PROPERTY OUTLINE

MAIN PROPERTY TOPICSI. Adverse Possession

A. People who did not pay for something nevertheless acquire itB. Applies to real and personal propertyC. How to avoid another person from adversely acquiring something they did not actually have/own

II. Estates in land and future interestA. Conveyance of property over time, as a method of control for parentsB. Limited use rightC. Rule against perpetuity

1. Rule against perpetual control of property by dead people limited to 20 years III. Chain of title and recording of property interests

A. Title is transferred or taken by successive owners of the propertyB. Want to know that you are buying from the true ownerC. Registering concept for all things that are valuable in society want the rest of the world to know that you own the

propertyIV. Servitudes (easements + covenants)

A. Burdens underlying owner cannot be pulled back once they have conveyed the propertyB. Makes property progressively unmarketable, so they want to clear these offC. Can arise or be destroyed by AP; can be purchased via transfer

V. Concurrent ownership of propertyA. How to create co-ownershipB. Management + termination of co-owned property

CONCEPT OF PROPERTY

I. PROPERTY A. Property is a human invention

1. Based on reason, combining law and economics2. Legal positivism: property exists only to extent that it is recognized by gov’t3. Natural Law Theory: idea that certain rights naturally exist as a matter of fundamental justice regardless of gov’t

actiona. Does not apply to property law

B. Property as rights NOT things:1. “Bundle of sticks” can take out certain rights with regard to a particular object, but can still retain ownership

a. Ex. a person holds legally-enforceable rights in their computers, but do not own the thing itself2. Defined by gov’t legal positivism3. Rights are relative, not absolute

a. Depends on whether they conflict with others’ property rights4. Rights are divisible

a. Can be split among multiple parties (ex. A can have right to use, but B has right to destroy)5. Property rights evolve as the law changes

a. Stability of title: property rights should be certain and predictableb. Rights can change as technology changes (ex. with development of planes, landowners no longer own

airspace above their land)C. Real Property vs. Personal Property

1. Real Property: rights in land an things attached to land 2. Personal Property: rights to moveable items

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D. Property Rights 1. Right to Transfer [alienability]2. Right to Exclude3. Right to Use/Monetize4. Right to Destroy

II. FIVE THEORIES OF PROPERTY A. Protect First Possession

a. First to discover held property rightsb. Early 19th century concept in the US, when resources were plentifulc. Describes how property rights arose but not why society recognizes those rightsd. RULE OF CAPTURE: first to actually take = owner of rights (Pierson)

B. Encourage Labor1. John Locke's labor theory: each person entitled to property produced through his own labor2. If person "mixed" his own labor (owned) with natural resources (unowned), then he will acquire property rights

to the mixtureC. Maximize Societal Happiness (Utilitarian)

1. Jeremy Bentham's traditional utilitarian theory: to maximize the overall happiness of societya. Property rights given and defined in manner that best promotes welfare of all citizens and serves human

valuesb. Property rights = efficient method of allocating valuable resources to maximize societal happiness/benefit

i. Ex. Recognize that C owns tree so that C can more efficiently utilize tree to benefit society (like sell nuts to them, use tree as lumber, etc)A) Issue may be that C might not utilize the tree efficiently (so maybe this relates to adverse possession)

2. Optimal Level of Production requires property rights system to have:a. Universality - all valuable, scarce resources must be owned by someoneb. Exclusivity - if no exclusivity, then owner has no incentive to improve the propertyc. Transferability - must be able to transfer, otherwise no efficient use of property

D. Ensure Democracy (Civil Republican Theory)1. Civic republican theory: property rights provide owners with economic security necessary to make political

decisions that serve the common gooda. Ex. Thomas Jefferson envisioned free yeoman farmers who owned land and could therefore exercise

independent political judgment that was vital for true democracy2. Right to participate in civic duties used to be derived from ownership of property (ex. rights of “slaves” after the

Civil War)3. Not common today because ppl acquire economic security thru wages earned at a job, not thru property

ownershipE. Facilitate Personal Development (Personhood Theory)

1. Georg Hegel's personhood theory: property is necessary for personal developmenta. Ppl get emotionally connected to tangible things, so much so that it virtually becomes an extension of oneself

individual's right to property should merit special protection if have this special connection2. To achieve personal development (to be a person), individual needs some control over resources in external

environment

III. RECOGNITION OF PROPERTY RIGHTS A. RULE OF CAPTURE

1. Definition: property rights established through actual taking first to capture or kill = owner2. Later extended to natural resources (ex. oil)

a. Benefits: deserving ppl would get the resourcesb. Costs: difficult to figure out who was first to possess, esp if land was open w/o drawn boundaries

3. Pierson v. Post (1805)a. P knew that D was hunting for a particular fox, but P killed and captured it for himself. Lower court ruled in

favor of D bc D was chasing fox first. P appeals.i. Held: P wins right to the fox because rule of capture creates certainty and consistency. Possession

belongs to whoever captures or killed it.

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THEORY APPLICATION OF PIERSON V. POST

First PossessionRule of Capture

Issue of intents of each person asserting property rights

Encourage Labor

Both P and D labored on the fox Theory does not resolve the issue May need to revise so that whoever’s labor changes the nature of it will get

the property rightsMaximize Societal Happiness (Utilitarian)

Certainty is beneficial to societyGets rid of foxes that may destroy livestock correct to let P win

Ensure Democracy (Civic Republican) Killing foxes encourages agricultureFacilitate Personal Development (Personhood)

B. RIGHT TO PUBLICITY 1. Definition: right to one’s self and recognition of that self as “property”

a. “Creation” as a source of property (White)b. Violation of this right when a person appropriates a person’s name or likeness to his advantagec. Can be violated by use of the name alone

2. White v. Samsung Electronics America, Inc (U.S. Ct. of App, 1993)a. P’s likeness (robot dressed as Vanna White) was used in a Samsung ad, so P sues under CA Civil Code, CA

common law right of publicity, and federal Lanham Actb. Held: CA Civil Code = P loses statute limits “likeness” to actual image of P (narrow)

CA common law = P wins statute limits the CA common law right of publicity (broader)Lanham Act = P would need to show that reasonable ppl would actually see it as her endorsing D

c. Dissent: holding is an overprotection of IP rights stifles creative forces when the law is supposed to nurture it

THEORY APPLICATION OF WHITE V. SAMSUNG First Possession P was first to capture/possess her own celebrity P has right to publicity

Encourage Labor- P used what she already owned (self) and labored on it to form her celebrity (by working on Wheel of Fortune)- Creation as a source of property

Maximize Societal Happiness (Utilitarian)

P has right to promote self for entertainment purposes, which has societal value

Ensure Democracy (Civic Republican)

P’s right to own self/wages gained from giving her the right to participate in society

Facilitate Personal Development (Personhood)

P’s celebrity is an extension of herself

3. Dead Celebrities a. Post-mortem right of publicity is not appropriate considering the five property theories

THEORY APPLICATION TO ESTATES OF DEAD CELEBRITIES

First Possession- Estate was not the first to possess the right of publicity for the dead celebrity - Dead celebrity was the first to possess this right

Encourage Labor- Dead celebrity does not use its own labor to generate revenue- Estate uses dead person’s celebrity to generate the revenue for themselves

Maximize Societal Happiness (Utilitarian)

- It is more difficult for society to enjoy the fruits of dead celebrity’s labor or the freedom of using others’ artistic expression

Ensure Democracy (Civic Republican) - No democratic function if the person is deadFacilitate Personal Development (Personhood)

- Dead person has no further personal development

C. OTHER PROPERTY RECOGNITION ISSUES 1. Bilida v. McCleod (U.S. Ct. of App, 2000) – P kept raccoon as pet, but state took it away from her bc raccoons are

not recognized as property or pet under state law i. Held: P loses. P had no property interest in the raccoon bc state makes it illegal to possess it w/o permit

A) Quasi property right : ct held P had right to be notified if raccoon needed to be euthanized3

1) for limited periods of time, state can recognize a limited property rightii. RULE: Only property interests that are recognized under state law can be protected by the due process

clause of 14th Amendment legal positivism2. “Students Rush to Web Classes” – Coursera Article

a. Cousera’s right to the courses they offer raises issues as to whether they have full property rights on them and whether they can exercise all of those rightsi. Right to monetize not used yetii. Right to exclude but exercise of this right does not define the property right

A) If cannot prevent ppl from using your property for free no property right3. “Actress sues ‘Muslims’ Producer, YouTube”

a. P’s two property claims: 1) right to publicity, 2) copyrighti. Since there was no valid contract where P gives up all rights to the film, P has part ownershipii. As part owner, P requests that video be taken down bc it cannot be posted to YouTube without consent of

all owners b. Invokes right of publicity CA Civil Code § 3344: Use of another’s name, voice, signature, photograph, or

likeness for advertising, selling, or soliciting purposes4. “Websites are sued for charging to remove mug shots”

a. Look to the commerciality of mugshots on the websiteb. Where does most of the revenue come from (primary source of income)?

i. Revenue here comes from taking the mugshots down or from advertisingc. Another issue is whether the websites are even newsworthy

IV. RIGHT TO TRANSFER

Right to TransferAny owner may freely transfer or alienate any of her property to anyone

Limitations (often for public policy reasons)o Who can transfero What can be transferredo How it can be transferred

A. Economically important bc it ensures that property is devoted to its most valuable useB. Property law favors free alienation of property as a general matterC. When title is conveyed assumed that use and ownership of that land is also conveyed

1. Use and ownership can be considered separate and independent rightsa. Was use AND ownership being conveyed? Or JUST the use rights?

D. Issue: what specific circumstances should alienation be restricted?E. Cases

1. Johnson v. M’Intosh (SCOTUS, 1823) a. P bough land from Native Americans and wanted for U.S. gov’t to recognize the titleb. Held: D wins. First-in-time discovery rule governs. Here, the British “discovered” the land, who then

transferred the rights to the land to the US federal gov’t. Native Americans had no property rights to give to P even though they were living on the land.i. Native Americans did not have title to land bc

A) Prior payment (Europeans gave them civilization and Christianity)B) Abandonment (Natives receded as more Europeans came to US, 3)C) Undue delay in claiming title

c. Lesson: Chain of title issue here need to show that there is a property entitlement that you can protectd. Lesson: property rights can be severed Natives may have had the right to use the land but not necessarily

the right to transfer the land, since they did not have ownership to it in the first place, at least that’s the case according to US law at the time

2. Moore v. Regents of University of CA (CA Sup Ct, 1991)a. P’s bodily tissue was used without his consent to manufacture patented product that has market value of $3

billion

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b. Held: D wins. P did not have right to ownership of his cells, so he did not have right to transfer them. D acquired ownership of P’s cells when they excised them.

c. Conversion = strict liability tort, so good faith is irrelevantd. Public policy is against ppl selling bodily materials many serious and unintended consequencese. If take too many sticks from the bundle, then you no longer have property

V. RIGHT TO EXCLUDE

Right to ExcludeRight to exclude others from benefiting from your ownership to the property

Implemented through doctrine of trespass One of the most essential sticks in the bundle heavily protected Can only exclude if there is a legitimate reason for doing so Limitations:

o Privilege – Consent + Necessityo Changing society – community values v. egalitarian goalso Right to roam (England) – right to exclude v. public’s interest to access land (ex. for hikes)

TEST : Landowner’s right vs. public’s interest to access

A. Trespass1. Definition : any intentional and unprivileged entry onto land in the possession of another

a. Trespass exists despite good faith mistake2. Developed under “enclosure mvmt” in 18th century England3. Reasons prohibiting trespass

a. Protection for owners – incentivizes owners to make efficient use of their land; way to maximize economic value

b. Policy reasons – not allowing D to trespass even if no damage occurs is enough to protect right to exclude4. Use interest balancing to determine whether there was a necessity for the “trespasser” to enter the property

a. Landowner’s right vs. public’s interest to accessB. Privilege

1. Does not constitute trespass2. Consent3. Necessity – for survival, when fundamental rights are being infringed, etc4. Implied License/consent

a. Expectation some ppl (ex. solicitors and hunters) have implied permission for limited purposesb. In many areas, without “No Trespassing” sign, there is a right to enter land can overcome by placing a sign

C. Cases1. Jacque v. Steenberg Homes (Wisc Sup Ct, 1997)

a. P sued D for trespassing on their land when D was trying to move a mobile home across to P’s neighbor, despite P explicitly telling D that he could not trespass onto his land.

b. Held: P wins. D’s act was an intentional trespass. If allow D to win, then P’s right to exclude others from his property will be infringed. Law and courts must protect the right to exclude. Punitive damages are appropriate here bc $30 citations are no enough to deter D from trespassing again. P was afraid of AP.

2. State v. Shack (NJ Sup Ct, 1971)a. P sues D for entering land to provide medical aid and info about legal services to P’s migrant workerb. Held: D wins. Right to exclude is not absolute must give up right when it’s necessary and affects the well-

being of the occupants.i. Right to enjoy the “associations common among our citizens” can allow visitors

VI. RIGHT TO USE

Right to Use

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Right to use property in any way owner wished, as long as he did not harm the rights of others Core value of ownership Consistent with utilitarian theory owner knows best how to use the land productively for the benefit of

all Limitations

o Nuisanceo Spite fenceo Statutes + ordinances

TEST : trespass vs. nuisance

A. Private Nuisance1. Elements:

a. Intentionalb. Nontrespassoryc. Unreasonabled. Substantial interference with…e. Use of enjoyment of P’s land

2. Used to resolve land use conflicts law to protect the rights of both P and D (balancing test)3. May be inconsistent with the idea of “free society”

a. Reasonable Use Doctrine = one must share the resources even if he was the first to discover the source of water

4. Trespass vs. nuisance need to determine this all the time!!!a. Trespass = strict liabilityb. Nuisance = balancing test (uncertain) look at how substantial the interference is

B. Spite Fence: landowner cannot erect and maintain an otherwise useless structure for sole purpose of injuring or annoying his neighbor1. Universal view: where structure serves a beneficial and useful purpose no COA

C. Cases1. Sundowner Inc. v. King (Idaho Sup. Ct., 1973)

a. D built a “sign” along property line shared with P’s property, blocking 80% of light and air to P’s motel rooms next door. D claims that it is not a useless structure bc it had advertising value

b. Held: P wins. “Sign” is actually a spite fence cannot infringe upon ppl’s right to breathe and enjoy sunlight if the fence was built out of spite/malice. Advertising value would have to be more than value denied to P in order for it to be not deemed a “spite fence”i. Ruling does not define the scope of the “spite fence” rule. Possible remedies are:

A) Enjoin the nuisanceB) No nuisanceC) Enjoin the nuisance, unless pay the other side a certain amtD) No enjoinment, but have to pay

2. Prah v. Maretti (Wisc. Sup. Ct., 1982)a. P sues D for building house in a location that would cast shadow on Ps house, thus interfering with his right to

sunlight and to use that sunlight as an alternative resource for energy (P had solar panels)b. Held: P wins. Private nuisance law is applicable

i. P’s right to access sunlight as source of energy > D’s right to use land unreasonably impairs use and enjoyment of another

ii. Changing public policies allowed for right to access to sunlight to be recognized

VII. RIGHT TO DESTROY

Right to DestroyRight to destroy your own property. Logical adjunct to the right to use

Limitations

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o When property to be destroyed has substantial value o Courts are less likely to allow destruction if it were by “decedent by will” fewer restraints if

alive TEST : expressive interests vs. substantial economic/social welfare interests

A. Scope of this right is unclear1. Intent should matter bc the reason to destroy may actually benefit society more than keeping it2. Common economic theory: can’t destroy property when you’re dead bc you don’t live with the consequences of

your actions3. History landmark laws: usually do not express restriction on owner’s ability to destroy, but could be implied?4. Destruction of Animals – animals are thought of as property, but there is no right to destroy them when there is

no sense to do so5. Eminent domain could be used by the city to limit destruction of property6. Moral rights of artists moral rights = right to prevent current owner from destroying or significantly

modifying artworkB. Law rarely intervenes to prevent destructions exception: Eyerman (below)

1. Strahilevitz : this may actually hurt society if we don’t allow ppl to destroy their property stifles progressa. Expressive interests vs. substantial economic/social welfare interests

C. Cases1. Eyerman v. Mercantile Trust Co. (Missouri Ct of App, 1975)

a. P, neighbors of the decedent, brings suit to enjoin the destruction of the decedent’s house, since the decedent had put in her will that she wanted it to be torn down after her death. Historical landmark regulations were put into the effect after decedent had died.

b. Held: P wins. P has a legally protectable interest that is greater than the interest in protecting the decedent’s will which seems to have been made on a whim, so the house cannot be destroyed.i. Against public policy to all executor to exercise such great power based on whim of testatrix

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ADVERSE POSSESSION

I. ADVERSE POSSESSION A. Definition: when a person who does not own the land but nevertheless acquires it without the owner’s consent,

through occupation during a long enough period while meeting certain conditions1. Ex. IF A occupies B’s land for long enough period while meeting certain conditions A acquires land without B’s

consent2. “Long enough period” is determined by statute3. AP usually happens by mistake 4. Prescriptive rights/easements – can be acquired via AP5. If you sleep on your rights to a property, then you lose it6. AP can only grant either a FSA or use rights [prescriptive easements]

B. Tacking1. Possible to tack on time to establish AP as long AP(2) can show he was voluntarily conveyed land from AP(1)

privitya. Privity : voluntary transfer of property by deed or will from one possessor to another

i. Good faith can show privityii. Partial interest iii. Spectrum: marginal connection btwn successive APers w/o actual transaction transfer of deed

b. Example: Statute says 10 years to establish adverse possession → AP occupies land for 5 years, conveys land to AP(2), AP(2) lives there for another 5 years, and AP(2) acquires land via adverse possessioni. Original possessor would actually want the time period to restart once AP conveys to AP(2)

A) But principle is that original possessor had such a long time to check their own property and to kick someone off should have asserted right to the land earlier

2. Makes sense where there is color of titleC. Airspace: most states say that ppl have ownership of airspace 500ft above their propertyD. Subsurface: modern view is that ground rights limited to only as far as use is reasonable/foreseeable by the owner

Elements of Adverse Possession (all elements must be met to have AP)

1. Actual → Must use in same manner as reasonable person would given its character, location, and natureo Gathering and removing natural resources = actualo Recreational use ≠ “actual” possession

2. Exclusive → cannot be shared with owner or public (no third party)3. Open and notorious → possession must be visible and obvious to put owners on notice that their title is being

challenged4. Adverse and hostile → not applicable if possession authorized by owner; could be based on good faith, state of mind

being irrelevant, or bad faith depending on the stateo Hostile = intent to possess, occupy, control, use and exercise dominion w/o true owner’s consento Claim of right: some mindset is req’d, but cts often say that objective conduct demonstrates this

5. Continuous → continuous as a reasonable owner's possession would be (sporadic use is OK if reasonable owner would also use it sporadically)

6. For statutory period → 5-40 years, but usually 10, 15, or 20 years

E. Claim of title = APer must have acted knowinglyF. Color of Title = deed, judgment, or another written document that is invalid for some reason

1. Standards of AP based on color of title are easy to meet in many states (shortened time period, able to acquire more land) but having deed establishes good faith that you honestly believed you had ownership to whole property

2. If APer comes onto land w/ deed for whole property but only adequately occupies a small portion of it, the APer will acquire the whole property

3. Color of title ≠ actual title nor claim of titleG. Types of Notices

1. Actual notice – when you are told about it

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2. Record notice – a reasonable person would have looked at the record3. Inquiry notice – reasonable person would ask the appropriate person

H. Justifications for AP1. Preventing frivolous claims

a. AP bars lawsuits based on stale, unreliable evidence and protects occupants from frivolous claimsb. Gives occupant security of title → encourages productive use of land

2. Correcting title defectsa. Lengthy possession serves as proof of title where there may have been technical mistakes in the conveyance

of title to land3. Encouraging development

a. Encourages economic development by reallocating title from idle owner to an industrious squatterb. This is a major theme in real property law develop land for productive use

4. Protecting personhooda. Property that one has enjoyed as used as his own for a long time = extension of that person → should be

protectedI. Cases

1. Gurwit v. Kannatzer (Missouri Ct of App, 1990) a. P acquired parcel of land that actually belonged to his neighbor via AP. He was shown the land when he

bought the property from the previous owners, but the land was not actually in the deed. P won quiet title action, but D appeals. P has minimal activities

b. Held: P wins. All elements of AP proven. Hostility proven when P put out ‘no trespassing’ signs and treated the parcel as if it belonged to them (in the same way that D would have used the land)

2. Van Valkenburg v. Lutz (NY Ct of App, 1952)a. P bought triangular tract of land that was used by D for over 30 years. D acknowledged P’s title to land but

wanted an easement for the road that he built to get to paved road. D claims AP D had extensive activitiesb. Held: P wins. D failed to show actual occupation for over 15 yrs, exclusivity, and possession under “claim of

title” (ie hostile mindset)i. NY law req’d CL elements of AP as well as add’t req’mt (ie claim of title) to show AP

II. STATE OF MIND IN ADVERSE POSSESSION A. “Adverse and hostile” element is most difficult to prove, so most jurisdictions say that intent is irrelevant

1. Good faith AP must have good faith belief that she is owner of land2. Bad faith AP knows she is not the owner but intends to take title anyway

B. Land Piracy – court recognizes your title if you purposely do the minimum req’mts to acquire via AP in juris where intent does not mater

C. Good Faith – now normally not required in most jurisdictions, but most imply it anywayD. Cases

1. Fulkerson v. Van Buren (Ark Ct of App, 1998)a. P asserts claim o land that D occupied for 13 years. D was a church group that changed the nature of the

property. P did asked that D to leave property in 1994 but D refused. Lower court said AP to D. P appeals.b. Held: P wins. Not continuous for more than 7 years and not with intent to hold against the true owner.

Intent was not clear and distinct and did not begin until D acknowledged P’s title to land (and this was fewer than 7 yrs ago), since D was unsure about who owned the land when they first started occupying the land.

2. Tioga Coal v. Supermarkets General Corp (Penn Sup Ct, 1988)a. P seeks title for a paper street that actually belongs to D in title. P operated and controlled access to the street. b. Held: P wins. P acquired land via AP even though P’s intent was adversely possessing against the city, not D.

All other elements of AP satisfied

III. PROVING ADVERSE POSSESSION A. AP usually occurs in:

1. Quiet Title Action (Gurwit) AP must bring this up if want title to be shown on public record2. Defense to owner’s lawsuit to recover possession (Van Valkenburgh)

B. AP does not need to arise from judicial action can get it automatically w/o court recognitionC. Sometimes difficult to prove “continuous” element, esp when tacking is involvedD. Privity usually is req’d for tacking to occur and can be shown by good faithE. Cases

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1. Howard v. Kunto (WA Ct of App, 1970)a. P files quiet title action to obtain land (summer property) they had title to and on which D was living. Survey

of land 30 yrs prior was incorrect.b. Held: D wins. D gets AP via tacking. Occupancy during the summer does not destroy continuity because

occupancy was in the same manner that the true owners would have occupied it

IV. DISABILITIES AND IDENTITY OF PARTIES A. Disabilities

1. If landowner is disabled, AP period can be extended, making it more difficult for APer to acquire land2. Types of disabilities:

a. Imprisonmentb. Minority (under age of majority)c. Lack of mental capacityd. Military service or those who reside out of state [depends on the state]

3. Effect of disability on statutory period varies by state, but can include:a. Suspend running on the period until disability is removedb. Provide a limited period of time after the disability ends within which suit must be brought [most states]c. Only disability that exists at beginning of AP period will extend statutory periodd. Death ends disabilitiese. Disabilities cannot be tacked and cannot shorten the std period for AP

B. Identity of the Parties1. APer only acquires whatever interest the owner has in the same property

a. Ex. if owner had a life estate, APer receives only a life estates as well2. AP not available against owner who does not hold the present right to the possession of land3. Cannot AP against state of local gov’t unless land is used for proprietary or nonpublic purpose

V. PERSONAL PROPERTY ADVERSE POSSESSION

Adverse Possession of Personal PropertySOL bars prior owner from bringing action to recover possession gives title to APer

Statutory period for AP of personal property is must shorter than for real property Tacking is OK as long as there is privity Applies to intangible property EXCEPTION: fraud + concealment SOL will not bar recovery TEST : good faith for value + open/notorious + SOL expired AP

A. Approaches to AP of Personal Property 1. Common Law Rule

a. SOL focuses on APerb. SOL starts when taking happensc. Issue: SOL may expire before true owner learns that the chattel is missing

2. Discovery Rulea. SOL focuses on owner in record

i. Owner must be “diligent” in looking for property actively searching vs. just thinking about itii. When owner stops being diligent, then SOL begins to run

b. SOL begins only when owner discovers (or reasonably would have discovered) where chattel is and stops being diligent about looking for it(?)

c. More holistic bc it takes into acct both sides’ facts

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d. Issuesi. Definitional doubt don’t know what constitutes “diligent”ii. Predictional difficulty

3. Demand and Refuse Rulea. SOL focuses on owner

i. Protection for totally innocent owners but not so protective of downstream good-faith ownersii. Diligence does not matter

b. SOL begins when owner demands property back, and it is refusedi. SOL will continue to run no matter what

c. Applied in instances where owner not likely to get property back

4. UCC § 2-403a. General Principle: cannot convey more than what you haveb. If person has voidable title, can transfer a good title to a good faith purchaser for value

i. Good faith purchaser = gives valuable consideration to an item without knowing about its adverse claimsii. Voidable = in btwn void and full title, if someone with superior title comes alone, then property can be

taken awayc. If entrust a possession of goods to a merchant who deals in goods merchant has right to transfer all of the

rights to a buyer in ordinary course of businessB. Cases

1. Reynolds v Bagwell (OK Sup Ct, 1948)a. P’s violin was stolen over 5 years prior to suit and seeks to reclaim it from D, who bought it from someone

who had acquired it from a thiefb. Held: P wins. SOL (2 yrs in OK) bars P from recovering violin, P was acting in good faith, use of violin was

open/notorious bc daughter had used it constantly in violin classi. Common Law Ruleii. If P acquired violin through fraud/concealment probably no AP

2. O’Keeffe v. Snyder ( NJ Sup Ct, 1980)a. P’s paintings were stolen and he found them in an art gallery about 20 yrs later. Paintings were, for the most

part, “concealed” bc they were in D’s home. P sues to recover paintings.b. Held: D wins. AP occurs here based on discovery rule. SOL began when P knew or should have known

where the violin was. The owner’s diligence further(?) delays the start of SOLi. Burden shifts to owner to show that there was diligence in trying to find the chattel

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ESTATES AND FUTURE INTERESTS

I. INTRO TO ESTATES A. Divided into present interests and future interests

1. Both types of interests can be transferred B. Conveying land = conveying estate, not the land itself

1. Present possessory interest + Future interest

Conveyance Method In other words… Parties ActionDeed Inter vivos Grantor grantee Grant/conveyWill Testamentary transfer Testator/Testatrix Devisee DeviseIntestate Succession Die w/o will, determined by

state statuteEstate Heirs “Descending” by operation

C. Type of Freehold Estates 1. Fee Simple Absolute dominant in U.S.2. Life Estate common in modern trust3. Fee Tail rare in U.S.4. Fee Simple Defeasible - (estate that may end upon occurrence of some future event)

a. Fee Simple Determinableb. Fee Simple Subject to a Condition Subsequentc. Fee Simple Subject to an Executory Limitation

5. [Term of years] – aka leasehold for set amt of timeD. How to Determine Type of Estate Conveyed

1. Testator’s intent2. Rules of construction

E. Restraints on Alienation 1. Definition: provision in deed or will that prohibits or limits a future transfer of the property (against public

policy which promotes free alienation)2. Three Types

a. Disabling restraint – prevents transferee from transferring her interesti. Ex. O conveys to B, and any conveyance B makes is void

b. Forfeiture restraint – leads to forfeiture of title if transferee attempts to transfer her interesti. Ex. O conveys to B, but if B ever tries to sell the estate, then to D.ii. Interest in Blackacre AND conveyance would be lost/invalidiii. Cts tend to favor this

c. Promissory restraint – stipulates that the transferee promises not to transfer her interesti. Ex. O conveys to B, and B promises that she will not sell the estate

II. FEE SIMPLE ABSOLUTE

Fee Simple AbsoluteHolder has all rights in the bundle of sticks. Potentially infinite with no future interest accompaniment.

Most marketable interest Can be conveyed to corporations Assumed to be this type unless words of limitation used Transfer rights: alienable, devisable, descendible Example: “To Cheryl Harris” or “To Cheryl Harris and her heirs”

A. Words of Limitation1. “… and his heirs” = describes the estate being granted as a fee simple [SHOULD BE INCLUDED]2. “… forever and ever” = not words of limitation; shows intent to give entire estate in fee simple3. “… to G, its successors, and assigns” = describes the estate being granted as a fee simple

B. Words of Purchase = describes the grantee

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C. Cases1. Cole v. Steinlauf (Conn. Sup Ct of Errors, 1957)

a. P agreed to buy real estate from D, but the contract said that if there is a defect, P can reject the deed and be repaid all sums, P found defect in previous deed in that it contained no words of limitation, so it’s unclear whether he was buying a fee simple. P tries to monies back, but D refused.

b. Held: P wins. Since words of limitation were missing, it’s unclear what type of estate P was buying. Lack of “his heirs” make it so that D’s chain of title only runs to the grantee. P wanted a fee simple, but D didn’t have this to convey. D only had a life estate (“…and his assigns forever”)

III. LIFE ESTATE

Life EstateMeasured by a person’s lifetime. When the person dies, the estate terminates

Present interest: person’s lifetime Future interest (FSA, unless otherwise noted)

o Reversion when life tenant dies, reverts back to original owner (“To Bo Remainder when life tenant dies, third party owns the remainder (“To B for life, then to C”)

Transfer rights: alienable ONLYo But grantee of life estate pur autre vie can devise/descend his life estate

Cannot be a partnership, corporation, or similar business entity (bc they have potentially infinite lifetimes)

Language: “for life” Example: “To A for life.”

Life Estate pur autre vieLife estate measured by another’s life

Usually created when a holder of a life estate conveys his interest to someone else If B holds life estate measured by his own life and then sells his interest to D, D has life estate pur autre vie

but D’s estate ends when B dies Example: “To B for C’s life”

A. Legal life estate = ordinary life estate rareB. Equitable life estate = existence of a trust

1. Trustee = holds legal title to trust property and manages the assets as a fiduciary for the benefit of the trust beneficiaries interests of beneficiaries usually split into present and future interests

C. Holographic wills = written entirely in handwriting of decedent and signed by her valid + enforceableD. Waste

1. Imposes a duty on the life tenant to use the property in a manner that does not significantly injury the rights of the future interest holders a. EXCEPTION: if the alteration would improve the property alteration/destruction = OKb. Types:

i. Voluntary waste – affirmative act that significantly reduces value of propertyii. Permissive waste – failure to take reasonable care to protect the estateiii. Ameliorative waste – affirmative act that leads to substantial change in property and increases its value

2. Life tenant is motivated to maximize his short term gain in having interest in life estate3. Future interest holder wants property to be maintained in its original condition so that it won’t be destroyed

when he gets itB. Issues with Life Estates:

1. Not enough legal protections for the future interest holder2. Present life tenant has not incentive to improve the value of the property past her lifetime3. Waste doctrine exists to protect the future interest holder from harms the present life tenant does to the property

C. Cases1. White v. Brown (Tenn. Sup Ct, 1977)

a. “I wish Evelyn White to have my home to live and NOT to be SOLD” is in testatrix’s will. Ambiguity issue: is this a FSA or life estate to White?

b. Held: P wins. This is a FSA bc testator’s intent and rules of construction support this conclusion.

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i. “Not to be sold” acts as a restraint of alienation, and cannot be applied to life estates thus, this is FSA2. Woodrick v. Wood (Ohio Ct of App, 1994)

a. P, future interest holder, wanted to enjoin P, present life estate holder, from razing the barn. P says barn is worth $3200, but D says property can be made more valuable if used as residential property.

b. Held: D wins. Present interest holder can make changes if it improves the propertyi. Ameliorative waste here bc destruction for improvement

IV. FEE TAIL

Fee TailRight to possession of estate for the duration of your life, and it will pass on to lineal descendants upon death

Present Interest: lives of the lineal descendants of a particular person Future Interest: reversion when bloodline ends, holder of O’s reversion gets FSA Transfer Rights: alienable [limited], descendible

o Alienate rights to possession only until deatho Descends only to lineal descendants

Language: “and heirs of his body” this is REQUIRED Example: “To G and the heirs of her body”

A. Generally disfavored in courts heir will get a FSA in jurisdictions that do not accept fee tailsB. Disentailing the tail = inter vivos transfer to another person to convert fee tail to FSAC. Critiques:

1. Undermines democracy2. Impairs freedom of alienation

D. Rule against perpetuities enough deadhand controlE. Variations

1. Fee simple male : “To G and the male heirs of her body” passes only to male descendants1. Fee simple special : “To G and the heirs of her body by R” passes only to descendants of a transferee who are

parented by a particular person

VI. FEE SIMPLE DEFEASIBLE A. Definition: fee simple that may continue forever or may end upon the occurrence of some future event

1. Variation of a FSA that has conditionsB. Often used to make gifts of land to public entities or charitable institutions, esp when grantor wants to transfer rights

only for a specific useC. Presumption: fee simple subject to a condition subsequent bc it has the smallest risk of forfeiture, as compared to fee

simple determinableD. Transferring Future Interests

1. CL: future possessory interest could only be transferred through intestate succession to holder’s heirs would make the market more marketable

2. Need to figure out the fair market value in order to figure out the future interestE. Condemnation Periods: holder of the fee estate receives all condemnation proceeds on the theory that such a

contingent future interest is highly unlikely to become possessoryF. Not subject to waste bc future defeasible fee interests are too contingent, speculative, uncertain, insubstantial to

qualify for protectionG. Statute of Limitations

1. Fee simple determinable = SOL limitations period begins to run as soon as it ends2. Fee simple subject to condition precedent = FSSCS continues until grantor exercise right of entry and SOL starts

thenH. Laches = P’s unreasonable delay in asserting an equitable claim causes prejudice to the D

Fee Simple DeterminableFee simple that ends when a certain event or condition occurs, giving the right to the transferor

Present interest: Fee simple that is cut short if event/condition occurs Future Interest: Possibility of reversion only retrained by transferor or his heirs

o Automatically becomes possessory when condition happens

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Transfer rights: alienable, devisable, descendible Language: “so long as” “while” “until” “during” Example: “To A, as long as wetlands are maintained on Blackacre”

Fee Simple Subject to Condition SubsequentFee simple created in transferee that may be terminated at the election of the transferor when an event/condition occurs

When condition occurs, transferor has the option to terminate the estate by taking action [not automatic] Present Interest: Fee simple that could be cut short if event/condition occurs Future Interest: right of entry Transfer rights: alienable, devisable, descendible Language: “provided that,” “but if,” “on condition that…” “transferor has right to re-enter and reclaim

property Example: “To G and her heirs, but if Alaska secedes from US, then O has right to re-enter and reclaim the land.”

Fee Simple Subject to an Executory LimitationFee simple created in transferee that is followed by a future interest in another transferee

Present Interest: Fee simple that could be cut short if event/condition occurs Future Interest: executory interest held by a another party (i.e. transferee or a third party, rather than retained

by transferor) Transfer rights: alienable, devisable, descendible Language: “so long as,” “while,” “during,” “until,” “provided that, “but if,” “on the condition that” Example: “O conveys to G and her heirs so long as Alaska does not secede from the US, then to M and her heirs”

I. Cases1. Marenholz v. County Board of School Trustees of Lawrence County (Ill. App Ct, 1981)

a. Deed conveyed land for school’s use. Deed said “land to be used for school purpose only, otherwise to revert to Grantors herein”. After several years, the grantor died and the school was closed and used as storage.

b. Held: deed was a fee simple determinable whose interest automatically reverted back to original grantori. First and second phrase looked at together = FSD; if look at it alone, doesn’t look like FSD

2. Metropolitan Park District v. Unknown Heirs of Rigney (WA Sup Ct, 1965)a. P seeks quiet title of land via AP that Rigney had owned for years. Rigney conveyed land to Tacoma Light and

Water company for water supplying services and noted that owner has right to re-enter land if land stops being used for water supply (fee simple subject to condition subsequent). Use for water supply has been stopped for years, much longer than SOL

b. Held: P wins. Even though it was a fee simple subject to condition subsequent, the SOL to re-enter land has expired. Land was not even being used for the violated purpose nor for the real purpose.

V. REMAINDERS A. Requirements (need both)

1. Capable of becoming possessory immediately upon expiration of prior estatea. Possibility of possession = OK as long as future interest holder might and is capable of satisfying condition

2. Does not divest (cut short) any interest in a prior transfereea. "To B for life, then if D becomes president, to D" → D has remainder; B's life estate needs to end before D gets

estateb. "To B for life, but if D becomes president, to D" → D has executory interest; D will cut short B's life estate if

becomes pres.B. Freely alienableC. Ambiguity:

1. Presumption is that it is a vested remainder2. But need to look at the exact language used in the deed/will

D. Vested Remainders (guaranteed possessory interest)

Indefeasibly vested remainder

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Ascertainable person alive and identifiable at time of transfer (ex. NOT unborn children), AND No condition precedent no condition to be satisfied before future interest becomes possessory

Vested remainder subject to divestment Vested remainder that is subject to a condition subsequent Future interest could be divested/terminated if a condition is satisfied or occurs Example: “To B for life, then to D, but if D doesn’t survive B, then to E” D could lose his interest if he dies before B

Vested remainder subject to open Held by one or more living members of a group or class that may be enlarged in the future (size of future interest

would decrease as group becomes bigger)

A. Contingent Remainder (possible possessory interest)

Contingent Remainder Requirements:

o Given an unascertainable person, ORo Subject to a condition precedent

Cannot be conveyed by deed or will Alienable, devisable, descendible

VI. EXECUTORY INTERESTS A. Future interest in transferee that must divest another estate to become possessory

1. Exact opposite of a remaindera. Can become possessory immediately after the expiration of the prior estate ORb. Can divest any interest in prior transferee

2. Alienable, devisable, descendible

Springing executory interestDivests the transferor [original owner]

o O conveys "to B for life, then one year after B's death, to D and his heirs" B = life estate D = springing executory interest bc D's interest will divest O's interest [cut short] D not capable of becoming possessory at the expiration of B's life estate

Shifting executory interestTransferee [intermediate owner] is divested

o O conveys "to B and her heirs until humans land on Mars, then to D and his heirs" B = fee simple subject to executory limitation D = shifting executory interest bc D cannot do anything to cut B's estate short

VII. RULE AGAINST PERPETUITIES A. Imposes a time limit on how long uncertain future interests could continue [required that uncertainty be removed

within a set period of time]

Rule Against Perpetuities (RAP)"No interest is good unless it must vest, if at all, no later than 21 years after some life in being at the creation of the interest"

B. Rule was created as a compromise between 1) landowners who wanted to create conditions on future interests in transferees and 2) commercial interests to ensure that title of land was freely marketable

C. Applied to:

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1. Contingent remainders2. Executory interests3. Vested remainders subject to open

D. Rule was a way to limit landowners’ freedom to control future interests far into the futureE. “What might happen” TEST;

1. If can logically prove that future interest will vest or forever fail to vest within the perpetuities period (a life in being plus 21 years) future interest = valid

2. IF possibility that interest might vest over 21 years from death of relevant lives in being future interest = void when created

3. If can think of any situation where interest might vest outside the perpetuities period VOIDa. ANY POSSIBILITY WILL MAKE IT VOID

F. Other Notes1. Vesting is not required more about whether it MIGHT vest too late 2. Perpetuities Period = date of death of the last individual who was alive when interest was created + 21 years3. Some life in being = someone who was alive and affects vesting in some way; NOT “after-born” ppl

a. Often use life of healthy infant as the measuring life in order to extend the time period of control as much as possible

b. Does not include corporations, partnerships, and gov’t entities4. If void for one member of class, then it is void for the entire class

a. EXAMPLE: Vested remainder subject to open: could be void for the entire class bc of an unborn decreasing the future interests of those in the class later on

G. Steps to Take when Applying the Rule :1. ID contingent interest2. List the lives in being [bracket the future interest that RAP applies, strike whatever did not survive and read

what’s left]3. Consider whether anyone can be born who might affect vesting4. Kill the lives in being at some future date and add 21 years5. Is there any possibility that the contingent interest will vest after this point?

a. Yes voidb. No valid

H. CASES 1. Jee v. Audley (1787)

a. “unto my niece Mary Hall and the issue of her body… and in default of such issue … to the daughters then living of … John and Elizabeth Jee” Are the futures interests in living Jees’ daughters void under RAP?

b. Held: Yes, Jees’ daughters future interests are void because:i. There is a possibility that Mary Hall may have children and the daughters’ interest may be not vest 21

years after Hall’s deathii. John and Elizabeth Jee may have an after-born daughter, and since that after-born was not alive during

this conveyance, it would make the daughters’ future interests void (vested remainder subject to open)A) would make that

II. SUMMARY OF FUTURE INTERESTS A. Retained by transferor

1. Reversion2. Possibility of reverter3. Right of entry

B. Created in transferee 1. Remainder

a. Indefeasibly vested remainderb. Vested remainder subject to divestmentc. Vested remainder subject to opend. Contingent remainder

2. Executory interesta. Springing executory interestb. Shifting executory interest

C. Rule Against Perpetuities as a limit to future interests in order to clear burdens on the land

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PRACTICE HYPOSPg. 344(d)

(1) O conveys “to B and his heirs so long as the land is not used as a nightclub”(2) O devises “to C and her heirs, but if Boston becomes a state then O’s heirs have the right to re-enter and retake the estate”(3) O conveys “to D for life, then to M and her heirs while the well continues to provide water.”(4) O conveys “to E and her heris provided that alcohol is never served on the premises”(5) O conveys “to First Baptist Church provided that the land is used as a church, then to Google Inc.”

Pg. 353(b)(1) O conveys “to A for life, then to B”(2) O conveys “to C for life, then to D and his heirs if D lives to the age of 30.”(3) O conveys “to E for life, then to F’s children and their heirs.”(4) O devises “to G for life, then to H, but if H doesnot survive G, then to L.”(5) O conveys “to J for life, then to K for life, then to L’s children.” Assume that L is alive and has one child, M.

Pg. 356(1) O conveys “to A 15 years from now.”(2) O devises "to B for life, then to C, but if D should return to New York, then to D"(3) O conveys "to E when E marries"(4) O devises "to F as long as no alcohol is served on the property and if alcohol is served there, then to Alcoholics Anonymous(5) O conveys "to G for life, and then to H if H becomes a lawyer"

Pg. 364, 373 O conveys "to C if anyone finds a cure for cancer"

o O = fee simple subject to executory limitationo C = springing executory interest (bc divests grantor's interest) in FSAo C's interest cannot be logically proven to occur within 21 years of O or C's death → void when created

Rule invalidates contingent interests that might vest too late, outside perpetuities period 

O conveys "to C if C finds a cure for cancer"o O = fee simple subject to executory limitationo C = springing executory interest in FSAo When C dies, C either finds a cure [will/has vested] or not [forever fail to vest] → valid when created

Possibility that C will find a cure, if he has not already, dies with him Because this is more certain, C's future interest can be valid Interest can never vest outside the perpetuities period

  O conveys "to B for life, then M's first child to reach 30". Assume M is childless

o O = reversiono B = life estateo M's first child = contingent remainder in FSA → void

Void bc when B dies, M's first child might not be 30 

O conveys "to B for life, then to M's first child to reach 18". Assume M is childlesso O = FSAo B = life estateo M's first child = contingent remainder in FSA → valid

Valid bc if M has children, at least one will be 18 within 21 years of her death → will vest Valid bc if M does not have children → forever fail to vest

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CONCURRENT OWNERSHIPI. CONCURRENT OWNERSHIP

1. Definition: when more than one individual owns a single property at the same time2. All co-tenants have equal rights to use and possess the entire property

II. TYPES OF CONCURRENT OWNERSHIP

  Tenancy in Common Joint Tenancy Tenancy by the Entirety

Example "to A and B" "to A and B as joint tenants with right of survivorship"

"to A and B as tenants by the entirety"

Interest Undivided, fractional[Proceeds in sale will be divided according to proportionate share]

Undivided[Right of Survivorship - when one tenant dies, the other absorbs that tenant's interest] 

Undivided

Rights Right to use and possess the whole property

Right to use and possess the whole propertyRight of survivorship

Right to use and possess the whole propertyRight of survivorship

Transfer Freely alienable, devisable, descendible

Freely alienable, but will sever the joint tenancy

Breaks unity of time and title Right of survivorship destroyed Grantee becomes tenant in

common w/ other concurrent owners]

No transfer -- but can be ended only by death, divorce, or agreement by both parties 

Other Notes

- Presumption when JT is not explicit [no “right of survivorship” language]- Is already like a severed joint tenancy

Requires all 4 unities [applies to all of the tenants]:

1. Time - acquire their interests at the same time

2. Title - acquire title by the same instrument

3. Interest - must have the same shares in the estate, equal in size and duration

4. Possession - equal right to possess, use, and enjoy the whole property [same in TIC]

If time, title or interest is missing → tenancy in common

If one joint tenant transfers her interest

Ideal Language: To A and B as joint tenants as

rights of survivorship, and NOT as tenants in commono High risk of aversion

approach → aversion from litigation costs

Applies to married couplesJoint tenancy + unity of marriageFive unities → 4 unities in JT + marriage

Clearest, most protectable JT right as possible

Safe from secret severance and creditor reacho Creditor reach → can attach

the right of survivorship that the debtor spouse has

o Secret severance

III. Other typesA. Tenancy in Partnership – used by individuals who want to jointly own and manage a businessB. Community Property – not covered here, but is specific to each state

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IV. CREATION OF CONCURRENT OWNERSHIPS A. Use specific wordsB. For JT, use 4 unities: time, title, interest, possessionC. Consequences

1. Co-management rules2. Survivorship

a. JT get the whole share of your co-tenant’s present + future interests when she dies (no transfer)b. TIC cross-transfers required to get co-tenant’s present + future interests when she dies (requires probate)c. Straw Person used as a middleman to create JT out of land already owned by one of the parties (otherwise,

conveyance would lack time and title unitites)3. Creditor Reach

a. Tenancy by the entirety cannot encumber/convey interest from your co-tenant AND the creditor cannot reach it; troublesome when debtor is 75% contributory and co-tenant is only 25% contributory

D. CASES 1. James v. Taylor (Ark Ct of App, 1998)

a. “… jointly and severally, and unto their heirs, assigns and successors forever” Does this create a TIC or JT?b. Held: conveyance is a TIC if no language indicating the right of survivorship (JT), then assume TIC

VI. SEVERANCE A. Severance of JT can be done by:

1. Unities Analysis (break the 4 unities)a. Via transfer/conveyance of one JT’s interest to another [CAUTION: leasing + mortgages may be different!]b. Via adverse possession

2. Intent Analysis (parties intended to break JT)B. Leases

1. RULE: leases do NOT sever JTa. Rent is owed only to the lessor JT that is not occupying the property

2. CASES a. Tenhet v. Boswell (CA Sup Ct, 1976)

i. JT leases interest to D. JT dies during the lease. P, other JT, now claims entire interest in property. D says no, the lease acted as severance of property. Issue: did the lease sever the JT

ii. Held: lease did not sever JT, so P gets full interest in property. A) If the lessor is a JT and dies, the lease will end [other JT has interest in lessee’s share and takes it as

sole owner of the entire property] if look at it under the intent analysisC. Mortgages

1. Requires that the surviving JT pay the debt of the deceased JT creditor will come and demand debt otherwise2. Title theory : mortgage is conveyance of title to the mortgagee severs JT (destroys time and title)

Title $$$$

Debtor Creditor Debtor Creditor

$$$$ Title

3. Lien theory : mortgage is lien to secure repayment of debt does NOT sever JT (unities preserved)

Promise to pay $$$$

Debtor Creditor Debtor Creditor

$$$$ Release of promise

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D. Secret Severance1. Some states allow joint tenants to secretly sever the JT and then devise her interest to another person

E. Divorce – usually severs JT1. Unities analysis divorce = no co-own property = JT severed2. Intent analysis assumption is that parties do not intend to continue the JT (but not always true)

V. PARTITION A. Partitions end the co-tenancy and distributes its assets accordinglyB. Partition in Kind

1. Division of land into cotenants’ respective fractional shares2. Doesn’t force sale on unwilling cotenants + leaves them holding same estate as before3. Preferred method and is the presumption, which can be overcome when:

a. Property can’t be conveniently partitioned this wayb. Interests of at least one party will be promoted by salec. Interests of at least one party will be prejudiced by sale

i. Factors: longstanding ownership, sentimental interest, economic value, desire to keep ancestral property4. Will be ordered when the setting the entitlements will be an efficient market-based solution

C. Partition by Sale1. Entire estate sold and proceeds appropriately split when land cannot be fairly divided2. Should be used narrowly and sparingly bc it interferes with property rights3. Most common method, though not preferred nor the presumption

D. CASES 1. Ark Land Co. v. Harper (West Virg, Sup Ct, 2004)

a. P has 2/3 interest in property co-owned with D and wants the rest of it for coal-mining. D refuses to sell.b. Held: partition by kind (what D wants) is ordered even though P could get more economic value out of it.

i. Balancing of the factors to determine prejudice finds that partition in kind is appropriate

VI. CO-TENANT RIGHTS AND DUTIES A. RULE: no obligation to pay rent to each co-tenant

1. EXCEPTIONS: Ouster MUST pay rent, AP, possibility of reverter, right of entry2. Each co-tenant must pay his proportional share of expenses

B. Ouster - when a co-tenant in possession refuses to allow another co-tenant to occupy the property1. Ouster is liable to the ousted co-tenant for her pro-rata share of rental value of ouster’s occupancy

C. Rents and Profits1. Each co-tenant is entitled to his proportionate share of all rents and profits derived from the land

D. Repairs1. Repairs only co-tenants benefiting from are liable2. Co-tenant who needs repairs will receive a credit for the costs during a partition action only3. Repairs could be considered an improvement, possibly making non-occupying tenant liable

E. Improvements1. Improvements all co-tenants liable

F. CASES 1. Esteves v. Esteves (NJ Super Ct, App Div, 2001)

a. P and D owned house in TIC (each 50%). P lived in it alone for 18 yrs before selling and asks D for reimbursement for his share of “rent”

b. Held: P is not entitled to reimbursement from D for all repairs/improvements made on the property. Whatever D owes to P should subtract the reasonable amount that P would have owed to D as “rent”, since D was not occupying the property

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RECORDING SYSTEM

I. INTRO TO RECORDING SYSTEMS A. Common Law - anyone who received his interest first prevailed (bc grantor could only convey title once)B. Modern Recording – allows anyone with an interest to record a deed to give notice of his rights to the world

1. Purpose : to assert property rights and to avoid disputes2. Bona fide purchaser – diligent buyer who conducts a careful search of public records and finds no title defects

II. RECORDING INDICES

Grantor-grantee index Organized by name of parties in transaction chain of title First look at grantee index, and go backward Then look at grantor index, and go forward check the date title was rec’d and date deed conveyed to

grantee

Tract index Organized by parcel involved each given a parcel ID number

A. Issues1. AP may not be in the public records2. Recording system = complex and cumbersome3. Even if document is recorded, it may not give constructive notice

B. Mother Hubbard Clauses- clause states the property to be conveyed generally (ex. “all grantor’s property”)1. Valid as long as subsequent purchaser had actual knowledge

C. CASES 1. Luthi v. Evans (KS Sup Ct, 1978)

a. Tours was conveyed “all grantor’s property in a certain county” (Mother Hubbard) which did not specify the Kufahl lease. Kufahl lease, specifically, was conveyed to Burris few years later. Dispute in who owns the Kufahl lease. Tours claims there was constructive notice, Buriss says no constructive notice.

b. Held: Burriss wins, and gets title to Kufahl lease. Kansas statute requires conveyances to be stated with specificity to avoid problems such as this, and Tours violated this. issue was IMPROPER RECORDING

III. RECORDING ACTS

First in TimePurchaser whose interest was created first prevails

EXCEPTION: bona fide purchaser

RacePurchaser who records first prevails

Even if she knows about previous unrecorded interest North Carolina + Louisiana

NoticeSubsequent bona fide purchaser prevails

Purchaser takes without notice of prior interest Does not have to record, but is recommended to prevent another bona fide purchaser from getting

interest Took from grantor when the grantor no longer had anything to convey

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Race-NoticeSubsequent bona fide purchaser who records first prevails

Purchaser takes without prior notice AND records firstA. Invalid Acknowledgements

1. If unacknowledged deed is not recorded not constructive notice2. If valid on its face but has hidden flaw treated as validly recorded

B. Forgery and Fraud1. Forged Deed – void; no interest transferred to grantee

a. Subsequent grantees receive nothing bc those conveyances would also be void2. Deed induced by fraud – voidable by grantor

C. Shelter Rule1. Allows a non-subsequent bona fide purchaser to prevail even though he knew that a prior conveyance in the chain

of title was not recorded2. Bona fide purchaser is allowed to transfer his protection to a later grantee

D. Title Registration1. An alternative to current methods of recording, where the gov’t to maintain registry of title2. Issue is that it’s not mandatory and expensive to implement

E. CASES 1. Messersmith v. Smith (ND Sup Ct, 1953)

a. Dispute over ownership due to multiple conveyances and late recordingb. Held: all transfers are invalid because the original transferor didn’t have the right to transfer its interest in

the property anyway bc it had quitclaimed its interest to another party before all of these transfers

IV. CHAIN OF TITLE PROBLEMS A. If a recorded document cannot be found in a standard title search considered to be outside the chain of title and

provides no notice to subsequent buyersB. OUTSIDE CHAIN OF TITLE

1. Wild Deeda. → B, does not record. B → C. C records. S → D. D recordsb. BC conveyance = unable to be captured by a reasonable searcherc. Previous deed is not properly recorded + does not provide notice → D owns property

2. Deed recorded too latea. S → B, does not record. S → C, who has actual knowledge of B. C records. B records. C → D, records.b. D will not discover B's interest bc the S-B deed was recorded at a point when D is no longer searching under

S's namec. S-B deed recorded too late + does not provide notice → D owns property

3. Deed recorded too earlya. S owns Greenacre. B→C, records. S → B, records. B→D, recordsb. D would not find the B-C deed bc he would have stopped looking under B's name at that point. c. Deed recorded too early → D owns property

4. Deed from a common grantora. S owns Greenacre and Forestacre. S conveys Greenacre to B, granting easement to cross Forestacre for purpose

of accessing Greenacre. B records. S conveys Forestacre to C, who is not aware of easement. C recordsb. C will only look at conveyances related to Forestacre only, so he will not know about the easement since it is

part of B's deed relating to GreenacreC. Recording acts cannot give priority to deed recorded before if it shows no conveyance from a record ownerD. CASES

1. Board of Education of Minneapolis v. Hughes (Minn. Sup Ct, 1912)a. Sequence of Events

i. CH→ Hughes (no record) + grantee name left blankii. CH→ D&W (no record)iii. D&W → Board (deed recorded too early)iv. Board recordsv. Hughes inserts name as grantee + recordsvi. D&W records

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b. Held: Hughes prevails bc his deed became operative when his name was filled in, and he was a subsequent purchaser in good faith for valuable consideration, whose conveyance was first duly recorded

V. NOTICE A. In notice and race-notice jurisdictions subsequent purchaser gains priority only if takes interest w/o noticeB. Types

1. Actual notice – knowledge of prior interest2. Record notice – notice obtained by standard search of public records (constructive notice)3. Inquiry notice – notice obtained by investigating suspicious circumstances (constructive notice)

a. Based on Possession – grantor was still living there is not notice, esp if still paying rent OK to stay little bit after conveyance

b. Based on Record – if doc within chain of title refers to another doc outside, required to investigate C. Possession of real property = constructive notice to entire world of whatever rights the possessor has in the propertyD. CASES

1. Raub v. General Income Sponsors of Iowa (Iowa Sup Ct, 1970)a. Banks got title from GI, which got title by fraud by P. P continued to pay rent to GI. P asserts claim to land.b. Held: Banks win bc they are subsequent bona fide purchasers. Even though it was obtained through fraud,

GI had legal title from P, and through all types of notices, Banks would not have been able to know of P’s title.

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PRIVATE LAND USE PLANNING

INTRO TO PRIVATE LAND USE PLANNING

A. Regulated by covenants, conditions, and restrictions (CC&Rs)B. Burdens on land make them less marketableC. Easements

1. Non-possessory right to cross another’s property in order to get to his own property2. Servitude on land (burden on land)

D. Land Use Restrictions1. Real covenant/equitable servitude created by owner to restrict use of his land2. Servitude on land (burden on land)

E. Nuisance Law1. Owner’s use of land seriously interferes with another owner’s use2. Zoning laws + land use regulation

EASEMENTS

I. Important for encouraging productive use of landII. License = informal permission that allows the holder to use land of another for a particular purpose

A. not an interest in land and can be revoked at any timeIII. Profit = right to enter land to remove minerals, gravel, timber, game, or other natural resource

TERMINOLOGY: Property

Dominant tenement/land : benefited from easement Servient tenement/land : burdened by easement

Parties Dominant owner : easement holder Servient owner : owner of servient tenement [easement grantor]

Appurtenant or in gross Appurtenant easement : benefits easement holder in her use of specific parcel of land (dominant tenement)

Benefit is attached to the land → when dominant land is conveyed, then the easement is conveyed as well Easement in gross : personal to the holder → not connected to holder's use of any particular land

Benefit is not tied to the land, but it is tied to the individual Dominant owner benefits regardless of ownership of specific land Personal easements in gross are OK, but are not transferrable Commercial easements in gross are transferrable → burden runs to successors even though it's not tied to

the land Affirmative or negative

Affirmative easement : allows holder to perform an act on the servient land [most common] Negative easement : allows holder to prevent servient owner from performing an act on the servient land

IV. TYPES OF EASEMENTS A. Express easement by agreement with ownerB. Implied easement by prior existing useC. Easement by necessityD. Prescriptive easement (acquired in same way as AP)E. Easement by estoppel (or irrevocable license)

V. EXPRESS EASEMENT A. By agreement with owner in writing

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1. Types:a. Express easement by grant – servient owner grants easement to dominant ownerb. Express easement by reservation – dominant owner grants servient land to the serivent owner, but

retains/reserves an easement over that property2. GENERAL RULE : when servient land is conveyed, easement remains attached like any other encumbrance

a. EXCEPTION: when the grantee is a bona fide purchaser3. Millbrook Hunt v. Smith (NY Sup Ct., 1998) – express easement in gross for P for fox-hunting remains attached to

the servient land even though it was sold to D. D was not a bona fide purchaser bc the easement was recorded.

VI. IMPLIED EASEMENT BY PRIOR EXISTING USE A. Elements

1. Severance of title to land held in common ownership2. Existing, apparent, and continuous use of one parcel for benefit of another at time of severance3. Reasonable necessity for that use4. Reasonable expectation that use would continue

B. Restatement approach1. Severance of title2. Existing use of one parcel for benefit of another3. Reasonable grounds to expect that conveyance would not terminate the right to continue the prior use

C. Reasonable necessity = easement is beneficial/convenient for use of the dominant tenement, but not essentialD. Van Sandt v. Royster (1938) – easement of private pipe running under P’s land from prior use to get to public sewage

was necessary, so D does not need to stop running their sewage under P’s land

VII. EASEMENT BY NECESSITY A. Elements

1. Severance of title to land held in common ownership2. Strict necessity for easement at time of severance (practical necessity if using Berge test)

B. Recognized bc:1. Implied intent of parties2. Public policy favoring productive use of land

C. Degree of “necessity”1. Strict Necessity - owner has no legal right of access to land; EXCEPTION: if there is extreme inconvenience2. Reasonable Necessity - must be beneficial/convenient for use of dominant parcel but not absolutely necessary

a. Restatement approach3. Lack of reasonable practical access – practical necessity (impractical alternatives)

a. If more practical, then can use that alternative practicality > inconvenientD. Duration: lasts only so long as the necessity continuesE. CASES

1. Berge v. State of Vermont (VT Sup Ct, 2006) – P got easement by necessity under the “practical necessity” rule. Just bc he can access his house via boat doesn’t mean it’s practical (esp during winters when the river would be frozen)

VIII.PRESCRIPTIVE EASEMENT 1. Elements

a. Open and notoriousb. Adverse and hostilec. Continuousd. For statutory period (usually the same as AP)e. Tacking is allowed of privity btwn successive users

2. Presumed to be adverse use if little evidence of it being permissive3. Promotes efficient use of land4. Beach Access and Public Trust Doctrine – the public retains rights to use navigable waters and certain lands if

the gov’t sells the land to private entitites 5. Adverse Possession vs. Prescriptive Easement

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a. AP = occupation/possession of landb. PE = limited use of land

6. CASES a. O’Dell v. Stegall (WV Sup Ct of App, 2010) – no prescriptive easement was found for P for use of gravel road,

which was maintained by D, to get to their driveway bc weak evidence that use of it was adverse

IX. EASEMENT BY ESTOPPEL (IRREVOCABLE LICENSE) A. Elements

1. Landowner allows another to use his land creates license2. Licensee relies on good faith of the license + makes physical improvements or incurring significant costs3. Licensor knows or reasonably should expect such reliance

B. Granted when owner misleads or causes another in any way to change the other’s position to his detrimentC. Easement by estoppel vs. irrevocable license:

1. Easement by estoppel = tied to the dominant property2. Irrevocable license = irrevocable until benefit which is derived that made it irrevocable is gone ended only by

ending whatever made the land irrevocablea. Lasts as long as the benefit that created it will last (50 yrs in Kienzle bc that’s how long pipe will last)

D. CASES 1. Kienzle v. Myers (Ohio Ct of App, 2006) – easement of estoppel bc original parties “changed position” by allowing

one to build a pipe through the land,and the other relying on that grant to actually build the pipe unreasonable for P to order D to stop usage of sewage pipe that connects to theirs and to build brand new pipe to

X. SCOPE OF EASEMENT (how to acct for technological changes)A. Traditional rule: location/scope of easement can only be changed if both servient and dominant owners agreeB. Restatement: servient owner allowed to relocate easement as long as it does not significantly lessen utility of it,

increases burdens on easement holder, or frustrate the purpose of the easement manner of the easement may change but the purpose must remain the same

C. Marcus Cable Associates v. Krohn (TX Sup Ct, 2002) – current easement allowing cables providing electricity cannot be extended to include cable TV wires bc original intent was for electricity, not for telecommunications (Restatement)

XI. TERMINATION OF EASEMENT A. Methods of Termination

1. Express easement – by its own terms in the deed2. Abandonment – non-use + present intent to terminator OR purpose inconsistent w/ future existence3. Prescription4. Condemnation – easement holder entitled to just compensation5. Estoppel – serveint owner substantially changes position in reasonable reliance of holding saying easement won’t

be used in the future6. Merger – obtains both easement and servient land7. Misuse – easement holder seriously misuses the easement8. Release – by executing and delivering writing that complies with Statute of Frauds

B. Presault v. United States (US Ct of App, 1996) – easement conveyed to US for RR use, but after RR shut down it was converted to a recreational trail for the public. Use as trail goes beyond the scope of the easement and in fact the easement was abandoned + terminated when US stopped RR service

XII. NEGATIVE EASEMENT A. Dominant owner prevents servient owner from performing an act on sevient landB. Private restrictions may encourage productive use of land real covenants/equitable servitudeC. Conservation Easement – restricts development of land to preserve open space

LAND USE RESTRICTIONS

I. CC&Rs must be recorded if want to subdivide land into lots with restrictions

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A. “Running with the land” = restrictions that are attached to the land and are applied to successors, regardless of who the owner is when analyzing this, look at whether the burden and benefit runs individually

II. TRADITIONAL APPROACH A. REAL COVENANTS

1. Definition: written promise that “runs with the land” + benefits/burdens original parties and successorsa. “Covenant running at law”

2. Remedy; Money damages3. Elements:

a. Statute of frauds specific terms must be in writingb. Intent to bind successors can be inferred from T+C or “I, part A, bind myself in the following way….”c. Touch and concern must relate to enjoyment, occupation, or use of property (NOT monetary obligation)

i. Ex. promise to use property only for commercial purposesd. Notice actual, record, inquirye. Horizontal privity relationship btwn original parties

i. Requires the transfer of some land, other than the covenantii. Mutual interests – both parties burden + benefit each otheriii. Successive interests - grantor-grantee relationship

f. Vertical privity relationship btwn original party and its successori. Only exists if entire estate was conveyed “like a bird traveling on a wagon”

Elements For Burden to Run For Benefit to RunStatute of Frauds Yes YesIntent to bind successors Yes YesTouch and concern Yes YesNotice Yes NoHorizontal Privity Yes NoVertical Privity Yes Yes

4. Deep Water Brewing v. Fairway Resources (WA Ct of App, 2009) – benefit ran to the easement holder’s successors bc all of the elements were met, so P could enforce the burden on D

B. EQUITABLE SERVITUDES1. Definition: written promise concerning use of land that benefits + burdens both original parties and successors 2. Remedy: injunction3. Common Plan Exception: all lots are burdened and benefited by uniformed restrictions even if the restrictions

do not appear in the chain of title of every lot

Elements For Burden to Run For Benefit to RunStatute of Frauds Yes, or common plan Yes, or common planIntent to bind successors Yes YesTouch and concern Yes YesNotice Yes NoHorizontal Privity No NoVertical Privity No No

4. Tulk v. Moxhay (Ct of Chancery, 1848) –P can get injunction against D for failing to keep up the garden, bc the burden ran to D (all elements met)

III. RESTATEMENT APPROACHA. Combines real convenat with equitable servitudeB. Elements:

1. Owner of property to be burdened intends to create servitude2. Owner enters into K or conveyance that satisfies Statute of Frauds

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3. Servitude not arbitrary, unconstitutional, unconscionable, or violative of public policiesa. Ex. cannot unreasonably restrain alienation

4. [VP only required for positive covenant in certain situations, but never for negative covenant]C. Do not need “touch and concern” and HP

IV. COMMON INTEREST COMMUNITIESA. All properties are subject to comprehensive private land use restrictions regulated by HOAB. Created by declaration

1. HOA2. CC&R’s3. Assessments (HOA fees)4. Ownership rights to each unit owner (FSA for each unit)

C. Benefit to living in CIC with CC&Rs = can enforce restrictions on your neighbor

D. Defenses to enforcement of CC&Rs 1. Unreasonableness

a. Nahrstedt v. Lakeside Village Condo Association – CC&R prohibiting cats is upheld because it is not unreasonable. It was also recorded in the declaration of the master deed, so it’s more likely to be enforced

2. Abandonmenta. Burden is on violator to prove that a reasonable person would believe that CC&R was abandoned

i. Number, nature, and severity of violationii. Prior enforcement efforts and possible realization of benefits (inconsistencies, purpose)iii. Non-compliance defeats the purpose of uniformity

b. Benefit high + enforcement low + scattered # of violations could go either wayc. Benefit low + enforcement high + scattered # of violations likely that CC&R abandonedd. Fink v, Miller (Ct of App, Utah, 1995) – CC&R deemed abandoned bc significant number have already violated

it and enforcement is inconsistent3. Changed conditions

a. TEST: i. How much change has occurred in the community?ii. How much of a drop of benefit has occurred?

b. Original purpose of the restriction has not been altered or benefit still exists for D no changed conditionsc. Changed conditions must take into account both adjoining and restricted tracts of propertyd. Vernon Township Volunteer Fire Dept v. Connor (Penn Sup Ct, 2004) – firehouse cannot build a social house

that sells alcohol bc of a Restrictions Agreement on land, and conditions have not changed substantially enough to allow alcohol to be sold

E. CC&Rs can be terminated by: 1. Condemnation2. Estoppel3. Merger4. Prescription5. Merger6. Laches + unclean hands (but not available when equitable relief is sought)

F. Scope of HOA’s authority 1. HOA allowed to:

a. Maintain common area of CICb. Enforce CC&Rs and add + enforce rules to supplement thisc. Collect fees from ownersd. Take other actions as necessary to administer CIC

2. Business judgment rule – HOA like a corporation not liable if board makes decision in good faith and rationally believed it was appropriate

3. Reasonableness standard – Restatement HOA to act reasonable to exercise discretionary powers

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4. Interpretation of CC&Rsa. CL = restrictive covenants narrowly construed bc interfered with free use of landb. Restatement = CC&R interpreted to give full effect to intent of parties and to carry out those purposes

5. CASES a. Schaefer v. Eastman Community Assoc. (NH Sup Ct, 2003) – D did not go beyond the scope of its powers to

close down the ski area bc no express provision restricting them from making decisions that are for the best of the community reasonableness standard

b. Fountain Valley Chateau Blanc HOA v. Dept of Veterans Affairs (CA Ct of App, 1998) – P cannot order D to clean up the interior of his home bc cannot reasonably read the CC&Rs as allowing HOA to dictate how much clutter one can have in their own home avoid restriction through interpretation

NUISANCE

I. PRIVATE NUISANCEA. Definition: non-trespassory invasion of another’s interst in the use and enjoyment of land (Restatement Second)B. Requirements

1. Intentional – purposely causing harm or knows that harm is resulting2. Non-trespassory – no physical entry of land3. Unreasonable

a. Gravity of harm test : causes substantial harm regardless of social utility of the conductb. Restatement test : gravity of harm outweighs utility of conduct

4. Substantial interference – “real and appreciable invasion of P’s interests”5. Use and enjoyment of land

C. Remedy1. Injunction (usually) but result would be that action could keep being brought against the nuisance maker2. Money damages

a. Determined by social utility, hardships (damages, injunctive relief, or both)3. Allow D to develop way to eliminate nuisance (but this may take too long or may never even happen)

D. Gravity of Harm Approach 1. Social utility offending use > social utility of complainant’s use nuisance (not legally cognizable harm)

no remedy use will continue2. Social utility offending use < social utility of complainant’s use nuisance remedy injunction/money3. Boomer v. Atlantic (NY Ct of App, 1970) – no injunction against D for causing cement dust to cover P’s personal

property since it would be unreasonable money damages to compensate for total economic loss of property [traditional approach]

E. Restatement Approach 1. Two Questions:

a. Could D’s conduct create nuisance?b. Did D’s conduct create nuisance?

2. Gravity of harm > utility of actor’s conduct unreasonablea. Gravity of harm

i. Extent of harm involvedii. Character of harm involvediii. Social value that law attaches to type of use or enjoyment invadediv. Suitability of the particular use or enjoyment invaded to the character of the localityv. Burden on the person harmed of avoiding the harm

b. Utility of actor's conducti. Social value that law attaches to the primary purpose of the conduct

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ii. Suitability of the conduct to the character of the localityiii. Impracticality of preventing or avoiding the invasion [here, D could use other forms of heating]

3. Thomsen v. Greve (Neb Ct of App, 1996) – P wins injunction against D who was using their wood-burning stove that caused an odor to seep into P’s house and stay. Nuisance was enough to keep P away from their house. gravity of harm > utility of conduct (esp since D has other alternatives for heat)

TRANSFERRING TENANT’S INTEREST

I. TENANT TRANSFERS A. Tenant and landlord are allowed to transfer their interests to third partiesB. Transfer by:

1. Assignment2. Sublease

C. Privity of contract: lease = contract so tenant and landlord have rights and duties under contract lawD. Privity of estate: lease = conveyance of an estate in land; related to the land itself regardless of contract law

1. Can only exist once btwn 2 parties

II. ASSIGNMENT VS. SUBLEASE A. Assignment

1. Tenant conveys the whole term, leaving no interest or reversion2. No privity of estate btwn lessor and lessee, but privity of contract remains btwn them3. Sub-lessee is liable to landlord

B. Sublease1. Tenant grants an interest less than his own and retains reversion2. Privity of estate and privity of contract remain btwn lessor + lessee3. Sub-lessee is liable not liable to landlord only the lessee is liable to landlord

C. Majority Test1. Assignment = tenant transfers his right of possession for all the remaining lease term2. Sublease = tenant transfers only a lesser right of possession than he has from landlord

D. Minority Test1. Look at intent of the parties2. Sublease would be possible for entire remaining term of the original lease

E. CASES 1. Ernst v. Conditt (Tenn Ct of App, 1964) – D as sub-lessee is liable to P for unpaid rent and removal of

improvements made to property bc lessee only said he would remain responsible for performance of the lease when D defaults, not ALWAYS

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III. RESTRICTIONS ON TENANT TRANSFERS A. Four Types of Restrictions on Alienation

LANDLORDTENANT Duty to Mitigate No Duty to Mitigate

Duty to Substitute

Most tenant-friendly Both parties need to minimize

costs/damages so tenant can more likely to get out of lease

(Minority Rule) modern trend

Who would do a better job of substitution? Not against public policy Landlord must be reasonable in discretion Must be in clear lang so tenant knows what he is

getting into

No Duty to Substitute

Who would do a better job of substitution? Tenants to pay for mitigation Fewer administrate costs (Majority rule)

Most landlord-friendly No replacement needs to be found, but landlord

is still able to collect rent

B. Kendall v. Ernst Pestana Inc. (CA Sup Ct, 1985) – clause in lease contract was an unreasonable restraint on alienation bc it prohibited lessee from subleasing without lessor’s prior written consent 1. Greater the restraint, the greater the justification must be for it to be reasonable2. Good faith and fair dealing inherent in any contract

IV. FEDERAL FAIR HOUSING ACT OF 1968 – § 3604 A. Cannot refuse to sell/rent to someone based on race, color, religion, sex, familial status, or national originB. Cannot discriminate against anyone in the terms + conditions based on the characteristics listed aboveC. Cannot make, print, or publish notice of any preference/limitation based on above characteristicsD. Cannot discriminate based on handicap of the buyer/renterE. Discrimination includes: refusing to allow reasonable modifications to premises and accommodations in policies

when necessary for equal opportunity and full enjoyment of the dwelling for handicapped and everyone else

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LAND USE REGULATION

I. BASICS OF ZONING A. Ordinances and statutes nowadays regulate one’s use of land

1. Traditionally → owner had complete discretion on how to use the land, subject to only private restrictions and nuisance laws

2. Modern → industrial development and increased urbanization called for use of land use regulationsB. ZONING LAWS – allowed bc gov’’t has inherent police powers

Public welfare = nuisance prevention = “police power” gov’t doesn’t need to pay

Gov’t will always claim that their actions are for nuisance prevention

Public welfare = public good just compensation

1. Zones = where different uses were permitted, with limits on size and location of bldgs.2. Standard State Zoning Enabling Act – allows gov’t to adopt zoning ordinances3. Test for Constitutionality = rational basis

a. Strict scrutiny used when there is a suspect class or a fundamental right infringementC. CASES

1. Village of Euclid v. Ambler Realty Co. (US Sup Ct, 1926) – zoning laws that restrict the way that P wants to use his land and therefore preventing him from using his land in the most valuable way possible are constitutional bc gov’t is acting in within its police powers THIS IS ABOUT CONTROLLING USE (NO LONGER FAVORED)

II. FAMILY ZONING A. Zoning laws where gov’t regulates who constitutes as “family” in a zone dedicated to family homesB. If ordinances cut too far into family life, they will usually fail RB and will be deemed unconstitutional

1. If using ordinance as proxy for an ulterior motive targeting a specific class of ppl unconstitutionalC. CASES

1. Village of Belle Terre v. Boraas (1974) – RB used to justify ordinance that prohibited non-families from living together in a particular zone ends are legit (to reduce noise, traffic) + means are rationally related (prevents density-related problems)

2. Moore v. City of East Cleveland (US Sup Ct, 1977) – RB used to show that ordinance dictating that grandmother living with her grandson is not a “family” is unconstitutional ends = proxy for preventing poor from living in that neighborhood + means are over/under-inclusive

3. Ames Rental Property Assoc v. City of Ames (Iowa Sup Ct, 2008) – RB used to justify ordinance that prohibited unrelated ppl (students) from living in a particular community ends: to build a sense of familial community + means: over/under-inclusive but not extreme enough to invalidate it (students is temporary and no involvement in community)

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EMINENT DOMAIN

I. EMINENT DOMAIN A. Definition: allows gov’t to take property from private owner who refuses to sell voluntarily

1. Limitations: ONLY for “public use” + just compensation givenB. Condemnation = process of EDC. Public Use – satisfied when

1. Land is physically used by public or gov’t employees + serves a public purpose2. Economic development

D. Compensation = fair market value, or amt a willing buyer would pay a willing seller on the open marketE. CASES

II. PUBLIC USE A. When gov’t takes property and it will be used physically by public (hwys) or gov’t employees (military installation)

What qualifies as “public use” Instrumentalities of commerce (RR, hwys, canals, etc) Private entity remains accountable to public in the use of that property public maintains control of the

property (ex. pipeline) Property is chosen for ED for reasons independent of private benefit private benefit is only incidental

INCIDENTAL BENEFITS TO PUBLIC DOES NOT JUSTIFY "PUBLIC USE Address economic blight Economic development

B. Narrow Definition of “Public Use” – physical use by members of the public (P argues)C. Broad Definition of “Public Use” – provides some public benefit regardless of who physically uses it (gov’t argues)D. CASES

1. Poletown v. Detroit (Mich. 1981)a. ED constitutional bc “public use” = stimulating economy and revitalizing area when giving taken land to GM

for new factory LATER OVERTURNED, but after Poletown already destroyed2. County of Wayne v. Hathcock (Mich Sup Ct, 2003)

a. ED not constitutional bc taking land to give to private entitles to build a technology business park is NOT “public use” none of the allowed “public uses” satisfied

3. Hawaii Housing Authority v. Midkiff (US Sup Ct, 1984)a. Condemnation is constitutional to address economic blight bc passes RB end: regulate oligopoly + means:

redistribution of fee simple to correct deficiency in real estate market; broad definition used here4. Kelo v. City of New London (US Sup Ct, 2005)

a. ED justified even though taking is to give to private company for building of a new facility bc taking to improve economically blighted area = OK

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REGULATORY TAKINGS

I. Eminent Domain vs. Regulatory Taking

Definition Just Compensation? Act

Eminent Domain

Physical taking by gov’t for public use Yes Condemnation

Regulatory Taking

Limitation on owner’s rights so as to almost be a taking[Regulations that go “too far”]

No Inverse Condemnation

A. Three “Taking” Situations: 1. Gov’t can take + doesn’t have to pay Nuisance Control (gov’t exercising police power)2. Gov’t can take and has to pay Eminent Domain3. Gov’t can’t take at all Unconstitutional

a. Private party private party preferential treatment = unconstitutional

TESTWhether a regulatory act constitutes a taking depends on extent of diminution in value of the property

Extent of diminution: look at value of the whole property rather than in divided parcels

B. Factor Balancing Test To Determine Whether RT Has Occurred (Penn Central):1. Gov’t action

a. Can’t be arbitrary2. Character of gov’t action

a. Is gov’t actually physically intruding on your property?b. Does gov’t authorize a 3rd party to come onto your property?

3. Economic impact of the regulation on claimanta. Extent of economic loss suffered by owner

4. Extent of Interference w/ Distinct investment-backed Expectationsa. Does the regulation interfere with the expected use of the property?

5. Reciprocity of advantagea. Is gov’t’s purpose to confer benefit upon the property?

C. Transferable Development Rights – relevant to whether taking has occurred and whether gov’t has provided a fair compensation for the taking1. Marketable TDR: enables 3rd party not to get cash from gov’t but to use land in what gov’t would otherwise not

allow + relates to compensationD. CASES

1. Pennsylvania Coal Co v. Mahon (US Sup Ct, 1922) – US statute prohibiting mining under P’s land acted as a takings via ED, so just compensation needs to be paid extent of diminution determines whether it is a takinga. Defines the Regulatory Takings Doctrine

2. Penn Central Transportation Co v. City of New York (US Sup Ct, 1978) – landmark regulations do not violate 5th Amendment and do not constitute a “taking’ that requires gov’t to pay just compensation bc restrictions are necessary to achieve public purpose of protecting landmarks KEY ISSUE: IDing what exactly is the property interest at stake

II. CATEGORICAL TESTS A. Formula-like rule for deciding if taking exists under certain conditionsB. More predictable than ad-hoc rulesC. Takings will be found under these tests if gov’t:

1. Allows permanent physical occupation of land2. Adopts regulation that causes "loss of all economically beneficial or productive use of land" unless justified by

"background principles of property or nuisance law"3. Demands an exaction that has no essential nexus to a legitimate state interest or lacks rough proportionality to

the impact of the particular project36

D. PERMANENT PHYSICAL OCCUPATION 1. Will be deemed a taking if this exists just compensation would be required2. Destroys the right to possess, use, and dispose of property

Elements of Permanent Physical Occupation Physical use Occupation of property Permanent

TEST: Taking regardless of reason for gov’t action

3. Physicality: you can see it, it is physically blocking4. Temporary physical occupation is NOT considered a taking5. If do not clearly/cleanly have all 3 factors, then do a Penn Central factor balancing analysis6. Loretto v. Teleprompter Manhattan CATV Corp. (US Sup Ct, 1982)

a. Taking here bc elements of PPO have been met under the statute that prohibited P from interfering with installation of cable TV lines on his property

E. LOSS OF ECONOMICALLY BENEFICIAL OR PRODUCTIVE USE 1. Loss of property value due to gov’t regulation may constitute a taking

a. Loretto says that it MUST be 100% loss otherwise, do Penn Central factor balancing analysisb. Determined by looking at fair market value v. value in eyes of the owner

TEST: regulation that deprives land of all economically beneficial use is a per se taking no matter how weighty the public interests involved

Unless justified by background principles of state property or nuisance law

2. Lucas v. South Carolina Coastal Council (US Sup Ct, 1992)a. Loss of property value reducing it to 0% = taking so just compensation should be paid, where the gov’t

prohibited P from developing land, which was the reason why he bought it in the first place

Lucas Analysis1. 100% loss? 2. IF yes, was the statute controlling a nuisance (background common law)?

a. If no → (Lucas) taking, compensation requiredi. Penn Central analysis

1. Character of gov't action should be analyzed under this prong [not discussed in Lucas bc P already conceded to this]

a. Illegitimate gov't action2. Reciprocity of advantage

b. If yes → no taking, compensation not requiredi. Gov't action is legit

3. IF no → Penn Central analysis

F. EXACTIONS: ESSENTIAL NEXUS AND ROUGH PROPORTIONALITY 1. Exactions – requires developer to provide land or fees to offset the impacts of the project as a condition of

discretionary land use approvalsa. Shifts costs for new residential development to developers in hopes they will pass it on to homebuyers

TEST: Takings if… There is no essential nexus btwn exaction and legit state interest Exaction is not roughly proportional to project’s impact

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2. Nollan v. CA Coastal Commission (1987) - approval on condition that owners grant easement allowing public to cross lot to get to the beach bc of concern that house was going to block view of beach from the fronta. No essential nexus btwn view problem and easement allowing public to walk along beach behind the house

taking3. Dolan v. City of Tigard (1994)- what degree of connection is req'd btwn impact and exaction?

a. Approved expansion of P's store on condition of conveyance of 2 portions of land:i. Land in floodplain of adjacent creekii. Land used as link in pedestrian/bike path

b. Essential nexus met but no evidence that req'd conveyance is related in nature and extent to impact of development → must be roughly proportional

c. Req'ment that owner provide land for path must be roughly proportional to amt of increased customer traffic that store expansion would produce

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