa.tion .osts li8ely to prevent e++i.ient 2argaining in the .ase o+ in?un.tive relie+Q Bhen da ages. 6is8 o+ 7rong entitle ent! ris8 o+ in.orre.t da age .al.ulation! ris8 o+ parties< not 2eing a2le to 2argain +or an e++i.ient 7or8*around. o Property 6ule ;n.onditionalNauto ati. in?un.tion $old rule and dissent in Boomer! in+ra'1 6egardless o+ the disparity 2et7een the e.ono i. .onse5uen.es o+ an in?un.tion versus the e.ono i. .onse5uen.es o+ the nuisan.e! an in?un.tion is an auto ati. re edy +or su2stantial $Inot unsu2stantialL' da age. o Bo do other7ise 7ould! Iin e++e.t! J2eK li.ensing a .ontinuing 7rong.L o (+ter pay ent o+ da ages! a polluter no longer has in.entive to .orre.t the 7rong and parties have no in.entive to 2argain to .orre.t ista8es. o By pre.edent and a..ording to the state )onstitution! Ita8ingL o+ private property 2y Iservitude on landL or per anent i pair ent is only authoriDed +or pu2li. use or 2ene+it. o Bhe :egislature has a.ted to de onstrate pu2li. .on.ern a2out air pollution. o ( lia2ility rule 7ould not ne.essarily .o pensate all a++e.ted parties! unless they are all involved in the present litigation. o Where the da ages are .ontinuing! a lia2ility rule 7ould lead to u.h di++i.ulty in .al.ulating the eApe.ted +uture da ages. o 3ven i+ in?un.tive relie+ is in.orre.t! parties .an 2argain to7ard a ore e++i.ient resultM 2ut this is not an option under a lia2ility rule. Braditional I.o ing to the nuisan.eL rule1 IJ(K residential lando7ner ay not have relie+ i+ he 8no7ingly .a e into a neigh2orhood reserved +or industrial or agri.ultural endeavors and he has 2een da aged there2yL $969<%'. o :ia2ility rule $Y% on )*-'1 (llo7 a de+endant 7ho .auses present da age and 7ill .ause +uture da age to pay per anent da ages $pay ent that en.o passes the value o+ present and +uture da age' to a++e.ted parties. Boo er v. (tlanti. )e ent )o.! "# $/970'! 9=61 :ando7ners near @<s .e ent plant sought in?un.tion and da ages +or alleged in?ury to their property +ro dirt! s o8e! and vi2ration e anating +ro the plant. (+ter trial! nuisan.e 7as +ound and da ages 7ere allo7ed! 2ut the in?un.tion 7as denied. 6<d to grant an in?un.tion! 7hi.h shall 2e va.ated upon pay ent o+ per anent da ages $pay ent that en.o passes the value o+ present and +uture da age' to Ps. o )on.erns a2out in?un.tive relie+1 Bhe 2lunt instru ent .ould .ause thousands! even illions! o+ dollars in da age to @! to prevent a u.h s aller a ount o+ da age to P. High transa.tion .osts $due to! e.g.! 2ilateral onopoly i+ too +e7 parties and .olle.tive* 2argaining pro2le s i+ too any' or 2argaining po7er i 2alan.es $e.g. hold outs' ay prevent 2argaining around an in?un.tion. @ has no in.entive to innovate under in?un.tive relie+. When there is a large dis.repan.y 2et7een the value o+ the a.tivity to 2e en?oined and its .ost! parties have opportunity +or highly strategi. .ondu.t. o Bhis solution 7ill address the plainti++<s .on.erns a2out loss o+ property value 2y .o pensating the +or total e.ono i. loss to their property .aused 2y @<s operations presently and in the +uture. o ,t 7ill also li8ely spur resear.h into te.hni.al solutions so that @ .an avoid paying +or +uture da age to other lando7ners. o ,+! instead! an in?un.tion 7ere granted 7ith a +uture e++e.tive date! @ is not li8ely to develop a te.hni.al re edy in a short period o+ ti e! parti.ularly 7ith its resour.es alone! rather than the resour.es o+ the industry as a 7hole. Bhen! it 7ill li8ely re5uest eAtensions on sho7ing good +aith e++orts to +ind su.h te.hni5ues. o ,nstitutional .o peten.y o+ .ourts1 -anaging issues su.h as air pollution through property rules is 2eyond the s.ope o+ ?udi.ial responsi2ility due to te.hni.al 5uestions and .onsiderations o+ the .osts and 2ene+its o+ regulation.. I,t is a dire.t responsi2ility +or govern ent and should not thus

6=

2e underta8en as an in.ident to solving a dispute 2et7een property o7ners and a single .e ent plant...L o ,+ in?un.tions are auto ati. upon +inding nuisan.e! .ourts ay +ind no nuisan.e using dou2t+ul reasoning in order to avoid the harsh results o+ an in?un.tion $96&n='. o ,n?un.tions ay en.ourage the Iendo7 ent e++e.t!L in 7hi.h people pla.e a greater value upon an eAisting possession that they 7ill lose or have lost than they 7ould have 2een 7illing to pay to o2tain the possession i+ they did not have it $964n6'. :ia2ility rule +or ulation o+ I.o ing to the nuisan.eL rule $G Y4 on )*-' )o pensated ,n?un.tions1 (llo7 P in?un.tive relie+ 2ut re5uire hi to inde ni+y @ +or a reasona2le .ost o+ stopping his a.tivity. IJWKhere a developer has! 7ith +oreseea2ility! 2rought into a previously agri.ultural or industrial area the population 7hi.h a8es ne.essary the granting o+ an in?un.tion against a la7+ul 2usiness and +or 7hi.h the 2usiness has no ade5uate relie+!L the developer ust inde ni+y the 2usiness o7ner +or a reasona2le a ount o+ the .ost o+ oving or shutting do7n. Spur ,ndustries! ,n.. v. @el 3. We22 @evelop ent )o.! (riD. $/97%'! 9641 o >a.ts1 (+ter We22 2ought property and 2egan developing an ur2an .o unity! Spur eApanded upon pre*eAisting .attle +eedlots! and the eApanded +eedlots ulti ately prevented residents +ro using and en?oying their property and prevented We22 +ro developing a portion o+ his property due to the odor and +lies +ro .o7 anure. Per anent in?un.tion o+ +eedlot operation. (<d ] P re5uired to inde ni+y @ +or .osts o+ shutting do7n or oving. o 6easoning1 Bhe pu2li. interest! as eApressed 2y statute or ordinan.e! ay .all +or relie+ even +ro a la7+ul a.tivity. o Pro2le s1 )olle.tive*a.tionN high transa.tion .osts +or ultiple parties.

B. Servitudes $97/' Ba.8ground o Ho7 do servitudes relate to the hesitan.y o+ dead*hand .ontrolQ )ovenants allo7 long*ter restri.tions 2ut allo7 +or .hanges i+ the .ovenants prove to 2e ine++i.ient. o Ho7 does 7hat has happened 7ith .ovenants +it into the use o+ property la7 to help people negotiate 7ith neigh2orsQ Bransition +ro rural areas to ur2an areas! 2eginning in /070s. o >a ily 7ealth is traditionally invested in housing 4ov<t see8s to prote.t su.h invest ents 2y .ontrolling the use o+ surrounding properties1 o "uisan.e la7 7as pro2le ati.Nunrelia2le devi.e 2N. o+ general la.8 o+ anti.ipatoryNpredi.tive en+or.e ent $ine++i.ient'! un.ertain standards ay deter invest ent in industry! li itation 2y /st*in*ti e rule $rapidity o+ .hange outpa.es the +leAi2ility o+ .ourts'! and en+or.e ent ostly restri.ted to private $and .ostly' litigation 7hi.h .an produ.e in.onsistent results. o (llo7an.e o+ de+easi2le +ees $property developer grants land 7ith restri.tions on use' 7as pro2le ati. 2N. e.g. )ourts have a .onstru.tional pre+eren.e in +avor o+ +ee si ple su2?e.t to .ondition su2se5uent or li ited .onditions on a +ee si ple deter ina2le! en+or.ea2le through .ontra.t la7! Judi.ial hostility to auto ati. +or+eiture o+ estates led to stri.t .onstru.tion o+ the .onditions and to the do.trine o+ no inal .onditions! 7hi.h allo7ed a .ondition to 2e ignored i+ the .onditions o+ the neigh2orhood had .hanged signi+i.antly or i+ +or so e other reason the en+or.e ent o+ the .ondition 7ould 2e o+ no inal value! Bhe .ondition 7as en+or.ea2le only 2y O! not 2y neigh2ors $although .ourts 2ent this'! @evelopers la.8ed in.entive to en+or.e violations or 7aived .onditions! and ;n.ertainty as to 7hether restri.tions 7ere i posed .onsistently on all lots in an area sin.e developers so eti es 7aived the .ondition to sell a lot. o )o prehensive Doning didn<t 2egin until /9/6! 7hen it started in "#. So! 7hile .o prehensive Doning 7as 2eginning to develop! the .ourts utiliDed the do.trines o+ .ovenantsNservitudes to address the issue o+ ensuring neigh2orly .ooperation. @e+initions1

66

o ServitudeN)ovenants H .ontra.t that generally 2inds su..essors in o7nership $Irun 7ith the landL' as 7ell
as initial parties.

o 3ase ent H .ontra.t in 7hi.h an o7ner 7aives his right to eA.lude .ertain 8inds o+ intrusionsNuses 2y
anotherM Iin re L $re1 all the 7orld'. (++ir ative ease ent1 per it a++ir ative a.tion. "egative ease ent1 per its holder to de and o7ner o+ servient land desist +ro .ertain a.tions that ight har the holder. $trend to7ard use o+ .ovenants instead'. 3ase ent appurtenant trans+era2le1 7hoever o7ns the do inant land has an ease ent over the servient land. 3ase ent in gross non*trans+era2le1 only a parti.ular grantee has an ease ent. Profit a prendre! or si ply Ipro+itL1 ease ent +or spe.i+i. purpose o+ eAtra.ting so ething o+ value $I.arrying out the pro+itL'! su.h as ti 2er or sur+a.e inerals. o 6eal )ovenant H .ontra.t in 7hi.h an o7ner agrees to a2ide 2y .ertain restri.tions on the use o+ his land +or the 2ene+it o+ one or ore othersM Iin persona L $re1 a parti.ular person'! although they do run 7ith the land. -a8es possi2le private transa.tions o+ land use and .ontrolling eAternalities. Only li ited 2y un.ons.iona2ility! statute o+ +rauds! dis.ri ination la7s! et.. Braditionally en+or.ed 2y da ages. o 35uita2le servitude H in.orre.tly*+or ulated .ovenant that is .orre.ted 2y the .ourt. Braditionally en+or.ed 2y in?un.tion! 7hi.h provided in.entives +or people to I ess upL their .ovenants sin.e a property rule is stronger than a lia2ility rule +or the holder o+ a right. /. 3ase ents o $a' @e+inition1 (n ease ent eA.uses a.ts done on another<s land that 7ould other7ise 2e trespass. ,t is not revo.a2le at the 7ill o+ the true o7nerNpossessor! unli8e a li.ense! 7hi.h is a revo.a2le grant o+ per ission to enter another<s land. ,t is does not grant possession! unli8e a lease. )ase1 Base2all Pu2lishing )o. v. Bruton! -ass. $/9&0'! 97%1 /9&4 @ sent P a .ontra.t giving P a right to use a .ertain portion o+ property +or 2ill2oard advertise ents. P sent a .he.8 to a..ept the .ontra.t! 2ut @ returned the .he.8. "evertheless! P atta.hed a 2ill2oard to the 7all. P sent in .he.8s in /9&6 and /9&7! 7hi.h 7ere 2oth returned. @ .aused the sign to 2e re oved! so P sued +or spe.i+i. per+or an.e. J +or P. (++ir ed 2N. P had o2tained an ease ent in gross! 7hi.h does not grant possession! only use! 2ut allo7s +or irrevo.a2le! .ontinual use. o $2' Bypes o+ 3ase ents 3Apress ease ent $ease ent 2y grant' re5uires a +or al deed. o 6easons 7hy +or alities are o+ten not adhered to1 lo7er value o+ ease ents as .o pared to .onveyan.es nor s o+ neigh2orly a..o odation su2stitute or supple ent eApress grants 3ase ent 2y stri.t ne.essity 7hen an o7ner .onveys a landlo.8ed portion o+ his land to another! the o7ner o+ the land*lo.8ed par.el o2tains an ease ent over the land retained 2y the original o7ner. o S.h7a2 v. Bi ons! Wis. $/999'! 9791 Ps $S.h7a2 et al.'! 7hose property 7as land*lo.8ed 2et7een 4reen Bay and a 2lu++! sought an ease ent in order to eAtend a private road a.ross @s< property. 3ase ent denied 2N. Ipar.els at issue 7ere not landlo.8ed at the ti e o+ .onveyan.eL until the petitioners the selves .reated the pro2le . o Ps did not have an ease ent 2y i pli.ation 2N. the private road had not 2een eAtended to their property and used previously +or the purpose they 7ere re5uesting! nor 7as it reasona2ly ne.essary +or their use 7hen the land 7as granted to the . o Ps did not o2tain an ease ent 2y ne.essity 2N. 7hen the .o on o7ner $the ;.S.' .onveyed their par.els o+ land! those par.els 7ere not land lo.8ed 2ut 7ere a..essi2le 2y a pu2li. road. Ps ade their land land*lo.8ed 7hen they .onveyed a7ay a portion o+ their land! even though a..ess to the pu2li. road at that ti e 7as still in.onvenient. J3ase ent 2y )onde nation $`private e inent do ain! 906n=' :and*lo.8ed o7ner re.eives ease ent 2ut ust pay +air ar8et .o pensation to servient o7nerM so eti es! the 3; ust see8 approval +ro a gov<t o++i.ial and allo7 servient o7ner to o2?e.t.K , plied ease ents although not +or ally e orialiDed! an ease ent is i plied 7hen its use

67

is histori.al $I.ontinued so long and 7as so o2vious or ani+est as to sho7 that it 7as eant to 2e per anentL' and o reasonably ne.essary +or the use and en?oy ent o+ one<s land. , plied 3ase ent1 3ase ent 2y pres.ription open! notorious! .ontinuous! and adverse usage ] passage o+ sol. o :ia2ility rule1 3ase ent user $3;' a.5uires an ease ent over land on.e the sol runs! 2ut 3; ust pay BO the +air ar8et value o+ the ease ent. $(ppeals .ourt in !arsaw and dissent in !arsaw re1 .o pensation +or the value o+ the ease ent'. Pro2le s1 o What i+ BO .annot 2e lo.ated +or pay ent o+ .o pensationQ o Ho7 is the value .al.ulated $e.g. at the ti e o+ original entry or use! at the ti e sol runs! at the ti e ?udg ent is issued'Q o Property rule1 3; a.5uires a pres.riptive ease ent over land on.e the sol runs! and 3; is not re5uired to .o pensate BO +or the value o+ the ease ent or the .ost to BO o+ re oving any stru.tures that inter+ere 7N 3;<s use o+ the ease ent! parti.ularly i+ BO ere.ted the stru.tures 7ith 8no7ledge o+ the alleged ease ent. Warsa7 v. )hi. -etalli. )eilings! ,n.. ! )al. $/904'! 9061 o >a.ts1 ( .o on o7ner sold in /97% a property to P and a northerly*ad?a.ent property to @. Bhe seller agreed to .onstru.t a 2uilding on P<s property! 2ut the 2uilding did not allo7 enough roo +or P<s tru.8s to turn and position the selves +or P<s loading do.8. Ps! @s! and the seller atte pted 2ut +ailed to negotiate an ease ent. Bhe .ourt +ound that neither an ease ent 2y i pli.ation nor an ease ent 2y ne.essity 7as .reated. ,n /979! @ sought to 2uild a 7arehouse on the portion o+ its land that P used! and P sued +or in?un.tive and de.laratory relie+. (+ter a te porary in?un.tion 7as denied! @ 2uilt its 7arehouse. Ho7ever! P 7on on the erits! and @ 7as ordered to re ove the portion o+ the 2uilding that inter+ered 7ith P<s pres.riptive ease ent. (++ir ed! although P 7as ordered to pay +or the ease ent and re oval. Judg ent a++ir ed re1 ease ent 2ut reversed re1 .o pensation. o 6easoning1 ( property rule $trans+erring title to 3; and not re5uiring .o pensation'1 o $i' redu.es litigation! o $ii' sta2iliDes long*.ontinued use and prote.ts 3;<s Ipossession!L and o $iii' +avors use o+ land over disuse. Sin.e @ 7as a7are o+ the pending litigation 7hen he 2uilt the 7arehouse! he too8 the ris8 upon hi sel+. o "otes1 @o the ?usti+i.ations +or adverse possession really apply in this .ase! 7here @ 7as a7are o+ the usage on his landQ @ either had to 2e .lear a2out his per issiveness or disallo7 P<s usage. o @issent1 $i' :itigation is not redu.ed 2y the property rule 2N. a party 7ill no7 have to 2ring a trespass a.tion to prote.t against adverse use o+ his land. $ii' ( lia2ility rule prote.ts the 3;<s possession $useQ' as 7ell. $iii' IJ-Kodern so.iety eviden.es a pre+eren.e +or planned use! not the ad ho. use o+ a trespasser.L o When BO or previous BO granted per ission $or! possi2ly! 7hen BO a.5uies.ed' to an ad?oining o7ner +or use o+ an ease ent a.ross BO<s land and allo7ed 3; to spend a su2stantial a ount o+ oney in relian.e on the ease ent! a .ourt o+ e5uity .an estop BO +ro dis.lai ing the ease ent. 3ase ent estoppel1 Hol2roo8 v. Baylor! 9y. $/976'! 9971 >a.ts1 @ pur.hased his land in /94%. ,n /944! @ gave per ission +or a haul road over his land in eA.hange +or a royalty! 2ut that use stopped in /949. ,n /964! Ps 2ought ad?a.ent land and ere.ted a ho e on it in /96= 2y using the road a.ross @<s land. "egotiations 2et7een Ps and @ +or P<s use o+ the road 2ro8e do7n in /970! and @ prevented Ps +ro +urther a..ess. P sued +or use. J +or P. (<d. "otes1 o 3le ents o+ estoppel1 Brue o7ner granted per ission! 3; aterially relied upon BO<s per ission! and
o

60

)ourt +inds revo.ation o+ per ission 7ould 2e ine5uita2le. 3stoppel grants an irrevo.a2le li.ense that .ontinues only as long as needed. o IJWKhere a stru.tures serves a use+ul and 2ene+i.ial purpose! it is not unla7+ul to 2lo.8 the +ree +lo7 o+ air or light to a neigh2oring property. >ontaine2leau Hotel )orp. v. >orty*>ive B7enty* >ive! ,n..! >la. (pp. $/9=9'! /00/1 @s $>ontaine2leau' planned to 2uild an addition to their hotel that 7ould 2lo.8 the sun and .ast an a+ternoon shado7 over its neigh2or Ps< s7i ing pool area in the Winter. P sued +or in?un.tive relie+. J +or P. 6eversed.' "otes1 o Bhe la7 is .on.erned a2out .reating i plied negative ease ents. Bhey provide no noti.e to 2uyers Bhey raise di++i.ult de+initional pro2le s 7hat .ounts as the +irst useQ Bhey involve the sa e pro2le o+ a +irst*in*ti e rule! 7hi.h allo7s one party to +reeDe land use. o $.' Ber ination o+ 3ase ents $/000'1 2y deed 2y erger into a .o on +ee si ple 2y (dverse Possession 2y a2andon ent $7hi.h ay 2e in+erred 2y prolonged nonuse' o $d' -isuse o+ 3ase ents $/' ( holder o+ an ease ent right ay not use the ease ent +or other property or other uses 7hi.h are unreasona2le or +or 7hi.h the ease ent 7as not granted. $%' -isuse o+ an ease ent does not .onstitute a +or+eiture! 7aiver! or a2andon ent o+ the ease ent! unless it is i possi2le to return the use to the appropriate level. $&' ( te porary in?un.tion ay 2e granted i+ .ir.u stan.es 7ould a8e it di++i.ult to deter ine 7hether the ease ent 7as 2eing used +or unauthoriDed purposes! until su.h ti e that .ir.u stan.es .hange in su.h a 7ay to a8e it .learer. Penn Bo7ling 6e.reation )tr. v. Hot Shoppes! ,n..! @.). (pp. $/949'! /0091 o >a.ts1 ,n /9&0! "3 sold land to HS $@'! reserving a portion +or an ease ent +or ingress and egress. ,n /940! "3 .onveyed a neigh2oring property to PB $P'. ,n /940! HS ere.ted a 2arrier 7hi.h prevented PB +ro using the ease ent. PB sued +or in?un.tive relie+. HS oved +or an in?un.tion against PB on the grounds o+ a2andon ent. J +or @ $HS'. o Poli.y issues1 ,n+or ation*+or.ing +un.tion1 IJBKhe pur.haser o+ real estate has three sour.es o+ in+or ation +ro 7hi.h to learn o+ rights to the land he or she is a2out to pur.hase1 o $/' revie7ing the .hain o+ titleM o $%' sear.hing other pu2li. re.ords that ay reveal other non*re.orded rights! su.h as ?udg ents or liensM and o $&' inspe.ting the land itsel+.L S"hwab v. Timmons $90='. Ho7 does the la7 in.entiviDe ni.eness or disin.entives nastiness and 2e e5uita2leQ Ho7 does it en.ourage people to 7or8 out their pro2le s 7ithout litigationQ o 3ase ents are one solution to har oniDe land uses that other7ise 7ould .on+li.t. o When ease ents are not in 7riting! they have to 2e i plied. , plying a negative ease ents is pro2le ati. 7hen a neigh2or sues +or pres.riptive relie+ ?ust 2N. their neigh2or has not done so ething 7ith their land 7ithin a .ertain ti e period. $See &ontainebleau'. )ourt 2alan.es +airness 7ith rules that 7ill get out o+ .ontrol. %. )ovenants and 35uita2le Servitudes o Pro ises respe.ting the use o+ land )ovenants are li8e a .ontra.t 2ut a++e.t su..essors in interest! too. 3n+or.ed 2y da ages. 35uita2le servitudes essentially .ovenants in a .ourt o+ la7M en+or.ed 2y in?un.tionNe5uita2le relie+M o+ten +ailed negative ease ents. o )lass "otes1 )ovenantor agrees to .onditions i posed 2y .oventee! as 7ith any standard .ontra.t. )ovenants a8e su.h a pro ise run 7ith the land. 3.g. $p/0%7 +igure' )r $B' sells to @ and )ee $(' to )! and the pro ise re ains 2et7een @ and ).
o

69

-ore use+ul than ease ents in dealing 7ith land use due to the pro2le s dis.ussed a2ove.

o Ho7 is an agree ent en+or.ea2le i+ one party has trans+erred her interestQ
;nder e5uita2le servitude theory! i+ .lai ant is see8ing an in?un.tion. ;nder real .ovenant theory! i+ .lai ant is see8ing da ages. o -ust 2e in 7ritingM no .ovenant 2y pres.ription! i pli.ation! ne.essity! or estoppel. ( eri.an .ourts generally re.ogniDe su..essive o7ners to the grantee and grantor as satis+ying the horiDontal privity re5uire ent! i+ it re ains a re5uire ent at all. o ,+ this re5uire ent 7ere not relaAed! .ovenants 7ould have li ited use+ulness in .ontrolling neigh2oring land use. Certi.al privity1 o (t ):! the party against 7ho the 2urden is to 2e en+or.ed had to 2e a su..essor in interest to the original .ovenantor<s estate or o+ the sa e duration $e.g. a +s a2solute .onveyed as a li+e tenan.y 7ould not satis+y the re5uire ent! although a +s deter ina2le 7ould'. o :ess stri.t re5uire ents +or the party 7ho 2ene+ited +ro the 2urden re5uired an interest in the original estate or a s aller estate $e.g. a li+e tenan.y .onveyed +ro a +sa 7ould 2e o.8.'. o 6SB $/0%9' proposes to a2olish v.p. re5uire ent +or negative .ovenants 7hen it 7ould 2e e5uita2le to en+or.e $e.g. )r agrees to o7 )ee<s la7n and then leases his property! )r or lessee should still 2e 2ound 2y agree ent.' 6e5uire ents +or en+or.ea2ility o+ an e5uita2le servitude1

J$/' Servitude is in 7riting.K $%' ,t appears that the grantor and the grantee intended that the servitude 7ould run 7ith the land! $&' Su2se5uent o7ners re.eive noti.e o+ the servitude! and $4' ,t appears that the servitude Itou.hesL or I.on.ernsL the land 7ith 7hi.h it allegedly runs. o JStri.t re5uire ent o+ horiDontal privity +or real .ovenants 7as a2olished in .ourts o+ e5uity 2y Tul'! so the .ourts la2eled these .ovenants e5uita2le servitudes. ,n the ;.S.! .ourts re.ogniDe horiDontal privity 2et7een su..essors in interest! 2ut the theory o+ e5uita2le servitude .ould 2e used 7hen no horiDontal privity.K Bul8 v. -oAhay! 3ng. $/040'! /0/41 >a.ts1 Bul8 sold land to 3l s 7ith the agree ent that 3l s and any heirs or assignees 7ould aintain the land as a Ipleasure gardenL $a++ir ative .ovenant'! 7ould not 2uild upon the land $negative .ovenant'! and allo7 B<s tenants to 2uy ad ission to use $an unen+or.ea2le &dP .ovenant'. Bhe pie.e o+ land passed through any o7ners and ulti ately 7as sold to -oAhay. When - pur.hased the land! the deed did not .ontain the .ovenant! although he a.8no7ledged that he 8ne7 a2out it. When - sought to .hange the .ondition o+ the land! B sought an in?un.tion. ,n?un.tion granted $+or P'. ,ssue1 )an the negative .ovenant 2e en+or.ed in the a2sen.e o+ horiDontal privity $no landlord*tenant relationship'Q 6easoning1 Sin.e the pri.e o+ a par.el o+ land is a++e.ted 2y a .ovenant in the sales .ontra.t $li8ely lo7ering the pur.hase pri.e'! it 7ould 2e ine5uita2le +or that .ovenant to not run 7ith the land. Other7ise the 2uyer .ould turn around and resell the land the very neAt day to so eone else at a greater pri.e 7ith no .ovenant! and the original seller 7ould retain no 2ene+it +ro the .ovenant. "otes1 o By 2inding su..essive o7ners! the .ovenant restri.ts alienation 2y a++e.tive the value o+ the land. But! in theory! the initial .ovenantor .ould have 2argained +or a lo7er pur.hase pri.e due to the 2urden. o Ho7ever! i+ the parties did not eApe.t that the .ovenant 7ould 2e en+or.ea2le upon su2se5uent o7ners! the seller .ould have 2argained +or a higher pri.e. 6egardless o+ the intent o+ the grantor! a real .ovenant 7ill Irun 7ith the landL and 2e en+or.ea2le against a su2se5uent pur.haser only i+ the +ollo7ing .onditions are et1 J$/' )ovenant is in 7riting and other7ise eets the re5uire ents +or the Statute o+ >rauds! $%' Person 7ho .ovenant is 2eing en+or.ed against had noti.e o+ the .ovenant.K $&' ,t appears that the grantor and the grantee intended that the .ovenant 7ould run 7ith the land! $4' ,t appears that the .ovenant Itou.h and .on.ernsL the land 7ith 7hi.h it allegedly runs $a 5uestion o+ degree! Idependent upon the parti.ular .ir.u stan.es o+ a .ase!L (agle (nterprises'M and

70

$=' ,t appears that Ithere is JhoriDontal and verti.alK Xprivity o+ estate< 2et7een the pro isee or party .lai ing the 2ene+it o+ the .ovenant and the right to en+or.e it! and the pro isor or party 7ho rests under the 2urden o+ the .ovenant.L Jper .lass notes! h. privity 2t7n party see8ing en+r. nt and original .ovanteeM v. privity 2t7n party en+r. nt is against and original .ovenantor.K o "eponsit Property O7ners< (ss.<n! ,n.. v. 3 igrant ,ndustrial Savings Ban8 ! "# $/9&0'! /0/91 >a.ts1 @<s prede.essors in title agreed to a .ovenant 7ith "eponsit 6ealty )o. that a aintenan.e +ee 7ould 2e paid to the realty .o.! or its assignee. P! an 6)( that 7as assignee o+ "eponsit! sued to +ore.lose on a lien due to nonpay ent 2y @! 7hi.h had o2tained title +ro a +ore.losed ho eo7ner. J +or P. 6easoning1 )ondition Y& 7as .learly et. 6egarding Y4! a++ir ative .ovenants generally do not Itou.h and .on.ernL land! 7hile negative .ovenants do. Bhe .ourt instituted a ne7 test! though! and as8ed 7hether the .ovenant had a su2stantial e++e.t on the rights o+ the property holders. ,n this .ase! it did 2N. @ o2tained ease ents in eA.hange +or the .ovenant. 6egarding privity o+ estate! the .ourt +ound that Iin su2stan.e! i+ not in +or ! there is privity o+ estateL 2et7een P and @ even though! te.hni.ally! P had no interest in the land. "otes1 o Bhe .ourt<s de+inition o+ Itou.h and .on.ernL is .ir.ular 2N. 7hether a .ovenant is en+or.ed a++e.ts the value o+ the land! thus a++e.ting the o Signi+i.an.e o+ this .ase1 ,t relaAed the re5uire ent o+ Itou.h and .on.ern!L 2y re.ogniDing that a++ir ative pro ises to pay oney tou.h and .on.ern land. o "ote that .ourts< relu.tan.e is that a result o+ nonpay ent o+ dues .ould result in loss o+ a ho e. ,t allo7ed +or Ipier.ing o+ the .orporate valeL in regard to 6)(s. o JOther indi.ations o+ the pro2le ati. nature o+ Itou.h and .on.ern.LK 3agle 3nterprises! ,n.. v. 4ross! "# $/976'! /0&01 >a.ts1 /9=/ Or.hard Hill 6ealties deeded land to the Bau s 7ith a .ovenant that the Bau s 7ould pay O&= a year +or 7ell 7ater +ro another property o7ned 2y the seller. 4ross is a su2se5uent o7ner o+ B<s property! 2ut 4<s deed did not in.lude the .ovenant! nor did any o+ the deeds su2se5uent to B<s. (+ter .onstru.ting his o7n 7ell! 4 has re+used to pay +or 7ater +ro 33! assignee o+ OH. So! 33 sued +or pay ent under the .ovenant. J +or P! +inding that the .ovenant Iran 7ith the land.L 6eversed. (++ir ed reversal $J +or @! 4ross'. 6easoning1 o (lthough intent is .lear and privity o+ estate eAists! the .ovenant does not tou.h and .on.ern the land 2N. Iit does not su2stantially a++e.t the o7nership interest o+ lando7ners in the Or.hard Hill su2division.L o Be.ause the .ovenant has no sel+*i posed li it! it i poses an I<undue restri.tion on alienation JandK an onerous 2urden in perpetuity.<L "otes1 o Bo address the pro2le s o+ Itou.h and .on.ern!L the 6SB $/0%9' proposes that .ourts .onsider servitudes +ro the perspe.tive o+ .ontra.t do.trine! su.h as un.ons.iona2ility and +ro the perspe.tive o+ e5uita2ility $is it e5uita2le +or a .ovenant to 2e en+or.ed a+ter ti e in a parti.ular .ase'. 6e.ipro.al negative ease ents $i.e. real .ovenants or e5uita2le servitudes' Iarise! i+ at all! out o+ a 2ene+it a..orded land retained! 2y restri.tions upon neigh2oring land sold 2y a .o on o7ner.L Bhey 7ill 2e en+or.ed as long as the 2urdened party re.eived a.tual or .onstru.tive noti.e. ,n5uiry noti.e1 4iven .onstru.tive noti.e! even i+ a 2uyer is in+or ed that his deed 2ears no restri.tions! the 2uyer should a8e +urther in5uiry as to 7hether restri.tions eAist. San2orn v. -.:ean! -i.h. $/9%='! /0&41 >a.ts1 Bhe -.:eans $@s' 2ought a property in a residential neigh2orhood! 2ut their deed .ontained no restri.tions! unli8e their neigh2ors< deeds. @s sought to .onstru.t a gas station on the rear portion o+ their land in 4reen :a7n su2division in @etroit! 2ut they 7ere en?oined +ro doing so. ,n?un.tion a++ir ed 2N. the property 7as su2?e.t to a re.ipro.al negative ease ent. 6easoning1 o @s re.eived noti.e! even i+ the restri.tion 7as not in their deed! 2e.ause the pur.hasers o+ all the surrounding properties! Iin every instan.e! o2served the general plan and purpose o+ the restri.tions in 2uilding residen.es.L I>or up7ard o+ &0 years the united e++orts o+ all persons

7/

interested have .arried out the .o on purpose o+ a8ing and 8eeping all the lots stri.tly +or residen.es! and de+endants are the +irst to depart there+ro .L o 3ven though told 2y the grantor that the lot .ontained on restri.tions! -r. -.:ean I.ould not avoid noti.ing the stri.tly uni+or residen.e .hara.ter given the lots 2y the eApensive d7ellings thereon...L "otes1 o Ba.8ground1 @eveloper sold /st set o+ lots 7ith restri.tions 2ut apparently relaAed restri.tions due to .hange in .ir.u stan.es $su.h as a slo7 ar8et'. Bhus! only so e deeds in.lude li its! and this .ase de onstrates ho7 .ourts have dealt 7ith this pro2le . o , plied re.ipro.al negative ease ent arise out o+1 $i' a .o on o7ner o+ t7o or ore plots o+ land $ii' 7ithin a .o on s.he e o+ develop ent and $iii' a sale 2y the .o on o7ner o+ one o+ the plots! su2?e.t to the restri.tions. o So e states don<t re.ogniDe ,6"3 due to the la.8 o+ noti.e. o Bhus! horiDontal privity re5uire ent a2olished +or e.s. tG. re5uire ent so+tened. verti.al privity re5uire ent so+tened on 2urden side and a2olished on 2ene+it side. 3S only re5uire noti.e $a.tual or .onstru.tive'! intent! and so e type o+ tG.. o )onservation ease ent servitude that restri.ts the +uture develop ent o+ landM e.g. prohi2its su2division and .o er.ial develop ent 2ut per its eAisting agri.ultural and residential uses! prohi2its .utting o+ ti 2er! or re5uires the preservation o+ a histori. +aaade. )riti5ue1 o (llo7 dead*hand .ontrolM o @eprive the pu2li. o+ input into the use o+ land that is supposedly +or their 2ene+itM o )on.epts o+ I.onservationL and Idevelop entL .hange over ti eM o Ber ination o+ )ovenants1 Poli.y issues1 o :i it dead*hand .ontrol $.+. sunset provisions on servitudes in ost states 7ith 6(P and re5uire ents o+ re*re.ording.' o )olle.tive 2argaining pro2le s $e.g. hold outs! transa.tion .osts' prevent parties +ro rea.h e++i.ient solutions 7ithout .ourt intervention. o ,s prote.tion 2est a.hieved through a lia2ility or property ruleQ @eed restri.tions 7ill not 2e en+or.ed o $/'$a' I7hen! 2y reason o+ .hanged .onditions! en+or.e ent o+ the restri.tions 7ould 2e ine5uita2le and oppressive! and 7ould harass plainti++ Jsee8ing relie+ +ro the restri.tionsK 7ithout 2ene+iting the ad?oining o7nersML o $/'$2' I7here .hanged .onditions in the neigh2orhood have rendered the purpose o+ the restri.tions o2solete.L Bolotin v. 6indge! )al (pp $/964'! /04% $P sought de.laratory relie+ in order to 2uild a .o er.ial 2uilding upon 7hat had 2een a residential lot. J +or P. 6eversed and re anded +or +urther +a.t*+inding 2N. trial .ourt deter ined that @s< ar8et value 7ould not de.rease! 2ut the test +o.uses on adverse e++e.ts to the 2ene+its o+ ad?oining o7ners! not to the ar8et value o+ their land.' o $%'$a' i+ the .ovenant has 2een a2andoned! or Iha2itually and su2stantially violatedL su.h that en+or.e ent is ine5uita2le 2e.ause Iprior violations have eroded the general plan and en+or.e entML IJ2Kut a +e7 violations do not .onstitute a2andon entML or o $%'$2' i+ the restri.tion is against pu2li. poli.y $7hi.h is a 5uestion +or the legislature! not the ?udi.iary'. Pe.8ha v. -ilroy! Wash. (pp. $%00/'! /046 $-rs. -ilroy operated a day.are in violation o+ a neigh2orhood restri.tion against operating a ho e 2usiness. -r. Pe.8ha sued +or in?un.tion. J +or P $Pe.8ha '. (++ir ed 2N. the other violations did not represent a su2stantial per.entage o+ the land in the neigh2orhood and 2N. private restri.tions against day.ares! unli8e pu2li. restri.tions! are not li ited 2y +ederal regulations! unless a .hange is ade 2y the :egislature.' Su ary1 6) 3S HP So+tened (2olished

7%

CP "oti.e ,ntent to run Bou.h G .on.ern 6e edy

(2olished on 2urden sideM so+tened on 2ene+it side. ,n5uiry i plied.

@a ages

35uita2le relie+ in?un.tion

o Sanborn $6"3 .ase' allo7ed &dP 2ene+i.iary a.tion. o 3eponsit also so+tened 2ene+it side o+ CP sin.e 6)( did not a.tually o7n the landM it 7as vie7ed as a
stand*in +or the o7ners.

o 6SB see8s to .o 2ine 6)s and 3S eli inates tG.

V,. 6egulatory Ba8ings @o.trine (. >oundation

6egulatory Ba8ing H 4overn ent regulates a property to su.h a degree that the regulation e++e.tively a ounts to an eAer.ise o+ the govern ent<s po7er o+ e inent do ain $physi.al o..upation +or pu2li. purposes' even though it does not divest the o7ner o+ possession. What is property +or ta8ings< purposes $/&%/'1 o :oo8 to independent sour.es! su.h as state la7. o ,n.ludes leases! trade se.rets! and +lo7age ease ents. o @oes not in.lude the head o+ 7ater in a river! a delegated po7er o+ e inent do ain! or the right to re.eive +uture so.ial se.urity 2ene+its. What are possi2le ?usti+i.ation that allo7 the 4ov<t to ta8e propertyQ o )ivi. 6epu2li.anis * 4ov<t see8ing to a.hieve a greater good! a higher value. o Pure ;tilitarian -ore people 2ene+it than the private individual loses. o Hold out theory * Sin.e the gov<t ust 2e transparent! people ay a.t strategi.ally and hold out +or a greater value! leading to less gov<t servi.es $e.g. less hospitals instead o+ shopping alls'. What are the ?usti+i.ations +or re5uiring the 4ov<t to pay ?ust .o pensation +or ta8ingQ o >ran8 -i.hael an1 )ondu.t a utilitarian .ost*2ene+it .al.ulation ,+ pu2li. 2ene+its ore than it loses! ta8ing is appropriate. But i+ people don<t get .o pensated +airly! people 7ill 2e less produ.tive and disen.hanted! adding a de oraliDation .ost. Bhus! the .ost*2ene+it analysis ust in.lude the de oraliDation .ost o+ those 7ho a.tually su++er the ta8ing and those 7ho are indire.tly a++e.ted 2y seeing the ta8ing. One 7ay to avoid $or li it' de oraliDation .osts is 2y paying ?ust .o pensation. But! i+ the settle ent .osts are greater than the de oraliDation .osts $due to transa.tion .osts'! then gov<t should not .o pensate those .osts. $e.g. sending O400 ItaA re2ateL .he.8s at a .ost o+ O=N.he.8 only to raise taAes the +ollo7ing year.' 3ssentially a re.ipro.ity o+ advantage .aveat. Bhis is the rule the pu2li. 7ould adopt +or utilitarian and +airness reasons i+ they 7ere 2ehind a 6a7lsian veil o+ ignoran.e and did not 8no7 i+ they 7ere the 2ene+i.iary or the har ee. o >airness @istri2ute .ostsN2urdens a ong ore people. $Armstrong prin.iple'. )ounter1 Ho7 do 7e dra7 the lineQ o 3A.eption +or har s $i.e. nuisan.es'. pro2le is the di++i.ulty o+ de+ining har s $re1 nuisan.e .ases'! parti.ularly 7hen har results +ro in.o pati2ility +ro t7o Iinno.entL uses rather than a alevolent use. o 3A.eption +or re.ipro.al advantages. o 3Ape.tations. Singling out .an 2e prote.ted 2y the e5ual prote.tion .lause. o )ost*,nternaliDation >or.es the 4ov<t to ta8e into a..ount the .ost o+ its ta8ing and a.t ore e++i.ientlyM other7ise! it 7ould 2e too prone to ta8e land.

7&

But i+ the 4ov<t is already .onsidering so e o+ the .osts $e.g. 2y loo8ing to polls! votes! or ne7s .o entary' and has to .onsider the .osts to a greater eAtent! it ay 2e deterred +ro a.ting. o Coters ay not voi.e .on.ern! though! i+ individual .osts are lo7 or a 2iguous $ho7 do 7e 8no7 7hat are taAes are used +orQ'. (nother pro2le is that ta8ings ?udg ents ta8e a long ti e $ eaning the de.ision* a8er ay 2e out o+ o++i.e 7hen a ?udg ent is rea.hed'! and the .ost usually .o es out o+ a general +und! not a parti.ular agen.y<s 2udget. (lso! the 4ov<t doesn<t nor ally eAperien.e the 2ene+its o+ ta8ings $they are not internaliDed to the sa e eAtent as .osts'. ( solution to this 7ould 2e to taA 7ind+all 2ene+its $e.g. taAing an in.rease in value as a result o+ a ta8ing'. Pu2li. .hoi.e argu ent1 Bhis theory 7ill lead to .on.entrated 2ene+its and distri2uted .osts. o Produ.tivityN)ertainty People 7ould 2e disin.entiviDed to invest in .o er.ialiDing property i+ it .ould ?ust 2e ta8en a7ay 7ithout ?ust .o pensation! thus de.reasing property value 2y su.h insta2iliDation. Bhis .ould 2e prote.ted 2y insuran.e. (rgua2ly! though! this is i pra.ti.a2le! so the gov<t .o pensation +un.tions as an insuran.e poli.y in a 7ay. o 9eep the +ederal gov<t in .he.8 2y prote.ting property! the I2ul7ar8 o+ li2erty.L Ho7 u.h do 7e need +or this +un.tionQ Where is the line 2et7een ta8ing and taAationQ )onstitutional 6estri.tions o =th ( end ent Inor shall private property 2e ta8en +or pu2li. use! 7ithout ?ust .o pensation. :a.8 o+ legislative history! outside o+ -adison<s 7ritings. o /4th ( end ent applies the =th ( to the states. 4enerally! i+ the 4ov<t restri.ts use o+ one<s land to su.h an eAtent that the restri.tion is essentially a Ita8ing!L the 4ov<t ust .o pensate +or the loss a..ording to prin.iples o+ e inent do ain. IBo a8e it .o er.ially i pra.ti.a2le to ine .ertain .oal has very nearly the sa e e++e.t +or .onstitutional purposes as appropriating or destroying it.L Penn. )oal )o. v. -ahon! ;.S. $/9%%'! /%=91 o >a.ts1 P o7ned rights to property 2ut ?ust the sur+a.e! and the deed .ontained a reservation o+ the right +or .oal underneath the sur+a.e to 2e ined and a 7aiver o+ da age that ay result +ro su.h ining. J(t the ti e P 2ought the property! perhaps te.hnology did not eAist that 7ould ena2le the iners to ine the support estates! 7hi.h prevent .oal ining +ro .ausing su2siden.e o+ ho es.K Ho7ever! the Penn. :egislature passed a la7! the 9ohler (.t! 7hi.h generally prohi2ited the destru.tion o+ support estates $thus giving P a right that she eApressly 2argained a7ay'. P sued +or in?un.tive relieve to prevent @ +ro ining under P<s property in su.h a 7ay that 7ould .ause su2siden.e. J +or P. 6eversed. o ,ssue1 )an the state gov<t destroy previously*eAisting property rights 7No .o pensating +or the ta8ingQ o Holding1 "oM thus! the 9ohler (.t 7as invalidated as an un.onstitutional regulatory ta8ing. o 6easoning1 Bhe 4ov<t .ould not pra.ti.ally operate i+ it had to .o pensate +or every .hange in the la7 that a++e.ts property rights! 2ut relatively a?or ta8ings should 2e .o pensated. >a.tors to .onsider to deter ine i+ a regulation goes Itoo +arL1 o $/' private interest * agnitude o+ ta8ing $large in this .ase 2N. the ta8ing a2olishes a valua2le estate and a previously*2inding .ontra.t'. o $%' pu2li. interest $lo7 in this .ase 2N. private land and li ited statute' and pu2li. sa+ety $"N( in this .ase 2N. noti.e o+ su2siden.e 7as provided to P.' o $&' 2alan.e o+ interests @oes B \ ) Q )ontrast Plymouth Coal v. Penn.! 7hi.h allo7ed the legislature to re5uire a pillar o+ .oal to 2e le+t along neigh2oring property +or sa+ety reasonsM that la7 Ise.ured an average re.ipro.ity o+ advantage.L )ontrast other de.isions regarding .ongestion in Washington and "#! 7here the la7s 7ere Iintended to eet a te porary e ergen.y and providJedK +or .o pensation...L 6is8*allo.ation When private parties or .o unities se.ured only sur+a.e rights! they too8 upon the selves the ris8. o @issent JBrandeisK1 Bhe @s should 2e en?oined +ro .reating a pu2li. nuisan.e! 7hi.h has resulted +ro .hanged .ir.u stan.es and 7hi.h threatens Ithe pu2li. health! sa+ety or orals.L 3n?oining use is not e5uivalent to seiDing land. o "otes1

74

>a.tors1 o :ength o+ ti e o @i unition o+ value * )o er.ial i pra.ti.a2ility o+ 7hat 7as le+t a+ter the ta8ing o ( ount o+ redistri2ution o Private 2ene+its out7eigh the .osts or average re.ipro.ity o+ advantage o "oti.e o+ possi2le har $ ay not 2e a nuisan.e i+ Ps had opportunity to avoid har ' "oti.e1 o Bhe +ailure o+ the .ourt to arti.ulate a solid! .oherent test +or 7hen regulations go Itoo +arL rather than an ad ho. analysis. o Bhe .ourt is really trying to eAplain 7hy! in see ing .ontrast to pre.edent! it<s i posing a re5uire ent o+ .o pensation +or regulation. o Hol es $ a?ority' and Brandeis $dissent' disagree on ho7 property is de+ined. Brandeis argued that the support estates 7ere a tiny +ra.tion o+ 7hat the .o pany o7ned! 7hereas Hol es 7as +o.used ?ust on the .o plete a2rogation o+ support estates! 7hi.h Pennsylvania re.ogniDed as a separate type o+ property. o What is regulation and 7hat is taAationQ Bhe 9ohler (.t 7as part o+ a pa.8age that i posed a taA on .o panies to .o pensate o7ners. (d Ho. $Balan.ing' test1 o 3A1 ( .ity<s restri.tion on the develop ent o+ individual histori. land ar8s does not .onstitute a ta8ing 2N. the pu2li. 2ene+it is great and the agnitude o+ private la7s is s all. Penn. )ent. Bransp. )o. v. )ity o+ ".#.! ;.S. $/970'! /%691 >a.ts1 "# Preservation :a7 vests po7er in the :and ar8s Preservation )o ission to designate land ar8s! to ensure they are aintained Iin good repair!L and to de.ide 7hether or not to allo7 re5uested .hanges to the eAteriors o+ designated land ar8s. (n o7ner .an see8 a .hange that $/' 7ill not alter the eAterior! $%' 7ill 2e appropriate to the land ar8 value o+ the stru.ture! or $&' 7ill prevent e.ono i. hardship 7hi.h 7ould other7ise result. Penn. )entral sought to 2uild an o++i.e to7er on top o+ 4rand )entral Station! 7hi.h had 2een designated a land ar8. Bhe )o ission denied the re5uest under .onditions $/' and $%'. P sued +or in?un.tive and de.laratory relie+. 4ranted. 6eversed. (++ir ed A% $6elie+ denied'. 6easoning1 o Pu2li. 2urdensN.osts should not 2e 2orne 2y private individuals disproportionately. Anderson. o >a.tors1 $/' agnitude and .hara.ter o+ ta8ing o $a' e.ono i. i pa.t does it e++e.t Iinvest ent*2a.8ed Jor pri aryK eApe.tations!L does it inter+ere 7ith present use! does it destroy the a2ility to re.eive a reasona2le return on invest ent! does it a++e.t a separately*re.ogniDed property $e.g. air rights'Q o $2' physi.al i pa.t invasion or ?ust inter+eren.eQ J0oretto rendered this prong oot.K $%' pu2li. health! sa+ety! orals! or general 7el+are $e.g. Doning la7s'. J$&' average re.ipro.ity o+ advantageK o Si ply sho7ing a denial o+ the a2ility to eAploit a property interest hereto+ore 2elieved to 2e availa2le +or develop ent is not su++i.ient to prove an un.onstitutional ta8ing. o ,n this .ase! $/'$a' Ps are per itted to use the property in eAa.tly the 7ay it has 2een used! 7hi.h ust then .on+or 7ith eApe.tations. Bhe :and ar8 la7 also prioritiDes that land ar8 o7ners 2e a2le to re.eive a Ireasona2le returnL on their invest ent. >urther ore! Ps are not ne.essarily prohi2ited +ro 2uilding any stru.ture. :astly! the a2ility to trans+er air rights Iundou2tedly itigate 7hatever +inan.ial 2urdens the la7 has i posed on JPsK.L o Bhe land ar8 la7s are not as targeted as Ps argue 2ut are li8e Doning! 7hi.h is a .o prehensive plan that e++e.ts any people generally. o IBhe restri.tions i posed ...L $/' Iper it reasona2le 2ene+i.ial use o+ the land ar8 site JandK also a++ord JPsK opportunitiesL to enhan.e the site and other properties. $%' Iare su2stantially related to the pro otion o+ the general 7el+are.L @issent J6ehn5uistK1 o Ps are singled out +or disproportionate loss. o Bhe .ases .ited 2y the a?ority that allo7ed legislation 7hi.h severely a++e.ted so e lando7ners 2ut not others involved InoAiousL uses o+ property. Bhis .ase does not.

7=

( se.ond eA.eption to ta8ing is 7hen an average re.ipro.al advantage is se.ured! as 7ith Doning la7s. Bhe I ulti illion dollar lossL in this .ase is not 2alan.ed 2y 2ene+its! nor is the .ost distri2uted. o Bhe trans+er develop ent rights $B@6s' .on.eded 2y @s a.8no7ledge a ta8ing. "otes1 o Bhe )ourt is un.ertain as to 7hether a regulatory ta8ing eAists. (lthough Penn Coal said that a regulation .an Igo too +ar!L the .lai ant in that .ase 7as as8ing +or an in?un.tion! not ?ust .o pensationM thus! the )ourt did not dis.uss 7hat the re edy 7ould 2e +or a ta8ing. Penn Central did not go 2e+ore the )ourt until =0 years a+ter Penn Coal! indi.ating the )ourt<s relu.tan.e to address the issue +urther. o ,n the 2a.8ground! the )ourt .onsiders 7hether the govern ent<s a.tion is su2?e.t to the =th ( or /4th ( . o PuDDles re aining1 Ho7 u.h di inution in value is going Itoo +arLQ o ,n Penn Cent.! not a 5uestion o+ the value o+ the land 2ut o+ the return on invest ent. ,s this easured against the pur.hase pri.e! the average return on the sto.8 ar8et! or .urrent invest entQ What i+ the investor I.a e to the ta8ingL $2ought the land 8no7ing o+ the regulation'Q Should the line o+ ?urispruden.e dealing 7ith the reasona2le return on a utility<s invest ent 2e transposed to other areasQ Ho7 is an invest ent*2a.8ed $or reasona2le' eApe.tation de+inedQ o One +a.tor is 7hen an investor had noti.e o+ a regulation 7hen he 2ought a property! 2ut a gov<t .learly .an<t ?ust provide annual noti.e that it ay li it rights. ,s there a nuisan.e eA.eption $e.g. i+ gov<t is regulating so ething that! unregulated! 7ould .onstitute a nuisan.e! is that ever a ta8ingQ' o %uggler and other .ases prior to Penn Coal allo7ed regulation o+ nuisan.es or Inuisan.e*li8eL a.tivity to the point o+ shutting do7n 2usinesses 7ithout 2eing re5uired to .o pensate. Penn Coal distinguished +ro that line o+ .ases 2N. the plainti++ had noti.e. Ho7 should 7e interpret 7hat the .ourt does 7ith B@6sQ Ho7 is the deno inator de+ined $i.e. di inution +ro 7hatQ'Q
o

B. Per Se 6ules

( per anent physi.al o..upation o+ an o7ner<s property authoriDed 2y the 4ov<t .onstitutes a per se ta8ing! even 7hen inor or 7hen gov<t interest is strong. :oretto v. Belepro pter -anhattan )(BC )orp.! ;S $/90%'! /%061 o >1 :oretto o7ns a =*story apt. 2uilding upon 7hi.h @ installed .a2les and .a2le 2oAes. Prior to /97&! @ o2tained per ission +ro property o7ners and paid a .o ission on revenues. ,n /97&! "# ena.ted W0%0 7hi.h li ited the pay ents to an a ount deter ined 2y the State )o ission on )a2le Belevision. /976 )o ission ruled that O/ 7as a reasona2le +ee. P dis.overed @<s e5uip ent on her 2uilding a+ter the /97/ pur.hase o+ the 2uilding and 2rought a .lass a.tion suit +or trespass and! 7hen @ relied upon W0%0! a ta8ing 7No ?ust .o pensation. Sought da ages and in?un.tion. Js *\ @. (<d A%. 6<d and re anded to deter ine ?ust .o pensation. o 6eas J-arshallK1 Bhough ad ho.! the deter ination 7hether .o pensation is due Iis not standardless.L o >a.tors to .onsider1 $/' (dverse e.ono i. i pa.t $espe.ially upon eApe.tations' $%' .hara.ter o+ gov<t a.tion $e.g. physi.al invasion' o ( per anent physi.al invasion $e.g. .ontinuous over+lights' is very serious and invaria2ly a ta8ing. o (n IinvasionL is su2?e.t to a 2alan.ing test. o (n Io..upation!L ho7ever! does not invo8e a 2alan.ing test. Bradition and pre.edent support the rule. Bheoreti.ally! a per anent physi.al o..upation doesn<t ?ust a++e.t one strand 2ut the 7hole 2undle o+ rights $Ito possess! use and dispose o+L land'. W0%0 per its even larger ta8ings than no7 o..ur. Physi.al o..upation is easy to prove.

76

o @issent JBla.8 unK1

Bhe )t. does not eAplain ho7 the statute allo7ing .a2les on a 2uilding is di++erent +ro statutes allo7ing utility servi.es. Bhe proper test should .onsider the eAtent o+ the State<s inter+eren.e. o "otes1 3SS3"B,(::# :,-,B3@ BO ,BS >()BS. 6eason +or the rule ay have 2een the slippery slope argu ent! as 7ith ease ents! that allo7ing a little 2it .ould have led to even ore. (nother reason .ould 2e that the Iright to eA.ludeL sti.8 is sa.rosan.t and the ost i portant in the 2undle o+ property rights $hen.e the S: trespass rule'. )onsider that the .a2les 7ere on the property 7hen P pur.hased itM so ho7 .an 7e say her eApe.tations 7ere a++e.tedQ ,+ she .an<t sue! and the previous o7ner did not! then the ar8eta2ility o+ property ay 2e negatively a++e.ted. What a2out the role o+ average re.ipro.ity o+ advantage $e.g. the value o+ the property in.reased due to the availa2ility o+ .a2le'Q )ould argue that a physi.al invasion is a proAy +or a++e.ting people uni5uely and not generally! although not so in this .ase. @o 7e re5uire the gov<t to pay .o pensation +or politi.al pro.ess +ailuresQ 3.g. a group 7ith less politi.al po7er ay 2e adversely a++e.ted! and physi.al invasions ight serve as a signal that su.h a group has o..urred. )ounter People 7ho are li8ely to lose a lot are ore li8ely to 2e a.tive in the politi.al pro.ess and .apture it. ,n regard to the rule1 o What<s per anentQ What i+ the 2uilding had 2een 2uilt in the /000s and the .a2le 7as only on it +or %0_ o+ the ti e and then re ovedQ o What<s physi.alQ (.tual +illing up o+ spa.eQ o What<s o..upationQ What i+ gov<t tells a landlord that he .annot evi.t a rent*regulated tenant $the )ourt says no 2N. o7ner invited tenant in in the +irst pla.e'Q Bhe )ourt has li ited the appli.ation o+ this rule to gov<t a.tion per itting physi.al o..upation +or +oreseea2le +uture that 8eeps o7ner +ro doing so ething di++erent 7ith the land. Poli.e po7er eA.eption1 ( regulation that deprives an o7ner o+ Iall e.ono i.ally 2ene+i.ial or produ.tive use J$/00_ o+ the value'K o+ landL .onstitutes a per se ta8ing that re5uires ?ust .o pensation! unless the use 7as unla7+ul under eAisting property and nuisan.e prin.iples. ( regulatory ta8ing in a..ordan.e 7ith nuisan.e la7 is not a ta8ing and does not re5uire .o pensation. :u.as v. S.). )oastal )oun.il! ;S $/99%'! /%991 o >1 P paid O97=9 +or t7o residential lots in /906! 2ut the S.). :egislature ena.ted in /900 the Bea.h+ront -gt (.t! 7hi.h 2arred P +ro 2uilding the houses he intended to 2uild on the lots. ( trial .ourt +ound the lots Ivalueless.L J *\ P $O/.%-'. 6<d. 6<d and re anded to apply the Itotal ta8ing test.L o 6eas JS.aliaK1 Perhaps! Itotal deprivation o+ 2ene+i.ial use is! +ro the lando7ner<s point o+ vie7! the e5uivalent o+ a physi.al appropriation.L "o re.ipro.ity o+ advantage. Bhe poli.e po7erNstate interest ?usti+i.ation +or non.o pensated di inution in value 7as previously* +or ulated as Iprevention o+ har +ul Jor noAiousK use.L (lthough .ase la7 see s to indi.ate other7ise! this is not a .ategori.al ?usti+i.ation +or not .o pensating total loss. (lthough a lando7ner should eApe.t that the 4ov<t ay restri.t property rights! it is unreasona2le to eApe.t total di inution o+ value +or use that 7as Ipreviously per issi2le under relevant property and nuisan.e prin.iples.L IBotal ta8ingL in5uiry1 o Ithe degree o+ har to pu2li. lands and resour.es! or ad?a.ent private property! posed 2y the .lai ant<s proposed a.tivities!L o Ithe so.ial value o+ the .lai ant<s a.tivities and their suita2ility to the lo.ality in 5uestion!L o Ithe relative ease 7ith 7hi.h the alleged har .an 2e avoided through easures ta8en 2y the .lai ant and the gov<t $or ad?a.ent private lando7ners' ali8e.L o @issent JBla.8 unK1 History does not support the eApe.tation that a .o plete ta8ing ust 2e .o pensated. Ba8ings ?urispruden.e has never 2een li ited 2y ): do.trines o+ nuisan.e.

77

o @issent JStevensK1
Bhe )ourt<s ne7 rule is ar2itrary 2N. a di inution o+ value o+ 9=_ .ould lead to no .o pensation 7hile a /00_ di inution re5uires +ull .o pensation. Bhe ne7 rule is easily anipula2le. Bhe ne7 rule +reeDes .o on la7! 7hi.h needs to 2e +leAi2le to respond to ne7 understandings. Bhe legislation at issue did not spe.ially a++e.t P and! in +a.t! 2urdens o7ners o+ developed land potentially ore than it 2urdens P. Bhe pu2li. interest is very large. "otes1 On re and! the State<s a.tions 7ould not have 2een authoriDed 2y nuisan.e la7 and! thus! .onstituted a ta8ing. Bhe a?ority distinguished the previous nuisan.e .ases as involving due pro.ess. Bhis opinion 7as per.eived as a huge vi.tory +or property rights advo.ates! 2ut lo7er .ourts have read it to say that less than /00_ di inution is not a ta8ing $per se'. (lso! the 2attle shi+ted to ho7 to de+ine property. Pro2le s1 o -a?ority<s reasoning is in.onsistent. 3.g. it says the .ases involving noAious har $su.h as %ugler' are too ushy! 2ut then the opinion later relies upon nuisan.e la7. o "uisan.e la7 is un.ertain is it a 2alan.ing test! a threshold test! or 7hatQ Bhe a?ority uses a ): .on.eption o+ nuisan.e! 2ut 7hen did that stopQ ,s this an issue o+ institutional .o peten.e trusting ?udges 2ut not state legislaturesQ ,+ not trusting latter! 7hat a2out the prin.iples o+ allo7ing states to eAperi ent 7ith di++erent la7sQ "uisan.e la7 essentially atrophied a+ter the /970s! 7hen state legislatures 2e.a e involved in regulating environ ental issues. Bhus! i+ the gov<t regulates an a.t under the )lean (ir (.t! is a P pre.luded +ro a su..ess+ul ta8ings a.tion 2N. the a.t has not 2een +ound a nuisan.e in the .ourtsQ o Why isn<t a .onde nation due to nuisan.e! 7hi.h appears to 2e a .hange in property rights! .onsidered a ta8ing that re5uires .o pensationQ o Bying ta8ings la7 to nuisan.e la7 eans that the de+inition o+ a ta8ing 7ill vary depending upon ?urisdi.tion sin.e nuisan.e de+initions vary 2y state. o Ho7 does the nuisan.e rule intera.t 7ith the notion o+ noti.eQ @oes a .odi+i.ation o+ nuisan.e ): .ount as noti.e 7hi.h pre.ludes a +inding o+ ta8ing under the .odi+i.ation<s de+inition o+ nuisan.eQ o When in?un.tive relie+ 7as seen as the only re edy +or nuisan.e! .ourts anipulated the de+inition o+ nuisan.e to avoid shutting do7n .on.rete plants! et.. o ( study o+ de.ided ta8ings .ases indi.ated that 0u"as i pa.t has 2een ini al! despite eApe.tations that it 7ould 2e a great 7eapon +or property rights advo.ates. o 0u"as 7as at +irst seen to 2e a ove ent +ro 2alan.ing standards to a .lear rule! 2ut this 7as soon undone 2y Tahoe and Pala88olo. o -a?or pro2le ! though! is that +inding a total di inution in value re5uires a deter ination o+ the deno inator.

). Persistent Pro2le s

/. @eno inator pro2le 1 o Euestions1 When di inution is easured against the value prior to the ta8ing! is the value o+ this Ideno inatorL deter ined using the property as a 7hole or a divided interestQ o Penn Central stated that a single par.el o+ land is not to 2e divided into dis.rete seg ents! 2ut 7hat is a Ipar.elLQ o But 0u"as de onstrated the )ourt<s Idis.o +ort 7ith the logi.L o+ easuring deprivation a++e.ted 2y a regulatory a.tion against the value o+ a par.el as a 7hole. PalaDDolo v. 6hode ,sland! ;S $%00/'! /&&41 >a.ts1 @ denied P<s re5uest to develop his /0*a.re par.el o+ 7etlands! and the trial .t. +ound P retained a portion o+ land 7ith O%009 in develop ent value. Bhus! P 7as not deprived o+ all e.ono i.ally 2ene+i.ial use and did not su++er a total ta8ing.

70

"otes1 When a ta8ing is esta2lished! Ia State ay not evade the duty to .o pensate on the pre ise that the lando7ner is le+t 7ith a to8en interestL $a s all value' $/&&4<4'. I)on.eptual severan.eL1 )an property rights 2e separated e.g. air rights +ro the 2undleQ o ,+ so! are rights vie7ed as the ar8et de+ines the Q as .ourts de+ine the Q Pennsylvania ay 2e the only state that separates out Isupport estates!L 2ut the ar8et separates it out in any ore pla.es. )an rights 2e divided te porallyQ o Bhe 7hole par.el .annot 2e separated physi.ally or te porally in .al.ulating di inution. Bahoe* Sierra Preservation )oun.il! ,n.. v. Bahoe 6egional Planning (gen.y! ;S $%00%'! /&&=1 >a.ts1 @ instituted t7o oratoriu s! lasting a total o+ &% onths! 7hi.h 2anned any develop ent along :a8e Bahoe. P .ontended this a ounted to a ta8ing. @istri.t .t. divided the par.el. 6<d. 6easoning1 JStevensK1 IJWKhere an o7ner possesses a +ull X2undle< o+ property rights! the destru.tion o+ one Xstrand< o+ the 2undle is not a ta8ing.L Other7ise! any delay in per itting 7ould .onstitute a ta8ing. @issent JBho asK1 o $/' Bhe deno inator rule is not settled. o $%' Bhe te poral di ension should a++e.t only the .o pensation 2ut a ta8ing has o..urred per 0u"as and &irst (nglish. What a2out +un.tional .ategories o+ property $e.g. ease ents or onetary interest on prin.ipal'Q o ,ssues1 ,+ the .ourt al7ays +o.uses on ?ust the portion a++e.ted! a ta8ing 7ill al7ays result. ,+ the .ourt .onsiders the entire holding o+ a .o pany $e.g. Stevens< vie7Q in Penn Coal that the .o. had /6 ines' or an in+inite ti e period $e.g. .onsidering that all regulations are essentially ti e* li ited 2N. they .ould 2e res.inded! espe.ially te porary oratoria'! a ta8ing 7ill al ost never 2e +ound 7hen P has deep po.8ets or 7hen a s all portion o+ that property has 2een a++e.ted. (ll land 7ill have so e value +or so e use. Bragedy o+ the anti*.o ons1 e.g. i+ a Bahoe o7ner engages in sale*lease2a.8 due to the oratoriu 2ut then dies intestate! the interest .ould potentially 2e divided a ong =0 relatives! a8ing it di++i.ult to pie.e 2a.8 together the reversionary interest. 3Ape.tations ay 2e easured 2y 7hat part o+ the property does the o7ner insure or pay taAes onQ (re the portions o+ land .ontiguous $e.g. not separated 2y a road' or histori.ally vie7ed as one propertyQ ,s there a re.ipro.ity o+ advantage $e.g. does the pie.e .ontri2ute so ething to the 7hole'Q @oes the pie.e have value standing on its o7n $e.g. in Penn Coal! the support estates had no separate value until te.hnology advan.ed that allo7ed the to 2e ined'Q See also Phillips. But "f. Penn Central $air rights .an stand on their o7n'. @o the regulatory ta8ings rules parallel physi.al ta8ings rulesQ $e.g. i+ 4ov<t physi.ally ta8es ?ust a little! 7e 7ouldn<t 7ant to say that it 7ould not have to .o pensateM ho7ever! ost Doning regulations re5uire a set2a.8 +ro the road and .ourts don<t usually re5uire .o pensation +or that. Ho7 to ?usti+yQ Bhe set2a.8 allo7s +or side7al8s! a8ing all the land in the neigh2orhood ore valua2le! 2ut the sa e argu ent .ould 2e ade +or the 4ov<t ta8ing a little to 7iden a road.' o Other )ases1 Phillips v. Wash. :egal >dtn.! ;S $/990'! /&&/1 BV ,O:B( $,nterest on :a7yers Brust (..ount' progra used interest oney +ro +unds deposited 2y .lients to 2e anaged 2y their attorneys. Sin.e Iinterest +ollo7s prin.ipal!L the interest is the private property o+ the prin.ipal o7ner. $(<d'. (lthough the ,O:B( progra is a ta8ing! o7ners are due no .o pensation 2N. they 7ould have earned no interest in the a2sen.e o+ the progra . Bro7n v. :egal >dtn. O+ Wash.! ;S $%00&'! /&&&. %. 3Aa.tions $/&&0' o 3Aa.tion H agree ent 2y a developer to donate property or oney to a .o unity in eA.hange +or approval +ro lo.al authorities o+ the develop ent plan. o ;nder the do.trine o+ Iun.onstitutional .onditionsL 7here2y the gov<t ay not re5uire a person to sa.ri+i.e a .onstitutional right in eA.hange +or a dis.retionary 2ene+it! .on+erred 2y the gov<t! that has little or no relationship to the property at issue $/' ,s there an Iessential neAusL 2et7een a legiti ate state interest and the per it .ondition eAa.tedQ $%' ,+ yes! is the .ondition roughly proportionate in nature and eAtent to the i pa.t o+ the proposed develop entQ ,+ not! it is a ta8ing.

79

@olan v. )ity o+ Bigard! ;S $/994'! /&&91 o >a.ts1 >loren.e @olan planned to eApand her plu 2ing and ele.tri. supply store! and the )ity o+ Bigard Planning )o ission granted her per it appli.ation on the .ondition that P dedi.ate the portion o+ her land lying 7ithin a /00*year +loodplain +or i prove ent o+ a stor drainage syste and another /=< strip o+ land ad?a.ent to that +or a pedestrian and 2i.y.le path7ay. (<d. 6<d and re anded. o 6easoning J6ehn5uistK1 ,+ the .ity had re5uired P to dedi.ate a strip o+ land +or pu2li. use! Ia ta8ing 7ould have o..urredL 2N. she 7ould have 2een prevented +ro eA.luding others. Ho7ever! IJaK land use regulation Je.g. DoningK does not e++e.t a ta8ing i+ it Xsu2stantially advan.eJsK legiti ate state interests< and does not XdenJyK an o7ner e.ono i.ally via2le use o+ his land. Agins.L ,n this .ase1 o $/' O2viously! Ia neAus eAists 2et7een preventing +looding along >anno )ree8 J$a legiti ate state interest'K and li iting develop ent 7ithin the .ree8<s /00*year +loodplain.L ( neAus also eAists 2et7een a plan to redu.e tra++i. .ongestion and re5uiring land to 2e used +or a pedestrianN2i.y.le path. o $%' 6ough proportionalityQ $a' (lthough P<s in.rease o+ i pervious sur+a.e 7ill in.rease the +lo7 o+ stor 7ater o++ o+ her property! the develop ent plan already in.ludes drainage spa.e. Bhe .ity is re5uiring ore 2ut Ihas never said 7hy a pu2li. green7ay! as opposed to a private one! 7as re5uired in the interest o+ +lood .ontrol.L "or is it .lear 7hy re.reational use o+ the area is related to +lood .ontrol. While P invites visitors to her .o er.ial property! as in Prune:ard Shopping Ctr. v. obins! ;S $/900'! 4=4n6 G /&46! P 7ill neither 2e a2le to pla.e li its upon the use o+ the land on.e it is dedi.ated! as 7as allo7ed in Prune:ard! nor 2e a2le to eA.lude visitors at 7ill. IHer right to eA.lude 7ould not 2e regulated! it 7ould 2e evis.erated.L $2' Bhe .ity has not et its 2urden o+ proving that the pedN2i8e path reasona2ly relates to the in.reased tra++i. P<s eApansion 7ill generate. :i8elihood at least is re5uired! not ?ust a possi2ility. "otes1 o Bhe .ourts are atte pting to regulate the deals that .o e out o+ eAa.tion ensure they are not eAtortion 2ut 2ear so e relation to the user<s proposed develop ent. ,+ you 7ould deny the per it 2N. the develop ent 7ould over2urden the neigh2orhood<s se7er syste ! then an eAa.tion o+ land or oney +or a se7er syste addition 7ould have a IneAusL to the proposed develop ent. o 6e aining 5uestions1 When a )ity )oun.il passes a usage +ee! 3ollan and .olan ay not apply 2e.ause the +ees 7ere legislated not negotiated ad ho.. Bhis line o+ .ases is uni5ue in that it puts the 2urden upon the lo.al gov<t to prove that a neAus eAists and that the eAa.tion is proportional to the 2urden! signaling an unpre.edented and perhaps sha8y invasion into legislative de.isions. ,+ there is not a 7ay to +iA a pro2le $e.g. sunlight pouring into )entral Par8' other than 2y li iting 2uilding! do 7e not 7ant the lo.al gov<t to have an option to re5uest so e other type o+ a enity to 2alan.e the loss that is +iAa2le 2y no other ethodQ ,s the .ourt really as8ing lo.al gov<ts to .ondu.t a least*restri.tive analysis $ala .onstitutional la7<s least*restri.tive eans standard'Q 3pstein argues that .olan! 2N. it<s really a2out 7ho 7ill o7n title to the +loodplain! allo7s an o7ner to propose a solution! pla.ing the 2urden upon the gov<t to deter ine that the solution does not address the pro2le at issue. ,+ the gov<t .an<t prove that it needs to hold title! 7hy 7ould 7e allo7 it to use 7hat is possi2ly a ore restri.tive solutionQ &. Be porary Ba8ings $/&40' o (+ter passage o+ the /4th ( ! ta8ings .lai s against state and lo.al gov<ts 7ere 2rought under the ( <s due pro.ess .lause! and .ourts too8 the position that only prospe.tive re edies in?un.tion! de.laratory ?udg ent! or de.ree o+ anda us 7ere availa2le. Bhus! a++e.ted lando7ners re.eived no onetary .o pensation! even though .lai s .ould ta8e years to resolve. 6eal estate interest .a paigned +or the ;S Supre e )ourt to address the re edial 5uestion o+ 7hether the appli.ation o+ the Ba8ings )lause through

00

the /4th ( . re5uires state .ourts to a7ard ?ust .o pensation +or all ta8ings! in.luding Ite porary ta8ingsL that o..ur during the ti e the regulation is 2eing .hallenged. ( land*use regulation .an a ount to a ta8ing re5uiring ?ust .o pensation even i+ the regulation is 7ithdra7n upon a su..ess+ul ?udi.ial .hallenge! 2ut ordinary delays in the per it pro.ess do not .onstitute su.h a ta8ing. >irst 3nglish 3vangeli.al :utheran )hur.h v. )ounty o+ :.(.! ;S $/907'! /&491 >a.ts1 >ire destroyed a portion o+ a 7atershed area and +looding su2se5uently resulted and da aged the )hur.h<s .a pground site .alled :utherglen. ,n response to the sa+ety and health threat o+ +looding! the )ounty adopted an ordinan.e 7hi.h e++e.tively prohi2ited the )hur.h +ro re2uilding :utherglen<s +a.ilities. P sued +or da ages that resulted +ro the regulatory ta8ing! 2ut the )ali+. Supre e )t. had held in (gins v. Bi2uron that a Ite poraryL ta8ing 2y a regulation that is ulti ately invalidated 2y the .ourts does not re5uire .o pensation. Bhus! J +or @ on that issue. (<d. 6<d and re anded. 6easoning J6ehn5uistK1 o ( series o+ .ases involving te porary ta8ings during WW,, support the prin.iple that .o pensation is re5uired +or su.h ta8ings 2N. I<te porary< ta8ings 7hi.h! as here! deny a lando7ner all use o+ his property! are not di++erent in 8ind +ro per anent ta8ings.L o ,nvalidation o+ a regulation does not su++i.iently .o pensate an o7ner in a..ordan.e 7ith the ta8ings .lause. P.S. On re and! Ithe )ali+ornia .ourts .on.luded that there had not 2een a ta8ing!L and the ;S Supre e )ourt de.lined .ert.! per Tahoe*Sierra $2elo7'. Physi.al ta8ings $i.e. the 4ov<t a.5uires property +or pu2li. use'! even te porary! evo8e a .lear rule! 2ut so*.alled Iregulatory ta8ingsL $i.e. a 4ov<t regulation prohi2its .ertain types o+ use o+ private property' Ine.essarily entailJK .o pleA +a.tual assess ents o+ the purposes and e.ono i. e++e.ts o+ govern ental a.tions.L Bahoe*Sierra Preservation )oun.il! ,n.. v. Bahoe 6egional Planning (gen.y! ;S $%00%'! /&==1 I:and*use regulations are u2i5uitous and ost o+ the i pa.t property values in so e tangential 7ay o+ten in .o pletely unanti.ipated 7ays. Breating the all as per se ta8ings 7ould trans+or govern ent regulation into a luAury +e7 govern ents .ould a++ord. By .ontrast! physi.al appropriations are relatively rare! easily identi+ied! and usually represent a greater a++ront to individual property rights.L &irst (nglish did not address 7hether the te porary regulation at issue .onstituted a ta8ing. ,t erely addressed the re edial 5uestion I2e.ause the )ali+ornia .ourts had de.ided the re edial 5uestion on the assu ption that a ta8ing had 2een alleged.L ,+ the .ourt 7ere to adopt a per se eA.eption +or oratoria on develop ent! the resulting +inan.ial .onstraints ight lead to rushed develop ent planning or an a2andon ent o+ planning at all. Su.h an a2andon ent 7ould! in turn! in.entiviDe lando7ners to develop property 5ui.8ly and ine++i.iently so as to avoid any possi2le regulation that ight 2e ena.ted. Euestions re aining a+ter /st 3ng1 When did the ta8ing 2eginQ 3.g. 7hen the reg 7as passed! 7hen a property 7as pur.hased! 7hen a parti.ular purpose 7as proposed! 7hen the proposal 7as denied! ... a ta8ing is +ound 2y the .ourt. o >or a I+a.ial .hallengeL a .lai that this la7 is un.onstitutional under any appli.ation ta8ing 7ould 2e 7hen reg 7as passed. o >or an Ias applied .hallengeL a .lai that the la7 ay 2e .onstitutional in general 2ut Ias appliedL to P<s situation! it is a ta8ing ta8ing 7ould 2e 7hen use 7as denied $7hen the reg 7as applied'. o When does the ta8ing endQ When P 7insQ What i+! on re and! @ res.inds the regulation 2ut applies a ne7 one. (gainst 7ho should the .ourt .harge the ti e 2et7een res.ission and approval or denialQ Ho7 is .o pensation .al.ulatedQ o -ust .onsider .osts! loss o+ pro+it due to a .hange in the ar8et! et.. o Should the lando7ner have to itigate da ages $e.g. putting up a ItaApayerL so e +or o+ 2uilding to a8e a little oney'Q ,n 7hat +or is .o pensation 2e re5uiredQ ,s a B@6 su++i.ient! or is .ash the only allo7ed +or Q ary

@. Su

,+ a regulation is +ound to 2e a ta8ing! the 4ov<t .an1

0/

$/' Ba8e title 2y e inent do ain and pay ?ust .o pensation. $%' 6es.ind the regulation. $&' Ba8e a negative ease ent and pay +air ar8et value +or the ease ent ,+ there is a regulation that e++e.ts a ta8ings! the +a.t that it is res.inded does not eli inate the ta8ing. While the ta8ing 7as in e++e.t! the property o7ner is entitled to .o pensation during that ti e period. &irst (nglish &irst (nglish says the state has done so ething 7rong 2y ta8ing land! and the gov<t 7ould 2e given a +ree pass i+ .ould res.ind the regulation and not have to pay .o pensation +or the ti e it 7as in e++e.t. Ho7ever! Tahoe involves a te porary oratoriu ! so it loo8s at a regulation e- ante 2e+ore the gov<t has done so ething 7rong.

0%