I.

Introduction
A. Ownership is a bundle of rights
B. Is there a natural human instinct for property ownership?
C. Goffman: Asylums
1. In spite of efforts of administration, people try to possess certain things.
2. Strongest take what they want associated with bad wards
3. First come, first served associated with good wards
D. Pipes: Human nature and the fall of communism
1. Even animals have ownership theyre possessive about things.
2. Studies of young children showed that some of the first concepts they understand, as
well as their initial communications/conflicts, center around property/ownership.
3. The Bolshevik revolution led to widespread corruption and a decline in public spirit.
This led to a decline in the will to live collective depression.
E. Lockean labor theory: you have property in your person, and so the labor of your body is
yours.

II. First possession

A. Acquisition by discovery/conquest, and capture
1. Discovery/conquest and the origins of property in land
a. Johnson v. MIntosh (US 1823)
i. P purchased land from Indians; D purchased land from the government.
ii. Is title by grant from a discovering nation superior to title obtained by
purchased from those that the nation conquered?
iii. Yes. Discovery of land in America by a European power gives absolute title
subject only to the Indian right of occupancy. Two principles at stake:
doctrine of discovery and first possessors rights.
iv. What are the rights of one European nation vis--vis other European nations?
(i) The nation that discovers the land has superior ownership rights. (First in
time rule rather than lottery, need-based, or Lockean theories)
(ii) This rule creates incentives for discovery. It creates certainty of title,
promotes Lockean labor theory (you find it, you get it), and
peace/order/avoiding litigation. The balance of scholarship, though, seems
to be against this principle.
v. What are the first possessors rights vis--vis the native population?
(i) Efficiency predominates. Usually, they should assimilate but the Indians
are savages so that was not possible.
(ii) Carol Rose: Some Indians didnt even understand ownership; theyd run
free in the wild, from place to place.
vi. Only the government can purchase the land from the Indians. So D gets the
land.
vii. Discovery v. conquest:
(i) Discovery: sighting or finding of hitherto unknown territory, frequently
accompanied by a landing and the symbolic taking of possession.
(ii) Conquest: taking possession of enemy territory through force, followed by
formal annexation of defeated territory by the conqueror.
viii. Haslem v. Lockwood (CT 1871): P raked into heaps some manure, but let it
alone until the next day. D took manure. It belongs to P, since P added value
to it.
2. Capture and possession: Foxes, whales, and ducks
a. Pierson v. Post (NY 1805)
i. P discovered fox and began to hunt and pursue it. D (saucy intruder) was
aware of this but killed the fox.
ii. Does mere pursuit of a wild animal vest title in the pursuer?
iii. No. Whoever occupies the animal has title to it. Spectrum of occupancy:
Sight and pursuit close proximity to capture ... trapping the fox killing
the fox and taking possession of it. You must trap or mortally wound an
animal to acquire title. D, then, has title to it.
iv. Livingston dissent: Foxes are a public nuisance, so killing them is in the
public interest. We should incentivize killing foxes. Prefers standard of in
reach of animal or reasonable prospect of capturing animal. This is the
custom in fox hunting: If someone else is pursuing a fox, you dont do it
yourself. P should have acquired title.

b.

c.

d.

e.

(i) This is a wealth-maximizing rule.

(ii) Think of how this would apply to software licensing.
Ghen v. Rich (MA 1881)
i. P killed a whale. Custom in whaling industry was to wait a few days until it
came up to shore; the finder would get some fee after notifying the
pursuer/killer. E found the whale and sold it to D.
ii. Is title to a wild animal acquired when a hunter apprehends the beast in
accordance with custom?
iii. Yes. When a custom embraces an entire industry, no need for a judge-made
rule. P captured whale in accordance with custom, so he acquired title.
Keeble v. Hickeringill (England 1707)
i. P lured wildfowl to his property with decoys; this was part of his trade. D
fired a gun three times near the pond so he could scare them away. They
never came back.
ii. May a landowner, in pursuit of his trade, lawfully capture wildfowl free of the
malicious interference of another?
iii. Yes. Every landowner should be able to use his land as he sees fit so long as
the use is lawful. The capture of wildfowl in pursuit of a trade is profitable,
and creates wealth for the nation at large. D could have interfered if, say, he
had put up decoys on his own land and lured them away from Ps property.
But here D was malicious. Liable for damages.
iv. Through the lens of Pierson: Distinctions that can be drawn are that P is
somewhere between thinking about pursuing and merely pursuing, and that
this is a profession, rather than a sport.
v. What if D was interfering for sport? What if, say, Greenpeace was
interfering? Some states have enacted laws preventing people from
interfering with hunting on government land.
vi. Ratione soli: Wild animals belong to the persons whose land they are on
(constructive possession).
Hardin: Tragedy of the commons
i. When theres common property, it gets abused. Decisions reached
individually are most often not those best for society.
ii. This is particularly catastrophic when populations grow.
iii. Tragedy isnt that youre harming the people you live with, but that youre
harming future generations.
iv. Cost of pollution is lower than cost of cleaning up so on an individual basis
theres abuse too.
v. Best way to curb the tragedy is by mutual agreements. Eliminate the
commons. Abandon the commons in breeding.
Acheson: The lobster gangs of Maine
i. This is an instance of joint/community property (as opposed to private
property or open access property). It seems the problem is less with common
property and more with open access.
ii. Only way to fish in Maine is to be a member of a lobster gang. Youll have
access to a protected area that belongs to the gang. There is, of course, a
pecking order within the gangs (usually based on seniority).

iii. Gangs will inflict revenge on others who encroach upon their territory.
iv. The ocean is technically open access, but its de facto private property. The
gangs tend not to act too aggressively with intruders because they want to
avoid identification, government regulation, and full-blown lobster wars.
v. Consider the transaction costs of these agreements.
vi. So whereas Hardin would say that a communal resource gets abused, Acheson
would argue that it causes private property rights to develop.
f. Demsetz: Toward a theory of property rights
i. Property rights emerge because of the relationship between transaction costs
and potential benefits associated with the control of resources through
property rights.
ii. Three types of ownership
(i) Private: Low transaction costs, tends to reduce externalities; preferred
(ii) Communal: Great externalities; negative view of this
(iii)
Government
iii. Note: When externalities confer a benefit, we have a free-rider problem.
iv. Utilitarian theory is the dominant theory of property. Minimal constraints on
the transfer property are necessary to further this theory.
v. How do we minimize the overutilization of resources facilitated by the rule of
capture? Private property rights, regulation, compulsory utilization for all
owners, individual transferable quotas, etc.
vi. Anticommons e.g., businesses in Moscow during communist rule, urban
renewal. This happens through splintering property rights one person has
the right to sign a lease, another to receive revenue, another to occupy, etc.
g. Central point: Law is the product of human interaction and doesnt just come
from the government.
3. Property rights in natural resources
a. Oil and gas
i. The fugitive nature of oil and gas has led courts to treat them like animals. So
when an adjoining owner taps into his land and drills out the oil thats
underneath both of your properties, he owns it.
ii. Suppose A and B are adjoining landowners with a common pool of oil beneath
their land.
(i) If B starts draining the pool, A probably cannot do anything about it,
except maybe when its excessive drilling. Union Gas & Oil v. Fyffe (JY
1927). Basically, its a rule of capture.
(ii) If the common pool is diagonally-shaped and bottoms out on As property,
B probably cannot drill diagonally but can drill straight down.
(iii)
If A reinjects gas that spills into Bs land, can B sue for use of
property? One case that said no, because it became Bs gas under the rule
of capture, was highly criticized and later overruled. Hammonds v.
Central Kentucky Natural Gas Co. (KY 1934)
b. Water
i. Groundwater: Water found in underground aquifers.
(i) English rule: Can draw freely.
(ii) American rule: Reasonable use. Cannot be wasteful.

(iii)

WSJ, A Thirsty El Paso: Hot disputes over selling water to

municipalities, options to purchase groundwater.
ii. Surface water
(i) First in time rule predominates in Western US
(ii) Riparian law (goes to adjacent landowners, subject to others with riparian
rights) predominates in Eastern US.
iii. Legal Affairs, Theres an old saying in Colorado
(i) Politics in Colorado centered on water compacts. Pure first-in-time rule
for beneficial use. This encompasses domestic use, generating power,
and making snow.
(ii) Should water be sacrificed for kayaking parks when it would add to a local
economy? Environmental concerns
(iii)
Interstate compacts and other straws from the Colorado River.
Courts hear battles over who gets water, where, etc.
B. Acquisition by creation
1. Copycats and the common law
a. International News Service v. Associated Press (US 1918)
i. D copied news from one of Ps postings.
ii. Is there a property interest in freshly printed news that allows the created to
prevent others from copying it?
iii. Yes. P has invested time and resources into the creation of news, so it can
prevent others from copying it until its commercial value as news has passed
away. If copying was permitted, no news service could stay in business.
iv. This opinion seems to reflect Lockean property theory.
v. Note that this is only a quasi-property right that lets you exclude others.
b. Cheney Brothers v. Doris Silk Corp. (2d Cir. 1929)
i. D copied one of Ps fashion designs. Designs, of course, have a short life. Ps
designs werent so original that P could get a patent.
ii. Is there a generic common law patent protection which lasts for the
commercial life of a creation?
iii. No. It would be too difficult for courts to define the boundaries of common
law patent protection. The Court didnt create a common law patent in INS; it
was just an unusual case, and so the holding is confined to its facts. Since
theres no patent here or other recognized common law protection, Ps designs
can be copied.
c. Smith v. Chanel, Inc. (9th Cir. 1968)
i. D claimed in an ad that its cheap perfume was the same as Chanel No. 5.
ii. Court held that this was fine; No. 5 was unpatented, and so D had a right to
copy it. Most effective way of conveying Hey, my product is just as good as
this other one, but its cheaper is to actually name the other product.
iii. Copycats serve an important public interest.
d. Baird, Common law intellectual property: Competition depends upon imitation.
2. Intellectual property
a. Modes of IP protection:
i. Patents: Granted for novel, useful, and nonobvious processes or products. 35
U.S.C. 101. Last for 20 years from date of application. Non-renewable.

ii. Copyrights: Protect the expression of ideas in books, articles, music, etc.
Usually last 70 years after death of the author or creator, subject to fair use.
iii. Trademarks: Words and symbols indicating the source of a product or service.
These dont expire.
b. IP, unlike normal property, is non-rival and non-excludable. Our system of
protecting IP is very arbitrary who not have the government hire people?
c. Diamond v. Chakrabarty (US 1980)
i. P tried to patent a man-made bacterium that would help with oil spills. Patent
application denied because micro-organisms are products of nature and that as
living things they are not patentable under 101.
ii. Is the micro-organism a manufacture or composition of matter within 101?
iii. Burger: Yes. Things that are not patentable: laws of nature, physical
phenomena, and abstract ideas. But this micro-organism is markedly different
from any one found in nature and has potential for significant utility. This is
not a discovery of nature, but P. Patentable.
iv. Plants also arent patentable. But this case isnt analogous because the
legislative history doesnt suggest bacteria are included in plant variety
protection statutes. Also, it doesnt matter that this is natural the proper
distinction according to the statute is whether its nature-made or man-made.
Living things can also be in the scope of 101.
v. It doesnt matter that Congress didnt expressly include bacteria within the
scope of patent protection. The language of 101 suggests bacteria are
patentable.
vi. Brennan (dissent): Need to be careful to extend patent protection. Finds plant
patent acts controlling suggest that bacteria shouldnt be patentable. 101
shouldnt include living organisms.
vii. Harvard Mouse genetically engineered mouse developed for cancer
research. Was patented. Whats good and bad about this? What happens
when the mice reproduce like a fugitive resource?
d. Article re: Open access and Lessig
i. With cases like Eldred v. Ashcroft (US 2003) and laws like the Digital
Millennium Copyright Act upholding extensions to copyrights, is the US
becoming less creative of a nation?
ii. Copy Left: Its not so good that rights of small pieces of culture are doled
out for small payments. We should have more open access.
iii. When researchers have to get permission from several patentholders to go
forward with their research, isnt something wrong going on?
iv. But what about the authors? Romantic notions of creation. Utilitarianism.
Lockean theory.
3. Property rights in ones persona/person
a. Right of publicity is often recognized as a sort of property interest for celebrities.
Should/does it provide protection in cyberspace?
i. This will protect your self name, likeness, and other aspects of your
identity.
ii. E.g., Midler v. Ford Motor Co. (9th Cir. 1988) (voice of Bette Midler); Vanna
White v. Samsung Electronics America, Inc. (9th Cir. 1992) (robot made to

look like Vanna White). Lugosi v. Universal Pictures (CA 1979) (dicta that
heirs of celebrities who used personalities for commercial purposes could
recover for people who used those characteristics without permission).
iii. Demsetzian story here technology enabled copying of characteristics.
b. Moore v. Regents of the University of California (CA 1990)
i. P was treated by D; some of his cells were extracted. It just so happened that
the cells were very valuable for use in treating cancer. D patented these cells
and developed research based on them without Ps consent. P sued for
conversion.
ii. Does a doctor have a duty to disclose the extent of his research and economic
interests in a patients body parts? Yes.
iii. Are human body parts property such that they may be converted?
iv. No. Must show interference with possession or property interest. No
possession here. No property interest. Body parts are different policy goals.
CA statutes limit patients control over excised body parts. Also, the patent
cant be Ps property; its different from his organs. This isnt as unique as
likeness and the such; have same structure in every human being.
v. Conversion shouldnt be extended. Want to protect researchers from liability.
Duty to disclose protect patients interests. Institutional competency; leave it
to the legislature. Thus, no property interest in body parts.
vi. Arabian (concurring): Human body is sacred. Difficulties would arise if we
let people sell bodies for profit.
vii. Mosk (dissent): Concepts of property/ownership are very broad. Uniform
Anatomical Gift Act lets competent adults make post-mortem gifts of any/all
organs, but cannot receive consideration. This doesnt prohibit sales when
alive. The Act, in fact, recognizes a right to sell. Unfair to let Ds get all the
profit, P none.
viii. Arabian concurrence misses the point we can have a bundle of rights
that dont include selling for profit. Could have, e.g., enforced right to
alienate.
ix. Donation rate for dead people is about 15%. Living people can sell semen,
skin tissue, and blood. Kant degrading people to objects.
x. Case of a man who committed suicide and in a note willed his sperm to his
live-in girlfriend of several years. Eventually, after much litigation, the
girlfriend got the sperm.
xi. What about the poor? Article on organ donations in India 96% sold to pay
off debts. Some middlemen make misrepresentations to donors. all who were
in good or excellent health had severe declines after donation.
xii. Federal law prohibits organ purchases.
c. Jacque v. Steenberg Homes, Inc. (WI 1997)
i. D attempted to travel across Ps land to move a trailer. D tried to get
permission but P wouldnt give it.
ii. May punitive damages be imposed when nominal damages are awarded for an
intentional trespass to land?

iii. Yes. P has right to exclude people from land. Nominal damages (in this case,
$1) arent enough to deter. (In other words, landowners have right to
unreasonably exercise the right to exclude.)
iv. Blackstone would commend this decision. He viewed property as an absolute
right. What about the right not to be excluded, though? More and more
limitations on this notion of property. Whats wrong with absolute rights?
Epstein argues nothing; it just sets up for later market transactions.
(i) Local governments often prohibit aggressive panhandling, overnight
sleeping in public places.
v. Spectrum: Property rule would be the rule above interest cannot be taken
without owners consent. So award nominal, punitive damages for trespass.
Alternately, we could just let D enter and not impose any costs on him.
Liability rule would permit trespass for a price (a reasonable amount).
Basically an option to buy a license for a judicially-determined amount. E.g.,
eminent domain.
d. State v. Shack (NJ 1971)
i. D entered onto Ps property to provide legal advice to illegal alien. D refused
to leave when P ordered him to.
ii. May a landlord use land in a manner that endangers the well-being of others?
iii. No. D can enter without having to pay anything. Property rights serve public
policy and needs of others. Federal law authorizing D to give legal aid to
migrant farm workers declared a public policy of aiding these people. P cant
interfere with that.

III. Subsequent possession

A. Acquisition by find
1. Armory v. Delamirie (England 1722)
a. P found a jewel and took it to Ds shop to get it appraised. D wouldnt return it to
P.
b. Does the finding of lost property have title superior to all but the true owner?
c. Yes. Since D isnt the true owner, P has superior title.
d. Illustrates that title is a relative concept.
e. The Winkfield (England 1901): If finder recovers from jeweler, can true owner
recover from jeweler if finder is nowhere to be found? No. Burden is on true
owner to recover from the finder.
f. When courts have to resolve a dispute between a wrongful prior possessor and a
lawful subsequent possessor, they usually resolve the dispute in favor of the latter,
despite the rule that subsequent possessors usually dont hold better title over the
prior possessor.
g. Awards of damages v. possession in cases like this.
2. Hannah v. Peel (England 1945)
a. P found a brooch on property D owned but never lived on.
b. If a landowner has never lived on a parcel of land, does a finder of property on
that land have superior title to the landowner?
c. Yes. Precedent cases indicate that owner possesses anything attached to his land,
but not necessarily something which is on the surface of it that is not attached.
This was lost property. We want to serve two objectives return property to its
owner and encourage honesty. Here, P was honest; he gave the brooch to the
police immediately after finding out it may be of some value.
d. What if P was a trespasser? Authorities are split on whether trespasser can have
superior title to constructive possessor (see p. 118).
e. Bridges v. Hawkesworth (England 1847ish): Bag was left in area of shop
accessible to general public. Finder won because shop owner did not possess it.
3. McAvoy v. Medina (MA 1866)
a. Customer of barber shop owner D left his wallet on the counter but did not
remove it. P found the wallet.
b. Does the finder of mislaid property have title to it?
c. No. When property is mislaid, shop owner has a duty to safeguard it until the true
owner returns. (Lost property is genuinely lost; mislaid property has been
misplaced.) Finder can never gain title to it.
d. Bridges is distinguishable because property was lost in that case.
e. This case requires honesty; imposes confiscatory tax on finder. Can legal
incentives to find something crowd out moral incentives to turn it in?
f. If an employee/agent finds something, does he have title to it or does his superior?
Law is all over the place.
g. Treasure trove: treasures hidden with the intention of return to claim them went to
the king; abandoned property went to the finder. This has persisted to a certain
extent in the US.
h. Wreck: Cargo washed ashore from a ship lost at sea with no survivors went to
king. Has persisted in the US. But maritime law awards salvage awards some

percentage goes to finder unlike other property law, where finder gets all or
nothing.
i. Some states maintain the lost/mislaid/abandoned distinction (abandoned property
finder entitled to keep).
B. Acquisition by adverse possession
1. Elements
a. Actual entry giving exclusive possession that is
b. Open and notorious
c. Adverse under a claim of right and
d. Continuous for the statutory period.
2. CA Code of Civil Procedure
a. 321 Presumption that true owner was in possession unless it appears adversely
possessed for 5 years.
b. 322 Claim of title, exclusive of other right, founded upon a written instrument
as a conveyance or decree or judgment by a competent court, continuous
occupation/possession, for 5 years.
c. 323 Based on written instrument, possessed and occupied in the following
cases:
i. Usually cultivated or improved
ii. Protected by a substantial inclosure
iii. Although not inclosed, has been used for the supply of fuel, or of fencing
timber for the purposes of husbandry, of for pasturage, or for the ordinary use
of the occupant
iv. Where a known farm or single lot has been partly improved, the portion that
may have been left not cleared, or not inclosed according to the usual course
and custom of the adjoining country, shall be deemed to have been occupied
for the same amount of time as the part improved and cultivated
d. 324 When no claim under written instrument, only the land actually occupied
can be adversely possessed
e. 325 Adverse possession not founded upon a written instrument is possessed /
occupied only:
i. Where land is protected by a substantial inclosure
ii. Where it has been usually cultivated or improved
iii. Adverse possession not shown under any section of this code unless land has
been occupied continuously for 5 years and the party, predecessors, and
grantors have paid all the taxes levied and assessed upon the land state,
local, county, etc.
3. Justifications
a. Encourage efficient use of land, clarity of title, facilitates transfers of land.
b. Holmes also says that after a certain point, land becomes part of you
psychological benefits. Seems very Lockean.
c. Powell says it rests on social judgments that passage of certain time should give
security to person claiming to be owner.
d. Ballantine says purpose is to quiet title.
e. Ellickson claims it has quite a bit to do with cognitive psychology value loss of
an asset in possession more than foregoing opportunity to realize equivalent gain.

4. Van Valkenburgh v. Lutz (NY 1952)

a. Ds purchased land and, instead of going up a steep hill to get to their property,
walked across the land Ps later purchased. Ds cleared the land and built a 1-br
shack on it. They grew vegetables on it and sold them. Some litigation occurred
and Ds at least tried to claim a right of way.
b. Must possession be actual to acquire title by adverse possession? Yes. There is
no actual possession here because the garden occupied only a small portion of the
lots and the garage only encroached on Ps lot by a few inches.
c. Where a person claims title not founded upon a written instrument, must a person
either protect land by a substantial enclosure or cultivate or improve land to be
deemed to be in possession? Yes. The land was not enclosed. The improvements
were not substantial because the shack was small, the garden was insubstantial,
and placing junk on the land is not improvement.
d. Must land be possessed under a claim of title to be acquired by adverse
possession? Yes. D testified he knew the land belonged to Ps.
e. Dissent: The land was substantially improved and need not be fully occupied. It
only needs to be occupied to the extent necessary to put the owner on notice. Ds
need not believe the property was theirs; they just need to intend to acquire and
use the land as their own. (Professor favors this argument)
f. Three alternative approaches to claim of right:
i. Objective (state of mind irrelevant): English/CT rule. Once true owner is
dispossessed, statute starts to run.
ii. Good faith/subjective. Not commonly held in the US. But Professor
Helmholz has concluded on the basis of recent cases that even if this is not the
formal rule, many courts manipulate hostility and claim-of-right to permit
good-faith trespassers to get the land. Merril responded by saying we should
just apply the liability rule for bad-faith adverse possessors.
iii. Aggressive trespass: Majority rule
(i) What if there was a liability rule in these cases?
g. Ewing v. Burnet (US 1837): Adverse possession established when claimant under
color and claim of title paid taxes on lot, occasionally dug sand and gravel from it,
permitted others to do so, and brought trespass against others for doing so without
his permission. Adverse possessors dont necessarily need to live on the lot;
sometimes its even fine if he doesnt use the lot for a long time.
i. But dont assume that this means its sufficient to use the property as an
average owner would in the area. Pettis v. Lozier (NE 1984): No adverse
possession of 8-acre suburban wooded lot even though the claimant
occasionally used the land for a variety of purposes throughout the statutory
period.
h. Claim of title hostility/claim of right. Color of title claim founded on written
instrument or judgment/decree that is for some reason defective and invalid.
Claim under color of title is not required by English law and is not required in
most US. Actual possession under color of title is constructive possession of all
that the writing describes.
5. Mannillo v. Gorski (NJ 1969)

a. For 20 years, Ds house (unknowingly to D) encroached upon Ps land by 15

inches.
b. Must possession be accompanied by a knowing intentional hostility for adverse
possession? No. Entry and continuance of possession under mistaken belief that
possessor has title to the lands satisfies hostility. (This is the majority
view/Connecticut doctrine. The minority view/Maine doctrine is that knowing
intentional hostility is required.)
c. Does a minor border encroachment satisfy open and notorious requirement? No.
A border dispute like this one does not create a clear situation of adverse
occupancy. Only way D knew he was encroaching was to have a survey of the
property. Only where the true owner has actual knowledge of encroachment can
it be open and notorious.
d. But equity may require that the true owner convey the land to D. Remanded.
e. What does the actual knowledge to be of? Suppose P thought encroachment was
only 3 inches.
f. Harrison v. Welch (CA 2004): P built a woodshed and planted some trees that
partially encroached upon neighbor Ds land. No adverse possession because P
didnt pay taxes on the area he encroached upon.
g. Accidental improvements: Common law rule was too bad if you improve on the
wrong land, no dice. Now courts can force conveyances at market price. Some
statutes give landowner the option to buy the improvement.
6. Howard v. Kunto (WA 1970)
a. M, D, and P had lots in a resort area. M occupied Ps land. D occupied Ms land.
Ds land was to the west. P conveyed deed to M. M conveyed deed to land that D
occupied to P. M then conveyed. D obtained title from predecessor. Quiet title
on land D occupies.
b. Is land that is used in a customary manner, even though it is not possessed
continuously, sufficient to vest title by adverse possession? Yes.
c. Is a reasonable relationship between successive adverse possessors all that is
required to tack? Yes. Privity is required; this is accomplished by the deed
transferring title. This only means a reasonable relationship; designed to prevent
trespassers who had no claim of right from tacking.
d. Physical tacking: If a deed intends by the parties to convey not just described land
but also adversely possessed land, claimant can tack the strip on to land
described in deed.
e. Temporal tacking: English rule successive possessors dont need to be in
privity; American rule yes they do.
f. The adverse possessor can only acquire the interest of the person who currently
has rights to possession.

10

IV. Shared ownership of property

A. Ownership divided into time periods
1. Possessory estates
a. Fee simple
i. An estate capable of being inherited by whomever turns out to be the heirs of
the fee simple owner.
ii. To A and his heirs (though and his heirs is no longer required)
iii. Applies only to real estate.
iv. Heirs: Persons who survive decedent and are designated as intestate
successors under the states statute of descent. Living people have no heirs.
v. Issue: If the decedent leaves issue, they take to the exclusion of all other
kindred. Issue are decedents.
(i) Per stirpes: If a child of the decedent dies before the decedent and leaves
children who survive the decedent, then the childs share goes to his or her
children by right of representation.
(ii) Rule of primogeniture: Eldest son inherited land. If he died before the
decedent, then his eldest son. Only if there were no sons would a daughter
inherit.
(iii)
Illegitimate children was considered the child of no one (filius
nullius); could not inherit at all.
vi. Ancestors: Parents usually take as heirs if no issue.
vii. Collaterals: Persons related by blood to decedent who are neither descendants
nor ancestors are collateral kin. If no spouse, parents, or issue, collateral kin
inherit.
viii. Escheat: If a person died intestate without any heirs, real property escheats
to the state. Personal property escheats to crown as goods without an owner
(bona vacantia).
b. Life estate
i. When A transfers his life estate to B, B has a life estate pur autre vie (it is
measured by the life of another person).
ii. White v. Brown (TN 1977)
(i) L left a will that P will get home said twice it was not to be sold. P
claims fee simple interest conveyed. D claims it was merely a life estate.
(ii) Unless a contrary intention appears by the terms of the will and its context,
does a will convey a testators entire interest?
(iii)
Yes. Legislature has enacted presumption in favor of conveyance
of testators entire interest rather than a life estate. Restraints on alienation
are void as against public policy. So P has a fee simple.
(iv) Dissent: The will is unambiguous.
(v) Restraints on alienation are bad problems with marketability,
concentrating wealth, improvements, and credit.
1. Disabling restraints withhold from the grantee the power of
transferring his interest.
2. Forfeiture restraints provide that if the grantee attempts to transfer his
interest, it is forfeited to another person.

11

3. Promissory restraints provide that the grantee promises not to transfer

his interest. These are rare.
4. Restatement is against absolute disabling restraints, but is fine with
partial restraints if reasonable under the circumstances.
(vi) Valuation of life estate rely heavily on life expectancy tables. See pp.
229-30.
c. Defeasible estates
i. Fee simple determinable: Automatically ends when a stated condition
happens.
(i) Language in conveyance
1. to A so long as premises are used for school purposes
2. while used for school purposes
3. during the continuance of said school
4. until A no longer uses the land for a school
5. Words with a durational aspect
(ii) Future interest is the possibility of reverter.
ii. Fee simple subject to condition subsequent: May be cut short or divested at
the transferors election when a stated condition happens.
(i) Language in conveyance
1. to A, but if the premises are not used for school purposes, O has the
right to reenter and retake the premises
2. Conveyance of fee simple, followed by language providing that it can
be divested if a stated event happens.
(ii) Future interest is the right of reentry/power of termination.
iii. Marenholz v. County Board of School Trustees (IL 1981)
(i) Hs conveyed land to D to be used for school purposes only, otherwise to
revert to grantors therein. D later used the land for storage. Hs conveyed
any future interest they had to P.
(ii) Did the language create a fee simple determinable?
(iii)
Yes. P has no interest; cannot convey these interests (per statute).
The phrase to be used for school purposes only used suggests Hs wanted
to convey land for a particular purpose and for no longer than the purpose
needed to be furthered. The phrase otherwise to revert to grantors
suggests an automatic return to Hs. This is a fee simple determinable.
(iv) Most states permit the transfer of possibility of reverted and right of entry.
But some states distinguish between the two.
(v) When does the statute of limitations begin to run? In many states, when
the condition occurs. Right of reentry must be exercised within a
reasonable time (usually defined as statute of limitations).
(vi) CA has no fee simple determinable. CA Civil Code 885.020.
(vii)
Conditions lead to forfeiture, but violations of covenants lead to an
injunction or damages not nearly as serious.
2. Future interests
a. Interests retained by the transferor
i. Reversion: the interest remaining in the grantor who transfers a vested estate
of a lesser quantum than that of the vested estate which he has.

12

(i) E.g., to A for life O has a reversion.

ii. Possibility of reverter: arises when an owner carves out of his estate a
determinable estate of the same quantum.
iii. Right of entry/power of termination: arises when an owner transfers an estate
subject to condition subsequent and retains the power to cut short/terminate
the estate.
b. Interests created in a transferee
i. Read the language from left to right
ii. A transferee holding a future interest can sue the current possessor for waste.
iii. A remainder is a future interest that waits politely until the termination of
the preceding possessory estate. But an executory interest is a future interest
that can take effect only be divesting another interest.
iv. Note: A life estate can end prior to the death of the transferee.
v. Note: The legal consequences of the various future interests in transferees are
minimal, if not non-existent.
vi. Vested remainder
(i) A remainder given to an ascertained person that is not subject to a
condition precedent (other than the termination of the preceding estate).
(ii) Indefeasibly vested remainder: remainder is certain of becoming
possessory in the future and cannot be divested.
1. e.g., to A for life, then to B and her heirs.
(iii)
Of course, a remainder can be vested but not certain of becoming
possessory.
1. e.g., to A for life, then to B and her heirs, but if B does not survive A
to C and his heirs B has a vested remainder subject to divestment.
(iv) A remainder created in a class of persons is vested if one member of the
class is ascertained and there is no condition precedent. The remainder is
vested subject to open or vested subject to partial divestment of later-born
children are entitled to share in the gift.
1. e.g., to A for life, then to As children and their heirs.
vii. Contingent remainder
(i) A remainder given to an unascertained person or is made contingent upon
some event occurring other than the natural termination of the preceding
estates.
1. e.g., to A for life, then to the heirs of B B is alive; the heirs of B
are not ascertained.
(ii) Contingent remainders cannot be possessory until they are vested.
(iii)
to A for life, then to B and her heirs if B survives A, and if B does
not survive A to C and his heirs B and C have alternative contingent
remainders.
viii. Executory interests
(i) Shifting executory interests: Divest or cut short some interest in another
transferee.
(ii) Springing executory interests: Divest the transferor in the future.

13

(iii)

Fee simple subject to an executory limitation: upon the happening

of a stated event, it is automatically divested by an executory interest in a
transferee.
1. e.g., to A and his heirs, but if A dies without issue surviving him, to B
and her heirs A has a possessory fee simple subject to an executory
limitation. to A for life, then to B and her heirs, but if B dies under
the age of 21, to C and her heirs B has a vested remainder in fee
simple subject to an executory limitation.
(iv) Defeasible fees: e.g., to Town Library Board so long as the premises are
used for library purposes, then to Childrens Hospital TLB has a fee
simple determinable. CH has an executory interest. This is because even
though it would otherwise appear to be a remainder, there is a rule that a
remainder cannot follow a vested fee simple. Courts err on the side of
violating the definition of executory interest than that rule.
c. Trusts
i. Trustee manages property for the benefit of the beneficiaries.
(i) Trustee has legal ownership and power to sell the assets and reinvest
proceeds.
(ii) Net income is paid to the beneficiaries.
(iii)
Beneficiaries are equitable owners.
(iv) Trustee is a fiduciary. Duties p. 288.
(v) E.g., Blackacre conveyed to X in trust to pay the income to A for life, and
then to pay the principal to As children who survive A.
ii. Swanson v. Swanson (GA 1999)
(i) S left a will that created two trusts. The Item IV trust gave his wife a life
estate, which she could dispose of as she wished, with remainder to his
nine children (or, if not surviving, to their children per stirpes). The Item
V trust gave S wife a life estate, remainder divided into nine equal shares,
one each for each of surviving children or the then surviving issue of the
deceased child.
(ii) B died before S and left everything he had to his wife, P. He had no
children.
(iii)
Does the law create a preference for vested remainders over
contingent remainders?
(iv) Yes. GA has two guiding principles: favor construction as conditions
subsequent; and when ambiguous, favor construction as vested
remainders. When theres at least one known person, then it is a vested
remainder.
(v) Item IV: Since children (all of them) were alive at the time the will was
created, so each had a vested remainder interest. Two conditions
subsequent predeceasing wife and leaving children who survived wife;
wifes exercise of power of appointment. Neither occurred, so B had a
vested remainder interest; passed on to P.
(vi) Item V: Provides for equal distribution among children. Just as with the
Item IV, Bs share was fully vested.

14

(vii)
Condition precedent: Condition incorporated into the language that
created the interest.
(viii)
Condition subsequent: Condition not incorporated into the
language that creates the interest.
(ix) Indefeasibly vested remainders give you the flexibility to deal with
marriages, divorces, births, and disabled or incompetent children. If
everything is contingent upon you surviving your parent(s), then you cant
deal with these changing circumstances very well.
1. To avoid these problems, the grantor could give life tenant power of
appointment; or making remainder contingent upon surviving life
tenant and giving remainderman a special power of appointment
exercisable if the remainderman predeceases the life tenant. A special
power of appointment is the power to appoint the property among a
limited class of persons.
(x) Can you adopt your adult spouse to get favorable treatment in a trust?
Some cases say no, since it would flout the intent of the trust.
d. Rule against perpetuities
i. 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 ends.
(i) Originated in Duke of Norfolks Case (England 1681).
(ii) The validating life need not be mentioned in instrument, but must
somehow effect vesting of the interest.
(iii)
A child in the womb as of creation of instrument is in being.
(iv) A reasonable period of gestation can be tacked on to the period.
ii. Measures what could happen.
iii. Rules of construction
(i) Prefer vested to contingent
(ii) Prefer early vesting to later vesting
(iii)
Avoid partial intestacy
(iv) Prefer fee simple absolute
iv. Similar policies as adverse possession. Want to respect wishes of transferor,
but dont want to give him too much power to rule in the distant future.
v. Future interests retained in the transferor are not subject to RAP. (Although in
England, the possibility of reverter and right of reentry are.)
vi. The Symphony Space, Inc. v. Pergola Properties, Inc. (NY 1996)
(i) In 1978, B sells building to P for a very low price. B maintains
possession because P leases it back to B for $1/year. (This is a tax evasion
deal.) B granted option to repurchase in 1987, 1993, 1998, or 2003. B
sold its interest for almost $5m; D eventually purchased it. Value of
property increased significantly and D exercised option.
(ii) Are options to purchase commercial property exempt from RAP? No.
RAP applies to commercial option contracts. An exception would remove
an entire class from RAP, and thats not warranted by the language or
legislative history.
(iii)
Does the option contract violate RAP? Yes. It must vest by 1999,
but theres an option in 2003.

15

(iv) Rejects wait-and-see approach.

(v) If a preemptive right (right of first refusal) can be exercised beyond the
perpetuities period, then its usually found void.
(vi) O: to A so long as land is used for school purposes, and when its no
longer used that way, O, his heirs, or his assigns can repurchase it. This
is a preemptive right that violates RAP.
vii. Modern reforms
(i) Restatement 3d of Property, Servitudes, 3.3: Options not subject to RAP,
but to restraints on alienation.
(ii) USRAP: RAP does not apply to options, commercial transactions.
(iii)
Cy pres: reformation of invalid interests so as to carry out
transferors intent within the perpetuities period. Mandated in a few
states.
viii. Wait-and-see
(i) This sacrifices the certainty provided by what-might-happen
(ii) Some form of wait-and-see has been adopted by most states
(iii)
Wait-and-see for the common law period. Has been adopted in
about 9 states.
1. Most of these states permit reformation of invalid interests
(iv) Wait-and-see for 90 years (USRAP)
1. Under USRAP, if it will vest within 90 years or the common law
period, then its vested. If its unclear, wait-and-see for 90 years. Has
been adopted in 26 states, incl. CA.
ix. About of the states have abolished RAP and/or permitted perpetual trusts.
x. Simes, Public policy and the dead hand
(i) The purpose of RAP, to facilitate alienability, is no longer valid.
(ii) Trustees have been given more powers of reinvestment.
(iii)
Income and estate taxes curb the concentration of wealth in
dynasties.
(iv) Sometimes RAP is justified by not encouraging survival of fittest, but
guaranteeing income of some people. Well, RAP lets us do it for one
generation.
(v) But there are two legitimate goals. RAP balances interests of old with
those of the young. Its also socially desirable that wealth be controlled by
the living and not the dead.
xi. Dynasty trusts
(i) WSJ Article trend toward using dynasty trusts.
(ii) Theres a federal estate/gift tax exemption of $1m if you put it into a
dynasty trust.
(iii)
Trust that endures for lives in being at creation of trust plus 21
years. In states with USRAP, goes on for 90 years or common law
perpetuities period. In some states, a dynasty trust can endure forever.
B. Concurrent ownership
1. Introduction
a. Tenancy in common

16

i. Separate but undivided interests in the property. Each is descendible and may
be conveyed by deed or will. No survivorship rights.
ii. Need unity of possession.
b. Joint tenancy
i. Have a right of survivorship. Together regarded as a single owner. When
joint tenant dies, nothing passes to other joint tenant. It just continues.
Cannot will any interest in joint tenancy.
(i) So creditors cant seize anything after a joint tenant dies, but can when
hes alive.
ii. Four unities needed:
(i) Time: Interest of each joint tenant must be acquired or vest at the same
time.
(ii) Title: All joint tenants must acquire title by the same instrument or by a
joint adverse possession. A joint tenancy can never arise by intestate
succession or other act of law.
(iii)
Interest: All must have equal undivided shares and identical
interests measured by duration.
(iv) Possession: Each must have a right to possession of the whole. After its
created, one joint tenant can voluntarily give exclusive possession to the
other.
iii. If not all of the four unities are present at creation, then most states and the
common law provide that it is a tenancy in common. If one of the unities
severs, its converted into a tenancy in common.
iv. If joint tenants or tenants in common cannot come to mutual agreement, any
of them can bring action for judicial partition. Court will either physically
partition land or order land sold and divide proceeds among the tenants.
v. Joint tenancies help people avoid probate. But Congress got smart and subject
joint tenancies to estate taxation.
vi. Courts frequently ignore the equal share unity; courts frequently divide
proceeds according to intent of parties.
c. Tenancy by the entirety
i. Can be created only in husband in wife. (Although HI recently permitted
reciprocal beneficiaries unmarried people who cannot get married to have
a tenancy by the entirety.)
ii. H and W are considered a single holder. They cannot defeat the right of
survivorship of the other by a conveyance of a third party. H and W must both
consent to conveyances.
iii. Exists in slightly less than states.
d. Presumptions
i. Tenancies in common over joint tenancies
ii. Usually a presumption that if conveyed to H and W, it will be a tenancy by the
entirety, absent some clear indication otherwise
iii. Some states require specific language (by statute) to convey a joint tenancy
e.g., to A and B as joint tenants with the right or survivorship (But in some
states including expressly a right of survivorship will be interpreted as
conveying a joint life estate with alternative contingent remainders.)

17

2. Severing a joint tenancy

a. Riddle v. Harmon (CA 1980)
i. P didnt want her property to pass to her H when she died, so she tried to end
the joint tenancy by selling the property to herself as a tenant in common.
ii. Can a joint tenant unilaterally sever a joint tenancy without the use of an
intermediary by conveying her interest to herself?
iii. Yes. Since state statute governing joint tenancy permits someone to
unilaterally create one by conveying property to herself and others, then its
perfectly fine for someone to unilaterally terminate a joint tenancy. A
strawman is unnecessary for the creation of a joint tenancy, its unnecessary
for the termination.
iv. What if the wife did this almost secretly? Suppose she wrote it on a paper,
told her daughter, and hid the paper.
v. Uniform Simultaneous Death Act 3: One-half of the property is distributed
as if one joint tenant survived, and one-half as if the other survived.
(i) Suppose A and B, joint tenants, are in a car crash. B is decapitated blood
gushing from his neck and there are no signs of life from A. Who
survives whom? Unclear.
vi. Uniform Probate Code 2-803(c)(2): If one joint tenant murders another, that
severs the joint tenancy. The killer loses his right of survivorship in the
decedents share.
b. Harms v. Sprague (IL 1984)
i. P and brother J own land as JTWROS. J wanted to help his boyfriend, D, buy
some property and mortgaged his interest in the land with P as a security for
Ds debt. P was unaware. After J died, Ds creditors recorded the mortgage.
ii. Is a joint tenancy severed when one joint tenant mortgages his interest in the
property? No. Two theories:
(i) Lien theory: A mortgage on the interest is just a lien. (Majority, incl. CA)
(ii) Title theory: A mortgage on the interest is a sale of it.
iii. Adopts lien theory. Liens dont sever joint tenancies.
iv. Does such a mortgage become a lien on the property after the death of the
mortgagor? No. A surviving joint tenant acquires the share of the deceased
joint tenant.
3. Relations among concurrent owners
a. Partition
i. Delfino v. Vealencis (CT 1980)
(i) Ps (99/144) and Ds (45/144) own property as tenants in common. D runs
a garbage removal business on her part of the land. Ps want to partition
and develop the property into residential lots. D wants to keep her
business (clearly a conflict between subjective and objective values).
(ii) Can a partition by sale be ordered when a physical partition is possible,
and a partition by sale would protect the interests of the owner of a larger
share of the property over the owner of the other share?
(iii)
No. Prefer partition in kind to partition by sale. A partition by sale
should be ordered only when (1) the physical attributes of the land are
such that a partition in kind is impracticable or inequitable and (2) the

18

interests of all the owners would better be promoted by a partition by sale.

PBS is essentially an extreme remedy.
(iv) Here, its physically possible to partition the land in kind. Its not
inequitable. Economic gain cannot justify PBS; need to consider that PBS
would make D surrender her business and home. Plus, Ps home is on far
west side of property.
(v) Professor: under this logic, each cotenant has a veto power by saying that
subjective value is very high.
(vi) Antique rocking chair case (In re McDowell (NY 1973)) A and B, heirs
to their father, fight over an item they both want very much. Cant PIK
that. But perhaps you can partition in time A gets it for 6 mos., B gets it
for 6 mos. The court granted this remedy.
(vii)
Courts do different things when there are many owners at stake.
Some order partition by sale because it would be unduly prejudicial to the
owners to PIK. But others order PIK and say the 4 cotenants can draw lots
as to who gets which lot.
(viii)
Modern practice is in favor of PBS, in spite of assertions that PIK
is preferred.
b. Sharing benefits and burdens of co-ownership
i. Spiller v. Mackereth (AL 1976)
(i) P and D own building as tenants in common. Tenant vacates. P starts
using space as a warehouse. D sent letter demanding P to pay rent or
vacate. No evidence that P excluded D from the land. P put new locks on
building seemed to be because he wanted to protect merchandise.
(ii) Does P owe D rent?
(iii)
No. Unless theres an agreement to pay rent or ouster, a cotenant
in possession is not liable to cotenants for the value of the use and
occupation.
(iv) Ouster: Refers to (1) beginning and running of statute of limitations for
adverse possession or (2) liability of an occupying cotenant for rent to
other cotenants. In the second instance, is shown when occupying
cotenant refuses demand of other cotenants to use property as well.
(v) There was no refusal here P just didnt respond to some letter D sent. D
didnt assert possessory rights. Locks werent ouster because not done
with intent to exclude and no evidence that D asked for keys and was
denied. P not liable for rent.
(vi) Minority view: Ouster is not required; there just needs to be a demand to
vacate or pay rent.
(vii)
This rule rewards the beneficial use of property.
ii. Swartzbaugh v. Sampson (CA 1936)
(i) D/H and P/W were JTWROS. When P was ill and without Ps consent, D
leased part of their land for a boxing pavilion. P didnt want the pavilion
there.
(ii) Can P cancel the leases?
(iii)
No. A joint tenant has the right to convey or mortgage his interest
in the property even if the other joint tenant objects.

19

(iv) Ps remedies:
1. If theres no ouster, a joint tenant can only recover agreed upon price.
a. If agreed upon price is higher than FMV, then a joint tenant could
just argue no ouster.
2. If there is ouster, a joint tenant can recover fair market value here.
iii. Accounting for benefits
(i) Cotenant who collects rent or other payments from 3d parties must
account to cotenants for amounts received.
(ii) Cotenant who pays more than his share of taxes, mortgage payments, or
other necessary carrying charges usually has a right to contribution.
1. An exception that is not uniformly applied is when the cotenant who
pays taxes and the such is the sole possessor and the value of the
possession equals or exceeds the payments.
(iii)
Necessary repairs: No affirmative right to contribution unless
theres an agreement. But can receive credit in accounting action.
(iv) Improvements: No right to contribution, no credit.
C. Marital ownership of property
1. Common law system
a. During marriage
i. At common law, H had complete dominion over property. Married Womens
Property Acts permitted W to have control over all of her property.
ii. Sawada v. Endo (HI 1977)
(i) D and W conveyed their property to their sons without consideration one
the same day D got into an accident with Ps. Ps received judgment against
D.
(ii) Is the interest of one spouse in real property held by tenancy in the entirety
subject to levy and execution by his creditors?
(iii)
No. 4 groups of laws on this:
1. Debtor spouse = D; non-debtor spouse = H. 2 is the right of
survivorship.
2. Group I: Old common law: H is the real owner of marital property
a. If D=H, then D1, D2, and X1 can be sold/levied upon.
b. If D=W, then creditor is SOL.
3. Group II: W has the same rights as H under old common law (leveling
up).
a. D1+D2 can be levied upon. So if X dies first, creditors are very
happy.
4. Group III: H has same rights as W under old common law (leveling
down). Following Married Womens Property Acts.
a. Nothing can be levied upon.
5. Group IV: Right of survivorship for either spouse is separately
alienable.
a. Can only sell/levy upon D2.
(iv) Hawaii joins Group III. Since a tenant by the entirety cannot convey his
interest without the consent of his spouse, it cannot be reached by only one
spouses creditors.

20

(v) Dissent: Should have joined Group II thats whats compelled by the
Acts.
iii. United States v. 1500 Lincoln Avenue (3d Cir. 1991)
(i) D/H used property he owned with D/W (completely innocent) for the
illegal distribution of drugs. Government/P tried to forfeit property.
(ii) Can the action of one tenant by the entirety in subjection property to
forfeiture extinguish the property rights of the other tenant?
(iii)
No. Two purposes to forfeiture statute: forfeit property used for
drug offenses and protecting rights of innocent property owners.
(iv) W is entitled to obtain title in fee simple if she doesnt predecease H. Her
interest cant be touched by a levy against her husbands interest. Here the
government will be quite happy if W predeceases H.
(v) Result may be different (i.e., in favor of wife) if H doesnt use the property
for illegal purposes. United States v. Lee (7th Cir. 2000)
b. Termination of marriage by divorce
i. The common law said the following (but this has been rejected everywhere):
(i) Marital property converted to property of spouse holding title
(ii) Property held as tenants in common or joint tenants remained that way
(iii)
Tenancy by the entirety converted to tenancy in common
(iv) Wife usually entitled to lifelong alimony
ii. Common law property states have instead adopted a rule of equitable
distribution. More common trend is to subject marital property to equitable
distribution.
iii. Obligation to pay lifelong alimony abandoned. Now its for only a limited
period of time.
iv. Movement toward equally distributing property upon divorce
v. In re Marriage of Graham (CO 1978)
(i) P/W (flight attendant) supports D/H while D went to b-school and worked
part-time. Ps income contributed about 70%. P did most housework. No
marital property accumulated. P wanted to get future earnings.
(ii) Does education constitute property which can be divided between spouses
upon divorce?
(iii)
No. Degree is of personal value to holder. Terminates on death of
holder. Not inheritable. Cannot be transferred, sold, assigned, etc. Ps out
of luck since no marital assets acquired (in that case, her contribution
would be considered).
(iv) Dissent: Most valuable asset P and D acquired during marriage was Ds
earning capacity. Ps earnings were an investment. Lets consider equity.
(v) Approach 2: Reimbursement. Professional degree is not marital property
because its too speculative in value. Working spouse can get
reimbursement alimony (covers all financial contributions toward
education, including household expenses). (Most states agree with
Graham or Mahoney.) Mahoney v. Mahoney (NJ 1982).
(vi) Approach 3: Full compensation. Reimbursement is not an adequate
remedy. Degrees are marital property (statute provides for consideration

21

of contributions to career or career potential of spouse). OBrien v.

OBrien (NY 1985)
vi. Elkus v. Elkus (NY 1991)
(i) P/W was an average opera singer. D/H coached her, quit his job, and
became her manager. 10 years as voice coach. Attended and critiqued all
performances. Took care of kids. Went from making 2k to 600k/year.
(ii) Does an increase in the value of one spouses career, when brought about
by the efforts of the other spouse, constitute marital property which can be
equitably divided?
(iii)
Yes. Follows OBrien property can be tangible or intangible.
Increased earning capacity just like degree. D made direct and concrete
contributions to Ps career.
(iv) In most jurisdictions, professional goodwill is a divisible marital asset
(even if degrees arent).
vii. Oldham, Putting asunder in the 1990s: NY system is double-counting because
we already consider lifetime earning capacity of spouse.
c. Termination of marriage by death of one spouse
i. Common law
(i) Dower to W: all freehold land in which H was seised during marriage and
that was inheritable by the issue of H and W. A life estate in 1/3 of each
parcel of qualifying land.
(ii) Curtesy to H: life estate in each piece of Ws real property under certain
conditions.
(iii)
Have been abolished in all but 6 jurisdictions in the US.
ii. Forced share
(i) Surviving spouse gets to choose between what is devised to him/her by
will and taking 50% of decedents estate.
(ii) Adopted by all but one common law property state.
(iii)
Usually applies only to property decedent spouse owns at death.
(iv) Usually does not apply to life insurance proceeds.
(v) Can try to get around this through lifetime gifts, but some states permit the
surviving spouse to set aside these gifts.
2. Community property
a. Fundamental idea is that earnings are owned equally.
i. All assets acquired during marriage are presumed to be community property;
can rebut by preponderance of evidence.
ii. Whatever is bought with earnings is community property.
iii. Separate property does not become community property merely by virtue of
the passage of time.
b. Nature of community property
i. In most states H and W can freely transmute nature of property via written
agreement (in some states, oral).
ii. Upon divorce, some states require that community property be divided
equally. Others permit courts to equitably divide.
iii. No community property state recognizes tenancy by the entirety.
iv. Community property can only exist between H and W.

22

v. No single spouse can sell ownership interest. No single spouse has right to
partition or other action.
vi. No survivorship feature. Can be passed through laws of intestacy. Some
states (CA included) have developed community property with right of
survivorship.
vii. At death, stepped-up tax basis value of property at death, rather than
purchase price. Internal Revenue Code 1014.
(i) This can be secured by residents of a common law stated by creating a
community property trust in AK with an AK resident as trustee.
(ii) Can also be secured by a couple changing domicile to community property
state and agreeing to hold property as community property, then moving
back to original state.
viii. Can devise community property.
c. Management
i. Since 1960s, all community property states have passed laws giving H and W
equal rights to management.
ii. Some detailed rules.
iii. Manager is a sort of fiduciary. Good faith but not good judgment needed.
d. Mixing community property with separate property
i. Three approaches
(i) Inception of right
(ii) Time of vesting (i.e., when property is paid off)
(iii)
Pro rata apportionment depending upon relative contributions of
individual in individual capacity v. community subsequent to marriage
(more common).
ii. Suppose W has business that she operates before marriage and then sells it off
5 years after marriage, with it more than doubling in value since marriage.
(i) In CA, the division of proceeds depends on whether the increase in value
is primarily due to Ws personal activity and abilities or the character of
the investment in the type of business.
(ii) If its all Ws effort, its all community property. If its entirely due to the
nature of the industry, then its all Ws.
e. Migrating couples
i. Once the property has been characterized, ownership does not change when
the parties change their domicile unless both parties consent to the change in
ownership.
ii. When someone dies, the law of his domicile at death governs the disposition
of personal property. The law where land is located governs the disposition of
land.
iii. Community property states usually dont give surviving spouse a forced share.

23

V. Landlord/tenant law
A. The leasehold estates and the lease
1. Four types of leaseholds
a. Term of years: Lease for a single, fixed period
b. Periodic tenancy: Lease for period-to-period
i. Notice of termination by either party must be given within at least one period
but not more than six months.
ii. If notice is inadequate for the next period, when does it become effective?
The period after that. S.D.G. v. Inventory Control Co. (NJ 1981) majority
view
c. Tenancy at will: Lease for no fixed period that endures so long as both landlord
and tenant desire.
i. Unlike term of years or periodic tenancy, death of the landlord or tenant
affects the tenancy at will.
ii. Modern statutes usually require notice of, say, 30 days to terminate.
iii. While this necessarily can be terminated by either landlord or tenant, a
unilateral power of termination can be engrafted on to a term of years or
periodic tenancy.
iv. Garner v. Gerrish (NY 1984)
(i) D leased house to G. G had option of terminating lease at his choice. P
(executor of Ds estate) wants G out.
(ii) If a lessee may terminate a lease when he pleases, is a determinable life
tenancy created?
(iii)
Yes. A life estate determinable is created when a lessee has the
option of terminating when he pleases. It ends when he dies or terminates.
(iv) L leases Blackacre to T for as many years as L desires. 3 approaches:
1. Old common law: Tenancy at will; T also has right to terminate.
2. Garner: Life estate determinable
3. Restatement 2nd of Property, Landlord and Tenant: Fee simple
determinable
(v) L leases Blackacre to T for the duration of the war. Its not a term of
years or a periodic tenancy, so it must be a tenancy at will. But this
appears to go against the intent of the parties. Perhaps it can be modified
by contract. Tension between intent and certainty in property law.
1. Courts will sometimes follow intent in spite of law, and sometimes
not. Some courts say that when a lease is ambiguous, theres a
rebuttable presumption that its at the will of both parties.
d. Tenancy at sufferance (holdover)
i. Crechale & Polles, Inc. v. Smith (MS 1974)
(i) D held over after the end of his five-year lease. P rejected a term-to-term
lease and treated him as a trespasser. P then accepted rent for first month,
though and now wants to subject him to a full-lease term.
(ii) If a landlord elects to treat a holdover tenant as a trespasser, may he
subsequently change his mind and hold him to a new term?
(iii)
No. Landlord has two options when a tenant holds over: treat him
as a trespasser or hold him over for a new term. Cannot change mind.

24

Since P initially wanted to treat D as a trespasser, cannot hold D over for a

new term. By accepting rent, though, P can hold D over on a month-tomonth basis.
(iv) How do you tell what the period is? Figure out on the basis of rent not
to exceed one year. Restatement.
(v) There is an array of statutes dealing with the length, form, rent amount,
and the such of holdover tenants. See p. 455. Many states permit double
rent. (In MS, such a statute was held to abrogate common law action.)
(vi) What if a tenant vacates but leaves stuff behind? If it doesnt interfere
with the landlords use of the premises, tenant is not liable as a holdover.
Caserta v. Action for Bridgeport Community (CT 1976). If tenant holds
over, but not voluntarily e.g., for an illness shes not liable. Herter v.
Mullen (NY 1899).
e. Lease v. Not-lease
i. A lease is a contract and a conveyance. Historically, courts stressed the
conveyance part. But now many concepts of contract law have been
incorporated into property law.
ii. The vast majority of states permits oral leases for a term less than a year.
Otherwise we run into Statute of Frauds problems.
iii. Consider the roles of bargaining power, form leases, and housing shortages.
B. The selection of tenants
1. Fair Housing Act
a. 3604
i. Cannot refuse to sell or rent after making an offer, or refuse to negotiate, or
otherwise make unavailable on account of race, color, religion, sex, familial
status, or national origin.
ii. Cannot discriminate against person in terms, conditions, or privileges of sale
or rental or in provision of services or facilities in connection therewith,
because of a protected characteristic.
iii. Cannot make, print, or publish, or cause to be made, printed, or published and
notice, statement, or advertisement that indicates a preference, limitation, or
discrimination on the basis of a protected characteristic or the intent to
discriminate, prefer, or limit.
iv. Cannot represent to any person on the basis of a protected characteristic that a
dwelling is not available when it is.
v. Cannot make representations to a person that the neighborhood will have a
certain composition of protected characteristics.
vi. Cannot discriminate in sale/rental or terms/privileges because of a handicap of
the buyer/renter, a person who will reside in dwelling after it is rented/sold, or
any person associated with the buyer/renter.
(i) Discrimination includes refusal to permit reasonable modifications if they
are necessary to afford the person full enjoyment of the premises except
in case of rental may require renter to restore interior of premises to
condition that existed before modification, reasonable wear and tear
excepted.

25

2.
3.

4.

5.
6.

(ii) Discrimination also includes a refusal to make reasonable

accommodations in rules, policies, practices, or services, when necessary
to afford person full enjoyment of property
(iii)
Discrimination further includes failure to design and construct new
dwellings so that
1. Public/common areas are readily accessible to and usable by
handicapped people
2. Doors designed wide enough for wheelchairs to pass through
3. All premises contain features of adaptive design
a. Accessible route into and through the dwelling
b. Light switches, electrical outlets, thermostats, and other
environmental controls in accessible locations
c. Reinforcements in bathroom walls to allow later installation of
grab bars
d. Usable kitchens and bathrooms such that an individual in a
wheelchair can maneuver the space
b. Exempt
i. Single-family house if owner does not own more than 3 at the same time, does
not use professional services to sell or rent, and does not use advertising. (But
can use attorney or escrow agents and the like). 3603
c. Other sections of FHA prohibit discrimination in financing of housing and
provision of brokerage services.
Civil Rights Act of 1866, 1982: All citizens of the United States shall have the same
right, in every State and Territory, as is enjoyed by white citizens thereof to inherit,
purchase, lease, sell, hold, and convey real and personal property.
Does the regular exclusion of minorities from housing ads constitute an FHA
violation? Its a potential claim. Ragin v. New York Times Co. (2d Cir. 1991).
a. What about housing set-asides for whites to guard against white flight? No. Must
give minority applicants same opportunities as whites. United States v. Starrett
City Associates (2d Cir. 1988).
Prima facie case under FHA
a. Member of protected class
b. Applied for and was denied housing
c. Was qualified to obtain housing
But note that a Civil Rights Act claim probably does require proof of intent.
Soules v. U.S. Department of Housing & Urban Development (2d Cir. 1992)
a. P was a single mother looking for a 3BR apt for herself, her 12-year old daughter,
and her mother. D posted an ad for an apt on the 2d floor of a building. D asked
odd questions during a telephone interview, like Do you have kids? How old
are they? Are they noisy? because there was this elderly couple in the apt
below. P was irritated and wouldnt answer. P eventually got to see another apt,
but D lied and said there werent any available in Ps desired location.
b. P contacted HOME, which had a few testers call up. A tester without children got
to see the apt but a tester with a 7-year old didnt get to see. A family with
children got to see it and was made an offer. The apt was eventually rented to a
woman without children.

26

c. Administrative law judge ruled in favor of D. Became a final order of HUD.

d. Can a housing provider defeat a rental applicants prima facie showing of
discrimination by proving a legitimate, nondiscriminatory reason for effusing to
rent? Yes. P made a prima facie case. D had two legitimate reasons P had a
combative attitude and D was constantly out of town to take care of family, so it
was impossible to constantly monitor the status of the apt P wanted. These arent
pretext substantial evidence supports them. Because the family got to see the
apt, D was willing to rent to a family with children.
e. May a fact-finder inquire into a housing providers discriminatory intent in
questioning prospective renters about familial status? Yes. Not necessarily
impermissible to ask about noisy children. Here, the questions were legitimate.
Local housing codes require children above 5 years old to have their own
bedroom, so asking about age was OK. A housing provider is not precluded from
asking about noise because noisy tenants can be deemed a nuisance and evicted.
Reasons articulated not pretextual, particularly because the family got an offer.
f. Are restrictions on the number of people who can live in a house discriminatory?
When business strategy is to rent below market, minimize turnover, and maintain
premises, a prima facie case is rebutted. Pffaf v. HUD (9th Cir. 1996).
g. Glover v. Crestwood Lake Section 1 Holding Corps. (NY 1990): L rents 1br apts
to 2 adults, 2br apts to two adults and two children, but not 1br apts to one adult
and one child, or 2br apts to one adult and three children. This is discriminatory.
h. What if a landlord discriminates against a heterosexual couple because theyre
unmarried? It seems that FHA gets at families with kids, so it may not be
implicated.
i. Suppose a state/local statute would prohibit this, but L refuses to enforce for
religious reasons. Smith v. Fair Employment & Housing Commission (CA
1996) no excuse, religion not burdened; Swanner v. Anchorage Equal Rights
Commission (AK 1994) same.
i. L discriminates against a gay couple for fear of AIDS. Baxter v. City of Belleville
(IL 1989) violates FHA.
j. T needs a dog as a companion due to a mental disorder and L has a no-pets policy.
HUD v. Riverbay (HUD 1994) must permit her to have dog.
k. Can L discriminate against lawyers? Kramarsky v. Stahl Management (NY 1977)
yes.
l. Generally fine to mention proximity to bus lines, no drugs or drinking (but not no
alcoholics), credit check required, school districts, senior discount, or presence of
nursery.
C. Rights and duties in the landlord/tenant relationship
1. Delivery of possession
a. Hannan v. Dusch (VA 1930)
i. Former tenant failed to vacate. D didnt do anything to get P in possession.
ii. Must the landlord deliver actual possession to the tenant?
iii. No. Landlord only has to deliver right to possession (legal possession)
(American rule/minority view). Rejects English rule (landlord has duty to put
tenant in actual possession).

27

iv. Case law is pretty divided on English v. American rule. Under American rule,
tenant can sue tenant wrongfully in possession. Can recover possession and
damages.
v. If L leases T a landlocked parcel, L still has duty to deliver actual possession
under English rule. Moore v. Cameron Parish School Bd. (LA 1987).
vi. If L leases to T and has another lease with X, but T is in possession, T must
still pay rent. Campbell v. Henshey (KY 1970).
vii. Clause in contract that L is excused from liability for failure to deliver
possession if building is still under construction is unconscionable. Seabrook
v. Commuter Hous. Co. (NY 1972).
2. The defaulting tenant
a. Berg v. Wiley (MN 1978)
i. D leased to P for term of 5 years (twas a commercial lease). Lease provided
that consent necessary for any change in building structure. P remodeled
without permission and violated health code. D eventually succeeded at
changing locks. Trial court found entry was forcible.
ii. May L use self-help to retake possession?
iii. No. At common law, circumstances when L could use self-help:
(i) L legally entitled to possession and
(ii) Ls means of entry are peaceable
iv. No determination that D was entitled to possession L cant determine this,
courts must. As to entry: Public policy against self-help. Summary
proceedings available, dude! Treble damages for forced entry! So entry was
not peaceable. Only reason violence didnt erupt was because locks were
changed. Otherwise it totally would have.
v. Unless T abandons or surrenders premises, L may not use self-help. Must go
to the courts.
vi. Berg reflects modern view of self-help, but not yet majority rule.
vii. Every state provides some form of summary proceeding. Typically only
require a few days notice to T. Anything extrinsic to possession normally not
addressed. Many states permit T to use self-help (e.g., withhold rent) if L
doesnt maintain premises, and so summary proceedings for nonpayment can
be made. Courts have relied on availability of summary proceedings to
abrogate self-help. Avg. of 114 days from request of evictions to day
accomplished.
b. Sommer v. Kridel (NJ 1977)
i. P failed to make efforts to re-let an apt that D abandoned (never went into
possession).
ii. Is the L under a duty to mitigate damager by making reasonable efforts to relet an apartment wrongfully vacated by T?
iii. Yes. No-mitigation rule based on property view of lease lease is a property
interest which forecloses any control of property b landlord. But adopts
contract view of lease. Landlord does have duty to mitigate damages. L has
burden of showing reasonable efforts.
iv. Part of trend in landlord-tenant law to recognize contract law concepts.
v. Relevant cases:

28

(i) Showing apt to all prospective tenants satisfies duty

(ii) Advertised apt in newspaper, placed sign in window, and employed realtor
duty satisfied
(iii)
L can ask for higher rent since this was merely a basis for
negotiation
1. But if he asks for a ridiculously high amount, probably wont be in
good faith
(iv) D need not accept less than FMV or substantially alter obligations to
satisfy duty
(v) Duty breached where newspaper ad placed in one issue of local paper by
broker
(vi) Duty breached where L refused to accept suitable subtenant
vi. Since Sommer, majority rule developed that there is a duty to mitigate. NY
still has a no-mitigation rule.
vii. Who has the burden of proving mitigation? It seems the majority rule is that
the T must prove that the L has mitigated or failed to mitigate. A seemingly
minority view is that L has burden of proving mitigation.
c. What if T fails to pay rent when due or breaches some other lease obligation? L
can sue, terminate lease, and recover possession. L probably cannot have
anticipatory breach recovery i.e., difference between FMV and rent in lease
unless theres a state statute providing for it. If its not a failure to pay rent but
abandonment, then the remedy may be more available if the courts apply contract
doctrine.
d. Security devices
i. Deposits
(i) In principle, L must return deposit less amounts necessary to compensate
for defaults by T. But in reality L can easily find some problem to justify
keeping deposit.
(ii) These abuses have led to some statutory reform. Some limitations include
deposit limited to 2 mos rent; deposits create trust relationship, deposits
placed in trust or escrow account; L must pay interest on deposits; etc.
ii. Ls can sometimes avoid restrictions on security deposits by characterizing
them not as deposits but as bonus or consideration for execution of lease.
This tends to work so long as theres no provision for return payment upon
termination of the lease.
iii. Even more successful to designate it as advance rent.
iv. Can also characterize as liquidated damages, but there are limitations on it
and its often not enforced. And if theres a clause providing for it, T has little
incentive to minimize damages once theres been a breach.
v. Can also have rent acceleration once theres a default. This is accepted by a
majority of courts.
3. Duties, rights, and remedies
a. Moral hazard once youre insured, less careful because youre covered. L has
little incentive to make repairs because costs of neglect are borne by T.
b. At common law, premises were as is and L had no duty to warrant fitness.
Sweeping reform began in the 60s.

29

c. Reste Realty Corp. v. Cooper (NJ 1969)

i. Whenever it rained, basement D leased flooded. Became difficult for D to use
premises. D vacated premises. (D had some knowledge of the problem when
he signed lease; P promised to fix.)
ii. May T vacate premises and terminate the lease if his quiet enjoyment is
interfered with by L?
iii. Yes. Didnt waive right to quiet enjoyment by knowing of problem because P
promised to fix it.
iv. Was D justified in vacating?
(i) Covenant of quiet enjoyment is implied in a lease.
1. Its breached when an act or omission renders the premises unsuitable
for the purpose for which it was leased. (This is called a constructive
eviction.)
2. When this happens, T has right to terminate lease, and can vacate
premises.
(ii) Since D couldnt use premises for meetings, the purpose for which the
basement was rented, she was justified in vacating and canceling lease.
(iii)
D didnt waive right to cancel lease because she remained in
possession after learning of defect. Ample evidence that D vacated in
reasonable time.
v. Note that eviction (actual or constructive) is not required to show a breach of
the covenant. But instead it relates to remedies. The tenant can stay on the
premises and sue for difference between value of premises without breach and
with. Or the tenant can leave under the theory of constructive eviction.
vi. If a lease is illegal, its not enforceable. E.g., if the premises are so unsafe that
they violate the health code, then L cant require payment of rent. Brown v.
Southall Realty Co. (DC 1968).
(i) This doesnt apply if the violations arise after the lease is made. Saunders
v. First Natl. Realty Corp. (DC 1968).
(ii) Minor, technical violations dont render a lease illegal, nor do violations of
which L didnt have actual or constructive notice. Diamond House Corp.
v. Robinson (DC 1969).
(iii)
T under illegal lease is tenant at sufferance and L is entitled to
reasonable rental value of premises. William J. Davis, Inc. v. Slade (DC
1970).
d. Hilder v. St. Peter (VT 1984)
i. A host of problems: broken window, no key to front door, toilet broken,
bathroom light broken, water leak, plaster falling from ceiling, and broken
sewage pipe. L promised to fix but never did. T repaired some things at her
own expense.
ii. Is there an implied warranty of habitability in every residential lese?
iii. Yes. As is rule historically valid, but rejected now. Old view: Lease =
estate in land. New view: Ts have changed. Ls are in much better position to
repair. Warranty is non-waivable.
iv. Courts can look to municipal housing code or state court standards not
dispositive, though.

30

v. Once warranty is breached, T must notify L and give him time to remedy
problem. If its not fixed, T can seek rescission, reformation, and damages.
Damages shall be difference between value of apt as warranted and apt as it is.
T can recover for discomfort and annoyance. T can withhold rent until
damages are calculated. T can deduct expenses of repair from rent. So
burden on bringing suit is on L. T can pursue punitive damages.
vi. Note that the implied warranty of habitability has exceptions in some
jurisdictions e.g., doesnt apply to casual Ls, like a professor who goes on
sabbatical; single-family residences excepted and isnt adopted by all states.
Most jurisdictions dont extend it to commercial properties.
vii. Standard varies, but usually the warranty is violated if a reasonable person
would not find it habitable. Continued loud noise or failure of a central air
conditioning system may be a violation.
viii. How are damages calculated?
(i) Hilder: Value of dwelling as warranted dwelling in defective condition.
(ii) NH: Agreed rent dwelling in defective condition.
(iii)
Percentage-reduction: agreed rent is reduced by percentage equal
to percentage lease-value lost by T as a result of Ls breach.
ix. Ts tend to ignore specific performance even though its available in principle.
x. Suppose maintenance staff goes on strike and city sanitation workers wont
cross picket lines. Trash piles up. L must bear the loss breach of IWH.
Park West Management Corp. v. Mitchell (NY 1979).
xi. The implied warranty of habitability only covers the basic minimums you
cant recover under it if, say, you pay for a luxury apt and dont get services
you expected. But you probably can recover under a contract action. Solow v.
Wellner (NY 1995).
e. Most states prohibit retaliatory actions by L (within, say, 180 days of a good faith
complaint). Its usually via a rebuttable presumption if certain conditions are
present. An alternative approach pursued by NY and other states is to permit L to
serve an eviction notice once repairs have been made, but require L to give T a
reasonable time to find other housing.
f. Note that this interacts with tort law in that some states impose a general duty of
care on Ls. But most states stick to the common law.
g. Duty of T not to commit waste is breached if T makes changes to affect a vital and
substantial portion of the premises, that would change its characteristic
appearance, the fundamental purpose of the erection, or the uses contemplated
or a change that would affect the very realty itself, extraordinary in scope and
effect, or unusual in expenditure. Pross v. Excelsior Cleaning & Dyeing Co. (NY
1919).
i. Of course, not a bright-line rule. E.g., no waste when T: replaced defective
ceiling with another one that didnt conform to code, installed light and
switch, attached wooden closet to wall, and put frame around window.
Rumiche Corp. v. Eisenreich (NY 1976).
ii. Ts duty to repair: Arose out of duty not to commit waste. At common law,
duty was to make repairs that would keep the building windtight and

31

waterticht, thus preserving the property in substantially the same condition as

at the commencement of the term, ordinary wear excepted.
(i) But now this is disfavored doesnt make sense. Implied warranty of
habitability is in part based on this idea.
(ii) Explicit covenants to repair usually except damage by fire or other
casualty. Current trend is that the exception applies even if T caused the
harm.
(iii)
Does T have a duty to pay rent when the premises have been
destroyed? Historically, yes, because the building was not the primary
part of the lease it was the land. An exception was made when part of
the premises had been destroyed, and T only leased part of the premises
no interest in the soil. In many jurisdictions legislation creates these
results.
D. The problem of affordable housing
1. Chicago Board of Realtors, Inc. v. City of Chicago (7th Cir. 1987)
a. Rent control case; ordinance reallocated rights between L and T. Concurring
opinion of Judge Posner: This is reasonably related to a public goal, but we really
arent happy about that.
b. Since this law doesnt permit Ls to charge Ts more than $10 for late rent but
permits Ts to withhold rent, it decreases incentives for Ls to improve housing.
c. Instead, Ls will try to raise rents. This will force poor Ts out. If they cant raise
rent, they will devote more resources to condos, reducing stock of housing.
d. Provision requiring deposits to be placed in IL banks transfers wealth from Ls and
out-of-state banks to Ts and in-state banks.
e. This only benefits the middle class, not the poor. Theyre a better risk against late
rent. Theyll benefit from lower-priced, over-supplied condos.
2. Other economists have said rent control can succeed iff demand for rental units rises
sharply at the same time that new construction of the units has been legally restricted
in order to conserve resources.
3. Does fairness trump economics?
4. In reality, rent control is on the decline.
5. These arguments also apply to the implied warranty of habitability.
6. We let poor people buy a host of goods that are of sub-optimal quality whats so
special about housing?

32

VI. Public and private regulation of land use

A. Easements
1. Basics
a. Four types of easements
i. Affirmative: The right to use someone elses property
ii. Negative: To prevent someone from using anothers property
iii. Appurtenant: Right to use land that benefits owner of particular parcel of land
iv. In gross: Benefits owner without regard to ownership of real estate
Appurtenant
In gross
Affirmative
Classic Blackacre/Mauveacre Most common.
hypo Blackacre is
Utility easement, sidewalk
landlocked and the adjacent
easement, billboard
lot, Mauveacre, is next to a
road.
Negative
View easement (Aerosmith
Least common.
article)
Conservation easement.
2. How do you create an easement?
a. Grant
i. Willard v. First Church of Christ, Scientist (CA 1972)
(i) M owned some lots and let D use them for parking on Sundays. Easement
was in title when M conveyed to Petersen, but not when Petersen
conveyed to P. Petersen didnt mention the easement to P. But D used lot
for parking when P was going through purchasing process.
(ii) Can a property owner, in granting her property to a second person, reserve
an easement in the property for a third person?
(iii)
Yes. Common law: cant do this. But were not restrained by it
anymore want to follow intent of grantor. Property rights are to be
treated the same as contracts. Original grantee probably paid less because
of the easement. P wasnt prejudiced D was still using lot when he was
purchasing. Interests of grantors outweigh interests grantees may have in
following common law. No evidence that P relied on rule.
(iv) Authority is still divided on common law v. new rule.
(v) The theory in this case is that the reservation is a regrant to the grantor
from the grantee. So, O to A and her heirs, reserving an easement in O,
is treated as two deeds. This developed as a way to get around the
common law rule.
(vi) Servient estate: Willard. Dominant estate: Church.
(vii)
Appurtenant easements cannot be detached from the dominant
tenement without the consent of dominant and servient owners.
(viii)
The law construes in favor of easements appurtenant when its
ambiguous.
b. Estoppel
i. License
(i) Revocable

33

1. A license is oral or written permission given by the occupant of land

allowing the licensee to do some act that otherwise would be a
trespass. Licenses are revocable, but easements are not.
(ii) Two exceptions: Irrevocable
1. License coupled with an interest cannot be revoked e.g., if O grants
to A the right to take timber from Os land. A has an interest and an
irrevocable license. -- Licensee has some ownership interest in chattel
that is on licensors land.
2. License starts out as permissive and revocable and becomes
irrevocable by operation of estoppel.
a. Holbrook v. Taylor (KY 1976)
i. Ds let Ps use a road Ds paved on their land. Ps used the road
extensively when building their house. Ps repaired the road,
put in culvert, and graveled it with red dog. Ds then tried to
cut it off.
ii. Can an easement be established by estoppel, or reliance?
iii. Yes even when person making use of property does so with
permission of owner. A license cannot be revoked after the
licensee has erected improvements on the land at considerable
expense while relying on the license.
iv. Shepard v. Purvine (OR 1952): An oral license is just as
binding as a written one.
v. Henry v. Dalton (RI 1959): An oral license to do something on
the licensors land can be revoked by the licensor, even if the
licensee has spent money as a result of faith in the license and
the license was originally intended to be a continuous one.
Lets establish a bright-line rule.
vi. Property v. liability rule: Perhaps we can conceive of this as a
government subsidy of people who make efficient use of land.
vii. Restatement 3rd agrees w/Holbrook rule.
viii. What if Ds house burned down can Ds build a new house
and use the right of way across Ps land? Restatement 3rd says
that expectations that create the servitude determine its scope
and terms.
ix. Should courts give servient owners damages?
c. Implication
i. Requirements
(i) Apparent
(ii) Continuous
(iii)
Necessity
1. Not necessarily required to show PEU it informs the apparent nature
of the use (whether its supposed to be continuous, for example).
2. Strict necessity required? Depends on jurisdiction. NY and TX
require strict.
ii. Easement from prior existing usage: Van Sandt v. Royster (KS 1938)

34

(i) Shortly after city built sewer line, private sewer lines were built under Bs
large lot, extending from city line. Bs lot was then divided into three lots.
B sold them off. Houses were built. The house closest to the public line
wasnt so happy about the lines his basement flooded with sewage. It
wasnt obvious that there were lines under his house they were buried in
the ground.
(ii) Can an easement be created by implication when it was used by a previous
owner, yet was not readily visible to a party to the conveyance of the
property?
(iii)
Yes. This depends in part on the circumstances under which the
conveyance of land was made, including extent to which manner of proper
use may have been known by the parties. Each party assumed to know
about reasonably necessary uses that are apparent upon reasonably prudent
investigation. Easement may be implied for grantor or grantee on basis of
necessity alone.
(iv) Quasi-easement: owner can use one part of his land to benefit another part
of his land. (You cant just give an easement to yourself.) Benefiting part
of land: quasi-dominant tenement. This easement arises from the
circumstances not the language of the conveyance.
(v) Here, P cant claim he had no notice. P made careful inspection of
property and knew the house had modern plumbing and needed to drain
into a sewer. Since he had notice of the lateral sewer, the easement was
apparent.
(vi) If dominant and servient tenements come under the same ownership, the
easement is extinguished. If theyre redivided, another easement can arise
if the circumstances at the time indicate a new easement was intended.
iii. Easement by necessity
(i) Othen v. Rosier (TX 1950)
1. D had a plot next to a road. P had landlocked plot adjacent to Ds
property. P used roadway on Ds property to access the road. D
blocked it off. All of these lots used to be owned by H.
2. Is there an EBN here?
3. No. Must show that there was unity of ownership between dominant
and servient estates, that easement is a necessity and not a
convenience, and that necessity existed at time the estates were
severed. Dominant estate has burden of proof.
4. There was unity of ownership here; but at the time the use of the road
was a mere convenience. Other tracts of land could have been crossed.
P hasnt made adequate showing. Mere fact that parcel is landlocked
does not create EBN.
5. Is there an easement by prescription? No. The use of the easement
was not adverse. This was initially a permissive use.
(ii) Most courts require strict necessity. Others will grant an EBN when
theres access to the land, but it would be inadequate, difficult, or costly.
(iii)
What happens if the owner of five parcels, one of which is
landlocked, dies intestate and his kids fight over who has to have the

35

EBN? Is there an EBN? Fairness suggests there should be an EBN. But

where? Perhaps we could evaluate the costs it would impose on each
property put EBN where it would cost the least. This really depends on
how strict the court is about necessity and its receptiveness to basing its
decision on pure fairness.
(iv) EBN endures only so long as it is necessary. EBPEU is not this way.
(v) Some state statutes in the West permit landlocked parcel owners the right
to condemn an easement upon showing of necessity. Servient owner gets
damages.
1. Leo Sheep Co. v. United States (US 1979): US has no right to EBN to
access landlocked govt parcels because it has the power of eminent
domain.
d. Prescription
i. Lost grant theory: Owner of land is presumed to consent or acquiesce in use.
But if the use is made with the permission of the owner, its not adverse. So
claimant needs to show that the owner didnt object, but didnt permit.
ii. The lost grant theory should have completely lost traction when US courts tied
prescriptive easements to adverse possession.
iii. In a jurisdiction that doesnt follow the lost grant theory, owner must
effectively interrupt or stop adverse use to prevent a prescriptive easement.
iv. When someone acquires a prescriptive easement, should he have to pay
damages to the owner? In CA, court said that legislature would have to bring
any changes about, but court was very divided on merits of no-compensation
rule.
v. Most courts require exclusive use for prescription, but its not the same as in
adverse possession Exclusivity only requires showing that claimants right
to use land does not depend upon similar right in others.
vi. If Os property is next to a golf course and errant golf balls frequently fly onto
his property, the golf course has a prescriptive easement. MacDonald
Properties, Inc. v. Bel-Air Country Club (CA 1977).
vii. Public prescriptive easement:
(i) Long, continuous use by public
(ii) Under a claim of right NOT by individuals
(iii)
Notice to landowner of kind an extent of use
(iv) Instead, some courts use theory of implied dedication. Sort of like lost
grant theory landowner evidences intent to dedicate, and state accepts by
maintaining land used by public.
viii. Beach access
(i) In most states, the state holds in public trust the beach from the water to
the mean high-tide line.
(ii) The dry sand portion between the mean high-tide line and the vegetation
line is subject to private ownership.
(iii)
Prescriptive easement doctrine has not been very successful in
providing public access, partly because the adverse requirement is
difficult to prove permission is presumed.

36

(iv) In CA, public prescriptive easements abolished by statute except on land

w/in 1000 yards from the ocean. Even on this land the owner can prevent
public easement by posting annually a sign (Right to pass by permission
of the owner, revocable at any time) or recording a similar notice in the
public records. Granting permission defeats adverse.
(v) Because permission is presumed, a few states (FL, TX, and OR) have
found public access because theyve existed for very, very long its a
customary right. Similarly, in HI, public right found up to vegetation line
because of history.
3. Negative easements
a. Right of dominant owner to prevent servient owner from doing something on the
servient land. Prevent:
i. Blocking of windows
ii. Interfering with air flowing to your land in a defined channel
iii. Removing the support of your building
iv. Interfering with the flow of water in an artificial stream
v. Newer ones in US
(i) View easement
(ii) Conservation easement
b. Judges rather reluctant to create new types of negative easements not as easy to
discover as affirmative easements. Negative easements could arise by
prescription, so adding more easements that could arise by prescription would
significantly restrain the rights of the servient owner to control his land. Also,
historically easements could only be created by grant.
i. American courts have accepted this restriction on creating new types of
easements. Sometimes new ones are created.
c. Kohl v. Legoullon (AK 1997): Two mansions, one in front of the other was
halfway through building a 5th floor court said per a view easement, he had to
convert it to an open porch/deck.
B. Covenants
1. Intro
a. Real covenant: Promise about use of land that runs with the land at law.
b. Vertical privity: Privity of estate between successive owners.
c. Horizontal privity: Analogizing to successive relationship, its a grantor-grantee
relationship. Required for burden to run. Not required for benefit to run.
i. Commentators hate the horizontal privity requirement.
ii. Restatement 3d doesnt require horizontal privity.
d. Can be affirmative or negative
e. Cannot be enforced against an assignee who has no notice
f. General requirements
i. Did original parties intend for burden/benefit to run? Will usually manifest
itself in terms of covenant
ii. Does the promise touch and concern the land?
iii. Notice? Only applies to burden
iv. Privity?

37

(i) Vertical runs with an estate in land. Burden doesnt extend to adverse
possessor, because its a new title.
1. Restatement 3d rejects vertical privity requirement. Instead it draws a
distinction between affirmative and negative covenants. Negative
covenants are treated like easements for succession purposes runs to
all subsequent possessors and owners of the burdened and benefited
land. Affirmative covenants extend to person who succeed estates of
the same duration as were held by original parties to the covenant =
traditional privity requirements. Burdens run to adverse possessors.
Lessees must perform only covenants that are more reasonably
performed by her than the L. Life tenants succeed to burdens but
liability limited to value of life estate.
(ii) Horizontal only required for burden classic situation is where
developer sells home to individual purchasers
1. You can also have a straw transaction where you convey to X (say,
lawyer) and reconvey to parties to agreement with covenant in deed.
g. Suppose B promises A hell only use his property for residential purposes. B sells
to C. A sells to D.
i. A sues B when B builds a factory: This is just a contract action. Pretty
obvious.
ii. A sues C when C builds a factory: A must allege that the burden runs to C,
since C is not an original party.
iii. D sues B when B builds a factory: D must allege the benefit runs to D, since D
is not the original party.
iv. D sues C when C builds a factory: D must allege that the burden and benefit
run.
2. Covenants enforceable in equity
a. Privity not required, except for the benefit, which runs to all assignees (adverse
possessors unclear hasnt been litigated) but everything else is.
Enforceability at law is irrelevant.
i. What about 3d parties? In some jurisdiction, 3d party beneficiaries cant
enforce.
ii. Property theory of equitable servitudes: Its an interest in land not an estate
in land like real covenants. Basically this is like a negative easement.
Supports theory that if government condemns property, it must compensate
beneficiaries for loss of covenant. Should they only be contract rights? The
property theory has prevailed over the contract theory.
iii. Suppose O promises A without any consideration from A. O sells to B. B
knows of the promise and violates it. A can probably enjoin B.
iv. Note that a P can always sell an injunction to D P determines damages rather
than a jury.
v. Since unification of law and equity in most states, it really doesnt matter how
its classified. You can get damages for equitable actions. Restatement 3d
rejects equity/law distinction. Everything is a covenant running with the land.
b. Tulk v. Moxhay (England 1848)

38

i. P conveyed to E; title included covenant that E, his heirs, and assigns would
maintain garden, without any buildings. Property eventually passed to D; title
didnt contain covenant. D conceded that he had notice of covenant. D tried
to build buildings.
ii. Is a covenant enforceable against a purchaser of land when that purchaser
acquired the land with knowledge of the covenant?
iii. Yes. A covenant is enforceable in equity against a person who purchases land
with notice of the covenant. D had notice. He probably paid less for land
because of the covenant. If he can just go and build, thats not fair. Hed be
unjustly enriched he could resell land at a higher price.
3. Creation of covenants
a. Real covenant can only be created by a written instrument signed by the
covenantor. An equitable servitude can be implied in equity under certain limited
circumstances. Cannot be obtained by prescription.
b. Sanborn v. McLean (MI 1925)
i. Development which was entirely residential all lots were residential. Ms
sold some lots with residential-only restrictions in deed. Passed on to D
without the covenant contained in deed. Neighbor P tried to enjoin Ds.
ii. Is there a covenant here?
iii. Yes. An equitable servitude can be implied on a lot, even when the servitude
is not created by a written instrument, if there is a scheme for development of
a residential subdivision and the purchaser of the lot has notice of it.
iv. Ms included covenants for the benefit of the lots they retained. They were
subject to them, too. Theyre reciprocal negative easements. Can be enforced
by P if Ds had notice.
v. There was intent, there was touch and concern. Was there notice? Inquiry
notice is looking around to get an idea. Here, theres been inquiry notice its
pretty obvious!
vi. Sufficient notice when not obvious by inquiry notice, but deeds of
surrounding properties including restrictions recorded in public record.
McQuade v. Wilcox (MI 1921).
vii. Actual notice is probably too tough a standard to prove.
c. Neponsit Property Owners Association, Inc. v. Emigrant Industrial Savings Bank
(NY 1938)
i. N sold to Deyers; deed contained covenant that property would be subjected
to an annual fee for infrastructure maintenance (e.g., roads, gardens, etc. in
housing development), payable to P (an assignee of N). D acquired title to
Deyers property title mentioned covenant.
ii. Does the covenant touch and concern the land?
iii. Yes. Whats determinative is the degree to which the covenant substantially
affects the legal rights of the parties to the covenant. This gave the owners
some right to enjoy common property with other nearby owners.
iv. Is there privity between P and D? Yes. P was designed as a convenience to
advance common interests of property owners. SO essentially a privity of
estate between P and D.

39

v. Gradually, 3d party beneficiaries have been permitted to sue on a breach of

contract. But theres still a bit of life in the doctrine that they cant sue.
Generally you need privity. If original promisee didnt convey land to person
who wants to enforce covenant, this doctrine would prevent a suit.
vi. Touch and concern has almost always been found with negative covenants
but not so with affirmative covenants. An affirmative obligation is like a
perpetual rent feudal system. Reluctant to issue orders requiring people to
do things, judicial supervision. Enforcing an affirmative covenant may
impose large personal liability on a successor.
vii. Touch and concern is often found with covenants to pay money, esp. in a
common interest community.
viii. Is the touch and concern requirement valuable?
ix. Restatement 3d discards touch and concern. 3.1:
(i) Servitude is valid unless its illegal, unconstitutional, or violates public
policy
(ii) Examples of covenants that violate public policy
1. Arbitrary, spiteful, or capricious
2. Unreasonably burdens a fundamental constitutional right
3. Imposes unreasonable restraint on alienation
4. Imposes unreasonable restraint on trade or competition
5. Unconscionable
(iii)
3.5:
1. An otherwise valid servitude is valid even if it indirectly restrains
alienation by limiting use that can be made of property, by reducing
the amount realizable by the owner on sale or other transfer of the
property, or by otherwise reducing the value of the property.
2. Servitude that lacks a rational justification is invalid.
x. In CA, cannot have a covenant restricting use of home to provide day care for
nonresidents. CA Health & Safety Code 1597.40(c).
4. Scope of covenants
a. Hill v. Community of Damien of Molokai (NM 1996)
i. D owned group home for people with AIDs. Unrelated individuals; limited to
4 per house. Outside nurses came to home during day. P and other neighbors
noticed increase in traffic after D started using it as a group home claimed
group home violated single family home restrictive covenant. D claimed
enforcing covenant, if interpreted to not include the home, would violate
FHA.
ii. Does the group home fall within the single family residence covenant? Yes.
Family isnt defined in covenant. Ambiguous restrictive covenants
interpreted in favor of free use and enjoyment of property against restrictions.
The group home has many characteristics of a family communal meals, do
own shopping, provide emotional/financial/spiritual support for each other.
Strong public policy of letting disabled people living in residential settings.
Also, this isnt a profit-driven organization its a nonprofit charity.
iii. Do restrictive covenants violate the FHA when they have a discriminatory
intent, effect, or constitute failure to make reasonable accommodations? Yes.

40

(i) Discriminatory intent: Not enough evidence here

(ii) Disparate impact: This would definitely have a disparate impact if the
community wasnt a single family use, above. Balance neighbors interest
in avoiding increased traffic against communitys interest in providing
housing for disabled individuals. This balance weighs in favor of the
community.
(iii)
Reasonable accommodations: Neighbors didnt make reasonable
accommodations. In this case, a reasonable accommodation would have
been to not seek enforcement of the covenant.
iv. Other courts have interpreted single family residence in restrictive
covenants to just mean it has to be a house of a particular size.
v. What if a restrictive covenant bars nonresidential use? Some courts have even
found that a bed-and-breakfast is a residential use, so is training dogs, and
home day care of 5 children. What about home offices?
b. Shelley v. Kraemer (US 1948)
i. Restrictive covenant prevented blacks from moving into neighborhood.
ii. Is this enforceable?
iii. No. The state action here is judicial enforcement of the covenant. Equal
Protection Clause of 14th Amendment prohibits enforcement.
iv. Note that since the late 60s, courts have addressed racial discrimination claims
under FHA and 1982. But when not covered by those laws, Shelley lives.
What about unreasonable restraints on alienation
v. Barrow v. Jackson (US 1953): Court cannot grant damages against a seller
who breaches a covenant not to convey to a nonwhite. Thats state action.
vi. Mayers v. Ridley (DC Cir. 1972): DC recorder of deeds cannot record deeds
containing racial covenants.
vii. Buchanan v. Worley (US 1917): Unconstitutional to zone on the basis of race.
C. Public regulation of land use: Zoning
1. Basics
a. Village of Euclid v. Ambler Realty Co. (US 1926)
i. City enacted zoning ordinance that restricted the use and size of buildings in
various districts.
ii. Is it unconstitutional to enact an ordinance which establishes a comprehensive
zoning plan regulating the use of property?
iii. No. Valid exercise of police power. Sure, this wasnt needed fifty years ago,
but its quite necessary now given the urbanization of life. Major issue with
exclusion of apartments, stores, and shops from residential zones. There are
legitimate goals here reduction of traffic, open space, quiet, etc. Its not
arbitrary, unreasonable; its substantially related to public health, safety, etc.
b. Standard State Zoning Enabling Act
i. Empowers municipalities to regulate and restrict buildings.
ii. Regulations must be made in accordance with a comprehensive plan and
designed to promote safety, health and general welfare.
(i) Only half of the states require and judiciary has been traditionally relaxed,
but this may be changing.

41

iii. City must create a zoning (planning) commission who makes

recommendations to the city council.
iv. But a few states, including CA, NJ, and PA have deviated from it in recent
years. Note that there must be standards controlling the delegation.
2. Exclusionary zoning
a. Village of Belle Terre v. Boraas (US 1974)
i. City zoning ordinance confined family to individuals related by blood, and
confined entire city to singe-family use. Six college students wanted to live
together.
ii. Is the ordinance constitutional?
iii. Douglas: Yes, as long as its rationally related to legitimate objectives, such as
creating zones where family values and the blessings of quiet seclusion and
clean air are preserved. No fundamental right is at stake here. This isnt
unreasonable or arbitrary. Legislature has discretion here.
iv. Marshall (dissent): The ordinance burdens rights of association and privacy
under First and Fourteenth Amendments. Sure, we defer to legislatures, but
not when they intrude upon fundamental rights. This is very under- and
overinclusive based on the stated goals (above).
v. Moore v. City of East Cleveland (US 1977): Limited holding of Belle Terre.
Court invalidated ordinance that defined family as not including more than
one set of grandchildren. Court distinguished Belle Terre because the
ordinance only applied to unrelated individuals. Here, this is a major intrusion
into the family.
vi. Some states take less deferential positions than the Court did in Belle Terre.
E.g., NY courts have invalidated statutes that permit any number of related
people to live together but only two unrelated people to live together if theyre
elderly goals of maintaining integrity of single-family neighborhood fine,
but means are too restrictive. McMinn v. Town of Oyster Bay (NY 1985).
b. City of Edmonds v. Oxford House, Inc. (US 1995)
i. Zoning code limited family to people related by blood or a group of 5 or
fewer unrelated people. O opened a group home for 10-12 people recovering
from drug or alcohol addiction in a single-family housing zone. Theres an
FHA exception for reasonable restrictions on maximum number of individuals
in dwelling.
ii. Does the provision fall under the exception?
iii. Ginsburg: No. The primary purpose of FHA is to get fair housing for people.
So exception should be interpreted narrowly. Single-family restrictions get at
character of neighborhood, but maximum-occupant restrictions get at health
and safety. This is a family composition rule, not a maximum-occupant rule.
This provision doesnt answer maximum occupancy another provision does
that.
iv. Oxford House v. City of St. Louis (8th Cir. 1996): Regulation limiting
occupancy to 8 has a rational basis; plus, OH didnt apply for an exception.
Dont want federal courts to act as zoning boards.
c. Southern Burlington County NAACP v. Township of Mount Laurel (NJ 1975)

42

i. Ds zoning ordinance only provided for single-family residences, with only

one house per lot. A new housing development would only be within financial
reach of upper-income families.
ii. Rents pushed higher due to public services. Added zone for retirement
community would only be accessible to wealthy retirees. City sort of agreed
to low-income housing, but only on large lots and as single-family housing.
iii. Can a municipality make it physically and economically impossible to provide
low and moderate income housing?
iv. No. A developing municipality must, by its land use regulations, make
realistically possible the opportunity for an appropriate variety and choice of
housing for all categories of people who may desire to live there, including
those of low and moderate income.
v. City cant justify its regulations by the fact that poor people who move in will
use costly services and not be able to pay their own way. Relief will have to
be provided from other branches of government.
vi. Mt. Laurel II (NJ 1983) - Court requires that every municipality produce low
and moderate housing; much more draconian, concrete, exact about what
municipalities have to do.
vii. Other means of excluding poor people
(i) Minimum housing cost: Invalidated by courts
(ii) Minimum floor area: Mixed judicial reaction
(iii)
Minimum lot size: Upheld in most cases if rational justification in
community
(iv) Minimum setback: Upheld because they increase light and air, reduce fire
danger
(v) Barring mobile or manufactured homes: Almost always upheld in early
cases, and still upheld today, but some exceptions
viii. Tiebout hypothesis: Consumers benefit from being able to vote with their
feet. Specialization of municipalities and competition among them enhances
efficiency.
(i) But contrast with Waring Blender model: Calls for all land uses and all
types of households to be represented in each neighborhood in proportion
to their representation in the entire metropolitan area.
ix. Professor: Desire to pay market value for things is innate.

43

VII. Takings and eminent domain

A. Introduction, public use, and just compensation
1. Eminent domain as a constraint on monopoly (Posner)
2. This is all about the uncompensated increment.
3. Hawaii Housing Authority v. Midkiff (US 1984)
a. Just under half of HIs land was owned by only 72 people, and HI wanted them to
break up their estates. Forced them to sell to their tenants.
b. Does this satisfy the Public Use requirement?
c. OConnor: Yes. Courts should have strong deference to legislature.
Concentration of land ownership has altered housing market. Regulating
oligopoly has long been recognized as a legitimate exercise of police powers.
d. Exercise of power is legitimate, then. Statute authorizing the plans is rationally
connected to the problem. Only look at the takings purpose, not the mechanics of
it, to determine whether its a public use.
e. Berman v. Parker (US 1954): Redevelopment of slum areas and transfer to private
interests is constitutional.
f. Public use focus on ends or means of taking? Pressing need or mere
convenience? Dont forget additional costs to government legislative
authorization, judicial proceedings, and professional appraisals.
4. Poletown Neighborhood Council v. Detroit (MI 1981)
a. D wanted to condemn some property so GM could build a plant.
b. Is this a public use?
c. Yes. The private benefit here is only incidental to the public benefits. D will
benefit from thousands of jobs and tax revenues. Primary objective is
revitalization of local economy.
d. Dissent 1: The primary objective here is to benefit GM. Its not blighted property.
e. Dissent 2: GM dictated all the terms of the project. It just promises a greater
public benefit than the prior use.
f. Was later overruled Hathcock in July 2004.
5. City of Oakland v. Oakland Raiders (CA 1982)
a. Owners of Oakland Raiders wanted to move to LA; city tried to acquire them via
eminent domain.
b. Does the taking of a professional sports franchise satisfy a legitimate public
purpose?
c. Yes. Anything calculated to promote the education, recreation, or pleasure of the
public is within legitimate scope of public use. Cities own and operate
facilities, so they can own and operate a team.
d. The public use question was remanded, and action was dismissed on other
grounds. Dismissal reversed and remanded again. Court later ruled that taking
would violate commerce clause.
6. Kelo v. City of New London (US 2005): Property taken for use as a Pfizer plant CT
Supreme Court said it was a public use, now before the Supreme Court. Poletown all
over again.
7. Just compensation
a. Generally, this just means fair market value.
b. Its an objective standard.

44

i. United States v. Commodities Trading Corp. (US 1950): What compensation

is just both to an owner whose property is taken and to the public that must
pay the bill?
c. When the US takes property from city or state government, the court historically
required compensation in terms of the substitute facilities doctrine dont just
compensate for FMV of property, but also cost of obtaining other substitute
facilities. But this was abandoned by the Court when the value of the land is
ascertainable, even if the condemnee has a duty to replace condemned facility and
cost of substitute exceeds compensation. United States v. 50 Acres of Land (US
1984).
B. Physical occupation and regulatory takings
1. Two categorical rules
a. Loretto v. Teleprompter Manhattan CATV Corp. (US 1982)
i. D installed a cable on a building under state statute. Ran along roof of
building, and was attached directly to masonry. D was given exclusive rights
to provide cable in the building. P bought the building without notice of the
cable.
ii. Is this a taking?
iii. Marshall: Yes. A permanent physical occupation of an owners property
authorized by the government constitutes a taking which requires just
compensation, regardless of the public interests it may serve. Property is
seriously devalued as a result of this. Permanent occupation is arguably one
of the most serious invasions of property rights. State can still regulate fire
alarms and the such because it imposes duties on L/Ts and not third parties.
iv. Blackmun (dissent): Whats permanent? What about statutes requiring
installation of fire alarms? The third party problem would still exist even if P
owned the cable D would still send signals through cable. Distinction
between permanent occupation and temporary invasion has not basis in
Takings precedent or economic logic. Takings claims should be evaluated
under a multiple-factor balancing test, and not a set formula. Plus, what other
use would P have for the space?
b. Hadacheck v. Sebastian (US 1915)
i. P owned property that contained some very valuable clay if it was used for
that purpose it was worth about 800k but only 60k if used for residential
purpose. P already set up expensive brickyard machinery.
ii. After purchase it was annexed by City of LA, and the city said he violated an
ordinance against brickyards.
iii. Can a persons property be taken in the prohibition of a nuisance without
compensation?
iv. Yes. This is an exercise of the police power and so no compensation is
needed. One of the most essential powers of government, and has few
limitations. Reality is that P can still use his property, just not for the
brickyard. And he can operate the brickyard elsewhere.
v. Note: This decision has been heavily criticized. Seems that the rule is if its
a nuisance control measure, its not a taking. Concept is its regulating a
public bad rather than expropriating a public good.

45

2. Rules based on measuring and balancing

a. Pennsylvania Coal Co. v. Mahon (US 1922)
i. D owned mining rights to land, sold surface rights to P. Statute prohibited
mining.
ii. Is a property regulation statute which eliminates a pre-existing property right
the equivalent of a taking without compensation?
iii. Holmes: Yes. If regulation goes too far in diminishing value of property, it
will be a taking. Of course, some property rights have an implied limitation
and must yield to governments police power. This eminent domain power,
though, must be limited by contracts and due process clauses. Where the
limits lie will depend on the facts of each case.
iv. Court suggests that a secure and average reciprocity of advantage (e.g.
zoning) will be upheld.
v. Here, limited public interest in law theres an exception for people who mine
and own surface land. This cant be justified as a protection of personal safety
because D gave P notice of intent to mine. Enforcement would eliminate Ds
interest in the coal and would go against a valid contract between Ds. Making
this commercially impracticable is the same as taking it.
vi. Brandeis (dissenting): Right to land is never absolute. Cant use land in a way
that threatens public welfare. Restriction is lawful if its an appropriate means
to the public end. This is one of the only ways of keeping the surface from
sinking. Mere notice cant prevail over exercise of police power.
vii. Keystone Bituminous Coal Association v. DeBenedictis (US 1987): Basically
same situation as Pennsylvania Coal. No taking because purpose not just to
balance private economic interests but to promote public interest in health,
environmental quality, and fiscal integrity. Coal company didnt show
sufficient diminution in value either. Rehnquist (dissenting): Majority
wrongly discounted Pennsylvania Coal.
b. Pennsylvania Central Transportation Co. v. City of New York (US 1978)
i. Commission D designated P1s land a landmark. Didnt restrict actual use, but
severely restricted any changesneeded Ds approval. P1 submitted plans to
D for a lease with P2, which would have produced much income but entailed
building a high rise. D rejected plans, calling one an aesthetic joke.
ii. Was there a taking?
iii. Brennan: No. A law that is substantially related to the promotion of the
general welfare and that does not interfere with an owners primary
expectation concerning the use of the property, and allows the owners to
receive a reasonable return on his investment, does not effect a taking which
demands just compensation.
iv. Look at how rights to the property as a whole are affected not just, say, air
space.
v. P1 can still get a reasonable return on the property. P1 can submit other plans
that are more in line with Ds desire to maintain landmark. Its not ideal, but
P1 still has very valuable rights.

46

vi. Rehnquist (Dissenting): this isnt like a typical zoning restriction where there
are benefits and burdens on restricted properties. No reciprocity of advantage.
Remand to see whether transferable development rights are just compensation.
vii. Transferable development rights: because of the regulation, the city gives P1
the right to violate zoning laws in other areas with buildings they own or the
right to sell the TDRs. This serves to ease the burden of regulation so that the
court will find that does not amount to a taking.
viii. Distinct investment-backed expectations have been very puzzling. Some
courts have read them out of takings law by finding expectations frustrated
only when all economically viable uses of the land are frustrated. Others have
found DIBE only in instances when regulations interfered with investments
that have already been made.

47