I. #POLICY''''

	Property
Authors	Merrill; Smith
Text	; Property: Principles and Policies (University Casebook Series)
Taught by
Taught at
Related course(s)

Two conceptions of property
1. Right of thing (in rem) against the world – traditional
2. Bundle of rights – Modern, varies based on policy
Bundle of rights
1. Ownership rights include use, exclusion, transfer, posses, etc.
2. Possession is key to property
3. Penner: In rem right based on exclusion (more important than right to use)
  1. But no property right is absolute
4. Grey: Property rights are not fixed, subject to determination by different courts. Bundle up for debate.
Four types of rights
1. Rights
  1. Claims that others act a certain way (right to exclude)
2. Privilege
  1. Permission to act without damages – e.g. build a 50 foot building if you want to
3. Powers
  1. Ability to change entitlement, transfer the property
4. Immunities
  1. Security from having entitlement changed by others
5. Property theories
  1. Justice, Liberty (individual rights)
    1. Whether an interest is sufficiently important that others should respect it.
  2. Cost-benefit (utilitarian)
    1. Maximize social utility
  3. Social relations
6. Justifications for property rights
  1. Possession
  2. Locke Labor theory (reward work) (Whetherbee v. Green)
  3. Human flourishing (modify the world)
  4. Efficiency (clarify who owns what)
  5. Justified expectation
  6. Distributive justice
7. Ways to resolve a property dispute
  1. Use dispute
    1. Let individual parties work out a deal = Coase Theorem
      1. Drawback: Negotiation barriers (ppl hate each other, endowment effect, holdout), No consideration for justice (even payment might be degrading)
    2. Nuisance remedy
      1. Nontrespassory, intentional (know or should know), unreasonable (balancing gravity of harm/benefit, locality principle (reasonable placement?), first in time), substantial (actual)
      2. Injunction or Damages
        Injunction = Great harm, not important use
        
        Damages = Incentive to keep activity going (Boomer)

Eminent Domain

Nuisance remedy of damages
Trespass remedy of injunction
Eminent Domain
1. Public Use. Public benefit is sufficient.
2. Just Compensation – just for the actual lot affected.
Regulatory Taking
1. Public interest sufficient to justify private harm.
Custom? First in time?

II. #EXCLUSION / USE

'Right to Exclude'

Protection from trespass
Penner: Exclusion is key to property, which is about relationship btw people
- o Property is right in rem = right of thing
  - Imposes duty on all others no to interfere with thing
  - Versus in personam right (behavior of some person), more complicated and binds only specific people
- o Clear communication (binds all the world)
  - Low information cost (don’t need to know owner to know not to trespass)
- o Relationship w/ right to use
  - Exclusion protects right to use – go hand in hand: while I use, you’re excluded
- Two exclusion rights
  - o Exclusive possession
    - Prevents others from using or invading land without the owner’s or possessors permission
    - Not absolute right
  - o Quiet enjoyment
    - Enjoying your property without interference- noise or pollution

Jacque v. Steenberg Homes, Inc. (1997)

Facts
- o Company intentionally cuts over guy’s property against his denial. Bad faith trespass. Middle of winter. Court awards nominal damage ($1) and punitive damages.
Holdings
- o Right to exclude people from property has an independent status as a legal interest, even if no actual injury and apart from any other interest (like privacy)
- o Society has a strong interest in protecting trespass to land
- o Doesn’t matter if property owner acting irrationally or not helping solve community problems.
Jacque’s Rule: intentional trespass forbidden, w/o regard to reasonableness of intrusion or actual harm
Trespass = any intentional intrusion that deprives another of possession of land (even if only temporary)
Trespass to Chattels: will result in liability only if it causes harm to the owner of the thing.
2 reasons for strict right to exclude:
- o (1) avoid potential violence and (2) protect privacy rights

Himan v. Pacific Air Transport (9^th Cir., 1936) = #Ad Coelum limit

Facts
- o Farmer (P) sues airline for trespass on the theory that he owns the airspace above his land.
Holding
- o No absolute ad coelum rule
  - Ad coelum = whoever owns soil, owns air above and earth beneath
  - Majority limits Roman law, Justinian (ad coelum)
    - Says its archaic! Not to be used literally.
  - If applied, would need injunction from each landowner plane passes over, big mess
    - Would render air navigation impractical
  - o You only own the space that you are occupying or making use of; air/sea are incapable of private ownership (except in so far as one may actually use it)
  - o Only trespass when plane comes so low that it injures land or interferes with enjoyment/use of it
    - Must interfere with actual, current use – not hypo use
  - Note
    - o Ad coelum also limited by police power, zoning (Welsch)
    - o Alternate idea: Navigable airspace is public property (US v. Causby (1946)) = ED

Exceptions to Right to Exclude''''

A) Necessity
- o Entry upon land of someone else may be justified by necessity (especially to save a life)
  - Ploof v. Putnam (1908)
- o Compensation Rule: if there are damages to property – then P is liable for the damages caused to dock (Vincent v. Lake Erie Transportation Co. 1910)
  - Right to exclude satisfied by damages payment. Entitlement still belongs to owner but is protected by liability rule (instead of property rule).
- o Requires that the situation be out of trespasser’s control
  - Ex: Wild animal forces you off road, storm forces you onto property, etc.
  - In Jacque, it was in the trespassers control
- B) Customs
  - o Court may give priority to an established custom to override trespass
    - McConico v. Singleton (1818): not a trespass b/c of custom; there is a customary right to hunt on enclosed and uncultivated land owned by another; the right to hunt on unenclosed land is established by custom (so it was okay).
  - o Custom: shared norm among people in a location (but not a law); a behavior that is a norm in society
  - o Some states have “posting laws” – permit anyone to hunt on rural land, unless “no hunting” or “no trespassing” signs are prominently posted
    - Waned in recent years for US.
    - But Sweden has “open camping” laws and UK has “right to roam.”
  - C) Public Policy
    - o Most broad category exception
    - o Exclusion cannot impede govt public policy (protecting human dignity rights of migrant workers)
    - o Migrant workers need to see lawyers. (State v. Shack (SC NJ 1971))
      - Balancing test: health of migrant workers/legal rights v. right of property owner
      - Less black-and-white rule than Hinman
      - Right to exclude is a standard, not a rule
        Rule = simple decisional devices that generate legal conclusions (if X then Y)
        
        Standard = Outcome not clear, must weigh different criteria to reach law’s purpose
        o Ex post decision-making, greater deal of discretion.
        
        o More ambiguous, more costly, probably more fair
        
        Shack Standard: if stranger crosses the boundary of an owner’s property, then the owner can have the stranger evicted. But must consider
        Owner interest in protecting his autonomy is sufficiently great?
        
        Interests of other persons in abrogating the owner’s right to exclude are not more important?
        
        Reasoning
        Land owner’s right to exclude, limited
        
        Public policy in Economic Opportunity Act – federal program to assist migrant workers
        o Court looking at who is being invited/for what purpose
        
        Rights of tenants can be modified by express lease provisions; courts have held that tenant’s rights are non-waivable as a matter of public policy.
        o Tenant (right to receive visitors) v. resident (aid of employment, which involves no possessory interest in the realty)
        
        o Court says migrant worker right also limited, cannot harm others
        
        Aid workers didn’t invade possessory right of owner à not a trespass
        
        o Most socially significant exception to the right to exclude: Civil Rights Act (1962)
      - D) Copyright Law
        o In constitution, there is only so long that you can exclude others from using your IP.
        
        o Goal is to promote public knowledge. Also exceptions for educational and charitable purposes.
      - E) Prescription
        o Easement / adverse possession

'Encroachment'

If someone encroaches (intrudes onto your property), you can enjoin the structure (get court to order it torn down)
- o Encroachment is trespass regardless of intent
Considerations from court
- o P’s willingness to cooperate (i.e. allowing D to come onto property to chip away at wall)
- o D good faith or bad faith – was D was acting without malice
  - Ex: CA Good Faith Improver Act
- o Look if P knew if encroachment was happening and then waited to bring notice until after structure/wall was completed.
  - “Clean Hands” principle
- Absolutist Approach (OLD)
  - o Pile v. Pedrick (SC Penn 1895): have no right to occupy land that does not belong to you – so must remove the wall (and should be done only on their land, not coming onto the other party’s land)
    - This is true even when unintentional intrusion onto P’s land and the wall resting on stone foundation is within the D’s property lines (still an encroachment; and can be enjoined)
  - Balance of Equities Approach (NEW)
    - o Golden Press, Inc. v. Rylands (1951): No injunction, but damages okay
      - 1. Good faith – presumptive
      - 2. Slight encroachment – 3 inches
      - 3. Interference – None on current use, no consideration of hypothetical future basement
      - 4. Relative hardship – Prop value only $55
    - o “Balance of equities” test: If good faith and slight intrusion, weigh hardship on D versus P land interference
      - If its continuous/intentional, usually enjoined. Want to deter future intruders.
      - If “de minimis” intrusion (minor, small cost to P), court will award damages
    - Only employ balance the equities approach to deny injunctions only when the original encroachment is innocent; good faith violator
      - o A bad faith violator – court agrees that injunctive relief against encroachment is appropriate
    - Ex Ante v. Ex Post Analysis
      - o Ex ante analysis = Look toward future, more strict. Injunction/auto damages to deter future intrusions.
        More utilitarian. Parties know to negotiate upfront.
      - o Ex post analysis = Retrospective. More popular. Easier to determine if its serious infringement. Less efficient.
    - Patent Owner (infringement on patent):
      - o eBay Inc. v. MercExchange (2006) – SCOTUS embraced Golden Press – injunctive relief may be granted, only if patent holder can show that relief is required by traditional equitable principles. Four-parts: (1) suffered irreparable injury, (2) remedies available at law (monetary damages) are inadequate to compensate, (3) considering balance of hardships, a remedy in equity (injunction) is warranted, and (4) public interest isn’t disserved by permanent injunction)
      - o This method getting popular (no regard for good/bad faith).
      - o Concern of rewarding firms that buy up patents.

'Nuisance'

Nuisance: interference with use and enjoyment of land caused by activity on neighboring land (noise, pollution)
- o Three qualities (Adams)
  - A) Intentional = know or should have known
  - B) Unreasonable
  - C) Substantial harm
- o Differs from trespass (invasion of land by large objects) – Jacque and Hinman
  - Trespass: protecting interest in possession of land
  - Nuisance: protecting the use and enjoyment of land
    - Nuisance = nontrespassory invasion of land
  - Nuisance liability turns on balancing the competing landowners’ interest
    - o TEST (Restatement of Torts § 827): when gravity of harm > social value of activity
      - Public nuisance: examination of reasonableness or unreasonableness of the use of property in relation to the particular locality
      - Private nuisance: any determination of liability must include examination of private use/enjoyment of the land seeking protection and nature of interference
        Private nuisance is limited to conduct that is intentional and unreasonable
      - Adams v. Cleveland-Cliffs Iron Company (App. Ct. Mich 1999)
        o Wants to protect traditional concept of nuisance and trespass as distinct sticks in bundle of property rights
        
        o Denies trespass recovery for indirect, intangible invasions of land.
        Problematic trend by other courts. Not every speck of dust should be considered trespass à Courts add requirement of “actual and substantial” injury à Necessitates balancing test à Too complicated
        
        o Law shouldn’t require landowner to justify exercise of right to exclusion

	Trespass	Nuisance
Right violated	Right to exclude	Right to quiet enjoyment
Recovery standard	Appreciable – Nominal dmgs even w/o proof of injury.	Substantial – proof of actual + substantial injury. No auto damages.
Balance considered	N/A	Unreasonable – Balance nuisance utility w/ social utility
Form of Entry/Form of Object	Direct or immediate entry. Physical or tangible.	Indirect via “intervening force” (wind or water). Intangible.

o Invasion implies intent = offender knew or reasonably should have known its invasion
o Intangible = dust (in meaningful sense), noise, vibrations
Other approaches for resolving nuisance disputes:
- o Determine threshold of harm
  - Ask whether D has committed some kind of invasion of P’s land that causes harm above a certain threshold level (“significant harm”)
- o Normal/proper use
  - Enforcing general understanding in relevant community of what constitutes “normal use”
  - Some uses will be offensive (and deemed nuisance, but not trespass) in some areas, but not in others
- o Absence of Spite
  - “Neighborliness” – spite fence is actionable nuisance – built for sole purpose of irritating neighbor
- o Timing – “Coming to Nuisance”
  - First use to be established is given a presumption of validity to a later, incompatible use)
- o Public interest of activity
  - Someone’s concurrence: Will it promote science?
- o Noninvasive nuisance
  - Depends on effect, whether Courts will accept
    - Courts usually accepting for depressing effect of funeral homes and graveyard
    - Not accepting for effect of identity of neighbor (ie black people) or purely aesthetic reason (ie ugly junkyard next door)
  - o Natural intrusions
    - Ex: tree on Ds property that grows roots or branches that extend into Ps land
    - Common law
      - Treats it as trespass
      - Limits P to self-help.
        o P can’t force D to fix it and can’t get damages from D if it falls and injures Ps land
      - Still common
    - Virginia law
      - Intrusion by tree (in suburban setting) is nuisance
      - Intruding tree can cause liability if “actual harm” and “unreasonable”
        o P can sue both for damages and injunctive relief against owner
      - Old Virginia Law = that was the old law, about it being “noxious”
      - New law = about roots, just needs to cause harm
    - Threshold of harm:
      - Dropping leaves and casting shade à no harm à no liability
      - Imminent harm or “noxious” vegetation à liability (Miller v. Schoene)
    - Comparison to water
      - Flooding caused artificially (ie from pond as “non-natural” use of land) = subject to liability
      - Natural flooding = “common enemy” doctrine = self-help precludes liability

Ways to Resolve Exclusion Dispute

A) Governance
- o Exclusion Strategy: decisions about resource use are delegated to an owner who acts as manager of resource
  - Owner decides who comes onto property, use of property, etc.
  - Trespass (Jacque) reflects exclusion strategy
- o Governance Strategy: focus on particular use of resources and prescribes particular rules about permitted and prohibited uses without regard to the other attributes of the resource
  - Tend to be used in situations where particular use of property are of heightened significance
  - Ostrom – fishing, commons
- B) #Coase Theorem
  - o Key idea
    - Optimization – Parties bargain to efficient outcome (don’t care about distribution of benefits; but rather that the most efficient outcome occurred). Rearrangements of rights will always take place if it would lead to an increase in the value of production
      - Doesn’t matter who has property rights. Property rights don’t matter.
    - Law should work to reduce these costs (or at least not get in the way)
    - Assumption = Market transactions are costless
  - o Weakness
    - Transaction costs get in the way of people getting to mutually beneficial outcomes
    - Hard to apply when bilateral monopoly! Best for many parties negotiating.
      - In bilateral monopoly, can have unequal bargaining power.
    - o Coase controversial claim: any conflict over resource is reciprocal (each party to dispute is imposing costs on the other party)
  - C) By Contract
    - o Contracts used to resolve property disputes (“Coasean Bargains” should be explored as alternatives to litigation b/c contractual rearrangement of rights may be cheaper and more satisfactory to all)
    - o Factors of high transaction costs:
      - Assembly problems
        Large number of parties (ex: Hinman)
        
        Holdout
        o Last party to be negotiated with has a lot of bargaining power (b/c deal with all other parties would be a waste if the deal with the last party falls through)
        
        Bilateral Monopoly
        Owner of property needs something that can be provided by only one other person or entity
        o Example: Jacques b/c only 1 seller and 1 buyer for the contested resource
        
        Might also arise as a result of minor building encroachments
        o Must identify potential assembly and bilateral monopoly problems before the client gets trapped in a situation that precludes any kind of Coasean bargaining.
        
        o How to determine equitable remedy for property violation?
        1) Is there violation of rights? Yes/No
        
        2) What’s the remedy? (Damages or Injunction?)

III. #POSSESSION''''

'Original Ownership''''

Three ways to establish original ownership
- o Acquisition and claim scope (first possession, customs)
- o Discovery
- o Creation

A) ACQUISTION AND SCOPE CLAIM
'#Wild Animals'
- Wild animals are unowned
  - o Impact on slavery
- Ownership of wild animals acquired by occupancy
  - o Minimum is mortally wounding or capturing it w/o ability to escape
  - o Max is physical possession
- Pierson v. Post (1805)
  - o Fox hunting. Post was in pursuit, Pierson killed it. On common land.
    - If it were on Post’s land, he’d have constructive possesion
  - o Pursuit does not give property right to pursuer. Must have actual possession.
    - First possessor
  - o New issue of law! Not covered by common law
    - Majority looks to Roman Law. Justinian
    - Ratione soli of common law insufficient. Only applies to game animals like deer.
  - o Majority (Tompkins) reasoning
    - Actual possession is clear rule à no dispute, maintains peace
    - Pursuit is too ambiguous of a signal à would lead to more litigation.
    - Ex-post ownership analysis
  - o Dissent (Livingstone) reasoning
    - More grounded in common practice
      1. Look at hunting customs. Seek advice of hunters (“arbitration of sportsmen”), b/c they know what’s commercially acceptable
    - More concerned with socially utilitarian rule
      1. Killing foxes is a social good.
        Note that this is BS. Notes show that fox hunting was for sport. Foxes weren’t major population.

Lockean philosophy = fruits of labor
1. Fine as long as “reasonable prospect” of catching animal
John Locke = FRUITS OF LABOR.
- o See: Pierson v. Post dissent, Ghen v. Rich, Green
- o Concept
  - Every person owns his own body and labor. When person mixes with some unclaimed thing, you get possession over it.
  - So long as expending labor leaves “enough and as good” for others to acquire and does not overclaim
- o Drawback = Locke didn’t consider resource scarcity. Big deal for US law!
First In Time Rule
- o See Pierson majority
- o Can lead to wasteful competitions and race to be first
- o Works best when clear winner emerges quickly b/c of special skills or relationship to resources
#Custom
- o May play a role in resolving disputes
- o Ghen v. Rich (1881)
  - Whale hunting. Ghen kills whale with special marker whale bomb. Finder (Ellis) supposed to turn it into owner for small collection of profit but instead sells it himself. Against custom.
  - Holding = Whaler gets ownership as long as reasonable act of appropriation.
  - Court allows custom to rule
    1. Economic concern
      1. Without possession upon killing, valuable whale industry would be destroyed.
    2. Close knit groups can devise and enforce norms amongst themselves to maximize their wealth = optimization
      1. For this specific case. Otherwise customs have potential to harm outside groups (not the case here, b/c finders compensated)
      2. Drawback – what if finder doesn’t know custom?
Pre-Possessory Interest
- o Popov v. Hayashi (2002)
  - Baseball considered property of home team. Abandoned once it enters stands, and becomes ownership of whoever catches it first (custom). Very valuable item.
  - Solomonic Approach
    1. Split the value of the ball between the two.
    2. Popov established pre-possessory interest by getting his hands on it. But Hayashi had full possession by end.
      1. Pre-possessory interest is superior to everyone else, except the one with possessory interest. Their interest is equal
      2. Govt wants to prevent wasteful race behavior.
    3. 'Open Access and the #Commons'
      - Commons = open for public use/consumption
      - Big idea: Property rights are not the perfect solution to resource scarcity
      - Garret Hardin', Tragedy of the Commons'
        o People rush to get economic benefit from commons. People distrusts others to use appropriately, so they overuse. Destroys environment as a result
        
        o Danger
        Wasteful effort
        
        Elimination of resource
        
        o Benefit gained by individual, but costs shared amongst everyone (externalities)
      - Elinor Ostrom', Governing the Commons'
        Solutions to Tragedy of Commons = coercion or cooperation
        o Privatization
        Robert Smith: Assign property rights. Align private incentive w/ resource maximization.
        
        Also see: Welch
        
        Drawback
        Politics – people may be unwilling to give up commons (e.g. oceans)
        
        If benefits differ, misuse might still occur
        
        o Leviathan
        Let central government control (ex: air pollution, fish)
        
        Drawbacks
        High bureaucratic set up costs
        
        High management costs
        
        Lack of information access, monitoring
        
        o Voluntary, self-negotiated binding contracts for cooperative strategy
        Drawbacks
        Weak contract-enforcement
        
        Can over/under estimate problem if setting it up for yourself
        
        Negotiation issues
        
        o Custom
        Somewhere between private-property and centralized
        
        Ex: Lottery rotation fishing system in Turkey
        Low cost – management left to the people, automatic monitoring
        
        No wasteful race – no fighting for fishing spot
        
        Anti-Commons Problem
        o Problem of property rights solution – if too many have rights, no one can use resource
        
        o Solutions: licensing, investing around, infringing, public disclosure, litigation
        
        Semi-commons
        o Resource subject to private exclusion rights for some uses, open access for others

'Other Examples of First Possession'
- #Fishing = Commons
  - o In US, solved by govt regulation.
  - o Scientific panel ran the numbers. Determined sustainable quota for all fishermen. Fishermen get right to fish that amount!
    - Lower incentive to overfish, b/c regulated by govt
    - Lower incentive to create overfishing tech
    - Higher incentive for fishermen to monitor others
  - #Oil and gas = Commons
    - o Fugitive Resource
    - o Challenge
      - Hard to impose property lines b/c oil moves freely, not fixed
      - Rule of first capture: People can pump as much as they want à over pumping incentive
    - o Solution
      - Each party has right to drill in their “column of space” = correlative rights
        “Slant drilling” = trespass
      - In US, govt acts as unitary owner and forces reasonable usage.
    - o Reinjecting gas makes the oil ownerless again, no trespass (Hammonds v. Central Kentucky / Lone Star Gas)
  - Abandoned or Lost Property
    - o Lost property = you may not have relinquished your ownership, but the first person who comes along / takes possession of the item can claim a kind of qualified ownership
      - Finder has superior right to the thing relative to everyone else in the world, except the true owner.
    - o Abandoned Property = Owner manifests intent to relinquish all future ownership claims (can be implicit)
  - Sunken Vessel
    - o Law of maritime gives ownership to 1st possessor, but only if
      - A) Vessel was abandoned (and unclaimed by owner or insurer)
        Abandoned = Owner manifests intention to relinquish claim
      - B) Wrecked. Salvor has right of possession and protection from other salvor interference if:
        Due diligence, capable of salvaging
        
        Give notice of intent to other salvors
      - o Eads v. Brazelton (Ark. 1861)
        Brazelton lsot possession claim on wrecked vessel b/c wasn’t exerting due dillgigence. Exceeded reasonable recovery time.
      - o Columbus American Discovery Group (VA 1989)
        Telepossession allowed. If you can show imaging of vessel, locating it, ability to recover via robots, and present intent to control.
      - Treasure Troves
        o In England, all treasure troves go to crown.
        
        o In US, falls to law of finders. If you are first finder, you get possession as long as treasure abandoned and not in area subject to National Register of Historic Places (Abandoned Shipwreck Act)
      - Climate Change
        o Unfeasible, but could give conveyance of ozone to one authority to regulate
        
        o Tax could help bad actors internalize the cost
B) #DISCOVERY

Original title to property can be established through discovery
- o First possession = Actual possession
- o Discovery = First to find/lay claim. Need not occupy to own.
Constitution considered to give Fed US power to manage public lands. Art IV.3 Property clause.
History
- o Federal Public Domain – US states gave lands to Fed in order to pay off debts from Revolutionary War
- o Land Ordinance of 1785 = Jefferson and committee surveys lots of land in the US. Uses new surveying method.
- o Old: Fed public policy to get rid of land
  - First sold it at very lone prices.
    - Squatters adopted tactic for securing legal title to the land they occupied
      - o Banded together to form claims associations (designed to prevent competitive bidding at public land sales; to ensure that local settlers could purchase the land of their choosing at the minimum price)
    - Then Homestead Act – give land if you settle it
      - Goal: Balance surplus labor in East Coast cities. Preston Greeley “go west young man”
      - Also national defense against Mexicans and Indians
    - Based on US concept of property
      - Abundance of land = everyone should own land
    - o NEW: Fed should preserve land. Beginning in late 19^th
      - 1) Consider public land valuable – Nature, first public park was Yosemite
      - 2) Govt would be better steward of national parks than private companies
      - 3) Desert land was hard to attract people
    - o Fed owns 30% of US land mass.
  - Johnson v. M’Intosh (1823):
    - o United States can take title from Indian tribes via treaty or conquest
      - Individuals cannot. Must buy from govt.'
        Idea: More fair to Indians. Maybe not, because no competition on prices to trade land.'
      - English discovered. Theory that discovering sovereign could do whatever they please.
    - o Ownership is being shown by purchasing it (identify owners by who they received ownership from through a transaction)
      - Discovery of land brings with it the right to obtain title either by purchase or conquest
        Distinction b/w dominion (based on discovery) and Indian occupancy (based on possession).
      - Under Lockean Theory: Occupants need to make the land better
    - o No property rights for Indians
      - Under conquer law, property right given unless conquered people are violent (savages).
      - Also racist idea that Indians didn’t understand property. (History shows they had usufructory concepts of property rights)

C) #CREATION

Applies primarily to property in the form of information
- o Information property is intangible. Different from tangible property b/c
  - Zero post-production costs (ie copying/reproducing)
  - Nonrival good (use by one consumer doesn’t diminish other consumers use)
- GOAL: Incentivize creation of new info
- OLD v. NEW protection of IP Rights
  - o Old: Constitution. Protects to promote science and arts, but only for limited time! Then out to public.
  - o Modern: Governed by statutory regimes (patent, copyright, trademark). IP much more protected.
- INS v. Associated Press (1918):
  - o FACTS:
    - D is using telegraph to get news collected by P and posted in NY out to rest of country first.
  - o News is quasi-property: protecting interest from competitors for a certain amount of time (so the party investing in getting the information can get the benefit of their work/collecting news before competitors)
    - Fresh/hot news is protected
      - Limited: (a) temporary (b) only against competitors
      - “Hot News” Doctrine – In old law, ideas (news) couldn’t be copyrighted, only the medium/word could be copyrighted. So judge-made law covered. Today ideas can be copyrighted.
    - Publication =/= abandonment
    - P putting in a high cost. D just mooching.
  - o Brandeis also mentions legislature should decide, because they’re more equipped for fact analysis.
  - o ISSUE: Conflict about Goal – Economic industry v. spread ideas
    - 1) Lockean Fairness – He who puts in effort should get reward. (Majority)
    - 2) Economic value – Want to maintain industry (Majority)
      - Similar to Ghen, important industry. This protection incentivizes people to continue to invest and collect the news.
    - 3) Qualified right to exclude. No right to exclude for uncopyrighted combo of words (Holmes). No breach of contract (Brandeis)
    - 4) Free exchange of ideas – Doesn’t want property right to limit this. (Brandeis)
  - Developments in Hot News
    - o NBA v. Motorola: Motorola created a pager that gave NBA sports updates; NBA sued w/“hot news”
      - Hot News Doctrine still exists but is shrunken down; found that what Motorola was doing is reporting on what was going on in the game (a reporter); so not infringing on the hot news (would be watching game on TV and reporting the information)
    - o Barclay’s (2^nd 2011) – Barclay’s sues aggregators for serving its investors with tips. Court says its not Hot News. Instead, News aggregator more like a reporter (not a free-rider) by taking information and reporting it out; also giving credit to the person

'NOT Original Ownership''''

Transfer of title.

Right of Possession
Accession
Sequential Possession Issues

A) Right of Possession

Haslem v. Lockwood (CT, 1871)
- o FACTS:
  - Manure case. Guy starts to pile manure up on side of public highway (effort). Leaves for night without sign. D finishes and takes it home.
- o Conversion = Can gain (limited) interest in abandoned property by (1) increasing value, (2) changing its nature, and (3) through your own labor/expense/time
- o P found worthless property and increased its value by changing its nature. So he gets reasonable time to remove property.
  - P doesn’t have full ownership. But superior to D. Would maybe not be superior to city or horse owner.
  - Based on Lockean ideal. Protecting “pre-ownership” rights (like Popov or Ghen)
  - Reasonable time is like Eads v. Brazelton
  - Horse poop abandoned
- What counts as possession based heavily on customs and social norms

B) #Accession''''

'

Principle of Accession = Owner of larger thing is owner of the closely related smaller thing
Accession tells us what a legal “thing” is
- o can also be viewed as an acquisition principle – ownership of some unclaimed or contested resource is assigned to the owner of some other resource that has a particularly prominent relationship to the unclaimed or contested resource.
Ex: Owning land means you own minerals on surface, doctrine of fixtures (if you attach item to house, it goes w/ sale)
Advantages
- o Identifies winner without having to do anything
- o Doesn’t encourage wasteful racing behavior associated with 1st possession, discovery and creation
- o Enhances incentive to improve property

'Doctrine of #Increase'

General rule: Offspring of animal belongs to owner of the mother
- o Not a standard. No exceptions.
Carruth v. Easterling (Miss. 1963) – P’s cattle wandered onto D’s farm and gave birth. Calf belongs to P.
Rationale?
- o Pragmatic – Maternity identification. Mother can nurture child.
- o Psychological – Closeness of mother and child?

'Doctrine of #Accession'

Doctrine of accession: applies when someone mistakenly takes up a physical object that belongs to someone else and transforms it through her labor into a fundamentally different object
Whetherbee v. Green (Sup Co Mich 1871)
- o FACTS:
  - Action for replevin – Wants wood back, in form of hoops.
  - D cuts down timber thinking hes on the right plot. Then turns it into valuable hoops.
- o HOLDING
  - Innocent converter who mixes labor to convert object (increasing value) has a right to the newly transformed object. However, P is due restitution.
    - If labor is insignificant and original object prominent – title stays with original owner of the object
    - If labor is prominent and original object is insignificant – title passes to the improver (and improver pays the original owner damages equal to the value of original object)
- o Reasoning
  - Normally no intent element for trespass. But there is for appropriation.
    - P must show good faith innocence and value added.
  - Lockean
- Doctrine of Confusion = where someone mixes things up, but you can’t get back because the item was mixed in with other stuff à P must show value lost, and then gets damages (but not the item).

'Doctrine of #Accretion'

If a water body that serves as the boundary line between riparian property owners experiences rapid changes on one side and gradual changes on the other, the boundary line is flexible under the law of accretion rather than fixed under the law of avulsion
- o Riparian: land bordering on any type of water (river, stream, lakes, oceans)
  - Littoral: more properly to land bordering the ocean or a major inland sea
- Nebraska v. Iowa (1892)
  - o When changes to water body occur gradually, the boundary line adjusts with the water body b/c riparian landowner is subject to the loss/gain of land through the same means
    - Accretion: change is gradual, then boundary line adjusts with water
      - Gradual change is considered to be fair b/c gain now, lose later
    - o But, when there is a sudden and visible change in water body – the boundary line remains fixed in the center of the old channel
      - Avulsion: change is sudden, then boundary line remains fixed
    - o Reasoning
      - Accretion easier to prove – technology simpler back then
      - Avulsion – you’d have to cut around town
    - Reliction, Accretion, and Erosion are all governed by the same rule
      - o Erosion: gradual and imperceptible wearing away of land (bordering on water) by natural action of the elements (example: erosion of beaches)
      - o Reliction: land that has been covered by water, but which has been uncovered by the imperceptible recession of the water.

C) #Sequential Possession Issues''''

If multiple people serially claim property on theory other than purchase or gift from the prior owner?
- o Relativity of title and the rejection of the jus tertii defense (defense based on rights of 3rd parties)
  - Reasoning
    - Procedural – Would get too complicated to identify ownership of third party (especially before registration acts existed) and common-law litigation focused n just two parties
    - Substantive – Want to protect peaceful possession. If you violate another’s right (even superior right, not absolute), should be punished
      - o See: Jeffries v. The Great Western Railway (1856)
    - #Finders v. Possessor Rights
      - o Armony v. Delamirie (1722): (dispute b/w a finder and someone in possession; but neither is “true owner”)
        Finder has superior rights to possession over everyone else, except the true owner
        
        Reasoning
        Favor finders b/c want to encourage finders to turn in found object (if court found for party in possession, then finders wouldn’t have incentive to bring forward object)
        o Modern application:
        Japanese law requires turning found items into police. You get finder fee or item (if not recovered in 6 months.
        
        NY has similar law.
        
        Japan law very successful, NY law is not. Importance of culture = Japanese schoolchildren taught to be honest finders.
        
        Very important to protect finders rights. Even if its under suspicious circumstances (did boy steal the gem?)
        
        o Finder =/= first possessor (Pierson)
        1) Finder doesn’t become owner on possession. Subordinate to TO.
        
        2) B/c Finder has subordinate rights, also has duties. Acts as Bailor. Try to return it.
        
        Finder v. Finder Rights:
        o Clark v. Maloney (1840):
        If lost property has been found on separate occasions by various parties who are not the original owner of the property, the first finder has superior title to the 2nd finder.
        
        Reasoning
        First in time rule
        
        Court doesn’t want to incentivize bad behavior (theft)
        
        Converter v. Converter Rights:
        o Anderson v. Gouldberg (1892):
        P wrongly thought he had consent of and owner, so took timber. D then converted them (also innocently). First converter has superior possession.
        
        You (D) can’t defend your position by saying opponent is not real owner, so let me hold it until 3^rd party TO emerges
        
        Reasoning
        Purpose: protecting / preventing someone from taking away from the 1st finder/converter
        
        But, when true owner is known – Converter 2 can defeat an action in trover by Converter 1 by showing that the true owner of the logs was C (Russell v. Hill)
        
        4 Categories of Found Property: abandoned property, lost property, mislaid property, treasure trove → right to property depends on the category of it:
        o Benjamin v. Linder Aviation (1995):
        Abandoned: owner no longer wants to possess it – owner intends to abandon it and has voluntarily relinquished all right, title, interest in property
        Belongs to the finder against all others (including the original owner)
        
        Lost: owner unintentionally and involuntarily parts with its possession and doesn’t know where it is (must be that owner parts with it involuntarily)
        
        Mislaid: owner voluntarily puts it in a certain place and then overlooks/forgets where the property is (not lost property b/c owner voluntarily and intentionally places the property in the location where it is eventually found)
        Finder acquires no rights to the property; possession belongs to the owner of the premises upon which the property is found, against all people other than the true owner (true owner has the highest right over mislaid property)
        
        Treasure Trove: must have been hidden for a length of time (that owner is dead or undiscoverable); know the owner isn’t coming back b/c it has been so long
        Belongs to the finder against all but the true owner
        
        Holding
        mechanic finds money in the wing of an airplane
        
        the court says that the money was not abandoned because who would abandon money.
        
        the court also says that treasure trove does not apply here because the money has not been hidden long enough
        
        It must have been mislaid. And property on which it is found is the plane, not the hanger.
        
        o True owner has highest right over mislaid, lost, and treasure trover; but not of abandoned property
        
        Duty of True Owner
        o Georgia O’Keefe
        FACTS:
        Paintings were stolen in 1946. Years later is appeared for sale in art gallery (D). 1976, P discovers that D had bought the paintings from Frank who had acquired them from his father. Frank claims continuous possession for over 30 years through his father and claims title by adverse possession. D concedes the paintings stolen.
        
        Regularly, the statute of limitations starts from when it is stolen – but the courts thought this was unfair – so they have the discovery rule – which says that the statute doesn’t start so long as you are making a reasonable effort to find it (such as listing your work on the police list.) It starts once you have found it or could have with reasonable effort.
        
        Had the paintings been acquired through Stieglitz (who wrongfully sold the paintings), the title claim would be voidable. There has to be an honest fair sale somewhere along the line to defeat O’Keefe’s title. You can’t change voidable title into good title through inheritance or gift, it has to be through bonafide purchase.
        
        But if it is stolen, the bonafide purchaser rule does not apply. A thief cannot transfer good title.
        
        o
        
        Goddard v. Winchell
        o Owner of a meteorite vests in the owner of the real property on which it lands
        
        o P is the owner (P’s argument that the meteorite is now embedded in the land, became part of the land/earth; so he is the owner)
        
        o Court rejected D’s argument that meteorite is unowned thing (he is a finder and used his labor to dig it out of the ground)

	ABANDONED PROPERTY	LOST PROPERTY	MISLAID	TREASURE TROVE
ORIGINAL OWNER	NONE	SUPERIOR RIGHT	SUPERIOR RIGHT	DEAD?
LANDOWNER	NONE	NONE	RIGHT TO HOLDBailee for O	NO RIGHT
FINDER	SUPERIOR RIGHT	RIGHT TO POSSESSActs as Bailee for O	NO RIGHT	SUPERIOR RIGHT

'ADVERSE POSSESSION #AP'

No transfer of title

Definition – when an owner fails to exercise his right to exclude and the statute of limitations runs out, the adverse possessor gains a new title.
- o Gives rise to new title– there are no damages (like in encroachment).
  - NOT A TITLE TRANSFER! Just destroys one title and creates a new one.
    - No voluntary conveyance à No transfer à So privity does not extend.
    - Tacking okay for privity, if there is transfer.
  - Elements = “OCEAN” Ownership, Continual, Exclusive, Adverse (acting under the claim of right), Notorious/Open
    - o Ownership
      - Possessing as if owner
      - Actual possession does not require actual occupation, cultivation or residence; it is sufficient that the AP makes public acts of ownership and uses it as if he owned it.
        Different from prescriptive easement – Just need to use for specific purpose beyond SoL
      - Color of Title – Record suggesting title, signifying good faith belief it was AP’s.
        Some states require, most don’t.
        
        Actual AP in part of parcel of defective deed may give rise to constructive AP in whole parcel
      - Claim of Right – Intent to possess something as one’s own. Alternative to color of title in some states.
    - o Continual
      - For SoL,
      - Tacking allowed (Howard v. Kunto)
    - o Exclusive
      - AP must be the only one using land in such a way
    - o Adverse
      - TO doesn’t give permission
      - Adverse to a claim of right – three approaches: (Carpenter v. Ruperto)
        Good Faith rule – AP must have acted in good faith that he has a legal right to the property.
        o Applied by Washington state.
        
        Maine Rule (minority) – AP must have been acting in bad faith.
        
        Connecticut Rule (majority) – AP's subjective state of mind doesn't matter; only matters that AP didn't have TO's permission.
    - o Notorious/Open = Everyone knows what’s happening. Notice not always required (in US, but it is in England and some states (including
  - Government Lands
    - o Presumption that AP does not apply to govt lands.
  - Purpose of Adverse Possession:
    - o (1) Loss aversion/endowment effect – psychological/personhood argument. Person develops gradual attachment to land, AP’s might be greater than TO’s. Holmes belief.
    - o (2) TO as failed gatekeeper – Penalty designed to discourage true owners from “sleeping on their rights.” Make best use of land.
    - o (3) Low transaction costs – for determining title to assets that last for a long time (like land)
  - Real Property' (land)'
    - o Scott v. Anderson-Tully (Missouri, 2015)
      - FACTS:
        Anderson (D) used portion of land of Scott (P). Put up blue fence that everyone recognized. Used that land to cut timber and give out hunting licenses – typical usage of such an owner.
        
        10 year SoL
      - Holding: P won it.
      - Reasoning:
        Followed test. Additional element of peaceful use. Also maintenance of fence serves as “flag waiving” (notorious), but must have some additional use besides just fence.
        
        Doctrine of Agreed Boundaries – When person has tacit consent of TO. Might destroy AP, but not case here. D never sought permission.
      - o Howard v. Kunto (Washington, 1970)
        FACTS:
        Kuntos purchased house from predecessor, sat on P’s lot by mistake. P purchased that title, but P’s predecessors never asserted right.
        
        Color of Title case. Tacking allowed.
        
        SoL = 10 year
        
        Holding
        Occupancy for summer months for SoL w/ tacking + continued improvement = continuous possession = AP
        o Continuous use need only be as normal for owners. Beach = summer use normal.
        
        Privity via “reasonable connection” of tacking.
        
        Good faith color of title allowed.
        
        o SoL
        Begins when “action accrues”à when trespass first occurred
        
        AP vest property right in the encroacher
        
        TO can bring suit anytime in the SoL
        
        Personal Property (chattel)
        o SoL
        NJ Rule (discovery rule) = cause of action will not accrue until the injured party discovers (know or should have known) facts which form the basis of a cause of action.
        Problem: There was no registry system for art. TO can know item is missing, but can’t bring suit if they don’t know who has it.
        
        NY Rule (demand rule) = for a good faith purchaser, when the TO’s demand return of the property was denied.
        
        NY Conversion Rule = for a bad faith converter, when the property was originally taken, regardless of TO’s knowledge.
        Seems illogical = because essentially helping the thief with SoL running
o O’Keefe v. Snyder (NJ, 1980)
- FACTS:
  - Three small ininsured paintings of O’Keefe stolen from NY gallery in 1946.
  - Def claims he bought from Frank in 1975. Frank claims his father owned it from 1941. Bona fide purchase.
  - P didn’t report theft until 1972. Discovers them in 1975 in NY gallery, demanded return and denied. Brings suit.
  - O’Keefe sues for replevin. Alleges she is TO. Def claims AP and 6 yr statute of limits run out.
- Court finds middle ground. Discovery rule,but adds on that you need to know or should know who to sue.
  - But this implies due diligence standard on P. Remands to determine.
- Reasoning
  - Stolen paintings = no title regardlss of good faith. Did Frank have “voidable title” thereby? But UCC allows transfer of voidable title to become good title if sold to good faith buyer
  - When did statute of limitation begin. In NY, not until refusal of demand for return (1976). In NJ, discovery rule.
  - Discovery rule is good. Shifts emphasis from conduct of possessor to conduct of owner. AP doesn’t matter, but TO must act with due dillegence. Should also encourage good faith purchases from legit art dealers, since illegit ones will be returned via TO discovery.
- UCC
  - o Codes about transfers and sale. Adopted by states as law.
  - o Article II, on transfers of title
    - Purchaser gets title that seller had (thief doesn’t get title!)
      - Exception: Purchaser in good faith gets good title when in reasonable place of business.
    - o Bona Fide Purchase: when you buy something from someone who doesn’t have good title
      - But if seller had possession of good from owner, he can give good title to a bona fide purchaser
    - Replevin v.

IV. #PERSONHOOD

Overview

Some things too personal to be property
Things close to human identity – law is reluctant to treat as property
Law acknowledges the authority of all persons to control the destiny of their body parts
Demsetz''''
- o Property rights emerge when resource gains value via new technology and new market'
  - You don’t need property rights in resource if there’s no high demand (b/c no value)'
- o Demand spurs property rights'
- o Property rights emerge when benefits > costs'
  - At point which more profitable to internalize externalities (ie don’t overhunt on your land)'
- o Ex: Indians in America v. Canada'
Radin''''
- o Personal property versus fungible (utilitarian) property'
  - Personal = Pain of loss can’t be relieved by replacement'
  - Ex of personal property: Wedding ring'
- o Two theories underlying this'
  - Lockean: body is property, and personhood based on body'
  - Continuance: Personhood based on continuance, including future plans'
- o Inalienability rule = rules that prohibit transfer of entitlement'
  - '

'Slavery'

Old Law = State v. Mann
- o Slave has no status as person, so no wrong done against them
- o Hirer (who shot slave) may be liable to owner for permanent injury done to slave (as property)
- o Formalism case. Treats case as bailment issue
- o Policy concern = court ruling for slave’s rights might encourage them to stand up for themselves
New law
- o People are not a permissible subject of property rights (13^th Amendment)
  - Anti-commodification principle
- o Indentured servitude is illegal

'Property and Human Body'

Moore v. Regents of UCLA (1990)
- o FACTS:
  - Guy has spleen removed for procedure. Then doc uses his rare cell to generate new cell line. He sues for conversion.
- o Holding
  - Once cell leaves patient’s body, they are no longer patient’s property
  - Physician duty to disclose personal interests that might influence professional judgment à patients can shop around
- o Demsetz = new technology (gene research) spurs property right discussion!
  - Cost-benefit analysis for new property right
  - Costs = research opportunities benefit = value of personhood
- o Reasoning
  - Ignores publicity right. Regular body =/= cultivated commercial image
  - Patent is distinct from Moore’s cell. Docs put their “ingenuity” into cell to create patented cell line. The patent is worth money, not Moore’s cell.
  - BIG POLICY CONCERN – Balance of Arabian and Mosk
    - If we rule for P, then all doctors will have to do Due Dillegence to determine that the cells they’re working with were acquired legally. è Would hamper science!
    - Judicial Restraint / Legislative deference – Court refuses to make evaluation for personhood value. Leaves the property right decision to legislature.
  - o Arabian Concurrence
    - Sanctity of human body. Don’t let commodity market decide personhood.
    - Potential for exploitation of poor ppl if we allow people to profit off their bodies.
  - o Mosk Dissent
    - If cells like organs à can be legally sold for research purposes à constitute property à protect from conversion
    - Mosk’s main interest in encouraging scientific research
  - o Accession? Conversion? Doctor’s mixed their labor, but under bad faith.
- After Moore
  - o Hecht v. Superior Court (CA 1993):
    - Frozen sperm cells of deceased can be given to others. When not, subject to juris and control of court
    - Moore did not involve gametic (reporductory) material, where original producer has strong interest
    - Gametic cells = strong owner inter à property’
  - o Newman (9^th Cir 2002)
    - California law imposes duty on next of kin to arrange for body of deceased. à “quasi-property” right of next of kin à parents of deceased kids can keep corneas (despite use for transplants for others)
    - Court upheld violation of DP b/c parents entitled to notice when their deceased kids eyes are used.
  - o Conroy v. Regents of UCLA (CA 2009)
    - Quasi-prop rights of next of kin not great à Orgs receiving donated bodies do not have duty to dispose in decent manner.
- Penner’s “Separation Thesis:”
  - Only items that are thought of as separate from their owners can be things and hence objects of property (the right to a thing);
    - If someone cuts a lock of your hair while you sleep, violation of person (tort)
    - If someone took lock of hair after you cut it off, theft.
Property and Human Body is still unsettled': court willing to attach property to body parts for procedural; but not really after removal. '
Flynn v. Holder (CA 2012)
- o FACTS:
  - CA nonprofit has new way to get bone marrow. Offers scholarship for black people to donate their marrow (which is rare to match, and big need for black donors). GGS sues saying its paying for body part.
- o HOLDING:
  - In new method, marrow is really extracted from blood. So it’s fine; no different than blood donation.
- o Policy and philosophical concerns about organ sales
  - Policy concerns: if donors are paid, then
    - 1) Induce poor people to sell organs
    - 2) Extortion of recipients with “money or your life” offers
    - 3) Encourage black market of forced sales
    - 4) Incentivize lying donors – degrade supply
  - Philosophical concerns
    - People have instinctive revulsion at denial of bodily integrity – and most particularly commodification of such conduct (sale of one’s body tissue)

'Right of Publicity'

Right of publicity has most of the attributes of property
A party may not deliberately imitate the distinctive voice of a professional singer in order to sell a product (protective in commercial settings)
- o Midler v. Ford Motor Company (9^th 1988)
  - Celebrity identities / persona exist and has value; Ford is trying to take advantage of it
  - P has protection of her voice; and another party may not deliberately imitate the distinctive voice of a professional singer in order to sell a product
  - The human voice is one of the most palpable ways identity is manifested, so impersonating it is piracy
    - Midler has right to exclude on this property!
  - Attribute of a person if it can uniquely identify that specific person
- o Midler is analogous to INS – intangible, commercial, nonrival (everyone can sing/read)
Right of publicity doesn’t cover imitation of identity w/o consent for entertainment or education (Fair Use Doctrine)
Parody
- o White v. Samsung (9^th Cir 1993) – Robot flipping panels came close enough to woman on Wheel of Fortune to block it.
  - Dissent by Kozinksi – parody creates something new!
- o Generally, parody is okay
Publicity rights can be inherited after death. See MLK and Elvis.

V. #PUBLIC RESOURCES (Public Rights; Public Trust)

Overview

Some things too public to be property

'PUBLIC RIGHTS''''
A) Public Trust Doctrine

Public Trust Doctrine prevents legislature from granting a private corporation title to submerged lands held in trust ofr public
- o Illinois Central RR v. Illinois (1892)
  - If govt conveys land to private party, they cannot just take it back. But can under the 5^th Amend (w/ JC)
    - Public trust doctrine – Making sea open to everyone for travel (subject to regulation)
    - Cannot give up public trust – so state can take it back
  - Origins of PTD
    - From Rome. Adopted by English common law (covers hunting, fishing, navigation, high tide lands)
  - Policy concerns
    - Monopoly – Giving access to one corp would put too much power in one company
    - Corruption of legislature – Opinion indicates that the Legis somehow changed Act to give control to corporation, very suspicious
  - The state has an affirmative duty to take into account the public trust in the planning and allocation of water resources, and to protect the public trust use whenever feasible.
    - o National Audubon Society v. Superior Court (Cal 1983)
      - Diversion of streams previously flowing into Mono Lake by the Department of Water and Power for the City of Los Angeles. Four of the five streams, which flow into Mono Lake were diverted and the lake is diminished in size and has been impacted ecologically.
    - Public Trust in Contemporary Law – Professor Sax: transformed the public trust from a doctrine about public access to commercial navigation, into a doctrine about preservation of natural resource
      - o Arguing that doctrine could be employed as an effective tool for environmental protection; more concerned with developing new forms of public participation and judicial oversight to act as a counterweight to capture of state and local legislatures by developers
    - Juliana v. United States: public trust interest in the atmosphere; government failing to control climate change is in violation of public trust
      - o In November 2016 – Oregon held there is Federal Public Trust in the Atmosphere; environmentalist could sue government under public trust doctrine (but Prof thinks this is unlikely, but environmentalist have made strides)
      - o Cert denied!
    - CA recently ruled that PTD limit usage of ground water when it connects to public navigable waters.

B) Purprestures

Encroachments by private persons on navigable waterways or public highways
In common law, they were controlled by public nuisance action, not trespass
- o Originally were criminal action, but later on injunctions were allowed by Crown. Treated very strictly in English history
- o Continued in American law – Am. Jur. classifies purprestures as constituting a “public nuisance per se”
Dry Sand Area Litigation:
- o State of Oregon ex rel. Thornton v. Hay (1969)
  - Public trust historically didn’t apply to beach (dry sand area)
  - Court says public can use dry-sand area to access public trust (water), but using doctrine of custom!
    - Public value outweighs private value – but cant come out and say that – so court kind of does it through doctrine of custom (saying ownership was always subject to public interest)
    - Elements of Custom: (1) must be ancient, (2) right be exercised without interruption, (3) peaceable and free from dispute, (4) reasonable, (5) certainty, (6) custom is obligatory, (7) custom not repugnant/inconsistent with other customers or laws
  - Didn’t go with prescriptive easement
    - Would have taken too long à carve out each specific path (thing Warsaw)
  - Law does not preclude creation of prescriptive easement in beach land for public recreation
    - So now PTD extended! From commercial to recreation as well
  - o Public Beaches
    - Most commonly contested ground for claims that property is inherently public and cannot be subject to private exclusion rights
      - States are divided on interpretation – Not uniform or certain!
        o Some states use public trust doctrine to claim all or party of dry sand beach is inherently public property
        
        o FL, TX, and HI follow the OR model
      - Overall trend is toward greater public rights or open access to beaches
        o Explained by Demsetz – new technology allows clear boundaries in dry land to finally be established
      - Carol Rose:
        inherent public character of beach; people gather at beaches (social/public gathering); some kinds of property should be open to the public (certain kinds of property ought to be public)
        o Some goods too public to be private
        
        Beaches cases employ one of three theoretical bases:
        Public Trust Theory: to the effect that the public has always rights of access to the property in question, and that any private rights are subordinate to the public’s trust rights
        o Least subject to legislative override
        
        Public Prescriptive Theory: by which a period of public usage gives rise to an implied grant or gift from private owners
        o Probably subject to override, but govt needs to condemn and/or pay JC
        
        Theory of Custom: where the public asserts ownership of property under some claim so ancient that it antedates any memory to the contrary
        o Property doctrine most subject to legislative override
        
        o Is beach custom like AdPo
        No, custom is ex post rule – depends on length of time
        
        Ghen based on popular, current custom. In AP, not popular, people just possess.

C) NAVIGATION SERVITUDE

Navigable Waters
- o US can take any action regardless of state or private rights to enforce public’s right to free use of waterways for transportation
  - US does not need to compensate
- o Longest historical claim to something being inherently public
  - Under Commerce Clause, and enforced by judicial history (Gibbons v. Ogden)
  - Interest of US to be legally superior to private rights in case of water navigation
    - Benefits commerce
  - Navigable Airspace
    - o Same concept. See United State v. Causby – navigable airspace is in the public domain!
  - Servitude = non-possessory interest in land

'WATER''''

Overview

Water rights have aspects of both private and public rights; open to individual appropriate and subject to correlative duties to other users
Water in a surface stream: 2 different systems: riparian rights and prior appropriation
Diffuse surface water is very different, considered undesirable (“common enemy”)
Water is unique
- o Necessary for life
- o Fugitive – constantly moving
- o Renewable
- o Aspects of both private and public rights; open to individual appropriate and subject to correlative duties to other users
- o Not equally distributed (like air)
- o Hard to manage when scare or too abundant

A) Watercourses (Surface Water)

Riparian system

American law favors Reasonable Use Theory
- o English law goes for Natural Flow Theory – each riparian owner could prevent any diversion of the natural flow of a river/stream by an upstream riparian owner
  - Equal usufructory rights
  - Important to protect overall river health in an agrarian society
  - Similar to trespass
- o Reasonableness factors
  - 1) Is upstream user being wasteful? What purpose are they using for?
  - 2) What’s the value to upstream user?
  - 3) Whats the harm to downstream user?
- Upstream riparian landowner may not divert all stream water away from a downstream riparian landowner, if the diversion is for nonessential activities
  - o Evans v. Merriweather (Illinois 1842)
    - FACTS:
      - Evans is upstream, but Merriweather predecessors are first in time. Steam mills on river. Drought, so both can’t use. Evans diverts water for his mill, so Merriweather’s mill is limited in use.
    - No one owns the water – but have rights to use the water
    - Reasonable use doctrine – Riparian landowners can use water, if diversion does only limited injury to other riparian landowners
      - Similar to nuisance
        o Restatement (Second) Torts § 850(A): reasonable should consider the purpose of the use, its suitability to the water course, the economic and social values at stake, the harm caused, possible accommodation techniques, the protection of existing investments, the ability of adversely affected riparian’s to bear the loss, and justice
      - To determine whether diversion of water is reasonable:
        o Natural wants: domestic purposes (water for livestock)
        
        o Artificial wants: use for nondomestic purposes (irrigation or manufactured)
      - Holding: When water supply is small (b/c of drought) and doesn’t supply more than sufficient to answer the natural wants of different proprietors living on it, none of them can use it for artificial wants (irrigation or manufacturers)
        Someone can use all water if satisfying their natural needs
      - Regulated Riparian Regimes: states do this – legislature to do on going estimates of quality/quantity of water, and to divert the water you need a permit (has become more scientific / bureaucratic)
        o Core principle = responsible sharing
      - Riparian rights run with the land and cannot be severed
        o Riparian owner A cannot sell riparian rights to nonriparian owner B
        
        o Can get around this by “bowling alley parcels” – Riparian owner just sells small strip of land to nonriparian owner

Prior Appropriation System

The first party to put water to productive use gains enforceable property rights in the quantity of water used, even if the water is put to use on land in a different watershed
- o Coffin v. Left Hand Ditch Company (Colorado 1882): holding that prior appropriation permits water to be served from riparian land and even transported into another watershed.
  - Prior appropriation (“Colorado doctrine”): first party that diverts water for beneficial use has rights; this right is good against everyone who comes after them (first in time, first in right)
    - Doesn’t matter if the first party is riparian or not.
    - only beneficial uses of appropriated water are permitted
    - Unambiguously permits the first appropriator to take all of the water in the stream
    - Must be continuous – negative incentive to keep using water (even if you don’t need it)
    - No sale of water to third party if it would harm downstream users
  - Today – prior appropriation regimes generally allow sales of water rights unless the sale would impose unwanted effects on 3rd parties (such as downstream users of the return flow)
  - Eastern Waters: Evans v Merriweather (reasonable use)
  - Western Waters: Coffin v. Left Hand Ditch (prior appropriation = first user to make beneficial use of it)
    - o Demsetzian – property rights emerged with move westward. West is arid and need irrigation to grow crops. Market for water as a property right.
    - o Incentivizes fast water use for economic use, undermines environmental use
      - Instream uses (recreation (rafting, fishing, etc)) = Today, enviro groups have gotten CA state to uphold environmentally friendly water use as beneficial to state, rather than purely recreational

B) Ground Water

Groundwater is much more widely distributed than surface water; used mostly in agriculture (95% of drinking water)
Problem with groundwater: don’t know where it is, until above surface
Competing doctrines
- o Correlative rights doctrine (use just below your land)
  - Too complicated in practice (value assessment hard)
- o Absolute capture/ownership (common law) – anyone who owned land could pump/extract all the ground water below it. Landowner has absolute ownership to water under his land, no liability even if dries up neighbor’s land (like oil)
  - Tragedy of commons
  - Still the law in many states. Allows for commercial water bottling industry.
- Reasonable Use Doctrine Can’t extract groundwater under land if: (1) not for beneficial enjoyment of land, and (2) diverts all water from neighbor’s lands.
  - o Sic utere – “use your property in such a way not injure others”'
  - o Higday v. Nickolaus (Missouri 1971)
    - Taking water from grand and then transporting it away for commerce is unreasonable
    - Relief = damages. Allows market to regulate price and use. Govt can buy water rights, but subject to market prices à encourage optimization principle
  - o Govt use in excess of natural recharge rate can be subject to damages, but not injunction
    - Injunction would encourage govt to just use ED.
  - o Subterranean waters fall into two categories
    - Underground Stream: water that passes through or under the surface in a definite channel or one that is reasonably ascertainable
    - Percolating Waters: all waters which pass through the ground beneath the surface of the earth without a definite channel and not shown to be supplied by a definite flowing stream
  - Diffuse Surface Water (aka “casual water”, or flooding)
    - o Common Enemy Doctrine – Absolute right to use self-help to repel inflows of casual water, even if it damages neighbor’s lands
      - Old doctrine. Modern one is reasonable use.
      - Mirrors trend from trespass-like doctrine to nuisance-like doctrine.

VI. #OWNERSHIP RIGHTS (Divided ownership)

'#ESTATE in Land''''

Overview

Estate = type of property right and measures a person’s interest in the land in terms of duration
- o Interest may either be a present possessory estate or future estate
  - Present Possessory Estates = freehold (fee simple absolute, life estate, defeasible fees) and non-freehold (lease)
  - Future Estate = one that doesn’t take possession until happening of some future event
- o May be freehold (give possession under legal title) or non-freehold (give mere possession (lease))
English origin – “feudal incidents” (homage, aids, relief), duties owed to lord, no absolute ownership of land
- o Freehold interests were recorded in land registry and livery of seisin (public display of transfer)
- o Nonfreehold interests weren’t recorded

A) Present Possessory Interest

PRESENT POSSESSORY INTEREST

Freehold:

Fee Simple Absolute
Life Estate
Defeasible Fees

Fee simple determinable Fee simple subject to condition subs Fee simple subject to executory limitNonfreehold:

Lease

I) FEE SIMPLE ABSOLUTE – the norm
- o Largest package of ownership rights
  - From which others are carved
  - Potentially infinite in time (no natural end)
  - Inheritable, or can sell to third party
- o FEE SIMPLE
  - O 'à' A
  - O 'à' A and his/her heirs
    - A person does not have legal heirs until death (while alive, they are heirs apparent)
    - Heirs don’t have interest, just “expectancy”
  - O has given up all rights (O has nothing left)
- o Only words of purchase designate someone who is to receive an interest – purchaser can be the recipient by sale, give, or devise (grant of real estate by will
II) LIFE ESTATE
- o Come to a natural end with the death of named person (holder of estate)
- o O 'à' A for life
  - When A dies, O has reversionary interest
    - If O dies before A, reverts to his heirs (if he’s established successor in will)
  - o O 'à' A for Life, and then to B
    - A has a life estate, followed by remainder in fee simple to B
    - Life estate ends with A’s death, then goes to B (future interest)
      - A has use/possession now, but if A destroys economic basis of land for continued use, then it is a WASTE, and B can bring an action for waste (and enjoin A or get damages)
      - After O makes this grant, O has nothing left to retain
    - A cannot sell more than she has; so when A dies, B will take.
      - If A sold, the purchaser will receive a life estate pur autre vie (for A’s lifespan), then loses property to B on A’s death
    - o O 'à' A for Life, and then to B and his heirs
      - B and his heirs = remainder interest (remainder of fee simple) (“heirs” just shows duration)
III) DEFEASIBLE FEES
- o Similar to fee simple, but may end on the happening of a named contingency
- o Generally, when language is ambiguous as to whether it creates a fee simple determinable or fee simple subject to condition subsequent, courts favor the latter b/c it avoids automatic return
o FEE SIMPLE DETERMINABLE
- End automatically upon the occurrence of some named event; grantor takes property
- “as long as” “so long as” “while” “during” “until” (used in charitable gifts)
- O 'à' A and his heirs, as long as used for farming
  - There is a condition – if it is no longer used for farming, then A loses property interest and goes back to O (Reversion)
  - A’s fee simple ends automatically
- But if O doesn’t come back, and A stays on land – A could get adverse possession (trespass triggers SoL)
o FEE SIMPLE SUBJECT TO CONDITION SUBSEQUENT
- Upon the happening of the named event (condition), the interest does not automatically end but can be ended by action by the grantor
- “But if” “on condition that” “Provided that” “Provided however” “if”
- O 'à' A and his heirs, but if cease to be used as farm
  - O has right of re-entry (aka power of termination)
  - A’s fee simple doesn’t end automatically
- No adverse possession b/c A is allowed to still be there
o FEE SIMPLE SUBJECT TO EXECUTORY LIMITATION
- Defeasible fee is followed by an interest not reserved to the grantor
  - The future interest is in a third party, not the grantor
- O 'à' A for life, then to B if x occurs
  - B has executory interest
o Fee Tail
- Nontransferable life estate granted to A, following his blood descendants. Ends when the line dies.
- Abolished in most states

B) FUTURE INTEREST

Interest that becomes possessory at some future point in time
O à A for life, then to B and his heirs
- o B has a future interest (alienable; vested – no condition need be met, just when A dies)

FUTURE INTEREST

In Grantor

Reversion
Possibility of Reverter
Right of Entry

In Grantee:

Remainder

Indefeasibly vested Contingent Vested subject to complete divestment Vested subject to partial divestment (subjext to open)

Executory Interest

I) FUTURE INTEREST RETAINED BY GRANTORS
- o Reversionary interest
- o Ex: O à A for life and then to B
  - A has present possessory interest in life estate
  - B has remainder in fee simple (future interest)
- o Vested from the moment its created
o Reversion
- Follows the natural end of a life estate or other context where owner has not disposed of entire fee
o Possibility of Reverter
- Interest reserved to the grantor that follows a fee simple determinable
- O automatically gets property back if the limitation built into fee simple determinable occurs
  - If O is dead, then O’s successor gets property
o Right of Entry (Power of Termination)
- Interest retained by grantor that follows defeasible fee, but the preceding defeasible fee must be a fee simple subject to condition subsequent
  - If condition occurs – nothing happens automatically, but the grantor has the right/power to change legal relations by ousting the holder
  - If grantor does nothing, holder of fee simple subject to the condition subsequent continues on as owner like before
II) INTEREST CREATED IN A GRANTEE (Interest in a Third Party)
o Remainder
- Follows a life estate, never a fee simple
- Indefeasibly Vested –
  - Identity of the taker is known, AND
  - There is no other contingency that has to be fulfilled before the interest is ready to become possessory (other than the natural termination of the proceeding interest)
- Contingent Remainder
  - Some uncertainty about identity of taker (eg “then to his kids”), OR
  - Some uncertainty about occurrence of condition happening (“then to C if he graduates”)
    - o Condition precedent must be met
  - If uncertainties resolved, then taker becomes vested in interest
    - o When they take property, then vested in possession
  - Vested Subject to Complete Divestment
    - If occurrence of condition can cause interest to shift to someone else.
    - Ex: O à A for life, then to C; but if C fails to graduate by 21, then to D and his heirs
  - Vested Subject to Partial Divestment
    - When it gets split (diminished interest)
      - o O à A for life, then to his children and their heirs (B and C are both children)
    - Subject to Open: when more people can join the party
      - o O à A for life, then his children and their heirs (B and C are children at time of grant, but D is born later)
o Executory Interest
- An interest in a transferee (not retained by the grantor) that divests or cuts short a previous interest

'#MEDIATING CONFLICTS OVER TIME''''

Overview
- o There is possibility for conflict when two or more people hold interest in single piece of property
  - Could happen when grantor divides a fee simple into life estate and one or more remainders
    - Holder of life estate will prefer current consumption (short-term investments)
    - Holder of remainder will prefer conservation of asset (long-term investments)
  - If all parties agree, they can act however they want

A) Waste

An act that causes permanent injury to inheritance
Types of Waste
- o Affirmative Waste
  - Life tenant acts wrt property that is unreasonable and causes excess dmg to reversion or remainder interest
    - Often defined in terms of “normal use” of property
  - Misfeasance
- o Permissive Waste
  - Life tenant fails to take some action wrt property; failure is unreasonable and causes excess damage to reversion or remainder
  - Nonfeasance
- o Ameliorative Waste
  - Affirmative act that significantly changes property, increasing market value
  - Traditional v. Modern
    - Traditional view (Brokaw) treats this as prohibited affirmative waste
    - Modern View (Pabst) allows on condition of changed circumstances. Econ optimization.
  - Brokaw v. Fairchild (NY 1929): Life tenant may not use his land in a manner that causes permanent injury to inheritance
    - o FACTS:
      - Brokaw child wanted to demolish his lot of family mansion to build a high-rise in Manhattan. Monetary benefit, but remaindermen (siblings with future interest) objected to it.
    - o Life tenant can enjoy use for life, but cannot fundamentally change the character or nature of asset.
    - o Doesn’t matter if that change would increase the value of asset.
    - o EXCEPTION (Pabst Brewing Co. ()): Changes by life tenant allowed b/c of extreme changed circumstances
      - Court use this when change of circumstances that makes it rational to change character of asset
      - Restatement goes further – gives present owner rights to change if “reasonable.” Economic balancing test.
    - Standing for Waste Claims: indefeasible vested remainders, reversion holders, executory interest holders, etc. can only sue on behalf of all non-possessory interest holders
    - Posner: simple rule of wealth maximization
      - o If the life tenant’s action would maximize the present value of the property (including both the life tenants interest and the reversion or remainder interest) then it is permissible; but if the life tenants action wouldn’t maximize the present value of the property, then it is waste.
      - o But, legal doctrine doesn’t seem to require maximization of present value by the party in possession, it enforces “normal” behavior
    - POSSIBLE SOLUTIONS:
      - o Contracts: Parties can agree among themselves (but, need 100% agreement)
        Pay off the future interest holders, via valuation calculation.
      - o Trusts: O →A in trust for life of B
        A as trustee can manage and make decisions on behalf of the trust
      - Valuation of interests
        o Future value of property C = P (1+r)ⁿ
        
        o Present discount value P = C / (1+r)ⁿ
        C = future value
        
        P = present value
        
        r = Discount rate (% by which money change in value over time)
        
        n = Number of time periods (years)
        
        o For property holders
        Present property value = P
        
        Value to remainderman (future interest holder) = C
        
        Value to life estate (present interest holder) = P – C
        
        o 7% interest rate is useful. Amount doubles every 10 years.

B) Restraint on Alienation = condition where land cannot be sold

Notion of property is the right to be able to convey it
Mountain Brow Lodge No. 82 (CA 1967): Absolute restrictions on alienation will ALWAYS be void
- o Habendum clause – grants property for “use and benefit” of club = use restriction, not alienation restriction
- o Where language is ambiguous on creating fee simple determinable or fee simple subject to condition subsequent, courts opt for latter b/c its not an auto forfeiture
  - No formal language necessary to create fee simple subject to condition subsequent. Just look for grantor intent.
- Attempts to directly restrain alienation usually considered void as contrary to public policy
  - o Won’t uphold wills
  - o EXCEPTION: Courts will uphold restraints on alienation for limited period if they’re reasonable for family estate planning purpose
    - Ex: Restraint on alienation by a minor until he reaches age of majority
  - REASONS FOR POLICY AGAINST RESTRAINT ON ALIENATION
    - o Owner autonomy
    - o Right to transfer (and efficiency)
    - o Free alienation is primary way in which society changes assignment of responsibility for management of resources
  - NOTE: Restraint on alienation sometimes required – like body parts!

VII. #CO-OWNERSHIP (Concurrent interests)

Overview

Shared ownership that is simultaneous
- o Horizontal Division (division over time): Fee simple, life estates, remainders
- o Vertical Division (concurrent division)
Off-the-rack legal solutions to problems facing co-owners
- o Afford them exist opportunities from relationship (action for partition)
- o More detailed governance rules (usually to protect co-owners in situations of exit)
Alternatives to co-ownership arrangements: trust, partnerships (most common), corporations
- o Entity Theory: Entity is owner and manages property and resolves disputes btw co-owners as matter of corporate law, as opposed to property law

'#FORMS OF CO-OWNERSHIP''''
A) Tenancy in Common

Two or more tenants with separate but undivided interest in single asset
- o Separate = Inheritable, conveyable, and devisable by each tenant
- o No right of survivorship
- o Undivided = Right to possess whole property by each tenant (doesn’t have to be equal, share of rent/profit based on % of ownership by each tenant)
O à A as tenant in common
Only unity required at time of creation is: Possession

B) Joint Tenancy

Again, separate, undivided interest
BUT there is right of survivorship
- o When conveyed, becomes tenancy in common b/c time unity violated
- o Interest not inheritable, but conveyable during the life of the joint tenant.
  - When JT B dies (after conveying to C), interest goes to JT A (away from C)
- 4 unities required at creation
  - o Time – each interest acquired/vested at same time
  - o Title – titles all acquired by same instrument (eg will) or joint AdPo. Never by intestate succession.
  - o Interest – same legal interest in property (eg fee simple, life estate, lease), but not necessarily equal share
  - o Possession – each has right to possess the whole, but don’t need to exercise that right
- If any unities destroyed
  - o Joint tenancy severed
  - o Tenancy in common created
- Joint tenancy comes with Partial exit right (via possibility of severance)
  - o If JT B transfers his interest to creditor by attachment à interest unity destroyed à no more joint tenancy

C) Tenancy by Entirety

Each has separate but undivided interest + right of survivorship
5^th unity = Marriage
- o Tenancy destroyed by DIVORCE
Need consent of other spouse to transfer shares of property
Good for debt protection – creditor can’t go after assets shared w/ other tenant for debt b/c would violate “interest” unity

How to choose which arrangement to use (tenancy in common or joint tenancy)?''''

1) Survivorship feature of joint tenancy (and tenancy by entirety) allows remaining owner to avoid probate.
- o This means survivor can sell property immediately if he wants, without costly probate decision
2) Creditor/debt protection in joint tenancy (tenancy by entirety)
3) Tax considerations – best for married couples

'COMMUNITY PROPERTY''''
A) Partition

Most important legal remedy available to concurrent owners
Each cotenant has automatic right to terminate the co-tenancy at any time
- o Right of partition is absolute (either party can get it)'
- o Partition afford each co-owner an avenue for exit'
Only available to tenant in common and joint tenants''
Two types'''''
- o Partition in Kind' = actual, physical dividing up property'''''
  - Preferred for dividing jointly held property'''''
- o Partition by Sale' = Sell property and divide up proceeds by % of share of property owned'''''
Delfino v. Vealencis' (CT 1980) – Law traditionally favors partition in kind'''''
- o Facts:'''''
  - P and D were tenants in common. P wanted to sell their property and sought partition by sale, because D ran a trash operating business on her land. Would make it hard to sell because buyers don’t want to be near trash business. But D actually lived on land (as opposed to P) and didn’t house trash on premises. '''''
  - Partition by sale would have forced D to surrender to her home and jeopardize livelihood. '''''
- o Only grant partition by sale when two conditions met'''''
  - (1) Physical attribute of land is impracticable or inequitable for partition in kind'''''
  - (2) Partition by sale would promote best interest of parties'''''
- Transactions costs are a problem – bilateral monopoly: the parties have to deal with each other, causing partition'''''
- STRATEGIES''
  - o Exist' – threat of exit can help co-owner protect interest; places at least one co-owner on the “outside” of the property along with other duty holders who must respect the exclusion rights of the owner'''''
  - o Voice' – Expressing dissatisfaction and agitating for change w/in the group'''''
  - o Loyalty' – Leads participants to avoid leaving and to leave quietly when they do'''''
- Partition law impact on decreasing black farming'''''
  - o Black farmers more often pass farms off to kids w/o a will, so they take property as tenants in common. No right of survivorship!'''''
  - o One kid would sell out of the family à Doesn’t revert back to his kids on death à fewer black-owned farms.'''''

'''''

B) Contribution and Accounting

If one co-tenant rents to a third party – supposed to share payments with other co-tenants (divided by their % share)
- o Tenants have a right to use whole property (undivided interest)
Ouster: a co-tenant being prevented from her right to use property (another co-tenant using property in a way that prevents this co-tenant from using it)
Gillmor v. Gillmor (Utah, 1984)
- o FACTS:
  - P and D are co-owners of land. D is renting out his portion, which thereby excludes P from grazing cattle there. P claims ouster.
  - Note: It would have been fine for D to exclude if he were possessing. Just a problem that he’s not possessing and excluding (via renting out).
- o An ousted co-tenant may recover her share of rent and profits from land held jointly or in common
  - But mere exclusive use of commonly held property by one co-tenant is not sufficient to establish ouster
    - Exclusive Use: Requires either an act of exclusion or use that prevents other co-tenant from exercising property rights
  - Must have requested and been refused use.
- o Co-tenant not in possession is liable for his share of necessary repairs/maintenance costs
  - But factor in any improvements of land by D, if it led to P’s ouster. Subtract those improvement costs from amount owed to P.
- Once ouster occurs, AdPo may start ticking (if co-tenant using doesn’t have consent)
- Action for Contribution
  - o When co-tenant in sole possession makes repairs or improvements to common property without the consent of fellow co-tenants, there is generally no right of contribution
    - EXCEPTIONS: Compensation for improvements is allowed when
      - Other co-tenants stood by and permitted him to proceed to his detriment
      - Co-tenant in possession acted in good faith, with the bona fide belief that he was the sole owner of the property
      - Repairs were essential to preserve/protect the common estate
    - Action for Accounting
      - o Valuation of the land and payment of fair share value of co-tenant’s interest
      - o A non-renting co-tenant can bring an action for accounting (when the other co-tenant rents to a 3rd party – the renting co-tenant is obligated to share the payments with other co-tenants)

B) Severance

Either joint tenant can unilaterally sever the joint tenancy – destroys right of survivorship and converts JT to TiC
Common law = severance required destruction of one of the 4 required unities
- o If one tenant sells interest, that severs it
- o But if there are 3 tenants and one severs – the other two still remain joint tenants
Harms v. Sprague (Illinois 1984) – a lien placed on one joint tenant’s interest in jointly held property does not sever joint tenancy
- o Facts
  - Harms bros owned property as JT. Harm 1 allowed Sprague to use his property as collateral to buy neighbors land. Harm 1 was guarantor for Sprague and mortgaged half his property. Harm 1 then dies, leaving estate to Sprague in will. Harm 2 contends its just his under joint tenancy.
- Guaranty: When borrower fails to pay, the lender can reach out to the 3^rd party (the guarantors)
- Mortgage: security interest in real property; if the borrower enters into a loan agreement, the mortgagor (borrower) conveys to lender (mortgagee) a security interest in the property (and if the borrow can’t pay, then mortgagee can see off land to pay off the loan)
  - Mortgage is a property right (for the mortgagee; the lender); a security interest in real estate that protects the lender if the borrower fails to repay
- Does grant of mortgage by one co-tenant sever the joint tenancy?
  - It is a transfer of a lien (a security interest that has status of property); during life of lien, doesn’t give any right to possession
    - did not sever the joint tenancy interest; grant of mortgage doesn’t sever joint tenancy
    - Idea: The joint tenancy based on two people having interest in property. Court says that the interest didn’t transfer by mortgage, it just disappeared.
  - Selling interest: does sever joint tenancy (sale is not a lien)
- In Harms – if both brothers dealt with the mortgage, then the question of severance wouldn’t even be brought up b/c the lien would be unaffected by the one brother’s death.
Severance needs an actual conveyance of right
- o A lien on a joint tenants’ interest in property will not effectuate a severance of the joint tenancy absent the conveyance by a deed following the expiration of a redemption period.
Riddle
- o Wife didn’t want husband to get survivorship. She gave property to herself (strawman) then got it back, breaking joint tenancy.
- o CA responded by passing law requiring notice to joint tenant of conveyance.
In most cases, “straw transaction” works to break joint tenancy

C) Marital Property

All property acquired during marriage (“marital property”) automatically becomes community property
- o Property acquired before marriage is theoretically separate, but may become community property through commingling with community property
O’Brien v. O’Brien – In divorce, marital property is subject to equitable distribution. Court will consider any direct or indirect contribution to the acquisition of the property.
- o Equitable distribution overrides title to property the parties had during marriage. On divorce, property is pooled and divided (one-time division – moving away from continuous payments like alimony)
- o Concurrence – Concern!
  - Personhood – Medical license is closely personal item! Think Radin and Moore
  - Also nontransferable and locks him into a career (asset hasn’t yet returned value)
- Notes
  - o Promotion is not property
  - o Equitable division is available for both men and women (Elkis v. Elkis, NY)
  - o Anti-nuptial agreement – Early agreement about how divorce proceeding might eventually play out

VIII. #LANDLORD / #TENANT

'ENTITY PROPERTY''''

Devices that allow owners to switch to governance strategy
Key attribute: permit management of resources to be separated from their use and enjoyment
- o Management by specialist, while use and enjoyment distributed over larger group of individuals
Governance versus Exclusion
- o Co-ownership forms of property rely on exclusion strategies (assumption: someone is “gatekeeper”)
- o Governance better suited for more complex resources
Legal distinction: Entity versus Property Law
- o Entity creates legal managerial entity, whereas property law creates specialized functions by L/T
Functional distinction: Possessory versus non-possessory
- o Governs multiple possessory interests of single asset – (leases, cooperatives, condos)
  - Leases: More attractive for people who can’t/don’t want to invest their resources in large enterprise
    - Might not have money, or not committed to one location
  - Condos/Cooperatives: more attractive to people who can make investment
- o Governs multiple non-possessory interests – (trusts, corporations, nonprofits, partnerships)

'#Leases''''

Most common form of property interest today
Reasons why lease is popularity
- o A) De facto financing device
  - Way to “leverage” limited resources – can’t afford house, but can lease apartment
- o B) Risk-spreading device
  - For Tenant – Minimize risk that you might want to move cities later, and regret purchase
  - For Landlord – If you have many Ts and one defaults, you can offset by other Ts payments
- o C) Functions as entity property – good way to manage complex of assets
Why buy property as opposed to lease?
- o A) You get equity in property, and hope its an investment that pays out over time
- o B) Less restrictions on use
- o C) Locks in price
- o D) Tax advantage – you don’t pay income tax as it appreciates
Leases involve mix of L-T property and contractual relationship (most leases have contract)
Types of Leases
- o Terms of Years
  - Grant of present possessory interest w/ remainder interest
  - Fixed time, lease terminates automatically
  - Not L/T notice required before terminating (on stated day of termination)
- o Periodic Tenancy
  - Lease automatically rolls over for a stated period of time (usually year or month)
  - Requires parties to give notice if they want to terminate
    - What is adequate notice?
      - o If one year period, 6 month notice (per common law)
        Statute usually requires only 30 days notice for residential use
      - o If one month period, 1 month notice
    - o Tenancy At Will
      - Tenancy lasts only so long as both parties wish it to continue
      - Either party can terminate at any time for any reason
      - At common law, no notice required. But some states require notice equal to period of payment.
    - o Tenancy at Sufferance (“true tenancy”)
      - Exists when individual, who once had rightful tenancy, maintain possession after right ended.
        Different from trespass b/c T’s original entry was not wrongful
      - L can use self-help: can evict T using forcible entry, detainer statutes, or by bringing ejectment action (depends on jux)

'#INDEPENDENT COVENANTS''''

Independent promises in lease (so breach of one, doesn’t impact obligation of another)
Law implies obligation on tenant to pay rent (regardless if T occupies lease/home)
- o Independent of circumstances – T has absolute obligation to pay rent
  - EXCEPTION: Unless L fails to give quiet possession. Because this “goes to the essence” of the lease (Paradine v. Jane (1647))
- o If T doesn’t pay rent à L can sue for rent (not eviction). Normally L can’t evict T.
  - EXCEPTION: Forfeiture clause – specifies that T loses interest when he fails to pay rent.
    - Allows L to reenter and retake the property.
  - Essential covenants of ICM
    - o Landlord – Covenant of “quiet enjoyment” (ie promise not to interfere in T’s possession during lease)
    - o Tenant – Covenant to pay rent

'Tenant Defenses''''

Early on, L had a lot of power in the relationship, like special courts to force eviction.
T started to develop defenses. Change from ICM à DCM.

A) Constructive Eviction

Tenants can vacate apartment and L not entitled to get rent. If L does something or fails to do some legal duty.
Blacket v. Olanoff (Massachusetts 1976): Even where L has not intended to infringe on T’s right to quiet enjoyment, breach still exists if infringement is natural and probably consequence of what L did or failed to do
- Extends covenant of quiet enjoyment to things that L could control but didn’t
- Duty of quiet enjoyment duty is implicit! If L fails this, then T can leave w/o paying rent.
- Facts:
  - Cocktail lounge opens near apartment. L doesn’t try hard to fix the situation.
In majority of jux: T must actually vacate in order to claim constructive eviction disputes
- General standard is the tenant must move out in a reasonable time
- Burden on tenant to show reasonableness and speed of her abandonment
Construction eviction is limited (relies on implied rights), so it isn’t often used. Better alternate methods available.
- o Constructive eviction applied where no lease provision about quiet enjoyment, but can still infer that L caused inhabitability. Must be enough that T forced to vacate.
- o Contract law and DCM is better.

B) Surrender

Tenants can vacate apartment and L not entitled to get rent. If L does something or fails to do some legal duty.
Acceptance of surrender acts by L can relieve T of obligation to pay
- o L accepts its tenant’s repudiation of a lease when the L sends a new T a propose lease.
Landlord has three options when a tenant abandons:'
- o 1) Do nothing and sue for accrued rent'
- o 2) Re-let as the agent of the tenant'
  - ▪ (more appealing to landlords than option 1 – b/c can seek a new tenant and sue the abandoning tenant for damages equal to any benefit of the bargain under the original lease which has been lost)'
- o 3) Accept the tenants surrender, and re-let for the landlord’s benefit '

'#DEPENDENT COVENANTS''''

Modern L-T Law.
- o Focused on express terms of '
- o A lease is both a contract and a conveyance of land
Duty to Meet Contract
- o Medico-Dental (Cali 1942): Ts obligation to pay rent is dependent on L’s compliance with restrictive covenant in the lease, if the L’s breach of covenant defeats the purpose of the lease
  - Terms are treated as contract terms – so remedies available from contract law.
  - When considering whether it’s a Dependent Covenant, look at:
    - 1. Intent of the parties
      - o Express language in the lease?
    - 2. “Essence of consideration”
      - o Is the particular covenant vital successful operation of business?
        If so, when that covenant violated then DCM is null
      - Contract Law = was the breach material?
        Here, the breach was material. It was the whole purpose of T’s lease (goes to essence of lease)
        o T wanted lease exclusivity on drug sales b/c the building was full of doctors, and T is a pharmacy. T probably paid money for that special lease.
        So when Dr. Boonshaft started selling drugs, it messes with T’s business.
        
        Boonshaft wasn’t exactly selling. Giving drugs as part of visit charge, but still counts.
        
        D’s lost profits were not easy to determine.
        
        o Hiatt Investment Co. v. Buehler: 3 options for T who’s L breaches restrictive covenant
        1) Rescind lease and stop paying
        
        2) Continue lease to termination and then sue for loss of profits
        
        3) Consider L’s action as nullification of contract and sue for damages
        
        Duty of Repair
        o Wesson v. Leone Enterprises (Massachusetts 2002)
        Commercial lease. L failure to repair roof leaks in a printing shop not enough for constructive eviction, but breach of the lease under DCM. Therefore, T had right to terminate lease.
        
        Duty to Mitigate (CONTRACT LAW!): L has duty to mitigate damages when he seeks to recover rent due from defaulting or surrendering T.
        o L must make reasonable effort to mitigate damages.
        
        o Duty to mitigate exists in all residential leases.
        Not a mandatory rule. Can be waived in lease.
        
        o Sommer v. Kridel' (NJ 1977)': Duty to mitigate is consistent with basic justice and fairness
        Facts:
        Soldier gets apt but sends letter of surrender. L never responds and doesn’t respond to inquiries, then sues for rent.
        
        The trend is to treat leases not as conveyances, but as contracts
        So if L fails to mitigates damages when he has the opportunity, the defaulting T may be relieved of his duty to pay rent
        
        Duty to mitigate means making reasonable efforts to re-let apartment
        Including responding to surrender letter, advertise apartment in timely manner, respond to new buyer inquiries
        
        o Justification: When there’s a loss, allocate it to the party better able to accept it (usually L).
        Unless L makes a reasonable effort to re-lease the unit and fails to do so. Then T is liable.

'#Implied Warranty of Habitability (#IWH)''''

L has obligation to keep residence in condition that is habitable
Justifications (Javins v. First National Realty Corp (1970))
- o 1) Inequality of L-T bargaining power
  - Law must protect Ts who are not capable of negotiating for themselves
  - If T was bargaining for more protective lease, L would either (a) Find another T or (b) Raise the rent
- o 2) Consumer protection laws are common
- o 3) Ancient v. Modern Leasing
  - Ancient
    - Lease value based on the LAND
    - No expectations of repair
  - Modern
    - Lease value based on LIVING STANDARD
      - o “well known package of goods and services”
    - People don’t know how to repair things; expectation of specialized help to do this
  - Required Elements
    - o A) Residential lease, not commercial
    - o B) Comes from law, either judges or legislature
      - Commonly includes the Housing Code + additional provisions (like air conditioning)
    - o C) Urban, not rural
    - o D) Not de minimis violation – must be substantial
    - o E) Mandatory – Cannot be waived (even though contract)
      - If T could waive it for lower rent, then all Ls would do this until poorest Ts (with inelastic demand) have to accept it à lowers respect for their human dignity
    - Remedies for IWH violation
      - o 1) T withdraws lease and vacates w/o payment
      - o 2) Order directing L perform according to IWH
      - o 3) Action for damages for breach of IWG
      - o 4) Set-off against rent due by T in suit by L for failure to pay rent
      - o 5) T withholds portion of rent until repair made
    - Three principles introduced to DC
      - o 1) IWH – Does not subject to immediate eviction
        But requires T to put money into court registry to work through lawsuit. Requires T to have that money.
        But otherwise, L wouldn’t have security to litigate knowing T can’t pay.
        
        o 2) Doctrine of retaliatory eviction – L can’t evict T for reporting code violations
        
        o 3) Illegal Lease Doctrine – If property is subject to code violation and rendered unsafe, lease if void
        Brown v. Southall Realty Co (DC 1968)
        
        Drawback is lease becomes void, leaving T subject to immediate eviction. So IWH better.
        
        Impact of IWH (broadly) – Controversial impact on poor people
        o Academic perspectives
        1) Orthodox microeconomic perspective – Raises costs of housing overall (more demand, lower supply)
        
        2) Sympathetic perspective – No change in demand. Poor people still need housing.
        
        3) Neutral perspective – Good for some, burt hurts others
        Good for middle class income Ts (get unit they expect even if paying a little more), but harder on lower class
        
        Effect = wealth maximization, but unequal distributional effect
        
        o Private Ls are not often getting into low income housing
        Makes low income housing harder to find, lower quality
        
        o Government programs are insufficient
        Section 8 housing vouchers – govt pays diff btw rent and what poor person can afford
        
        Subsidized renting units to poor people for L. But not enough
        
        How to close the gap in providing housing for poor people?
        o #Rent Control
        ▪ Different forms'
        Rent freeze' – Prohibits Ls from increasing rents currently being charged'
        
        'Rent stabilization (vacancy decontrol) – Restricts rent increases while T remains in possession'
        o Allows for small annual increase, and allows increase when L hardship or L desire to make improvement'
        ▪ Attempt to incentivize L development'
        
        ▪ Economic Critiques of Rent Control:' '
        A) Gap in quality of housing demanded and quantity supplied (demand will rise, supply will fall)'
        o In the long run, T simply have less housing or poorer quality housing than if govt didn’t intervene'
        
        B) Poor people tend to move more frequently à less likely to take advantage of rent control)'
        o Plus, once T leaves, L can set price to market level '
        
        ▪ Supporters of Rent Control:' '
        A) less dramatic impacts on landlords, b/c %'
        o Increases are still allowed each year'
        
        o L enjoys a degree of localized monopoly power'
        
        B) Good for personhood'
        o Tends to lock people into particular apartments and communities (people develop subjective attachment to apartments – become part of their identity)'
        
        o How to subsidize housing for poor people:'''
        ▪ Public money'
        
        ▪ Shift burden to landlord through mandates (inclusionary zoning)'
        
        Eviction
        o Not a common law remedy. In ICM, L would sue for ejectment but still must house in meantime.
        
        o Supple-side technique to encourage Ls to move into low income market.
        But so many people evicted. Like the family in “Evicted”
        
        o There’s been no evidence to show IWH is successful, in part b/c eviction cases often have default judgment

'#FAIR HOUSING – Title 8 of Civil Rights Act of 1968'

Government has long history of promoting segregation through housing (Color of Law)
- o Red Housing Administration did “redlining”
- o Highways were built to separate racial groups
- o Public Housing = mortgage guarantees for single-race neighborhoods
- o Zoning laws excluded black people (no apts allowing in single-story house neighborhoods)
- o Police didn’t enforce law on violent racist mobs
- o Proposal: require localities to house share of poor people and black people proportional to metro average
Fair Housing Act (1968)
- o Prohibited behavior – Cannot refuse to sell, offer rental, advertise, etc. of apt on basis of race, color, religion, sex, family status (meant single/couple, not homosexuality), and nationality
- o Exceptions
  - Religious buildings can discriminate
  - Mrs. Murphy Exception – when owner lives in 1 unit, and rents out units #2 and #3, then exempt
    - Exception does not apply to advertising – L cannot advertise that T’s with kids not allowed
      - o Goal: Get racism out of public sphere
    - Texas Dept of Housing & Community Affairs (2015): P need not always show discriminatory intent, just discriminatory impact. Govt policy = acts should not have disproportional impact on any particular racial group.
      - o US v. Starrett City (2^nd City 1988): Housing policies that disproportionally affect minorities are unlawful, even if its for the reason of promoting integration.
        Housing project wanted no more than 40% quota on minority units allowed. Effort to create mixed race neighbored.
        
        But impact that project suggested wasn’t even reality, b/c massive influx of white Russians into Brooklyn
      - 1866 Civil Rights Act is also a protection (equal protection for sale based on race, creed, religion, etc.)
        o Based on Commerce Clause argument
      - Internet application
        o More discrimination allowed – online vehicle of racist ad not liable (FB not liable like a newspaper would be)
        
        o Fair Housing Counsel of San Fernando Valley v. Roommate.com (9^th Cir 2012): Anti-discrimination provisions of FHA do not apply to selection of roommates.
        Not many relationship more intimate than btw roommates
        Constitution gives fundamental right to intimate association
        
        State is laboratory for experimentation
        
        Dwelling = independent housing
        
        Technology is blurring the line between private sphere and market
        o Ex: AirBnB (license or rental? License = no property right, like a hotel. Rental implies a relationship with L.)
        
        o Ex: Uber – is the car public or private?
        
        Objectives for anti-discriminatory housing laws
        o 1) Increase housing opportunities for protected classes
        
        o 2) Eliminate personal harm or indignity by being rejected
        
        o 3) Eliminate social message of inferiority

'#TRANSFER OF INTEREST''''
A) #SUBLEASE

L has fee simple. L carve out lease for prime T. Prime T carves out sub-lease for sub-T, and so on.
Each sub-T has lesser interest.
- o Term of sublease must be shorter than term of prime lease.
- o Prime T has reversionary interest.
If problem arises, L deals ONLY with the Prime T. Prime T deals only with sub-T. So on.
- o Because L has privity of estate and contract only with T.
Similar to subinfeudation

B) #ASSIGNMENTS

L has fee simple. L carves out lease for prime T. Prime T alienates prime lease to first assignee. Etc.
Original T conveys entire interest in assignee.
- o No carving out. Whole transfer of lease.
Assignee owes duty to original L. If there is problem, L deals only with latest T in possession of lease.
- o But subrogation principle for assignor – If assignee fails to pay rent, L has secondary claim to assignor. Assignor must pay rent to L, then assignor has claim against assignee for payment.
  - Assignor essentially becomes L.
- Similar to alienation
- Assignment Context
  - o ASSUMPTION
    - Occurs if the first assignee expressly agrees as part of an assignment to be bound by terms of original lease
      - Assignee contractually agrees to be bound by both privity of contract AND privity of estates
      - Prime T still bound by privity of contract, but not privity of estate
    - So Prime T and successive assignees bound by privity of contract with original L (but only most recent assignee has privity of estate with original L)
  - o NOVATION
    - Parties agree to erase any privity of contract liability of the part of the Prime T
    - If L agrees to novation – Prime T is off the hook altogether
      - L, new T, and Prime T must all agree to let Prime T off the hook

C) Sources of L-T Obligations

1. #Privity of Contract
- o Obligation that comes from being party to bilateral contract (lease)
2. # Privity of Estate
- o Two conditions must be met
  - 1. Parties agree to be bound must have interest such that one is directly carved out of other (“nested” interests)
  - 2. One of the parties must be in actual possession of the property (or have reversion)
- Assignment doesn’t destroy the contractual relationship btw L and Prime T – still in privity of contract
  - o If there’s no contractual relationship between L and first assignee à no privity of contract btw them
    - But assignee is liable under privity of estate
      - Assignee may not have become party to original contract (“assumption”)
      - If no assumption by assignee: there is only privity of estates (and only for covenants that run with the land)
        o If assignee gets duties that run w/ land – Ex: rent, maintenance, etc.
        
        o But assignee doesn’t get personal obligations that assignor and L set up (like trash)
      - Which is better: a sublease or assignment?
        o Landlord: depends on how active you are in the management of the property
        Inactive: may prefer sublease b/c now prime tenant will serve as the landlord to the subtenant (collecting rents, answering complaints, etc.)
        
        Active: assignment probably better b/c tenant in possession owes a duty to pay rent and perform other obligations that run with the land directly to you under the privity of estate; and if the new tenant defaults, the prime tenant is still on the hook to you under privity of contract
        
        o Tenant: can’t escape your obligations to the landlord (you are stuck with privity of contract and estate under a sublease and with privity of contract under an assignment)
        But under assignment, you can move away and let assignee deal with L
        
        How to determine if Assignment or Sublease
        o Jaber v. Miller (Ark 1951): Look at the intent of the parties
        Facts:
        5 year lease with L. D transferred lease with “Contract and Assignment” section requesting promissory notes be paid. Then transferred to P. P refused to pay notes, claiming its sublease.
        
        “Common sense” distinction between sublease and assignment
        1) They labeled “Contract and Assignment” section in lease. Assignee meant to step into shoes of the D.
        
        2) Notes were consideration for the assignment.
        
        Rejects common law doctrine that doesn’t concern intent of the parties. It’s “unjust and arbitrary.”
        
        Some reversionary interests (like reentry) are so de minimis that they can’t transfer from assignment to sublease.
        
        Landlords typically want some degree of control over assignments
- MINORITY POSITION: Kendall v. Ernest Pestana (Cali 1985): a commercial lessor may not unreasonably withhold his consent to an assignment of a lease, with or without a clause requiring landlord’s consent to transfer the lease.
  - Facts:
    - San Jose leased property to Prime T. That property became very valuable as a hanger once airport opened up there.
  - Two considerations for why L might want to refuse assignment
    - 1) Assignor wants to pick good assignee who can perform – this is reasonable
      - Kendalls are better financial than current lessee
    - 2) L wants to get “bonus” rent – Not reaosnable
      - Here, higher rent would go to assignor, not L. So L wants a cut.
  - Court preferred the minority position here (reflecting the dual nature of a lease as a conveyance of a leasehold interest and contract)
    - Contract law! Must show refusal is good faith and fair value
  - Principle – don’t want to restrict alienation!
  - Why wouldn’t the landlord want to accept the assignment of the lease when the new tenant was in a better financial position?
    - If the landlord refuses – more likely lease will be surrendered and then the landlord can capture increase in rent with a new lease
      - a contest for that bonus value
o This holding has become more common, but not universal.
- MAJORITY POSITION: Kendall dissent – Because it’s judicially wasteful (requires court to reasonability fact analysis) and parties can circumvent it by contracts.

D) Covenants that Run with the Land

Covenants that “Run with the Land”
- o 1) Parties intend that covenants run with land
- o 2) Interest touch and concern the land
Ex: Payment of rent, maintenance obligations (replace your own lightbulbs)

IX. #COMMON INTEREST COMMUNITIES (#CIC)

Overview

Alternative form of Entity property – multiple people enjoy individual possessory interests while common area have specialized management = Governance
Condo/Coop/CiC
- o Differ from Lease b/c person who obtains individual possessory rights have ownership interest (like fee simple)
- o Multiple people have undivided common interest in certain common assets (eg lobby)
Why governance model makes sense (Hansmann)
- o Inefficient Decisions – everyone has their own interest, and majority might get their way even if not optimal (versus letting L make socially optimal decision)
- o Transaction Costs – If they all have to deliberate to make decision, that’s costly. Just singular decision maker here.
- o Tax Incentives – Tax breaks.
Two ways to operate
- o Contractual – Master deed
- o Governing Body – Like Home Owners Association (HoA), BoD

'Cooperative''''

Corporation w/ fee simple over complex.
- o Individuals have shares of stock and long-term renewable lease (99 years).
  - No real estate ownership
- o Operated by BoD elected by shareholders.
Not very popular outside NYC.
Advantage
- o Control of corporation. Run like a business.
- o Can reject people who you don’t like. For many reasons.
  - Ex: Richard Nixon rejected from the Dakota.
  - No alienation issue because you don’t real property
- Drawback (compared to condo)
  - o Intrusive on Financing – Very strict about who they let in. Because people have to pay off the debt of the complex. So often very nosy about your finances and credit worthiness.
  - o Financing – Everyone’s on the hook for ensuring the building can pay off mortgage. If one owner defaults, it hurts everyone.
    - Condo – you’re only liable for paying off your bit.

'Condominium''''

Individuals have fee simple over their units
- o Common areas shared as tenancy in common
Advantage
- o Lots of freedom to control use == Statutory restrictions
- o Lots of financing benefits
- o Condo association gives a buffer for public/private ownership – can reject people you don’t like (ex: Nixon)
  - Can only reject people for econ reasons
- Drawbacks
  - o Condo owners are bad Landlords. Usually don’t live on land and have no econ incentive to respect other residents.
- Nahrstedt' (Cali 1994): Cat lady case'
  - o Condo use restrictions presumed reasonable and enforced uniformly'. '
    - UNLESS (a) arbitrary, (b) burden on use of land substantially outweighs restriction benefits to all residents, or (c) violates fundamental public policy'
    - Reasonableness of restrictions and covenants evaluated on the whole, not by specific facts of individuals.'
  - o Why?
    - 1) Importance of stability and predictability for buyers'
      - Allowing one person to have exception would upset the whole dynamic = Hurts social cohesion.'
      - Everyone has choice of where to buy. Should get what you pay for.'
    - 2) Want to avoid costly individual litigation.'
    - 3) Court doesn’t want to get involved in private cases.'
  - o Although individual “owns” her condo unit – when Narstat signed the deed to the property, she signed away a good portion of rights associated with the Blackstonian “Bundle of Full Ownership”
  - o Unreasonable = against public policy / state law'
  - o Applies to rules that exist at time person bought property'
- Statutory exclusion of non-preferred use or individuals'

'Common Interest Communities #CIC''''

Ex: Association subdivisions of single-family homes with common facilities (like private roads, fences, pools, etc.)
- o Individuals have fee simple for their property, and either servitude or statutory obligation for common asset
Kiekel v. Four Colonies Home Association (Kansas 2007)
- o Changes to subdivision property use restriction must occur through amendment of document governing use restrictions!
- o Declaration v. Bylaws
  - Declaration = Constitution-like. Deals with property right protections. Supermajority of all to amend.
  - Bylaws = Statute-like. Deals with HoA regulations. Majority of present voters to amend.
- o Right to rent is a substantial property right.
  - In Kansas. Not the case everywhere. Wisconsin says it can be limited by bylaws.
- Co-Housing: Prof thinks this is a form of cooperative – b/c right to own unit but then have right to the common areas (example: share of a communal kitchen)

#ACCOMODATIONS OF USES OF LAND:'Conflict / Difficulty Achieving a Common Benefit'LAW OF #NEIGHBORS

Uses to which neighboring property is put can have an impact on the value and enjoyment of land even if there is nothing in the nature of the invasion at all
Legal devices to control conflicts among neighbors over incompatible uses of land
- o Nuisance
- o Servitudes (easements and covenants)
- o Zoning

X. #NUISANCE LAW

Overview

How the law deals with / govern this conflicts deals with USE among people
Trespass
- o Affects possession right -- Jacque and Hinman
- o Strict liability tort --- entitled to nominal damages and possible injunction
  - Don’t need to show bad faith or actual damages
  - Also possible actual/punitive damages
- Nuisance Law
  - o Affects use and enjoyment right
  - o Tests look to see if impact is unreasonable (balancing test), intentional, substantial (actual)
    - Also: whether D action giving rise to nuisance was committed on P’s land or outside P’s land
  - o Qualities (Adams)
    - A) Intentional = know or should have known
    - B) Unreasonable = balance: social utility versus social harm of nuisance
    - C) Substantial + actual injury
    - D) Indirect or intangible
  - o Nuisance = nontrespassory invasion of land
- Noise, vibrations, and dust are intangible objects à Not a trespass, but can nuisance ('Adams)'
- Adams v. Cleveland-Cliffs Iron Company (App. Ct. Mich 1999)
  - o Wants to protect traditional concept of nuisance and trespass as distinct sticks in bundle of property rights
  - o Denies trespass recovery for indirect, intangible invasions of land.
    - Problematic trend by other courts. Not every speck of dust should be considered trespass à Courts add requirement of “actual and substantial” injury à Necessitates balancing test à Too complicated
  - o Law shouldn’t require landowner to justify exercise of right to exclusion
  - o Invasion implies intent = offender knew or reasonably should have known its invasion
  - o Intangible = dust (in meaningful sense), noise, vibrations
Nuisance Per Se: activity that constitutes a nuisance wherever and whenever it occurs
Nuisance Per Accidens: otherwise permissible activity that constitutes a nuisance only b/c of where or when it takes place
Rule and Decisions:
- TEST: (from 2^nd Restatement)
  - 1) Does the harm affect use and enjoyment of land?
  - 2) Is the action intentional and unreasonable OR unintentional and negligent/reckless
    - Intentional just means that you meant to commit the act, not necessarily harm someone
- Reaosnable Balancing Test: P and D both have to put up evidence (and then given to jury on how to strike a balance and determine award)
  - Balancing of the utilities à only if the harm to P outweighs the social utility of D’s activity is there a nuisance:
    - Gravity of the Harm:
      - (1) extent/character of harm (public or private?)
      - (2) social value of P’s use/enjoyment;
      - (3) whether P came to the nuisance;
      - (4) burden on P to avoid harm
    - Social Utility of D’s Conduct:
      - (1) social value (employ many people?)
      - (2) suitability to locality (eg make sense to have factory there?)
- First in Time Principle: whoever is there first established right to engage in particular use
  - Considered, but never a determinative factor.
- If there is no Nuisance: people can do whatever they want or maybe there is actually a benefit

PRIVATE NUISANCE:

Non-trespass act or condition on D’s land that substantially and unreasonably interferes with P’s use and enjoyment on P’s land.
Law designed to mediate conflicting uses of land, which evolve over time; and unlike trespass, use a reasonableness standard here
Standing: private owners whose land impacted can bring an action

PUBLIC NUISANCE:

Affects whole community, effects are pervasive and everyone suffers (pollution) OR nuisance violates public norms (prostitution, gambling).
Requires ordinance declaring public nuisance (i.e. no slaughterhouses in town), which then becomes basis for civil action to enjoin type of activity
Standing: more general nuisance (usually attorney general or corporations counsel – but private individual can bring action if they can show they have suffered special injury above and beyond that experienced by other members of the public)

Remember: there is so much regulation in land use, that there are NOT a lot of nuisance cases (b/c they are expensive to litigate and so much uncertainty of how it will come out; regulation usually takes care of it). But, nuisance explains, looks into, and supports the need for regulation

'Property Rule / Liability Rule''''

Process
- o Determine entitlement
  - Entitlement = security of party to prevail to dispute
- o Determining the relief for nuisance or trespass – Injunction (property) or damages (liability)
Three entitlements
- o 1) Protected by property rules
  - Can only be given up voluntarily (can’t be taken without holder’s consent)
  - Injunction
- o 2) Protected by liability rights (contract/tort)
  - Can be given up involuntarily (can be taken by forced sale)
  - Damages/compensation
    - Price determined by state
  - o 3) INALIENABLE – Can’t be given up at all. State intervenes to forbid sale. Ex: Body parts, personhood.
- How to decide entitlement?
  - o Calabresi 3 Factors: (1) economic efficiency, (2) distributional preferences, and (3) other just considerations
  - o Coase focused on transaction costs:
    - When transaction costs are low:
      - Consensual exchange of entitlements are possible (court should prefer protection by property rules - Rule 1 and Rule 3)
    - When transaction costs are high
      - Shifting to liability rules is preferred à effects a buyout without requiring negotiation

CALABRESI & MELAMED BOX

'	MODE OF PROTECTION
Property Rule	Liability Rule
ASSIGNMENT OF ENTITLEMENT	Plaintiff	RULE 1 Campbell v. Seaman = Injunction	RULE 2Boomer = D takes P’s entitlement w/o consent, but D must pay damages (ie diminished market value of land subject to nuisance (pollution))
Defendant	RULE 3Hinman = Activity can continue, P can get it abated or only with D’s consent	RULE 4Spur = P can force D to transfer entitlement in return for payment (ie resident can sue to stop farming, but must pay for cost)

Relief
- o Injunction:
  - Rule 1: Harm to P outweighs the social utility of D’s conduct + D can avoid harm without undue hardship or P’s conduct is suited to the locale and D’s activity is not (Rule 1)
    - But may require P to indemnify D (came to the nuisance) (Rule 4)
  - o Damages:
    - Rule 2: D provides significant social utility + D cannot prevent nuisance
      - Avoids high transaction costs of negotiating with many homeowners (i.e. where plant polluting by shifting entitlement to plant to produce set amount of pollution; forced transfer in exchange for money)
      - Can include future damages (Boomer) but doesn’t fully internalize cost of polluting
    - Rule 2: Boomer v. Atlantic Cement Company (NY 1970)
      - o Facts:
        Cement plant affects many neighbors, but employs 300+ employees in the area.
        
        Many neighbors bring suit (potentially bad holdout problem for Coase)
      - o Holding: Permanent damages appropriate (not injunction) from D to P
        1) Injunction would destroy D’s activity, and it has big econ benefit to the area.
        D’s econ benefit significantly greater than harm to P.
        
        2) Too complicated a topic for court to resolve (air pollution). Leave it to legislature. Injunction too strict.
        
        3) If injunction is to be granted, it should be across all polluting plants, not just this one. Legislature.
      - o Dissent: Wants to give D 18 months to develop ameliorative technology
        Counter: Industry burdens should be carried by whole industry, not just one company.
      - Rule 4: Spur v. Del Webb (AZ 1972)
        o Facts:
        Del Webb builds retirement home, near bad smell from cattle. Deters new customers.
        
        o Holding: Spur has entitlement, but Del Webb may forcibly buy it away from them.
        No “coming to nuisance” argument because affects many people in surrounding area (not just Del Webb)
        
        Court doesn’t want to inhibit development in the area à no first in time rule.
        
        Common problem for agriculture states
        o Right to Farm Law – Makes farmer action (not negligent) not liable to nuisance law
        
        o However, Iowa recently struck it down on basis of property right of other property owners to be free from nuisance.
        Iowa is only farming state to have done this.

XI. #EASEMENTS

Overview

Right to use'' someone else’s land in a non-possessory way
- o Irrevocable
- o For a specific purpose (not possession!)
  - Right to use (no fee simple which has right of possession)
  - Excludes use by the original owner and all others (not included in easement)
- o Must be in writing
  - Contract is arguably a property interest b/c its enforceable as an injunction.
- o Property possessed by another person + with their permission (so not adverse)
Notes
- o Can be in any form of estate (fee simple, life estate, term of years, etc.)
- o Property right/property interest
- o Conveys just one stick
Classification
- o Affirmative or Negative
- o Appurtenant or In Gross
- o Public v. Private
If easement goes “well beyond” reaosnable grant à can lose the easement
- o If B (who has easement) subdivides to increase walkway traffic, generally allowed b/c expand public use without taking more property

'Appurtenant or In Gross''''

Easement In Gross
- o One benefiting a person whether or not the person owns any specific property (or any property at all)
- o Belongs to a particular grantee (as opposed to belonging to a particular tract of land)
  - Commercial easements are transferrable, but not personal/recreational ones.
    - Ex: Railroad Industry Growth.
      - o Not for public benefit, but private to RR.
      - o RR retains the easement, even when they sell track to other company.
    - o A contract that allows a party to engage in a particular use of land creates an easement in gross
      - Baseball Publishing Co v. Bruton (Mass 1938): Once have right to put up billboard, have property right
        Commercial easement in gross for a period of years.
        o Doesn’t benefit specific property they own, but their brand
        
        o Not revocable à Not a license
        
        o Gives right to use area (but not possession (?) and no exclusion) à not a lease
        
        Lease v License?
        o Lease of land
        Conveys an interest in land
        
        Requires a writing to comply with statute of frauds
        
        Transfers possession
        
        o License
        Excuses acts done by one on land in possession of another that, without the license would be trespass
        
        Conveys no interest in land and may be contracted for (or given orally)
        Ex: Hotel
        
        Revocable at the will of the possessor of the land
        May constitute a breach of contract giving rise for damages – but it is effective to deprive the licensee of all justification for entering or remaining upon the land
        
        There can be no specific performance of a contract that gives a license.
        
        License v Easement?
        o License: waiver of right to exclude (often arises by contract) – revocable at will
        
        o Easement: irrevocable conveyance of the right to engage in a use of land
        
        o PROFIT
        The right to enter on the land of another in order to extract something of value
        
        Generally governed by the same rules as easement appurtenant
        Ex: Fishing, hunting, recreation
        
        This grant carries an implied license to enter the land for purposes of carrying out the profit
        License remains irrevocable as long as the profit continues
        
        Easement Appurtenant
        o Belongs to another parcel of land
        
        o Dominant tract: tract benefited or enhanced by easemenet
        
        o Servient tract: tract burdened by easement (tract out of which easement is carved)
        
        Deciding which one it is''
        o The law favors easement appurtenant b/c this results productive use of the land.
        
        o Importance: easement appurtenant is automatically transferred when the dominant tenement is transferred (while an easement in gross remains with the holder)

'Affirmative v. Negative''''

Affirmative = permits easement holder to perform affirmative act on the land of another
Negative = permits the easement holder to demand that the owner of the servient tract desist from certain actions that might harm the easement holder
- o Can be done by drafting a covenant that runs with the land
- o Prevents owner of servient estate from doing something
- o No negative easements in the US
  - Instead – allow prohibition for equitable servitude and covenants

'Public v. Private Easement''''

Private
- o Authorize specific named parties (individuals/enterprises) to use land for designated purposes)
Public Easements
- o Authorize general public to use land for designated purposes
- o Many states have this.
  - Ex: public walkways in England.
  - Ex: Beaches
    - Public prescriptive easement – narrow use (traversing beach), broader use would be possessory (and thus be Adverse Possession)
    - Can be acquired by donation/sale by owner or prescription

'Creating of Easement''''

Create by (1) express (written grant), (2) implication, (3) necessity, (4) estoppel, or (5) prescription
A) EXPRESS EASEMENTS:
- o Grant or reservation
  - Grant: when a grantor conveys or “grants” an easement to another person
  - Reservation: when a grantor conveys land to another, but retains or “reserves” an easement in conveyed land
- o Comply with Statute of Frauds
  - In writing
  - Identify grantor/grantee
  - Contain words manifesting intent to create easement
  - Describe land
  - Signed by grantor
B) EASEMENT BY IMPLICATION
- o Implied from prior existing use
  - Hard to definitively prove b/c not in the deed records. Statute of Frauds inapplicable.
- o Requirements
  - Separation of Title (A conveyed land to B)
  - Use prior to separation was so continuous, obvious or manifest to show permanence
  - Easement was necessary to the beneficial enjoyment of land
- o Can’t be your fault that you’re landlocked
  - Schwab v. Timmons (Wisconsin 1999): Neither an easement by implication nor easement by necessity was established b/c they created their landlocked problem (sold top portion of their land)
    - Facts:
      - o Deed is silent.
        This isn’t implication easement b/c private road never extended to landlocked owner’s land.
        
        Not easement by necessity b/c WI doesn’t recognize geographic barriers (bluff) as sufficient.
      - Trying to balance
        o (A) desire to protect A’s right to exclude and
        
        o (B) Public policy: Utilitarian interest. Value of whole property less if A’s right to exclude is so strong.
      - “Reasonable-use” test for easement would ignore precedent and public policy. Would make things too vague.
        o Would allow for “hidden easements” (ie granting easement that was never in record and not obvious enough for implied)
C) EASEMENT BY NECESSITY
- o Arises where an owner severs a landlocked portion of his property by conveying such parcel to another
- o High standard of “necessity” than easement by implication (just convenience)
- o Requirements
  - Owner severs landlocked portion of property by conveying it to another
  - Common ownership of the 2 parcels, prior to severance of the landlocked parcel
  - Owner of now landlocked parcel cannot access public roadway from his property
- o “Necessity”
  - Majority View = strict necessity
    - Parcel must be
      - o A) Entirely surrounded by privately owned land without touching any public road, AND
      - o B) Owner must not hold an easement of another legal right of access to cross the adjoining land to reach a public road
    - Can’t be YOUR FAULT that you’re landlocked (Schwab)
      - o Owner sold public road access when he got property.
    - Minority View = reasonable necessity
      - Easement must be convenient or beneficial to the normal use and enjoyment of the dominant land
        o Note: Statutory condemnation allowed in half of states if there’s a public use
D) EASEMENT BY ESTOPPEL
- o Where owner of land has granted a license to another to use and make improvements upon the land + the licensee, relying on this permission, does use and make improvements to the land at considerable costs, that license is irrevocable (Licensors is estopped to revoke it)
  - Holbrook v. Taylor (Kentucky 1976)
    - Holbrook allowed T to use and improve along his private road. Didn’t object to him building house on road, only once house was built.
    - Essentially property right equivalent of promissory estoppel (contract right)
    - How else could H have stopped T?
      - o (would all have to be in writing)
      - o Negotiate access for $
      - o Allow use for limited duration
      - o Allow access by selling part of property (at bottom w/o road) to T
    - o Requirements
      - A license (typically for access purposes)
      - Licensee’s expenditure of substantial money or labor in good faith reliance
      - Licensor’s knowledge or reasonable expectation that reliance will occur
E) EASEMENT BY PRESCRIPTION
- o Closely related to Adverse Possession and site specific (if want to apply across the board, example to “all beaches” – Can’t use prescriptive easement; use custom (or something) Ex: Oregon ex rel Thornton
- o Based on concept that property rights in land of another can be acquired by conspicuous, long-term use
- o Requirements
  - Open and notorious
  - Adverse and under a claim or right (no permission)
  - Continuous and uninterrupted for statutory period
- o If an encroaching user obtains an easement by prescription à results in perpetual easement in all respects equivalent to an easement by grant
  - If a person acquires a prescriptive easement, the landowner may be required to remove a structure that encroaches on the easement (and the landowner pays for the structures removal)
    - Warsaw v Chicago Metallic Ceilings (Cali 1984): P did have a prescriptive easement b/c he didn’t possess, was just using it for turning the trucks (limited use) and D knew about it when he built the warehouse to block.
      - o Would have been different if P parked trucks there → parking more like possession
      - o CA civil code can trump common law, and says you can allow use w/o risking prescriptive easement if you put up a sign specifying use allowed
    - o Standard rules of prescription and AdPo involve Calabresi’s Property Rules
      - One day before SoL runs, TO has entitlement protected by property rule
        TO can block adverse user/possessor from further using property w/o TO’s consent
      - The day after SoL runs, adverse user/possessor has entitlement protected by property rule
        Can use self-help or otherwise to stop the TO (or others) from interfering with their right to use or possess
      - o Difference from AdPo
        Don’t need to be exclusive for easement
        
        Just use, not possession --
      - o Can only get positive easements by prescription

'

To get access to private road from landlocked property:
- o 1) Easement by implication – No compensation (Schwabb)
- o 2) Easement by necessity – No compensation (Schwabb)
- o 3) Statutory condemnation = compensation
  - Half of states allow ED by statute to balance interest. Person A (not landlocked) must give Person B (landlocked) easement in exchange for just compensation, as long as B can show a public use. F
    - Form of liability rule protection = permanent damages.
  - o 4) Easement by Estoppel – No comp, permission given, not written (Holbrook)
  - o 5) Prescriptive Easement (Warsaw)
    - Express denial of permission, but then allowed
    - Must be definite use w/in specific pathway
      - Distinguish from OR beach case – b/c pathway was not settled there (hence they used custom)
    - o 6) Easement in gross (express easement) – Contract allows use (Baseball)
NOTE: Some states (like New York) don’t allow easement by estoppel
- o Because it’s messy and there’s no recording in deed. You must make agreement up front.
  - Too costly otherwise
- o Half of states require explicit deed language of easement

'Easements and Quasi-Nuisance''''

A landowner must only use his property in a manner that doesn’t injure the legal rights of another
- o Fontainebleau Hotel (Florida 1959): a nuisance only exists when it interferes with the lawful rights of another, and absent some sort of easement or other agreement (statute, uninterrupted use for 20 years), a landowner has no legal right to the free flow of light / air across the adjoining land of the neighbors.
  - Sic utere only applies if injuring another’s lawful rights
  - Rejects Ancient Lights (one of 4 common law negative easements)
    - US wants new, big buildings in growing cities. Economic incentive (as opposed to first in time)
    - US can’t recognize negative easements where there’s no trespass.
  - If no legal right established, structure can obstruct light/air/views to adjoining property if it serves useful and beneficial purpose. Doesn’t matter if it injures neighbor or built partly for spite.
- If you want to ensure flow of sunlight across land
  - o Can use zoning ordinances
  - o Or negotiations of a restrictive covenant that limits height of neighboring building
- Negative Servitude recognized by law (solar light)
  - o This is a change in property law
    - Demsetzian à an asset that becomes more valuable / competition around it, then the property doctrines develop in a way to create a more accurate property right to rely on these continued developments and improvements in technology
  - o Prior appropriation rights for solar access in some Western States
    - Like water
  - Blocking of solar panel can be nuisance

Termination of Easements

Methods
- o By deed (agreement)
- o Surrendered by owner of dominant tract
- o When dominant and servient tract come under common ownership (merger of easement into larger fee simple)
- o Adverse Possession or prescription
- o Prolonged non-use suggests abandonment of easement (ex: Railroads)
Changed circumstances are not considered ground for termination of an easement, unless the easement is stated in terms of a particular purpose that has become obsolete

XII. #COVENANTS and #SERVITUDES

Overview

Easement – What neighbor can do on your property
- All about exclusion
Covenant – What neighbor (and his successor (runs with land)) can or can’t do on their property
- Deals with use of land
o Covenants and servitudes are same thing – promises respective use of land
o Can be either affirmative or negative
- Restrictive covenants
- Two types of restrictive covenants
  - 1. Equitable servitude = remedy is equitable remedy (ie injunction)
  - 2. Real covenant = remedy is damages
- Common Features of Covenants
  - o More like contract than property (unlike easements)
  - o Imposes no duties of forbearance on 3^rd parties
  - o One cannot acquire a covenant by prescription, implication, necessity, or estoppel
  - o Must be in writing – Statute of Frauds applies
  - o Not a core right, just “add on” by written contract

'Equitable Servitudes''''

Elements
- o Creation of Burden
  - 1) Intent of original agreement to bind successors
    - Must be written in original deed
  - 2) Notice – Reasonably knew or should have known (actual, inquiry, constructive)
    - Due diligence
    - Regardless of express/implied consent to burden
  - 3) Touch and concern
- o Other rules
  - Once created (by contract) – treated as property interest
  - Must have relationship with property to enforce servitude
- o Remedy = Injunction
  - However, can consider undue hardship. If P sits on action to enforce and seeks hefty injunction, courts can grant damages as relief (Wrotham Park Estate (Eng 1974))
- For Benefit to run
  - o Just need (1) Intent and (2) Touch and concern
- If predecessor had contract with original seller of land that had certain stipulations, the successive owner is bound to meet those if they run with the land and he had notice at time of purchase
  - o Tulk v Moxhay (Eng 1848)
    - Facts:
      - P sold land with covenant to keep garden an open space. Buyer then sold to D, who had notice. Promise wasn’t in the deed.
    - Court concerned about fairness à if buyer could escape restriction, it would be unfair.
      - He probably paid a lower price for the land b/c it had restriction!
    - o In US, buyer is bound to restrictive covenants of prior deed even if they don’t know
      - Buyer must do due diligence to see if restrictions on land from prior agreement.
      - They should have known!
    - Who can enforce equitable servitude?
      - o Have to have some kind of relationship to the property, such that your interest is benefited by equitable servitude
      - o Ex: Neighbors able in Tulk who could access garden.
    - Note: Usually no rule of perpetuities – deed should specify length of time and/or state will limit

'Real Covenants''''

Elements
- o Creation of Burden
  - 1) Intent of original agreement to bind successors. Promise runs with the land.
    - Must be written. But can be inferred.
      - o No notice requirement. Notice assumed if the deed is properly recorded (if not recorded properly à no real covenant).
    - Must relate to the actual ownership of land, not just general concerns
  - 2) Touch and Concern
    - Personal obligation (to do something), as opposed to not do something on your land, usually is not touch and concern.
      - o EXCEPTION: Affirmative covenant is fine for HoA fee (Neponsit)
    - Can be vague. Argue this.
  - 3) Privity of Estate, both
    - A) Horizontal privity
      - o Promise made between AàB and AàC in connection with original sale.
      - o Show some strong “community of interest” between benefit and burden holders
      - o Ex: B promises not to play loud noise (that would bother C), C promises same.
    - B) Vertical Privity
      - o Does the promise made by B/C carry on to their successor
      - o NOTE: successor must have same durational interest as the promisor – convey whole lease!
        If B had fee simple, so must D (when B transfers to D)
        
        Sublease breaks vertical privity, assignment does not
      - Neponsit (NY 1938)
        o Facts: HOA corporation sues to enforce covenant to pay fee, used for neighborhood improvements.
        
        o HOLDING:
        1) Old Rule = Affirmative covenant does not run with the land. Only negative covenants. (Some states + England)
        
        2) NEW EXCEPTION = Affirmative covenant may run with land if it affects value of overall development and burden is small.
        Covenant can be monetary. Benefit can be in gross (new rule for HoA), not just appurtenant (old rule)
        
        Eg even if it doesn’t physically touch the land, might still satisfy the rule.
        
        3) Neponsit is a corporation composed of home owners. Valid privity – corps can represent people
For Benefit to run
- o Fewer requirements b/c L would have incentive to advertise benefits as opposed to burdens
- o Requirements
  - 1) Intent for benefit to run
  - 2) Vertical privity
    - Just need succession in “some estate or interest”
    - Do NOT need to have same durational interest
      - o Sublease maintains vertical privity here
    - 3) Touch and concern
  - o Don’t need horizontal privity!
- Who can enforce real covenant?
  - o Anyone who’s acting in benefit of someone who meets benefit requirements
- Note: Adverse possession defeats all privity because there’s no succeeding in interest. Interest is destroyed and new one formed.
  - o Must have transfer of title

'Third Restatement of Property Servitudes''''

NO COURT HAS ADOPTED THIS YET
- o Courts prefer “touch and concern” standard à b/c vague and allows courts to wield liberally to do justice (so long as complies with precedent
Servitude is enforceable as default
- o Most contract-like
- o Assumes it is valid on transferee unless it is an exception
  - Exceptions for craziness or against public policy
    - Ex: illegal, unconstitutional, restraint on alienation, spiteful

'Termination of Covenants''''

CHANGED CONDITIONS
Eagle Enterprises Inc. v. Gross (NY 1976) – covenant no longer touch and concern if obsolete
- o Facts
  - EE sells to buyer w/ deed provisions requiring affirmative covenant to buy water for summer home.
  - Things change: SUMMER HOME à YEAR-ROUND HOME
  - New buyer. No mention of covenant in deed. EE sues b/c new buyer builds his own well.
- o HOLDING: No touch and concern.
  - Changed circumstance eliminates the “touch and concern” element of water purchase covenant
    - Obsolete covenant is void
  - Court doesn’t want to give broad-reaching ruling
- Bolotin v. Rindge (Cali 1964) – Must prove covenant is obsolete and no benefit for D by enforcement
  - o Facts:
    - P has restrictive covenant from commercial development. But area has become more valuable. Wants to build against neighbors (D) objections.
  - o HOLDING:
    - For changed circumstance to terminate covenant as “unreasonable”, must show:
      - A) Land has changed character such that covenant obsolete, AND
        o Look at the immediate land (ie neighborhood), not just surrounding land
      - B) Enforcement has no benefit anymore for current Defendant
    - o Court looks to purpose/intent of covenant (protect D from unwanted uses)
      - Weigh the defendant’s interest heavier

'#Conservation Easement''''

Servitudes that restrict future development of land
- o Ex: No commercial development, only for agro or residential use
Characteristics
- o Negative – similar to real covenant/equitable servitude
- o In gross – Control goes to third party conservation group instead of owner
  - Problem in common law (but has become exception)
- Growing popularity
  - o A) Popular with environmentalists – binds in perpetuity!
  - o B) Gives “peace of mind” for owners who don’t want obtrusive commercial development
  - o C) Significant tax benefits
    - Counts as donation to local govt unit or environmental group
    - In Virginia, you get (transferable) tax credit up to 25% of value of donated land, and you still keep land
  - Ex: NGO use
    - o NGO = private or nonprofit w/ mission to protect land
    - o People make covenant to not develop land, binds assignees
    - o NGO owns benefit in gross, doesn’t own land but active for public
      - Not valid at common-law b/c (a) No privity of estate and (b) Not appurtenant but in gross
        To get around these problems: Congress passed Act allowing it
      - Criticisms
        o 1) Deprives public of input into conservation policy – left solely to owner
        
        o 2) Can be abused
        In some states, building a gold course counts as public space for conservation tax benefits
        
        o 3) Binds in perpetuity
        What if you find super important mineral on land in 100 years but you’ve given up right to mine it

XIII. #ZONING

Overview

Main source of land-use control of a public character
Matter of state and local law
- o State Constitutions or legislation (“home rule” provisions) give local govts sweeping regulatory powers
- o States pass Zoning Enabling Act for localities to control
  - Kicked off with 1924 Zoning Enabling Act
    - Intent to make land use more efficient. PROGRESSIVE ERA.
  - Variance v. Special Exceptions
    - o Variances – Allow for relaxation of zoning requirements in cases of undue hardship
    - o Special Exception – Permit uses only if conditions specified in the ordinance are met
  - How it works
    - o (1) Divide community into separate zones
    - o (2) Specify uses permitted in each zone
    - o (3) Impose regulations on use
  - CHANGES TO ZONING
    - o Based on
      - Due Process (substantive and procedural)
      - Takings Clause (state or federal)
      - Equal Protection – race issue
      - Free speech, association, religion
MUST PROMOTE PUBLIC HEALTH, SAFETY, MORAL, and GENERAL WELFARE

'#Euclidian Zoning''''

Municipal zoning regulations are constitutional – unless clearly arbitrary and unreasonable (per public health/safety/etc)
- o Village of Euclid v. Ambler Realty (1926)
  - Facts:
    - Ambler bought property in city. Speculative. Doesn’t reside on property = future use. Gets restricted from commercial development in residential zone.
    - Due Process suit. NOT takings.
  - HOLDING:
    - Zoning is constitutional on its face
    - As applied question à Must be use of state police power for “acceptable ends”
      - o Nectow v. City of Cambridge (1928)
    - “Pig in a parlor.”
      - Apartments near homes can make them “mere parasites”.
        o Blocks sun/air, increases traffic
        
        o “very near to nuisance”
        
        o Similar to Fountainbleu (zoning expands right to exclude)
      - Zoning power comes from states’ police powers
    - Nuisance law is foundation
      - o Zoning is intended to prevent nuisance.
      - o No property right to engage in nuisance
        Goal is to prevent nuisance, not abate'
      - General desire to create overall benefit/use enjoyment via zoning
        o Single family homes often get most benefit
        20^th century desire to create nice suburbs
        
        Cumulative Zoning
        o Cumulative = Hierarchy. You can do anything in your zone and above (ie can build house in commercial area, but not factory in residential area)
        
        o Noncumulative zoning = Only enumerated use in that zone.
        
        FUTURE USE v EXISTING USE
        o Future Use = can be completely restricted
        
        o Existing Use = becomes non-conforming use
        Existing uses are grandfathered in
        Maybe because more psychologically to get them to stop – endowment affect?
        
        Tend to linger
        A use can become more valuable when it’s the only one in town
        o Ex: Only bar allowed in town after zoning
        
        Once a use of property is established 'à' becomes vested right
        Before zoning law is adopted, owner of undeveloped land has no vested right
        
        Enacting zoning law can’t stop existing use, but can’t switch or expand non-conforming use
        
        o See Amortization Theory

'#Amortization Theory''''

How to handle property owners with non-confirming use.
Harbison v City of Buffalo (NY 1958)
- o Facts:
  - Cooperage on property for 20 years. Then told to conform w/in 3 years of zoning.
  - EXISTING, non-conforming use.
- o HOLDING:
  - Give reasonable termination periods to non-conforming use = constitutional
    - Based upon the amortized life of the use/structure
  - Constitutional b/c don’t compel immediate destruction of the improvements – but they envision and allow for their normal life without extensive alterations or repairs
    - Only when PUBLIC INTEREST to stop > PRIVATE BENEFIT to continue
  - o No exact science for amortization or reasonable period
  - o FACTORS TO CONSIDER FOR REASONABLENESS TEST
    - Period of Amortization = crucial factor
    - Also:
      - Nature of surrounding area
      - Value/conditions of improvement on premises
      - Nearest area P could relocate
      - Costs associated with relocations
      - Whether P may continue business – resultant injury to P (fact specific)
    - o NO COMPENSATION
      - Just give reaosnable period to stop.
      - Unlike eminent domain (compensation), nuisance law (immediate injunction)
    - o Dissent concern – Retroactive Zoning is BS
      - Why would anyone build in an area if they can be zoned away later on?
      - Plus, these new residents “came to the nuisance” (like Spur (but we’re in the dissent here))
    - Note: Some states do not allow amortization, others apply the Harbison test

'Zoning Policy Pro/Cons''''

Advocates
- o 1) Tiebout Hypothesis – Zoning promotes competition btw localities
  - People will go to locality with zoning laws that best protect public goods
    - Aggregate happiness because people have freedom to choose (Euclid)
  - Local competition prevents “fiscal freeriding”
  - Assumption – only people paying taxes enjoy benefits
- o 2) Inexpensive way to reduce externalities (prevent nuisance!)
  - Helpful if'
    - Nuisance law isn’t enough'
      - o Nuisance may not be substantial enough (ie simple commercial use) or vague (hard to target)'
    - Covenant too expensive'
      - o Too costly to create individual covenants à holdout, expensive negotiations'
      - o 'Houston only big city w/o zoning. Relies on covenants and subdivision controls.'
    - o 3) Legislature > Judiciary for deciding zoning
      - Legislative can figure this stuff out better
    - o 4) Get public voice involved
      - But mostly rich people’s voice
    - Criticism
      - o 1) Bad track record – this is a really complex topic
      - o 2) Based on bureaucratic decision-making. Slow, uniform, high admin costs
      - o 3) Can be racist – drown out poor people
        Can exclude people by increasing housing prices by (a) preventing negative externalities and/or (b) creating local housing market monopolies
        Big developers can afford to lobby localities, but individuals can’t
        
        Buchanan v. Warley (1917) – No zoning law to bar sales to other race in majority white/black area (per 14^th Amend)
        
        Poor people have less of a voice than rich people
      - o 4) Focus on present, can lose sight of long-term
        Creates the future that majority wants

'#Exclusionary Zoning''''

Racism / class segregation affects on cities from zoning, while cities claim its just for tax incentives
Southern Burlington County NAACP v. Mount Laurel (NJ 1975)
- o HOLDINGS
  - Every locality, via zoning, must give reasonable opportunity for all housing options, including options for low income families to live in the town
    - May not constructively prevent them from doing so (excluding by no options to them)
  - Must structure zoning to promote welfare of all state citizens, not just your own
    - Each locality must pull its “FAIR SHARE”
  - o Facts
    - Zoning to favor upper income families (like sq ft minimum and one-person per room max).
    - Admits its limiting poor people for econ advantage
      - Can keep town low-tax, high-income b/c:
        o 1) Cost – Low income people more likely to use more public resources
        
        o 2) Revenue – Rich people can pay higher taxes
      - But this policy leads to ghettos and hurts neighbor’s area
    - o Based on state constitution and state interest. Unlike Euclid (based on Fed constit)
  - Options
    - o 1) No zoning at all
    - o 2) Mount Laurel approach
    - o 3) Statutes that limit local govt to exempt (need certain % of housing to be affordable)
      - Inclusionary zoning

'#Inclusionary Zoning''''

Tool urged by Mount Laurel II
When developers build units, a certain number of them have to be set aside for low income housing (rent is controlled by regulation and only rented to people who meet criteria)
- o No more nonprofit developers (like Mt Laurel 1)
- o Judicial Policy Making – Court decides what fair share is
  - Court held that affirmative measures by municipalities, such as incentive zoning and set aside, were within the constitutionally delegated power to zone and within the range of remedies courts can order
- o Builders remedy
  - Had to help builders/developers get subsides.
  - Developers can sue town that prevents acceptable building.
- o Economic Idea
  - Allows for subsidies of low-rent apartment units
  - Market rate buyers subsidize low-income buyers
- o Ex: if 100 apartments → 15 have to be affordable.

'Other Zoning Options''''

State Agency Rule
- o Mt Laurel III
  - Municipalities submit plans to meet agency reuqirements. If town meets reqs, cant be sued by builder’s remedy
  - Municipality can buy out obligations of other municipalities (up to 50%)
    - Not good! Leads to Camden (ghetto) buying up low-income obligations of Mt. Laurel
  - o NJ recently ruled this is unconstitutional and abolish
    - Governor (Christie) was not enforcing good regulation
  - Anti-Snob Zoning Act
    - o Massachusetts, very successful
    - o Builder’s remedy if locality fails to achieve affordable housing target
      - Towns must have at least 10% of housing to low income housing.
      - Developer may get around zoning rules (ie density regulations) if town is under 10%
        Developer gets subsidy to build low-income housing
        
        If developer turned down, he can bring suit (Builder’s remedy)
      - o But locals hate it because they see it as using public money to build unsightly housing
    - Applying Mt Laurel to DC
      - o There are tons of low income people who can’t afford housing b/c of the increase of gentrification in D.C.
        20% of D.C. is covered by historic preservation (exclusion going on subtly)
        
        Population is increasing rapidly (lot of new construction / high-rises).
      - o Issue: what to do about affordable housing?
      - o State-Level Zoning
        Across all municipalities, require each apartment (say over 40 units) to include X% of units for low-income
        
        In MoCo – dispute about whether low-income units need to be build on-site or somewhere else

XIV. #EMINENT DOMAIN (#ED)

Overview

“Nor shall private property be taken for public use without just compensation” – U.S. Constitution
ED is an attribute of implied government sovereignty
- o Legislative power
  - Federal = implied, Kohl v. US (1875)
  - State = Governed by state statutes or possibly state constitution (usually express)
- o Can be delegated to…
  - 1) Municipal governments – all states do this
  - 2) Common carriers (RRs and utility companies) – most states do this
  - 3) Individuals
    - Landlocked owners who need easement to access property can get ED – half of states allow
    - Landowners otherwise need express grant from govt
  - Justification for ED
    - o 1) Public use (or benefit)
    - o 2) Overcomes problem of bilateral monopoly (govt is only purchaser, landowner is only seller)
      - Haggling problems: strategic holdouts, haggling inefficiency, strong dislike btw parties
      - Ex: Govt trying to build pipeline over many individual landowner private properties (Shell Pipeline Co.)
    - o 3) ED is a compromise
      - Not govt taking w/o compensation (which would encourage lots of govt taking + unfair)
      - Not absolute prohibition on govt taking (impractical)
    - Power of government to alter entitlements
      - o Basically a liability rule protection
        Govt gets title to property and landowner gets paid
      - o Raises issues of flexibility and forbearance
    - Eminent Domain trumps ordinary property rights (eg exclusion)
      - o Must meet both statutory and constitutional requirements
      - o Statutory Requirements: Must show
        1) Condemnation power delegated by legislature
        
        2) Power covers proposed project
        
        3) ED is “necessary” to complete project
        
        4) Proper procedures have been followed
        + may be additional requirements (eg show property is “blighted” if urban renewal)
        
        o Constitutional Requirements:
        1) Public Use behind project
        
        2) Just Compensation offered -- JC = Fair Market Value
        + Due Process requires notice and opportunity for hearing on the issue before seizure

'#Public Use''''

Two polar positions
- o 1) Sovereign cannot take property of A just to transfer to private party B, even if A compensated.
- o 2) State can transfer proper btw private parties if future use by public is purpose of the taking
Broad interpretation used by SCOTUS
- o Old Interpretation = Actual use by public (eg highways, parks, RR)
- o Current Interpretation = Much broader. As long as there is public benefit
  - Public purpose is sufficient. Economic development = public purpose. Defer to legislature. Can transfer between private parties.
- Different from States
  - o States are much stricter than Federal
  - o 1/6 of projects fail to meet state constitutional standards (ex: private access roads often denied by state)
- Berman v. Parker (1954)
  - o Unanimous decision.
  - o ED is coterminous w/ state police power. You can ED anything for public purpose (welfare)
  - o First and largest urban renewal project.
    - Can condemn blighted area (beyond repair) for development is good public use (schools, streets, low cost housing)
    - Condemn everything, even if not every building is blighted.
    - Defer to legis for what is public interest (health, beauty, etc.)
  - Midkiff (1984)
    - o Affirms Berman. Mechanics of ED don’t matter.
  - Kelo v. City of New London (2005)
    - o Facts:
      - Not a blighted area. Middle-income white people. Pfizer was already there (so not actually bringing new business!), but trying to make the area nicer with development. Bring jobs to city with high unemployment.
    - o Majority Holding:
      - Economic development satisfies public purpose. Can transfer btw private parties for this.
        Econ Development = Jobs, taxes, optimism
      - Plurality Reasoning:
        1) Precedent
        
        2) Public policy – defer to legislature. They have a transparent plan and have fielded comments from public. Legislature knows expected public benefit and lands needed for plan.
        
        3) Serious need for econ in the city
        
        4) Distinguished from (narrower than) Berman
        o These are not blighted areas, but important for revitalizing econ. Berman was broader and said you can ED potentially blighted areas.
        
        No determination on transferring land just for higher tax revenue.
      - o Kennedy concurrence
        Rational-bases review for Public Use.
        
        Invalid if there’s favoritism + incidental benefit to public.
      - o O’Connor dissent
        Transfer btw private parties for public purpose by ED only when direct public benefit (ie gets rid of harm to public, like blights)
        Wants to be more narrow than Berman
        
        Econ development is not direct enough. Everything has incidental benefit to public.
        
        Ignored political/market reality
        
        o Thomas dissent
        1) Public Use just means ED. Not a limit, just distinguishing from taxes (where you don’t get JC)
        
        2) ED for economic benefit disproportionally affects poor (minority) communities. Like urban renewal.
        Counter: Not the case here. This was case of white middle class people. + civil rights protects minorities + this ED has public approval via legislature.
        
        Public reaction to Kelo
        o People woke up to ED existence, that govt can take their property
        
        o Strong backlash from states
        Many state adopting high standard for ED (no ED for economic development purposes)
        
        Note
        o Can’t condemn property and retransfer to commercial entity solely for econ development. (County of Wayne v. Hathcock (Michigan)). Overturning Poletown which was just trying to prop up GM auto plant.
        
        o Can’t use Ed to keep Raiders in Oakland. City of Oakland v. Oakland Raiders (Cali 1982)

'#Just Compensation''''

Fair Market Value for ED = price for willing seller to willing buyer
- o Some statutes add economic impacts (like relocation costs and moving costs to compensation for subjective value loss)
- o Personhood Loss of community.
United States v. Miller (1943)
- o Fair market value for ED does not include any value increase from the govt project, if land taken w/in project’s scope when govt committed to project
- o Normally, use value of property at the date of title transfer
- o FMV refers to hypothetical price b/c ED normally used for when negotiations break down (so really no market value)
  - Ways to calculate
    - 1) Look at recent sales of the property and adjust for inflation/market changes
    - 2) Look at other parcels of property in the area
    - 3) Look at rental value as benchmark and do real estate calculation
    - 4) Determining the replacement cost of the land and improvements taken and adjusting downward to reflect depreciation due to age and wear/tear
  - o Big takeaways
    - Don’t factor in price raised from planned project
    - Don’t compensate for impact on surrounding properties
      - Exception: If you damage another parcel of the same property, then compensate (partial taking)
      - But if govt benefits that other parcel à value of marginal benefit discounted from comp of taking
    - Arguments for/against FMV
      - o For
        1) Difficult to value intangible things or consequential damages
        
        2) Including increments of value would increase admin costs of ED
        
        3) Public Use warrants public subsidy (don’t need to pay full price)
      - o Against
        1) Doesn’t compensate for subjective value of property = personhood
        
        2) If person wanted to sell, they would
      - #PARTIAL TAKINGS – SEVERANCE DAMAGES
        o Landowner is entitled to the fair market value of what is taken plus severance damages for any loss in value to the part that is not taken.
        
        o The rule for partial takings apply only to those who experience a partial taking of their property:
        Miller says the rule apply only when a partial taking affects a single parcel of land (i.e. if landowner has 2 parcels – any damage that a taking on 1 parcel does to the 2nd parcel is not compensated)
        Murr v. Wisconsin (2017)
        o Where a landowner owns adjacent tracts of land, the tracts constitute one parcel for purposes of the Takings Clause if the owner’s reasonable expectations about property ownership would lead him to expect that his holdings would be treated as one parcel.
        
        o Calculate the lots together if it makes sense. Lot lines aren’t absolutely perfect. Consider:
        (1) the treatment of the property, specifically any division under state and local law;
        
        (2) the property’s physical characteristics; and
        Lots along river. Murr knew govt has interest in waterway.
        
        (3) the property’s prospective value, including any effect on the owner’s other holdings.
        
        #QUICK TAKE STATUTES:
        o Procedures are constitutional – provided the government deposits a fair estimate of just compensation with the court before title passes and the taking is otherwise legally justified
        
        o Let’s state take property, then proceed to court

XV. #REGULATORY TAKINGS

Overview

When the power of EMINENT DOMAIN is exercised, the 5th amendment explicitly requires that the government pay just compensation for the property taken.
- o But, when the government REGULATES property under the police power then it is understood that there is no constitutional requirement that the government compensate property owners for losses that may suffer due to the regulations
Idea
- o ED = JC
- o Police power regulation (zoning) = No comp
  - Except if RTD (regulates too severely)
  - Must show significant govt interest (Euclid)
- Core question
  - o Does the regulation at issue constitute a taking, which would require compensation,
  - o OR is it within the police power, and would not require compensation?

'#Regulatory Takings Doctrine (#RTD)''''

When regulation goes too far, then it’s considered a taking and JC owed
- o Inverse condemnation doctrine
Pennsylvania Coal Co v. Mahon (1922) = Big change (limit on police power regulation)
- o When the use of property may be regulated, overregulation will be considered a taking (Penn Coal)
  - A statute that promotes overregulation of property can be considered a taking.
- o STRONG PUBLIC INTEREST + MINIMAL IMPACT à valid regulation
  - Court still recognizes limit/boundary of police power
    - Police power = public health, safety, morals, welfare
  - o Facts
    - Mahon owns surface, but Penn Coal retains right to coal underneath (per deed). Penn govt restrict mining that would harm structural integrity of home. Penn Coal sues as govt taking.
  - o Holmes holding
    - Penn Coal permitted to continue mining. Property may be regulated unless it “goes too far” and becomes taking. This went to far.
    - Reasoning
      - Mahon new the risks. He got benefit of cheaper deed. Court/govt shouldn’t get involved here, b/c this is really a private dispute.
      - Ad coelum – right to coal = right to mine. To make mining impossible would be a taking/destroying. (even if not actual govt possession)
      - Coal has a big impact on the region. Big industry!
    - Distinguished from Plymouth Coal
      - That was case about employee safety w/o notice of mine instability.
      - (1) Those employees were in danger w/o notice and (2) there was reciprocity of advantage to the owners b/c both companies needed to leave a pillar of coal in place
    - o Brandeis dissent
      - Reciprocity of advantage consideration only for public benefit, NOT for public harms
      - This is isolated case, but could effect the whole state!
    - o HOLMES v BRANDEIS:
      - Looking at the scope of property (what the “whole” is) – that is the difference in their opinions
        Specifically disagree on: proper unit of property against which to measure the effect of the regulation (THIS IS LEFT OPEN IN PENN COAL; codified in PENN CENTRAL)
        
        Holmes = correct unit of analysis is the pillars of coal that must be left in place to support the surface
        o If value of coal underneath is property à taking
        
        Brandeis = the appropriate unit of analysis is the “whole property”
        o If just surface property à not a taking
        
        Justices didn’t really disagree about the factors to be considered in deciding whether a police regulation “goes too far”
      - Factors to consider if ”gone too far”
        o Diminution in value caused by regulation
        
        o Need to protect public against nuisance-like harms
        
        o Reciprocity of advantage for property owners (just for benefit and not for harm? (Brandeis))
      - Muggler v. Kansas
        o SCOTUS upholds state regulation preventing alcohol brewing b/c it’s police power for public health.
      - Bowditch v. Bosting (conflagration case)
        o Govt blows up houses to stop spreading fire. No comp b/c emergency necessity act by govt + even if govt did destroy house they would have burned down anyway
        
        o Holmes questions modern efficacy of Penn Coal reasoning
      - Miller v. Schoene (1928)
        o Facts
        Virginia state treats infected cedar trees as public nuisance. Destroys them on private property because they spread disease and only way to stop is to kill them.
        
        o HOLDING: when forced btw saving two properties that can’t coexist à govt can regulate to protect more valuable one
        Apple trees (need protecting) are huge industry for Virginia à public interest
        Cites Muggler and Euclid. Public harm from inaction.
        
        Would have been passive taking if the state didn’t act.
        
        o Impact on climate change?
        
        o Court here focuses on noxious use (not use) and greater good (public > private) (rather than Holmes’ factors)

'#Academic Perspectives on RTD''''

3 Academic Perspectives
- o 1) Doctrinal theory on distrinctions btw govt powers (of ED and PP)
  - Penn Coal = govt powers don’t overlap, limit police power (so not to overincentivize use)
  - Joseph Sax
    - Difference between “enterprise” govt role (comp required) and “mediating” govt role (no comp)
    - When enhancing benefits = comp due
    - When internalizing externalities = no comp
      - o Any regulation with spillover effects should be non-compensated
    - Merill – For novel issues, govt will reason by analogy
      - If regulation prohibits any use, it’s confiscation-like
      - See if analogous case gives comp or no
    - Must be one use or the other b/c they don’t overlap
  - o 2) Impact of Govt action on property owners
    - Government shouldn’t force some people alone to bear public burdens which (in fairness and justice) should be borne by public as a whole
    - Michelman and Epstein theories imply that very general government regulations can qualify as takings
      - Based on John Rawls’ theory of justice
      - Demoralization costs
      - Settlement costs
      - Unless govt addressing wrongs by owner or can show implicit comp, real comp always required
    - Michelman = liberal
      - All within state power. If loss is felt by private party, compensate only if great.
    - Epstein = libertarian
      - If govt redistributes wealth, then taking and comp due. Based on evaluation of reciprocity of advantage (if roughly equal then no comp)
    - Emphasis on DISTRIBUTIVE JUSTICE
      - Whether ED or PP exercised
    - o 3) Focus on compensation could improve govt operation
      - RTD might improve govt efficiency by getting govt to internalize costs of regulation
      - Flaw: Govt isn’t working with their own money. Just taxpayer money. Why would they improve?
    - o 4) Govt will under-regulate if not required to compensate, b/c then susceptible to corruption.

'#HISTORIC #PRESERVATION and REGULATORY TAKINGS''''

To decide if regulation = taking à court should consider economic impact of regulation on the owner, the extent to which the regulation has interfered with owner’s reasonable investment-backed expectations, and the character of the government action involved in regulation
- o Penn Central Transportation Co. v. City of NY:
  - Holding: Court upholds restriction on Penn Central to build 50 story building atop Grand Central.
  - Reasoning:
    - Looked at property as a whole (not just the confiscation of airways)
      - o Need to decide the economic impact of regulation – court said it wasn’t the air rights, but the asset was a train station (very valuable)
      - o Even though through the Landmark Preservation Act they may have lost some value, there is substantial value (in the train station)
        So no taking!
      - Reciprocal advantage
        o Everyone benefits by seeing historic building
        Counter: No reciprocity b/c they’re not neighboring land owners
        
        Historic preservation is in police power
        Counter: This property is too valuable.
        
        3-Part Inquiry:
        1) Economic impact of regulation
        o Have to look at the property as a whole (surface + transferable rights)
        
        o Must show that economic potential not viable due to regulation
        
        2) Interference with reasonable investment backed expectations
        o Will investor expectations be sufficiently met?
        
        3) Character of the government action
        o Actual taking or just appearance of such?
        
        Rehnquist dissent
        
        Transferable Development Rights (#TDR): can convey development rights to another parcel (the unused air right can be transferred to another site and build above the zoning laws)
        o Can help preserve value being lost and convey it to another property
        
        Murr v. Wisconsin: how do you determine the parcel as a whole? What is the property?
        o Case involves an exception to an exception (of ordinance regulation); the court said that the 2 lots have been effectively merged (treating the two lots as one when looking at the whole property); the Murrs’ want the court to look at the individual lot (not the two together) as the whole; Lower Court says no taking (losing 10% isn’t much and the regulation is trying to preserve a river which is very important).
        
        o Reasoning:
        Value not changed much if one lot or two. But higher as one, so Murr should think its one lot.
        
        Hard to build on each individual lot b/c of topography. So likely one lot.
        
        State law effectively merged them b/c continguous and on river.

Penn Central says that courts shouldn’t segment parts of the parcel; but then Murr raises the question about the denominator (what is the total property?)

Murr: the 2 lots owned are treated as 1 (which caused it to seem “minimally impacted”); but the Murr’s say they should be treated separately (which would cause it to be “heavily impacted”)

However, we don’t want government to hesitate about decisions and worry about compensation when in emergency (and human life at stake) (Miller)

#Coase: in cases of incompatible land uses we should not ask which use is inflicting harm on the other → rather, the problem is a reciprocal one.
- A be allowed to harm B or B be allowed to harm A? problem is to avoid the more serious harm.
  - Remember: in accession cases – the court gives the thing to the party who has supplied greater value to the final good, but award damages to the other party.

PENN CENTRAL IS THE DEFAULT ANALYSIS FOR REGULATORY TAKINGS!''''If no per se categorical rule applies → then Penn Central approach; and under this approach, it is hard for the property owner to win (for the 8 reasons discussed above)PENN CENTRAL’S AD HOC FACTORS:It is okay to regulate property, but if the regulation goes “too far” it becomes a taking

Character of government action (public benefit? Burden on only a few (i.e. the landowner)?_
Severity of economic impact of regulation on owner (how great is the loss?)
The extent to which the regulation has interfered with distinct investment-backed expectations
1. No regulatory taking occurs if landowner can make economic use of the property despite regulation
2. Diminution in value must be great (must be complete loss of value)
3. Regulation may be deemed a taking if the regulation interferes with landowner’s reasonable investment-backed expectations
Once a person improves property in justifiable reliance on regulations in effect at the time improvements were made, the person must have the opportunity to recoup the cost of the improvements
But, if an owner, after the regulation is imposed, still can use the property as he used it before the regulation '→ no taking

'#CATEGORICAL RULES FOR REGULATORY TAKINGS'''Per Se Takings: ''increasing the number of per se takings rules internalizes costs which could chill government regulation (government will enact regulations that violate per se takings rules only where net social benefit, plus government lacks capacity to raise revenue to pay)

The conservative court → draw denominator as small as possible so that regulated parcel grows relatively larger (making it easier to find a taking); the government/regulators want the opposite (want large denominator of “whole property” – to make the regulated portion smaller, and thus, no taking)'

2 PER SE RULES OF LIABILITY:

PHYSICAL OCCUPATION
1. Loretto
Only covers permanent physical occupation
DEPRIVATION OF ALL ECONOMICALLY BENEFICIAL OR PRODUCTIVE USE OF LAND
1. Lucas When property is left economically idle (property owner sacrifice all economically beneficial uses of property in the name of the common good) → suffered a taking
However, the per se rule in Lucas has been narrowed so much, it basically has no particular use b/c property is rarely values at zero (there is always something you could use the property for – probably)
There is no such thing as a “temporary Lucas taking” – Palazzolo; (but there IS SUCH THING as a temporary taking in general – just not a temporary Lucas taking)
1. Cannot segment property in space (Palazzolo) or time.

If one of these 2 per se (categorical) rules apply '→ then that is the rule (no other analysis required)

Yee v City of Escondido: held that an ordinance that took away a landlord’s right to determine the identitity of a preplacement tenant in a mobile home park did not result in a permanent occupation b/c the landlord had voluntarily chosen to lease the property in the first place
Prune Yard Shopping Center v Robins: held that a state directive allowing persons to distribute political leaflets and information in a privately owned shopping center was not a taking – the regulation had only a minor impact on any investment back expectation.

The combination of Penn Central and Loretto suggests that regulatory takings doctrine partakes a general ad hoc test – supplemented by narrow rules of per se liability that apply in particular circumstances. Most dramatic extension of Loretto’s categorical rule occurred in Horne v Department of Agriculture

Court found a TAKING (raisin grower case)
The Categorical Rule from Loretto applies to PERSONAL property too!
- o The physical taking of the raisins and regulatory limit on production may have same economic impact on owner; but the constitution is concerned with the means as well as the ends!

''''''Can a property owner complain about a regulation that was in existence and which the owner knew about when the owner acquired (or produced) the property?

Monsanto: notice of regulation defeats a takings claim
Palazzolo: notice is a factor to be taken into account in an ad hoc assessment
- o On remand, the court decided it was not a taking
- o Putting any value on the property (the house is still valuable) → so it cannot be a Lucas taking
  - ▪ There is also no such thing as a temporary Lucas taking
- Horne II: notice is irrelevant

REGULATORY TAKING vs REGULATORY DEPRIVATIONS: (Lucas)

Regulatory Takings require compensation
Regulatory Deprivations don’t require compensation

LUCAS SUMMARY: NO ECONOMICALLY VIABLE USE

Categorical / per se taking occurs if a regulation renders property valueless or prohibits all economically viable or beneficial uses (Lucas: must be 0% value)
Exceptions:
- o Regulations that duplicate nuisance regulations (b/c nuisance control is never a taking)
- o Restrictions that “inhere in the title itself” (i.e. restrictions state law of property already place on land ownership (e.g.: adverse possession, prescription, implied easement, recording acts, riparian rights, executory interest in favor of the government))

XVI. #EXACTIONS

One of features of modern zoning and land use planning is that developers must submit their plans for new subdivisions to local planning authorities for their approval before construction begins
- o A locality can require developers to “put up cash” for public development (i.e.: for every X houses built, there needs to be payment to make public school’s X% larger)
Exaction = an agreement by the developer to donate certain property or money to the local community – as a condition of obtaining approval from authorities to proceed with the development.
- o JUSTIFICATION: from these exactions, they provide resources that the community can use for public goods that offset the burdens imposed on the community by the new development.

2 REALITIES: (1) land use permit applicants are especially vulnerable to the type of coercion that the unconstitutional conditions doctrine prohibits b/c the government often has broad discretion to deny a permit that is worth far more than property it would like to take; (2) reality of the permitting process is that many proposed land uses threaten to impose costs on the public that dedications of property can offset

Nollan and Dolan accommodate BOTH realities by allowing the government to condition approval of a permit on the dedication of property to the public so long as there is a “nexus” and “rough proportionality” b/w the property that the government demands and the social costs of the applicant’s proposals.

DEVELOPMENT OF THE EXACTION DOCTRINE: Nollan-Dolan

Nollan v California Coastal Commission- RATIONAL NEXUS REQUIREMENT
- o Exaction needs to address same harm as development
  - ▪ Unless the permit condition serves the same governmental purpose as the development ban, the building restriction is not a valid regulation of land but an out-and-out plan of EXTORTION
- o Nexus = relationship b/w the end to be achieved (the legitimate state interest) and the means chosen to achieve that end (the exaction) must be close enough so that the exaction substantially advances the legitimate state interest.
Dolan v City of Tigard:- ROUGHLY PROPORTIONAL
- o has to be rough proportionality in quantity/value (cannot be small harm and large take; needs to be proportional)

Exactions of property that ordinarily would require the payment of just compensation must satisfy both requirements if they are to avoid invalidation under the Takings Clause.'Main legal question after Dolan is when the exaction is for MONEY and not LAND? Is that the same thing?

Koontz v St. Johns River Water Management District
- o SCOTUS HOLDING: Nollan-Dolan apply even when the government denies the permit (versus conditioning approval) and even when the government’s demand is for money (versus an interest in real property)
  - ▪ (1) no distinction b/w denying/conditioning permits – no significant difference b/w conditions precedent and conditions subsequent
    - no practical difference b/w denying a permit for an applicant’s failure to agree to a condition and conditioning approval of a permit on that same condition
  - ▪ (2) direct link b/w the condition to pay money and Koontz’s ownership of specific parcel of land → the condition implicates Takings Clause/must comply with Nollan-Dolan
    - what is the difference b/w monetary exaction and obligation to pay money?
      - o monetary obligation was tied closely enough to the permit to develop the property (it was not free floating; it was tied to be a condition on the permit to develop the property) – making it a monetary exaction and not obligation to pay money (like Eastern Enterprise –mere exaction of money isn’t a taking b/c that is just an obligation to pay money)

''''The government’s demand for property from a land-use permit applicant must have a (1) nexus (Nollan) and (2) rough proportionality (Dolan) b/w the demand and the effects of the proposed land use, even when the government denies the permit and even when the governments demand is for money (Koontz)

The majority in Koontz appears to affirm the understanding that Nollan-Dolan require the demand the government makes on the owner (the exaction) must be a per se or categorical taking if it were imposed by the government outside the context of awarding a permit to develop property'
- o The lateral beach easement in Nollan and the bike path in Dolan were both characterized by the court as actions that would be per se takings under Loretto outside the permitting context b/c the government was in effect demanding a permanent public easement (physical occupation) over a portion of the owner’s land.'

XVII. #JUDICIAL TAKINGS

Overview'The Takings Clause – doesn’t address the action of a specific branch of government; it is concerned simply with the act (and not with the actor). There is no textual justification for saying that the existence of the scope of a state’s power to expropriate varies according to the branch of government effecting the expropriation.To constitute a taking in violation of the 5^th amendment, a property owner must show that he has a vested future right superior to that of the State and in contravention to state law. 'Stop the Beach Nourishment v Florida Department of Environmental Protection:

Scalia: insists that in order to determine whether a judicial taking has occurred – the federal courts must determine the context of state property law independently, without deferring to the judgment of the state judiciary in the challenged decision.
- o there can be such thing as a JUDICIAL TAKING; state court construction of its own law could effectuate a taking.

does Stop the Beach strengthen or weaken the autonomy of states in determining the content of property law?

On one hand → property is determined by state → court holds that littoral owners whose property is cut off from direct contact with water by a public beach project have NO judicial takings claim, b/c prior Florida decisions had given the state the power to make artificial avulsions on submerged public lands
On other hand → Scalia insists that in order to determine whether a judicial taking has occurred, federal courts must determine the content of state property law independently, without deferring to the judgment of the state judiciary in the challenged decision

in striking the balance b/w protecting federal constitutional rights and preserving state court freedom in interpreting state laws, SCOTUS has most often said that it will defer to state court interpretations of state law as long as they have a fair or substantial basis.'''

Scalia' in Stop the Beach would adopt a different approach for judicial taking claims → would ask whether the state court has eliminated an established property right '

''''REMEDY for JUDICIAL TAKING?'Scalia: the reviewing court will overturn the rendering court’s decision dis-establishing a property right. If state legislature wants to provide just compensation, the change sanctioned by the rendering court will become law → otherwise the established right will remain in place

Problems: the beach restoration project in the case had already been completed. If the court were to hold that the Act could not be applied to the project, the grains of remedy would be to award compensation to the property owners – so invalidation would effectively be equivalent to ordering the state to pay compensation for a decision of its supreme court
Possible Solution: allow persons claiming a judicial taking to seek a declaratory judgment in federal district court as to whether the legal change is a taking, and if the federal court agrees, the claimant could then seek just compensation in whichever state court has authority to award compensation.

Only 4 Justices have agreed to a thing of “JUDICIAL TAKING”

the takings clause deals with CHANGES IN THE LAW; not the original context of the law.

Remember: the law changes ALL THE TIME. With change – someone wins and some others lose → but that doesn’t mean all of those changes amount to a taking!

Regulatory TakingExaction

Exaction = Condition of government to get a permit, must give up property interest
- o Has to be in public interest. Discretion, because up to govt to decide what pub interest is.
Koonts = Court has extended to monetary exaction, in lieu of property interest.
- o No actual taking. Permit denied when conditions denied. Court recorgnizes this
- o Shift from Nollan/Dolan of taking, to more of recognizing extortion problem
  - Right being protected, and what makes it unconstitutional, is right to just compensation for taking. Looking at govt leveraging ability to say no.
  - Must raises legitimate public concern that the permit policy mitigates
- o Do obligations on Koonts satisfy Nolan/dolan?
  - Rational nexus/proportionality test
    - Question: construction on public wetland and harm that would occur?
    - Court rules that this fails. Wetlands so degraded, no harm.
  - No actual confirmation about view of trial. Fact of no harm not fully proven by evidence.
- o When does jurisdiction make a demand sufficient as condition?
  - At what point?
- o What about scheduled exaction?
  - Scheduled exaction
    - Established by legislation. Not a regulation by locality. No negotiation.
    - Ex: Specifically scheduled (like Florida school construction)
  - Court worried about extortion, and very worried about negotiation problem.
    - Negotiation exaction covered by Nollan/Dolan, but scheduled exaction is not!
      - o Justice Thomas thinks this is significant though! Inclusionary zoning
        Ex: Inclusionary zoning requiring set number of houses to be set aside for affordability at a price. Regulation of prices for percentage of houses. P sued because they didn’t set the price. SCOTUS denied cert after lower court said its not covered as scheduled exaction. But Thomas thinks court needs to address this.
      - Tax = subjects pursuant to tax under state law, goes into common pool
        o Easier to tell under state law if it’s a tax or taking
      - Regulatory fee = Specially allotted to purpose that justified fee to begin with
      - Stop the Beach Renourishment
        o FACTS: Hurricane hit Florida. Lower mean high tide line. Govt program to transfer sand to newly uncovered land and improve beach. Homeowners nearby claim its their land (by accretion) and this amoutns to taking, but govt says its theirs b/c its avulsion (and also they put public money into improving it). Trial court says its taking b/c they lost right to beach and lost accretion land. FL Sup Co says accretion land and touch water is not independent, if there’s public beach in between you lose.
        So homeowners say FL Sup Co reasoning has actually changed FL law to eliminate their right as litoral land owner to accretion and right touch water! This is what actually goes to Court.
        
        o Note: Land under water is public land.
        
        o ISSUE: Did FL Sup CO change of common law work a taking of beach owners.
        Can there be judicial taking via reinterp of common law?
        Plurality Holding (4-4): Yes. Taking clause applies to all three branches of govt (b/c doesn’t specify which branch).
        o Kennedy response: TC just had to do with appropriation. It doesn’t make sense, from original intent, to expand to judicial decisions.
        Scalia response: Admits. But now courts can change common law and they do. Maybe weren’t explicit about it long ago, but they have long changed common law implicitly.
        
        When does it become a taking?
        Plurality Holding (4-4): RULE: When court change of law takes land protected by “established right” of owner.
        
        o Scalia probably thinking about Oregon ex rel case (Where by tradition people lost land to public access). Scalia hated that case b/c thought it was unfounded/unprecedent reasoning.
        Wants to limit state courts from eliminating property rights.
        SCOTUS will look at your precedence to see if you’re eliminating an established right.
        
        Accords with federalism – letting states have their laws, as long as not eliminating vested right
        
        o Link to Golden Press – Slight, good faith encroachment where traditional remedy is injunction to remove. But court decides to give damages as balance. Not elimination of right, but the remedy (counter: but remedy and right are often together).
        
        o Issues from Scalia
        How core does right need to be?
        
        Changing
        Golden Press – transfer from one property private owner to the other
        
        Stop the Beach – transfer from private to public. But Scalia doesn’t note that its limited to public transfer. Does it apply private to private?
        
        o Kennedy
        Don’t worry about how core. SCOTUS would prevent FL Sup Co from changing common law. Then let govt decide if they want to appropriate the money for it
        Completely new.
        
        o Note: Changing common law affects everyone similarly situatied in state, not just property owner. So everyone has takings claim against state.
        
        o Breyer
        There is no taking
        Scalia: We can’t know if this is judicial taking yet. We’ve laid out rule and are inviting people to sue to determine judicial taking.
        
        o Impact: This has encourage states doing renourishment program to declare this is
        
        o ISSUE: This is eliminating a right, very just excepting it for public policy (consider State v. Shack)

Review

IWH
- o If there are violations of housing code à T can void lease and vacate.
  - Would have to notify the L first and give them oppt to handle it (by local law, 2 weeks usually)
  - Must be substantial violation
- o This doesn’t come up often, though, because usually T doesn’t want to leave. So T uses offset defense that decrease of value due to violation means that they don’t owe rent.
If violations were there when you entered, you have argument about Illegal Lease Doctrine (lease not valid to begin with
If A, B, C are cotenants, and C grants interest to D à A and B are cotenants while A/B and D are tenants in common (because D does not have survivor interest)
Difference btween long term written license and easement
- o Billboard news case – Courts construed long term written license as easemenet. Because owner couldn’t terminate license when it wanted.
- o Can easement have a condition attached, such that it terminates on condition?
  - Yes, you can have easement for period of years or easement with condition subsequent.
    - Ex: Georgetown has easement over grassy area with codnition subsequent that if city ever extends F st, the easement ends.
  - Academic perspectives
    - o Calabresi and Malemed, Coase theorem, personhood, Olmsted, regulatory takings, etc.
    - o Use them on exam if its unclear case.
  - O’Keefe
    - o Court holds that SoL runs when owner knows or should have known who to sue (can bring cause of action)
    - o Applies to chattel
      - Not to land, because you should know whos on your land.
    - Relationship btw DP and Takings Clause
      - o Holmes notion: PP only goes so far.
      - o More modern: PP that can reasonable advance public health, safety
        Policy power and ED are coterminous. Doesn’t go beyond.
      - o Modern view
        Can violate takings clause if it .
        
        Taking can occur only before legitimate govt actions go too far (by placing burdens on property owners)
        Can’t be invalid as govt act (beyond went outside of legislation). But can be invalid otherwise.
        
        In this case, you would return the property and grant injunction (not damages like ED).
        
        o Even if ordinance constitutional, some applications of it can violate either DP or Takings Clause.
      - You can’t get AdPo against government.
        o When to apply Penn Central
        Consider character of govt action (ie promoting public health) à more leeway to govt not to compensate.
        
        o When Rt question
        Step 1) See if per se rules apply
        
        Step 2) See if exaction
        
        Step 3) If no, apply Penn Central
        
        o Penn Coal helpful if there’s unfairness about bargaining.
      - In AdPo, tacking is allowed
        o Must be privity between subsequent adverse possessors
      - Public prescriptive easement in gross
        o Not likely to have private prescriptive easement in gross
      - Eq Serv v. Real Covenant
        o Equitable servitude = binds the assignee
        
        o Real covenant = runs with land

Horn case

Navigation Servitudes
- o Limit on title, just exists
Is Oil regulated by govt quotas (like fishing) or is it open (sans the drilling regulation)
- o No quotas – just pump what you want
- o Lots of rights involved with oil, unlike water bodies (so harder to regulate)
Groundwater
- o Generally, you can take up as much as you want
- o Just have more exceptions
Touch the land
- o No clear rule
  - Reasonable standard – someone who buys land should expect to have to fulfill requirement
  - Have to be integral to use of land
- o Academic
  - Lack of clear rule allows discretion of expost analysis by court (could be good)
  - By nature of promise, could be something you shouldn’t be bound to
    - Could be too personal
    - Or land could change (Eagle: winter to year-round use)
  - o Notice of promise
    - Separate issue
    - Equitable and real
  - o If the promise is in the deed, really don’t worry about touch and concern. It’s there, you are expected to follow. Think of the Narstaadt
- Grey
- Nebraska v. Iowa
  - o Logic by rapidity
  - o Accretion is easier – world just changes
    - Presumption of accretion (more common), and you have to show evulsion
  - o When its gradual – it all comes out in wash, equalizes
- Stop the Beach
  - o Court (Scalia) essentially tells Florida that accretion not that important. It’s not a future interest, its just a grant of land due to practical. If land grows from mean high tide line reduction, its just exposing public land.
- Blocking sunlight
  - o Wisconsin – Considers it can be nuisance. Protected to a degree. Econ reasoning (protection for sunpanels – Demsetzian, new tech)
  - o Fountainbleu – Florida, rejection of sunlight blocking as nuisance. No ancient lights rule.
- Conservation easement
- Difference btw AdPo and easement by prescription?
  - o AdPo
    - Exclusive
      - T and O there at same time? Then not exclusive.
    - o Easement by Prescription
      - Doesn’t need to be exclusive
        Don’t need possession, just use
      - o Anderson-Tully
        Other party wasn’t residing on land, but issuing hunting license (counted as possession)
        Possession = used as conceived
        
        If both parties had been using land at same time (for hunting license) – wouldn’t been problem
        
        o Chattel
        AdPo applies, but easier to determine for possession reasons. You’d have to steal, arguable if borrowing is adverse.
        
        Custom
        o Usually treated by courts pretty narrowly. Must be well-established and just to character what a thing is.
        Oregon beach case was pretty extreme. Scalia didn’t like this because he saw it as eliminating property right.
        
        Taking can be a lease
        o Tahoe Sierra: WWII cases discussed about commandeering factories
        
        o For RTD – economic impact only extends to the property owner. Doesn’t consider impact on surrounding area
        
        RTD
        o Reciprocity of advantage
        Everyone is roughly benefited/harmed. No one party is singled out. Things are reasonably spread out. (Underlying reasoning: if its spread over many people, has to pass democratic agreement).
        
        Plythmouth Coal – First illustration of this. Both companies have to put column into mine (to protect miner)
        
        RoA factors into whether it’s a taking
        Epstein: All regulations are takings, but some don’t amount to compensation due to RoA.
        
        But usually, if it’s a taking, to calculate damages
        o Just see value of property with or without regulation
        See Dissent: Part of land confiscated, but increases rest – subtract. Breyer wanted to do this.
        
        o Per se rule
        Zero value rule
        Have to acknowledge that court might find this to be too narrow. A property right advocate court would want to expand this to eliminating the “primary use” of property
        
        Courts generally limiting of Lucas
        o But in Murr, P tried to make Lucas case about destroying use of Lot F. But Kennedy felt that change would make Lot E that much more valuable. So it was fine.
        
        o Murr = Penn Central
        Example of denominator problem
        
        Look at Lot E and F together to judge if it’s a making
        
        Covenant/servitude – Binds someone to not do something
        o Conceptually, think of it as a “negative easement”
        
        Easement – allows someone to do something on another property
        o No negative easements by prescription in American law.
        Exception: Conservation Easement. But essentially this is treated like a servitude.
        
        Easement
        o Easement = generally interest in land, so in writing (per Statute of Frauds)
        The exceptions that don’t show up in land record are the ones we discussed (prescriptive, by necessity, by implication)
        
        Commercial easement in gross is transferable (like RR rights of way), but personal easement in gross cannot (like right to friend to fish on your property)
        Q about whether commercial or personal – is fishing creational or commercial?
        
        Servient owner can’t terminate easement at will (if he could, it would be a license). Only dominant tract owner can do so.
        
        o Can probably include building a permnanent physical structure
        
        o One type of easement = profit (use of land for specific purpose)
        For commercial activity
        
        Can have easement for fishing rights, or hunting (license)
        
        o License v. Easement
        License is just a revocable permission
        
        Easement can have condition attached, limited duration, but NO right to owner of burden property to just revoke
        So its not an interest in property. Not substantial enough.
        
        Condition can be like Georgetown’s green space unless city extends F St
        
        Must arise out of transfer
        o Must show intent to convey easement out (can be implied)
        
        o Question whether owner of landlocked property has right. Answer is generally no (by state statute). But can always create license btween the parties.
        
        o Can get govt involved – would be like ED with compensation. Is there a public use of eliminating landlocked properties?
        
        What is noxious versus just nuisance
        o Noxious use – Nuisance like, RTD can go bit further to abate noxious use (even if its not strictly a nuisance)
        
        o Pretty much the same, just who is compelling the elimination of the thing or behavior (govt versus neighbors)
        
        Dependent Covenant Model, quiet enjoyment
        o Bracket: L doesn’t do anything to stop the noise
        Duty of L to act to prohibit the nuisance
        
        Exaction
        o You can waive
        Alito – if permit is much more valuable than property being given up
        
        Incentive of developers to be friendly with regulator
        
        o But there is discussion about if you regret waiving, reasonable time
        
        o Scheduled Exaction
        No extortion b/c no ad hoc negotiation – No application of Nollan/Dollan
        
        PP
        o Holmes – If you go beyond, youre in ED land and need to pay JC (Penn Coal)
        
        o Penn Central – All within PP. ED is coterminous within PP. RTD just arises within certain areas of PP. It’s valid in theory, but application can go too far (creates too great of burden on prop owner), such that invalid.
        No way to have takings problem if outside of PP. Because no DP. So can’t be taking (not a question of JC), they just can’t do it.
        Additional requirement that the regulatory action be statutorily authorized
        
        When outside PP, there is property rule (injunction), but can also be liability rule (might have been damages from time when regulation was in place)
        
        Prior appropriation of water
        o You can change use (at original level of seniority)
        But can’t use more water
        
        Must still be equivalent benefit
        
        BUT a new seniority of water level use is set
        So actually creates perverse incentive for owner to overuse water to maintain the original level of seniority
        
        Privity
        o Only comes up for real covenants (not equitable servitudes)
        
        o Viewed strictly as protection for defendants. But much looser for P (just need to be in possession of land protected by promise (ie could be lessee))
        In some states, you can convey easement. So easement can be part of promise between A and B, and when B conveys to C, the easement may be conveyed.
        
        What would defeat vertical privity? No conveyance!
        Leasing
        
        AdPo – Because no conveyance

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Property Merrill/Outline

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Contents

I. #POLICY''''

II. #EXCLUSION / USE

III. #POSSESSION''''

IV. #PERSONHOOD

V. #PUBLIC RESOURCES (Public Rights; Public Trust)

VI. #OWNERSHIP RIGHTS (Divided ownership)

VII. #CO-OWNERSHIP (Concurrent interests)

VIII. #LANDLORD / #TENANT

IX. #COMMON INTEREST COMMUNITIES (#CIC)

X. #NUISANCE LAW

XI. #EASEMENTS

XII. #COVENANTS and #SERVITUDES

XIII. #ZONING

XIV. #EMINENT DOMAIN (#ED)

XV. #REGULATORY TAKINGS

XVI. #EXACTIONS

XVII. #JUDICIAL TAKINGS

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Property
Authors	Merrill Smith
Text	Property: Principles and Policies (University Casebook Series)
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Property Merrill/Outline

I. #POLICY''''

II. #EXCLUSION / USE

III. #POSSESSION''''

IV. #PERSONHOOD

V. #PUBLIC RESOURCES (Public Rights; Public Trust)

VI. #OWNERSHIP RIGHTS (Divided ownership)

VII. #CO-OWNERSHIP (Concurrent interests)

VIII. #LANDLORD / #TENANT

IX. #COMMON INTEREST COMMUNITIES (#CIC)

X. #NUISANCE LAW

XI. #EASEMENTS

XII. #COVENANTS and #SERVITUDES

XIII. #ZONING

XIV. #EMINENT DOMAIN (#ED)

XV. #REGULATORY TAKINGS

XVI. #EXACTIONS

XVII. #JUDICIAL TAKINGS

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