12-16 - Antonin Scalia Law School · 2020. 12. 7. · EXCLUSION AND LEGAL THEORY: A COMMENT ON...

EXCLUSION AND LEGAL THEORY: A COMMENT ON PROPERTY AS

THE LAW OF THINGS

Eric R. Claeys,

George Mason University School of Law

Harvard Law Review Forum, Forthcoming, May 2012 (Symposium on “The New Private Law Theory”)

George Mason University Law and

Economics Research Paper Series

12-16

Exclusion and Legal Theory:

A Comment on Property as the Law of Things

Eric R. Claeys*

Prepared for

Symposium on the New Private Law Theory

Forthcoming, Harvard Law Review Forum (May 2012)

Production draft

Current as of February 8, 2012

I. LEGAL REALISM IN THE LAW OF THINGS

In Property As the Law of Things (“The Law of Things”),1 Henry Smith sets his sights on

key Realist generalizations about property: “property is not about things” but is instead “a bundle

of rights and other legal relations availing between persons … and a largely dispensable one at

that.”2 Smith tests the bundle picture by how well it explains several quintessentially property-

like attributes of property – especially its in remness, modularity, and connection to the residual

claim.3 The Law of Things concludes that a “thing” picture explains property law better than the

Realist bundle picture.

As John Goldberg’s Introduction suggests, however, the New Private Law raises many

questions about the legacy of Legal Realism – not merely questions about its legacy for property

law.4 From this broader standpoint, it is striking how Realist The Law of Things is in several

other respects.

* Professor of Law, George Mason University. Thanks to Henry Smith and Stephen A. Smith for helpful criticisms

and suggestions on an earlier draft of this Response. 1 Eds., please insert full citation. 2012.

2 Id. manuscript at 1. Accord HANOCH DAGAN, PROPERTY: VALUES AND INSTITUTIONS, at xxii-xxiii, 8-12 (2011).

3 See Smith, supra note 1, manuscript at 9-17.

4 John C.P. Goldberg, The New Private Law [editors, please fill in full cite].

Claeys

A Comment on Property As the Law of Things

Draft of February 9, 2012

2

The Law of Things is quite Realist in its presuppositions about scientific method. Smith

“accept[s] the social-scientific theoretical style of the bundle.”5 The Law of Things treats the

bundle and thing pictures as two test hypotheses, and finds that the former explains less than the

latter does.

The Law of Things is also quite Realist in its instrumental understanding of law.

Throughout, the Article assumes that economic actors would and should rationally prefer to work

with thing-like rights in their private affairs, and to see government institute thing-like rights as a

matter of law generally. Smith’s argument is perfectly understandable and familiar, for he is an

economic analyst of law. Law and economics scholars assume that “law [is] a manifestation of

social policy.”6 Here, however, Jules Coleman speaks for many conceptual philosophers of law

when he observes that “economists of law sometimes mangle the normative categories embodied

in law,” and that they do so primarily because, “[a]t bottom, economic analysis takes the law’s

normative categories to be merely of instrumental value.”7 Although the Legal Realists did not

invent this instrumentalist view themselves,8 they certainly embraced it and made it respectable.

Now, Smith’s property scholarship is far more respectful of the concepts and practices

internal to law than the economic analyses criticized by Coleman. The Law of Things

exemplifies and continues that level of respect. Even so, the Article’s method and its

instrumentalist presuppositions both deserve a hard look. This Response attempts to take such a

look.

5 Smith, supra note 1, manuscript at 1.

6 WILLIAM LANDES & RICHARD A. POSNER, THE ECONOMIC STRUCTURE OF TORT LAW 8 (1987).

7 Jules L. Coleman, Some Reflections on Richard Brooks’s “Efficient Performance Hypothesis,” 116 YALE L.J.

POCKET PART 416, 421 (2007). 8 See, e.g., LANDES & POSNER, supra note 6, at 4 & nn.9-11 (citing social-scientific studies of law from 1880 to

1915 as important “[a]ntecedents of the positive theory economic theory of [t]ort law”).

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II. TWO KINDS OF REALISM TOWARD LAW

To understand many philosophers’ complaints about the instrumentalism typical of

American Legal Realism, let me recapitulate some of the basic differences. For brevity’s sake, I

will follow John Goldberg’s lead and use Justice Holmes’s The Path of the Law9 as a shorthand

reference for Realist instrumentalism.10

According to Holmes, “If you want to know the law and

nothing else, you must look at it as a bad man, who cares only for the material consequences

which such knowledge enables him to predict, not as a good one, who finds his reason for

conduct, whether inside the law or outside of it, in the vaguer sanctions of conscience.”11

If most

citizens act like Holmes’s bad man, the state must order, penalize, or deter them to do what

general welfare requires. Bad men do not experience the law except as a yoke.

Many philosophical students of law believe that this account of law is not very realistic.

Law is not merely coercive. Law applies to members of a political community, all of whom are

free and rational actors. They may be bad men sometimes, but they are also capable of acting for

or being persuaded by moral reasons. Some of these members’ interests and reasons for action

are self-regarding, but other interests and reasons are sociable. Law’s coerciveness then seems

not a brute fact but rather a problem needing explanation. The law has legitimate authority – that

is, persuasive justification for being coercive – if it coerces citizens to act according to standards

that reasonably thoughtful and well-socialized citizens could plausibly accept as the standards to

which free, rational, and moral agents would adhere.12

9 Oliver Wendell Holmes, The Path of the Law, 111 HARV. L. REV. 991 (1997) (1897).

10 See Goldberg, supra note 4, manuscript at 2-5. Accord DAGAN, supra note 2, at xix (citing “The Path of the Law”

as the article illustrating how “realists place coerciveness at the center of their conception of law”). 11

Holmes, supra note 9, at 993. 12

See, e.g., STEPHEN A. SMITH, CONTRACT THEORY 18-24 (2004).

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Consider two opposing examples. If Marshall holds Taney up and takes his money,

Taney experiences the act as a theft.13

But now assume that a court enters a judgment ordering

Taney to pay Marshall compensatory damages for having polluted on his land for a month. In

principle, at least some Taneys should experience the judgment very differently from the hold-

up.14

Reasonably well-socialized Taneys should expect that the controlling nuisance rules

reconcile his and Marshall’s concurrent property rights with the concurrent property rights of

others and the welfare of the general public.15

In addition, lawyers and judges understand

nuisance law not as a tool to nudge or coerce Taney and Marshall to contribute to some policy

goal extraneous to the law; they assume that the law embodies land possessors’ reciprocal

obligations. Taney and Marshall’s judge thus takes the law of nuisance “as his guide and the

breach of the rule as his reason and justification for” assigning liability.16

These insights about law and human sociability generate an alternate way to study law,

starting from the law’s internal point of view.17

In private law, legal theory must attend carefully

to the law’s rights and wrongs, the normative interests that ground both, and the normative

theories that explain and justify how interests and rights are related to one another and to the

public welfare.

13

H.L.A. HART, THE CONCEPT OF LAW 18-23 (2d ed. 1994). 14

See id. at 101-10.

The natural-law/positivism debate does not affect my argument here. Although I rely primarily on Hart’s

(positivist) critique of instrumentalism, one could make the same critique even more trenchantly relying on a

natural-law account of law. See JOHN FINNIS, NATURAL LAW AND NATURAL RIGHTS 1-19 (1980). Positivist readers

may read me to be arguing that citizens have moral expectations, external to their perception what controlling law

requires, that the law have legitimate authority. Natural-law readers may read me to be arguing that these

expectations are simultaneously legal and moral. 15

See Eric R. Claeys, Private Law Theory and Corrective Justice in Trade Secrecy, 4 J. TORT L. 1, 17-26 (no. 2, art.

2, 2011). 16

HART, supra note 13, at 11. 17

HART, supra note 13, at 102; see id. at 56-58, 88-91, 101-10.

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III. THE METHODOLOGICAL COMMITMENTS OF THE LAW OF THINGS

How well does The Law of Things live up to these conceptual standards? I have two

answers. On one hand, The Law of Things is much more respectful of the rights and institutions

in property law than many other instrumentalist economic explanations are of other fields of

private law. To appreciate the contrast, compare Coleman’s indictments of economic analysis in

tort. As Coleman pointed out, leading economic analyses ignore all the rules and practices that

make tort a bilateral institution, which asks whether one defendant violated the rights to which

one plaintiff was entitled to by justice in some past transaction.18

Although Coleman made this

criticism conceptually, it resonates powerfully among non-philosophical scholars. It illustrates

vividly how contemptuous many economic scholars are of tort’s architecture in practice. The

Law of Things does not deserve criticism on this score. At least in its central features, Smith’s

account of The Law of Things is far more respectful of the practice of property. Indeed, in The

Law of Things and the magnificent twelve years of scholarship that Article summarizes, Smith

rescues many crucial features of property from the atomizing tendencies of economics scholars

in tort and contract.19

All the same, Smith’s main argument remains an economic argument, grounded in

Realist instrumentalist premises. As a result, The Law of Things’s argument remains subject to

Coleman’s methodological criticisms. So even if Smith’s account were fully convincing on its

own terms, it still would not supply answers to questions that find property law’s internal point

of view meaningful.

18

See JULES L. COLEMAN, THE PRACTICE OF PRINCIPLE 13-24 (2001). 19

See, e.g., Thomas W. Merrill & Henry E. Smith, The Morality of Property, 48 WM. & MARY L. REV. 1849 (2007)

[hereinafter Merrill & Smith, Morality]; Thomas W. Merrill & Henry E. Smith, What Happened to Property in Law and Economics?, 111 YALE L.J. 357, 376-83 (2001); Thomas W. Merrill & Henry E. Smith, Optimal Standardization in the Law of Property: The Numerus Clausus Principle, 110 YALE L.J. 1 (2000).

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Like many economic analyses of tort, The Law of Things’s account of property is

“difficult to criticize: since it seldom clear exactly what kind of explanation is being offered, the

criteria of adequacy … are not immediately apparent.”20

Although the Article offers criteria for

judging its bundle and thing hypotheses,21

these criteria are weak. If The Law of Things’s thing

hypothesis correlates with more basic features of property than the bundle hypothesis, that is

enough for Smith. By establishing this correlation, however, The Law of Things does not

necessarily proof fit or causation. And the correlations the Article shows still abstract from some

significant features about law.

Coleman suggested three criteria to establish fit or causation. An economic analysis of

law may be understood as a reductive conceptualist explanation, seeking “to explain [property]

law by showing that its central concepts can be reduced to [one interpretation of] the concept of

economic efficiency.”22

It may also be understood as a Dworkinian “constructive

interpretation,” which “reveals to use the way in which the disparate components of the structure

and substance of [a given field of] law hang together in a way that is, at the same time,

normatively attractive.”23

Or, an economic analysis may be understood as a functional

explanation, a “causal explanation of the existence and shape of [the given field of] law.”24

The Law of Things seems to fall short when judged by those criteria. In the law and

practice of property, norms about justice, rights, fairness, and the goodness or worthiness of

“use” loom large. Normative notions about “efficiency,” efficiency in relation to “information

costs,” or “modularity” do not loom anywhere near as large. If The Law of Things purports to be

20

COLEMAN, supra note 18, at 11. 21

See Smith, supra note 1, manuscript at p. 4-5. 22

Id. 23

Id. at 30. 24

Id. at 12.

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a reductive conceptual explanation, it reduces out of Smith’s theory of property the normative

concepts that matter most in practice.25

For The Law of Things to be satisfying as a constructive

reinterpretation, respect for the interpretive method “requires an argument for the moral

attractiveness of [information-cost] efficiency as the exclusive or paramount aim of [property]

law.”26

The Article assumes but does not demonstrate such an argument. And if efficiency,

information costs, and so on are external to the concepts important in property law, then The Law

of Things’s argument attempts to explain the law of property “by an outcome that lies outside the

intentions of those who have developed and maintained it.” The information-cost account makes

a nice “Just So Story,” but methodologically it is not an adequate causal account.27

In fairness, The Law of Things proposes a second explanation of property using concepts

besides information costs. Occasionally, Smith stresses the importance of “use.”28

Because the

normative concept of “use” is central to existing property law,29

this line of argument may

address Coleman’s adequacy criteria. A “use”-based account avoids reductionism, it supplies a

normative value focusing Dworkinian reconstruction, and it could supply a plausible causal

explanation why people come to respect property institutions in practice.

Yet The Law of Things does not make such an account its primary explanation – and if it

did, the Article would cease to be an instrumental and economic account of property. A use-

based account of property as sketched in the last paragraph stays within the horizons of

respectful moral- and conceptual-philosophical scholarship on property. At best, The Law of

25

See id. at 13-24. 26

Id. at 31. 27

Id. at 26. 28

See, e.g., Smith, supra note 1, manuscript at 11. 29

See, e.g., J.E. PENNER, THE IDEA OF PROPERTY IN LAW 49-51, 70 (1997).

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Things’s insights would be ancillary to such philosophical scholarship; at worst, its insights

would be parasitic.

Consider again the law of nuisance.30

Although philosophically-minded scholars may

quibble about the details of nuisance, most accounts agree that the field declares and protects a

general liberty of use held by land possessors. This general liberty is structured, on one hand, to

free owners to make noises or pollution reasonably necessary to beneficial land uses common to

the neighborhood and, on the other hand, to protect owners from interferences with the use or

enjoyment of their land from noises or pollution exceeding those neighborhood-tolerable

levels.31

In the best case, information-cost arguments could help clarify the constraints

legislators would need to respect while designing legal rights to secure moral rights grounded in

use. In the worst case, however, information-cost arguments may be parasitic. Moral principles

of “autonomy” and “liberty of use” already presume that humans are generally better off if they

are left relatively unhampered while making important choices about assets especially close to

them. If so, information-cost economic arguments may do little more than recast insights already

latent in practical concepts into social-scientific jargon.32

IV. PROPERTY’S PARADIGM CASES

However, many legal scholars may find my criticisms thus far not practical enough. So

in the remainder of this Response, let me suggest a few ways in which the Article’s method

generates practical confusions.

30

See Smith, supra note 1, manuscript at 19; Henry E. Smith, Property and Property Rules in the Law of Nuisance,

90 VA. L. REV. 965 (2004). 31

See, e.g., Eric R. Claeys, Jefferson Meets Coase: Land-Use Torts, Law and Economics, and Natural Property Rights, 85 NOTRE DAME L. REV. 1549 (2010); J.E. Penner, Nuisance and the Character of the Neighborhood, 5 J.

ENVTL. L. 1 (1993); Richard A. Epstein, Nuisance Law: Corrective Justice and Its Utilitarian Constraints, 8 J. LEG.

STUD. 49 (1979). 32

See Eric R. Claeys, The Right to Exclude in the Shadow of the Cathedral: A Response to Parchomovsky and Stein,

104 NW. U. L. REV. 391, 402-09 (2010); Claeys, supra note 31, at 1437-45.

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Before doing so, let me explain how I understand the right way to analyze law’s

concepts. Here, I am trying to follow Aristotle’s advice: “to look for just so much precision in

each kind of discourse as the nature of the thing one is concerned with admits.”33

In my

conceptual scholarship, I have sought a definition that explains both why property interests in

practice are conceived of as “property” and why non-property interests are not. Important here, a

satisfactory conceptual definition must respect the limits of conceptual analysis. Different

political communities may disagree reasonably about whether a neighbor has a possessory-use

interest in access to sunlight.34

Sound conceptual analysis must explain in what respects the

parties all continue to have “property” in their own entitlements even if owners in one regime

have property in the right to enjoy sunlight in one regime but not the other. This sort of

conceptualizing is not as rigidly scientific as Smith’s control-test social-science method. Yet if

is as absurd “to demand demonstration from a rhetorician” as it is to “accept[] probable

conclusions from mathematician,”35

it is also often impossible and counterproductive to apply

strict control-test method to law and other social practices.

Let me begin at the most concrete level possible. The Law of Things uses the legal

characteristics we associate with land and cars as paradigm cases, or a test prior.36

Yet riparian

rights have long been classified as “property” rights as well.37

Although riparian rights do not

confer “that sole and despotic dominion” Blackstone associated with property, even Blackstone

33

ARISTOTLE, NICOMACHEAN ETHICS I.3, at 2 (Joe Sachs trans., 2002). 34

Compare Prah v. Maretti, 321 N.W.2d 182 (Wisc. 1982) (endorsing such a use right) with Sher v. Leiderman, 226

Cal. Rptr. 698 (Ct. App. 1986) (rejecting such a use right). 35

ARISTOTLE, supra note 3, at I.3. 36

See Smith, supra note 1, at manuscript p. 11. 37

See Eric R. Claeys, Exclusion and Exclusivity in Gridlock, 53 ARIZ. L. REV. 9, 23-25 (2011) (book review)

[hereinafter Claeys, Exclusion and Exclusivity]; Adam Mossoff, Exclusion and Exclusive Use in Patent Law, 22

HARV. J. L. & TECH. 321, 330-35 (2009). When I refer to riparian rights and water law here, I mean in particular the

law and rights relating to the use of water in running rivers as specified at common law. Contemporary public-law

administrative schemes allocating riparian water may treat water totally inconsistently with the common law. Those

differences do not affect my theory or account, which focus on the private law.

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conceded that “a usufructuary property is capable of being had” in riparian rights.38

If riparian

rights are property rights, conceptual theory should reconsider whether all property is land-and

car-like. Instead, The Law of Property dismisses riparian rights on the ground that they are “less

property-like.”39

This is not revising theory to fit the law; the argument chops out law that

doesn’t fit the theory.40

Although the mistake here is conceptual, the conceptual misclassification has important

practical and policy consequences. Property rights often encourage owners to invest, with rights

that are clearly-delineated for the benefit of strangers and prospective contracting partners. Even

so, some fields of property law, associated especially with usufructs, focus on encouraging as

many claimants as possible to extract and deploy a resource that is not labor- or investment-

intensive to extract.41

The Law of Things pushes this strategy either to the periphery of property

or beyond property altogether.

V. PROPERTY’S CONCEPTUAL STRUCTURE

The Law of Things portrays property conceptually as a combination of exclusion and

governance. Property law institutes a “default” or “starting point” preference for a right to

exclude,42

and then recalibrates with “governance” alternatives when the gains from making

exceptions to in rem rights to exclude outweigh the information costs.43

This portrait follows

logically from The Law of Things’s method – to prove that the thing hypothesis correlates with

more features of property than the bundle hypothesis.

38

2 WILLIAM BLACKSTONE, COMMENTARIES OF THE LAWS OF ENGLAND *2, *14 (A.W. Brian Simpson 1979)

(1766). 39

Smith, supra note supra note 1, at manuscript p. 18. 40

See Henry E. Smith, Governing Water: The Semicommons of Fluid Property Rights, 50 ARIZ. L. REV. 445 (2008). 41

See Dean Lueck, The Rule of First Possession and the Design of the Law, 38 J.L. & ECON. 393 (1995); Richard A.

Epstein, On the Optimal Mix of Private and Common Property, 11 SOC. PHIL. & POL’Y 17 (no. 2, 1994); Carol M.

Rose, Energy and Efficiency in the Realignment of Common-Law Water Rights, 19 J. LEG. STUD. 261 (1990). 42


See id. manuscript p. 18.

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As Part III suggested, however, there lies a significant gulf between explanatory

economic analysis and conceptual explanation grounded in the morals embedded in the practice

of law. That gap distorts The Law of Things’s portrait of property. When The Law of Things

talks about exclusion and governance, it is not interested in explaining how, why or to what

extent exclusion and governance each institute or embody the moral norms internal to property in

practice.

Internalist accounts can. As Larissa Katz,44

Adam Mossoff,45

I46

and (with variations)

James Penner47

have all explained, property norms focus on use. Primarily, individuals claim

and recognize in others a normative interest in using external assets for the user’s own

gratification; secondarily, they claim and recognize a general domain of liberty to decide how to

use an external asset for such gratification. Property rights thus endow owners with rights to use

(and/or determine the uses of) external assets, exclusive of interference with those legitimate

domains for use (and/or use-determination). In this formulation, property’s exclusivity is

always calibrated to property’s legitimate use or use-determination – not the other way around.

Of course, property’s conceptual structure does not pre-determine or settle all normative

questions about property rights. Different communities may structure use rights differently for

similar assets to declare and encourage the pursuit of different ends. Thus, one community may

configure the general freedom to use land to encourage the active development of land and

44

See Larissa Katz, Exclusion and Exclusivity in Property Law, 58 U. TORONTO L.J. 275 (2008). 45

See Adam Mossoff, What Is Property? Putting the Pieces Back Together, 45 ARIZ. L. REV. 371 (2003). 46

See Claeys, Exclusion and Exclusivity, supra note 37, at 17-36. 47

See Penner, supra note 29, at 49-51, 66-75. Penner presents a slightly different case because he portrays property

as a right to exclude grounded in an interest in use. By contrast, Mossoff, Katz, and I all portray property as a right

to decide how to use – with exclusive implications – grounded in an interest in use. See Claeys, Exclusion and Exclusivity, supra note 37, at 23-25.

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discourage the passive enjoyment of sunlight, while another may do the opposite.48

In both

communities, however, property institutes a general right to decide how to use and enjoy their

lots for their chosen ends. One community may configure that right to encourage passive uses,

the other to encourage active development, but in both nuisance continues to secure a general

right of non-interference for some uses.

The Law of Things suffers because it delinks both exclusion and governance from use.

Obviously, this misconception helps explain why The Law of Things treats riparian rights and

other usufructs so dismissively. Although usufructs may not convey rights to exclude with

modularity and all the other attributes of thingness, they do endow users with rights of exclusive

use. The concept of parallel equal rights of use gives usufructs rights more content and direction

than is conveyed by a term as malleable as “governance.”49

Less obviously, The Law of Things’s portrait of exclusion is slightly off. To his credit,

Smith acknowledges that “[r]ights to exclude are a means to an end, and the ends in property

relate to our true interests served by property – interests in using things.”50

Correctly, Smith

denies that “the right to exclude is … why we have property.” Dubiously, however, he asserts

that “the right to exclude is part of how property works.”51

It is more faithful to practice and law

to say that exclusivity has value to the extent it indirectly secures and enlarges interests in use.

The Law of Things does not portray this relation adequately.

48

See supra note 34 and accompanying text. 49

See Eric R. Claeys, Intellectual Usufructs: Trade Secrets, Hot News, and the Usufructuary Paradigm at Common Law, in INTELLECTUAL PROPERTY AND THE COMMON LAW (Shyamkrishna Balganesh ed., forthcoming 2013),

http://ssrn.com/abstract=1889231. 50


Id.

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To illustrate, consider the choice between injunctions and damages in trespass.52

In

trespass, the possessory interest embodies a normative relation in which property owners have

near-total control over access to their lots and non-owners have virtually none. That absolute

control indirectly promotes use. Such control encourages different owners to use similar lands

for a wide range of legitimate uses, it secures the investment necessary for long-range uses, and

it helps the owner accomplish plans that involve not only land but also other people or other

factors of production. To borrow Smith’s terminology, trespass institutes a right to exclude, and

the right to exclude gives land modularity – but the exclusion and the modularity are justified in

relation to use. In Blackstone’s words, “absolute dominion”53

encourages each owner to “retain

to himself the sole use and occupation of the soil.”54

That norm shapes the remedies applicable in trespass. If Taney builds an encroaching

structure on Marshall’s land, equity starts with a strong presumption that Marshall deserves an

injunction.55

By reinforcing Marshall and other land owners’ rights of exclusive control, this

presumption indirectly encourages them to use their land with all the more initiative. As one

case put it:

A particular piece of real estate cannot be replaced by any sum of money,

however large; and one who wants a particular estate for a specific use, if

deprived of his rights, cannot be said to receive an exact equivalent or complete

indemnity by the payment of a sum of money.56

Remedy law reinforces the same normative structure in how it treats scienter. Assume that

Taney trespasses intentionally or any other scienter worse than good faith. Unless some other

52

The following argument restates Eric R. Claeys, Property 101: Is Property a Thing or a Bundle?, 32 SEATTLE U.

L. REV. 617, 645 (2009) (book review) and my criticisms therein of Henry E. Smith, Property and Property Rules,

79 N.Y.U. L. REV. 1719 (2004). 53

2 BLACKSTONE, supra note 38, at *2. 54

3 id. at *209 (emphasis added). 55

Accord Smith, supra note 1, at manuscript p. 21. 56

Lynch v. Union Institution for Savings, 34 N.E. 364, 364-65 (1893).

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circumstance excuses the encroachment, it will be extremely difficult for Taney to persuade a

court of equity not to enjoin his encroachment.57

This norm also protects and encourages use

interests, indirectly. Property rights are threatened most by deliberate and coordinated

trespasses; this rule deters and delegitimizes such trespasses.

Yet assume that Taney’s encroachment is minor, that it is expensive to tear down, and

that Taney encroached mistakenly even though he diligently checked titles and boundary lines

before building. Taney does not jeopardize the secure control and use of property, because his

due diligence respects others’ property claims. The requirement that the encroachment be minor

embodies a moral insight: The encroachment does not deprive Marshall “of any beneficial use”58

of his land. Similarly, the requirement about the hardship to Taney embodies another moral

insight: If he makes his encroachment in good faith, it is reasonable to say Taney is using the

encroached-on land beneficially. In this circumstance, the law better protects and encourages the

concurrent use interests of Taney, Marshall, and other similarly-situated parties in later cases if

qualifies the ordinary broad right of use-determination, to leave non-owners with the opportunity

to claim a use-based right to acquire ownership of land on which they mistakenly encroach in

good faith.59

The Law of Things explains this back and forth as an example of the interplay between

exclusion and governance.60

From the internal point of view, however, trespass and equity

endow owners with a general right of exclusive possession, qualified by a narrow no-right and

liability to dispossession by a non-owner who makes a minor encroachment in good faith. The

57

See Golden Press, Inc. v. Rylands, 235 P.2d 592, 594-95 (Colo. 1951); Heaton v. Miller, 391 P.2d 653, 58 (N.M.

1964); M.T. Van Hecke, Injunctions to Remove or Remodel Structures Erected in Violation of Building Restrictions,

32 TEX. L. REV. 521, 530 (1954). 58

Loughlin v. Wright Mach. Co., 173 N.E. 534, 535 (1930). 59

See Claeys, Exclusion and Exclusivity, supra note 37, at 31-32. 60

Smith, supra note 1, at manuscript p. 20-22.

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general right and the narrow no-right and liability are structured together to enlarge all owners

and non-owners’ concurrent interests in using things beneficially for their own purposes.

“Exclusion” and “governance” are not determinate enough concepts to link the forms to which

they refer to this substantive goal. Maybe, The Law of Things’s exclusion/governance

continuum allows lawyers or policy analysts to consider other goals. If so, it portrays existing

property law inaccurately. Maybe the exclusion/governance continuum accords with the internal

explanation I have just provided. If so, I suspect the former is parasitic on the latter, for reasons

stated in Part III.

VI. PROPERTY’S RELATION TO THE REST OF PRIVATE LAW

My last doubt relates to the general topic of this symposium – the private law. Does the

account of property in The Law of Things help clarify the conceptual relations among different

fields of private law? I am skeptical.

Because The Law of Things abstracts from the law’s internal point of view, it is relatively

indifferent to the ways in which different fields of private law interact with one another. The

Law of Things begins by taking for granted that the private law “need[s] baselines” and that

“[p]roperty is a platform for the rest of private law.”61

Yet the Article does not elucidate. The

Law of Things refers to “torts like trespass”62

and “aspects of property like nuisance.”63

Are

trespass and nuisance torts, property doctrines, or both? If trespass and nuisance are both – that

is, property torts – in what respects do they partake of property and of tort? The Law of Things

refers to nuisance and covenants both as “governance strategies.”64

This portrait gives short

61

Smith, supra note 1, at manuscript p. 9-16. 62

Id. at manuscript p. 3 63

Id. at manuscript p. 24. 64

Id. at manuscript p. 17.

Claeys



16

shrift to the important structural differences between torts,65

contracts, and remedies for wrongs

in both fields. Part IV, the section most focused on this relation, more or less asserts that

“[m]odular property feeds into contract, tort, and restitution.”66

How so?

Since space limits Smith only to speculative thoughts on these questions,67

let me finish

with a few speculations of my own.68

I suspect that tort, contract, unjust enrichment, and the law

of remedies all stand in a “teleological” relation to property.69

In a political community, the law

of private property follows, declares, and embodies broader common social opinions about the

legal relations in which citizens should stand to one another regarding the use of external assets.

Tort, contract, unjust enrichment, and remedy law are all shaped to help carry property’s norms

into practice, and they are all judged by how well they carry those norms into practice. In part,

they do so by imposing primary duties consistent with what property norms require. Thus,

trespass declares and enforces a general duty on non-owners to “keep off” owners’ land.70

In

part, they do so by instituting corrective mechanisms. Thus, if Taney violates his in rem duty to

keep off Marshall’s land, trespass supplies the institutional mechanism by which Marshall seeks

confirmation that he suffered a wrong and rectification of that wrong.

On this teleological view, however, tort, contract, unjust enrichment, and the law of

remedies all help specify or fill in the details of the primary duties property prescribes. I suspect

this relation has not gotten the attention it deserves in private-law scholarship. Each of these

secondary fields supplies a rack of different doctrinal options, and different doctrines take

65

On this basis, I have reservations about Henry E. Smith, Modularity and Morality in the Law of Torts, 3 J. TORT

L. (no. 2, art. 4, 2011). 66

Smith, supra note 1, at manuscript p. 28. 67

See id. at manuscript p. 28. 68

See Claeys, supra note 15, at 17-27. 69

See John Gardner, What Is Tort Law For? The Place of Corrective Justice, 30 L. & PHIL. 1, 2 (2011). 70

See Smith, supra note 1, at manuscript p. 3.

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17

options off the rack to make the field protect and correct rights consist with the ideals set by

property norms.71

Consider trespass again. Tort law provides menu options for harm- and rights-based

torts, and different torts may institute different kinds of intentional, fault-based, or strict scienter.

Property law prescribes that the possessory interest in controlling land should be near totally

exclusive or modular. To carry these prescriptions into practice, trespass dispenses with the

harm element and institutes strict understandings of scienter.72

Back in property law, however,

the possessory interest in use is more contextual than the corresponding interest in control.

Behind the veil of ignorance, most landowners’ interests in using their land will be enlarged if

each owner is bound to waive the right to sue others for low-level non-trespassory invasions that

are reasonably necessary to common beneficial uses of land. The tort of nuisance specifies to

accommodate this difference. Unlike trespass, nuisance requires proof of actual interference to

some ongoing use of land, and it requires proof that a defendant’s pollution is “unreasonable” in

relation to local live-and-let-live norms.73

Contract fits the same picture. Not only does property

supply the “platform” Smith envisions for contracting, it also supplies norms that reconfigure

contract doctrine. Thus, not only does property specify the use rights that landowners may use as

consideration in covenants running with the land, it also supplies controlling normative reasons

for the covenants to run in rem and not in personam as they ordinarily do. Similarly, trespass

71

See Claeys, supra note 15, at 43. 72

See Claeys, supra note 31, at 1405-09, 1414-16. 73

See id. at 1418-20.

Claeys



18

remedies help specify the substance of land possessors’ use rights74

– but the remedies embody

normative principles about free use-determination coming from the law of property.75

CONCLUSION

My criticisms of The Law of Things do not detract from my admiration for the Article or

my gratitude for the previous Articles on which Smith builds in it. The bundle picture remains

prominent in contemporary property law and scholarship,76

but Smith is quite right that it is

badly defective and deserves reconsideration.77

Smith has done more than any other scholar in

his and my cohort to prompt that reconsideration. Most impressive, Smith has been quite

persuasive among contemporary law and economics scholars, a particularly prominent and

opinionated constituency in the contemporary American legal academy.78

Nevertheless: Although it is not yet clear what “New Private Law Theory” is or aspires to

be, one aim of that project is to set adequacy criteria for private law theory more rigorous than

the criteria established by the Legal Realists. The Law of Things and Smith’s prior work deserve

to be judged by those adequacy criteria. By those criteria, an information-cost-grounded

exclusion portrait is pretty good … for an economic analysis. Yet that economic analysis

remains philosophically inadequate in important respects – because it abstracts from “use” and

other normative concepts internal to the law of private property.

74

See Jules L. Coleman & Jody Kraus, Rethinking the Legal Theory of Rights, 95 YALE L.J. 1335 (1986). 75

See supra notes 56-58 and accompanying text. Contra Henry E. Smith, “An Economic Analysis of Equity,”

(Draft, October 2010), available at http://www.law.yale.edu/documents/pdf/LEO/HSmith_LawVersusEquity7.pdf. 76

See Eric R. Claeys, Takings: An Appreciative Retrospective, 15 WM. & MARY B. OF RTS. J. 439, 447-51 (2006)

(book review). 77

See Symposium, Property: A Bundle of Rights?, 8 ECON. J. WATCH 193 (2011). 78

See, e.g., Thomas W. Merrill & Henry E. Smith, “Making Coasean Property More Coasean,” J. L. ECON.

(forthcoming, 2012), http://ssrn.com/abstract=1758846.

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