GeoCitesSites.com

Property

 

I.                     First Possession

A.      Acquisition by Discovery

                                                               i.      You can get rid of the right to possess by force/conquest or purchase

                                                             ii.      First in time, first in right

1.       whoever gets there first wins the right to the property in the name of the country

2.       Johnson v. M’Intosh

a.       Property rights from the Indians

b.       First in time, first in right did not apply to Indians, just Europeans

c.       Indians had the right of possession and not to own

                                                            iii.      Locke’s Labor Theory: if work is performed on or to the land then the land is yours

B.      Acquisition by Capture

                                                               i.      Application to animals

1.       Pierson v. Post

a.       Pl was hunting the fox and the def shot and took it

b.       The pl was merely pursuing – this will not be enough

c.       Easier to enforce that the animal has to be in hand and also there was no guarantee that the pl would have ever captured the fox

d.       This case takes place on unsettled land

                                                                                                                                       i.      If Pierson was on Posts (original pl) land then can use the argument of ratione soli (by reason of the soil – belongs to the person whose property found on)

1.       This rule discourages trespassing

e.       Rule: animal reduced from its natural liberty

2.       Keeble v. Hickeringill

a.       Pl had a duck decoy pond and the def shot the ducks he lured

b.       This case included trespassing which distinguishes it from Pierson

3.       Moby Dick

a.       Fast fish belongs to the party fast to it

                                                                                                                                       i.      Any connection bt the fish and the boat/person

b.       Loose fish is fair game of anybody who can soonest catch it

4.       Swift v. Gifford

a.       Iron Holds the whale

b.       Entire whale belongs to the first ship to put a waif in the whale if that ship continues pursuit

5.       Ghen v. Rich

a.       Whales killed and then allowed to float to shore

                                                                                                                                       i.      Ebb and flow of the tide language allows admiralty law to apply

b.       The rule in this case applied to only fin back whales

                                                                                                                                       i.      Takes the custom and turns it into law

                                                                                                                                     ii.      Reasons for the rule to be custom

1.       Limited application – only applies to a few people

2.       Industry would cease if not ruled this way

3.       Makes a clear rule regarding property

4.       No one has disputed this rule as custom in the past

5.       Works well in practice

                                                                                                                                    iii.      Problems with using custom as the rule

1.       May be different customs

2.       May not know the custom

3.       Court may state the wrong custom

4.       Even if the court gets the custom right, it may not be fair to bind the world to the custom

c.       Rule: first marked bomb lance in whale gives ownership interest in whale to bomb lancer without pursuit requirement with reasonable salvage going to finder

                                                             ii.      Oil and Gas

1.       These are resources that move

2.       If A is sucking oil from B’s property, but A’s well is on his own property, then have a rule of capture

a.       This may lead to overuse because everyone will be competing to get it first

b.       Two ways to regulate this

                                                                                                                                       i.      First in time first in right – whoever sinks a well first gets it (difficult to apply)

                                                                                                                                     ii.      Make the property owners share (most commonly followed)

c.       If A’s well is at an angle onto B’s property, then A is trespassing

d.       Courts look at the property owner as being an owner from the sky to the depths of the earth

                                                            iii.      Water

1.       Prior Appropriation

a.       First person who appropriates water has the right to as much water as they need no matter where situated on water bank

b.       Based on time and interest

                                                                                                                                       i.      If you change your use then you become junior

                                                                                                                                     ii.      Makes it clear as to what your water right is especially in a water short year

c.       Most often used in the west where the climate warrants this right

d.       Coffin v. Left Hand Ditch

                                                                                                                                       i.      Decided on this rule bc of climate – dry

                                                                                                                                     ii.      Usufructurary Estate: real right of use – not like owning a piece of land – based on use, how often, how much, etc.

                                                                                                                                    iii.      Allowed to divert water if first appropriated

2.       Riparian

a.       Two kinds of theories

                                                                                                                                       i.      Natural Flow: cannot divert water

                                                                                                                                     ii.      Reasonable Use: only use a reasonable amount

b.       Most often used in the east

c.       Gilbert v. Pyle

                                                                                                                                       i.      Gristmill owner

                                                                                                                                     ii.      Each owner has a right to the water but not despite the reasonable use of others

                                                                                                                                    iii.      These rights can be transferred like property rights

                                                            iv.      Theories of Property Rights

1.       Demsetz

a.       Law and economics

b.       Economics predicts the private property system based on North American fur hunting

c.       Private property will develop more readily than communal property

d.       Problems with theory

                                                                                                                                       i.      Anthropological Criticism

1.       Do not need private right for communal property rights to work – roommate situation

2.       Most communal property systems that have existed have some rules about how they control behavior

                                                                                                                                     ii.      Historical

1.       Historically off about the fur trade

2.       Assuming society’s goal is wealth and society moves to achieve that goal – begs the question

                                                                                                                                    iii.      Normative

1.       what are we giving up to live in a society that maximizes wealth

                                                                                                                                    iv.      Where you put the initial entitlement (starting point) matters

2.       Coase

a.       From an economic perspective, does not matter where you put the right

b.       Maximize wealth

c.       Assumption that we live in a world without transaction costs

3.       Calabresi

a.      If we live in a world with transaction costs, then put the burden on the person who can afford costs more cheaply

4.       Posner

a.      The reasons to have laws is to stop inefficient behavior

C.      Acquisition by Creation

                                                               i.      Cheney Brothers v. Doris Silk

1.       Def is using some of the pl designs – designs are only good for a season and only a few catch on

2.       Tries to use case of International News v. AP

a.       Court in that case limited its application

b.       Enforcing that in this case would go beyond extent intended

3.       It is Congress’ job and not the courts to decide copyright, patent, and trademark law

a.       Why should it be up to Congress

                                                                                                                                       i.      Subject is researched thoroughly

                                                                                                                                     ii.      More successful balance

                                                                                                                                    iii.      Address problems beyond a specific dispute

b.       Why should not be up to the courts

                                                                                                                                       i.      Cannot easily change rule

c.       Why should be up to the courts

                                                                                                                                       i.      Congress cannot address every type of case

                                                                                                                                     ii.      Legislatures often in pocket of lobbyists and also minority rule may harm the decisions

                                                             ii.      Persona

1.       Given the sense that you have the right to your name but actually do not

2.       Midler

a.       Imitation for Taurus ad

                                                            iii.      Seuss

1.       Cannot copyright font, creative use of lettering, style of drawing, title, or visual style

2.       Copyright issue over fair use of hat

a.       Fair use includes things like quoting which is allowed

b.       Four factors court considers

                                                                                                                                       i.      Purpose and character of the use

1.       Is the work transformative

a.       Gives new meaning, message, or expression

b.       Transformative is a stronger case than non-transformative

c.       Parody

                                                                                                                                                                                                               i.      This is not a case of parody because it is not criticizing or ridiculing the original work

                                                                                                                                                                                                             ii.      Parody is allowed

2.       Nature of the copyrighted work

a.       Creativity, imagination, and originality

b.       This cuts against fair use

c.       Things non-sufficiently creative are not protected by copyright

3.       Amount and substantiality of the portion used in relation to the copyrighted work as a whole

4.       Effect of the use upon the potential market for or value of the copyrighted work

3.       Court uses an 8 factor test in regard to trademark – Congress puts out a 4 factor test with regard to copyright

4.       Have to look at each factor and determine how it cuts

                                                            iv.      Body Parts

1.       Moore v. Regents of the University of California

a.       Use pl cells to develop the Mo line

b.       Conversion: taking someone’s property and making it your own

c.       Three reasons why not covered under law

                                                                                                                                       i.      No judicial decisions exist

                                                                                                                                     ii.      California statute limits interest for patient regarding excised cells

                                                                                                                                    iii.      Patent itself: must have inventive effort

d.       Court contradicts self by saying not unique but also unique

e.       Court wants to leave up to legislature

f.         If found for pl then would hinder research efforts

g.       Dissent – important points

                                                                                                                                       i.      Property is a bundle of rights (sticks in the bundle)

                                                                                                                                     ii.      Not every form of property includes the same sticks

1.       Some you can sell but not give by gift (if in bankruptcy, can sell but not gift property)

2.       Some you can gift but not sell (organ donation)

3.       Some you cannot gift or sell (professional license)

II.                   Subsequent Possession

A.      Acquisition by Find

                                                               i.      Finder has title against all the world except the true owner

                                                             ii.      Owner has greater claim than the first finder who has a greater claim than the second finder (F2 < F1 < O)

                                                            iii.      Armory v. Delamirie

1.       Chimney sweep’s boy finds a jewel

2.       Assume measure of damages to be the finest quality of the jewel

a.       If def cannot prove the worth, then will give the pl the greatest value

                                                            iv.      Want to protect

1.       True owner

2.       Prior possession

                                                              v.      Hannah v. Peel

1.       Broach found in house used by military

2.       Def never lived in the house before the pl was there

3.       Pl gave broach to police to see if anyone claims and two years later the police give it to the def instead of the pl

4.       Court relies on three cases

a.       Bridges v. Hawkesworth

                                                                                                                                       i.      Customer found money on floor of store and the finder got to retain it

                                                                                                                                     ii.      Could argue that the broach was mislaid and not lost

b.       South Staffordshire Water v. Sharman

                                                                                                                                       i.      Pl found jewels in def pond

                                                                                                                                     ii.      Property owner gets property bc it is attached

c.       Elwes v. Brigg Gas

                                                                                                                                       i.      Def found ancient boat while digging on pl land

                                                                                                                                     ii.      Def might have a better claim bc it went through the effort to find it

                                                            vi.      Mislaid property

1.       When not considered lost, then cannot be a finder

2.       McAvoy v. Medina

a.       Mislaid purse on business owner’s table

b.       Since mislaid, the owner is expected to come back

B.      Acquisition by Adverse Possession

                                                               i.      Adverse possession is when one takes property wo compensation

1.       A taking is when the government takes property – they often compensate for the taking

2.       Doctrine: if something happens for a set period of time (set by the legislature), the possessor retains the property

                                                             ii.      Theory and Elements

1.       Reasons to allow adverse possession

a.       True owner has not done anything with the property

b.       Reward the person who does something with the property

c.       Want to clear any error of conveyance – want to know who owns the property

2.       Elements

a.       Actual entry giving exclusive possession that is

                                                                                                                                       i.      Why: otherwise nothing to argue about

b.       Open and notorious

                                                                                                                                       i.      Why: if not then the true owner would not know – others know you are seeking possession – puts the true owner on notice

c.       Adverse, and under a claim of right (also called claim of title – sometimes referred to as the hostility requirement), and

                                                                                                                                       i.      Why: Intent to take land that you know is someone else’s

                                                                                                                                     ii.      This ties into being open and notorious

                                                                                                                                    iii.      Hostility is attacking the title of the land itself

d.       Continuous for the statutory period

                                                                                                                                       i.      Why: cannot move in and out of property – cannot accrue time spent there

3.       Van Valkenburgh v. Lutz

a.       Had a lot off the corner – farmed land behind them, built Charlie’s house, everyone knew they used the land

b.       Standards regarding state of mind

                                                                                                                                       i.      Objective:

                                                                                                                                     ii.      Good Faith: an encroachment occurred and state of mind does not matter

                                                                                                                                    iii.      Aggressive trespasser: have to know it is not your property you are possessing

c.       Actual occupancy can be shown by

                                                                                                                                       i.      Substantial inclosure

                                                                                                                                     ii.      Cultivated or improved

4.       Claim of title v. Color of title

a.       Color of title is when you have a written instrument that you have the right to the property – but the written instrument is incorrect

                                                                                                                                       i.      Advantage of this is that you get everything described in the title

b.       Claim of title is hostile possession – no written instrument

                                                                                                                                       i.      You only get what you actually possess

5.       Mannillo v. Gorski

a.       Built steps over the property line

b.       Could not be detected except by a survey

c.       Maine Standard

                                                                                                                                       i.      Have to know that is not your property

                                                                                                                                     ii.      Aggressive trespasser standard

d.       Connecticut Doctrine

                                                                                                                                       i.      Do not look at state of mind

e.       Discovery Rule

                                                                                                                                       i.      If you know or a reasonable person should have known that you have a cause of action, that is when the clock starts ticking regarding statute of limitations

f.         Since only discovered by survey, not open and notorious and therefore no adverse possession

                                                                                                                                       i.      Uneconomical to remove stairs so may just have person encroaching pay the other for the property used

                                                            iii.      Mechanics

1.       Howard v. Kunto

a.       Def received deed for land from the Millers but the deed is for a different piece of land then occupied

b.       Howards say they should win bc possession was not continuous

                                                                                                                                       i.      House was a summer home

                                                                                                                                     ii.      Court says as long as used in the manner which is typically used – summer homes are only used in the summer

c.       Court uses the term privity

                                                                                                                                       i.      Mutual interest

                                                                                                                                     ii.      A purchase is a relationship with privity

                                                                                                                                    iii.      Here the original owners never owned the land so no privity

1.       Court states that will not worry about those acting in good faith

2.       Rule is made for squatters and trespassers

2.       English Law

a.       No need for privity with tacking

                                                                                                                                       i.      Tacking: the joining of consecutive periods of possession by different persons to treat the periods as one continuous period – the adding of one’s own period of land possession to that of a prior possessor to establish continuous adverse possession for the statutory period

b.       Privity encourages more good faith transactions

c.       Not simply might makes right

d.       Discourages people from being lazy land owners

3.       Disabilities

a.       Statute of limitations extended when the owner has a disability

b.       Tolled: Stop the running of something (like a statute of limitations)

4.       Government: property owned by the federal government cannot pass by adverse possession

C.      Acquisition by Gift

                                                               i.      Elements

1.       Delivery – handed to you if possible

a.      Constructive Delivery: giving a key to a car is constructive – something that will open access

b.      Symbolic Delivery: handing a written instrument describing the property

2.       Donative Intent

3.       Acceptance

                                                             ii.      Inter Vivos gift – cannot take back once given – surrender control during lifetime

                                                            iii.      Donaio Causa Mortis: a gift made in contemplation of someone’s death – three elements – able to retract if donor overcomes and lives

1.       Gift must be made with a present illness or peril

2.       Donor must die from that illness or peril

3.       Delivery must take place

                                                            iv.      Gruen v. Gruen: painting case

                                                              v.      Newman v. Bost

1.       Involved a causa mortis gift

2.       The courts discourage this type of gift bc they want people to make wills

3.       Just pointed at the rooms and said that he wanted her to have the stuff

4.       Has to be an actual delivery for her to receive the life insurance policy

a.       Just bc in something non-deliverable does not matter

b.       If wanted it and able to deliver, must do so

III.                  Possessory Estates

A.      Feudalism

                                                               i.      Two types of tenure

1.       Free

a.       Military (knight service and grand sergeanty) – soon replaced with knight money (scutage)

b.       Economic (or socage)

c.       Religious (including frankalmoign)

2.       Unfree – villeinage

                                                             ii.      Feudal incidents

1.       Homage and fealty

2.       Aids (limited in Magna Carta)

3.       Forfeiture (if felon, everything goes back to the king) – we still have some of this today

4.       Liability at death of tenant

a.       Wardship and marriage

b.       Relief (had to pay lord above you some money to get land bc it was not inheritable)

c.       Escheat (die wo heirs all property went up the chain, eventually to the king – will still see this today)

B.      Fee Simple

                                                               i.      Creation of the Fee Simple

1.       To A and his heirs

a.       To A: words of purchase

b.       and his heirs: words of limitation

2.       If no heirs, then escheat to state

3.       Cannot create a fee simple that you cannot sell

4.       By definition, a fee simple cannot have limitations

                                                             ii.      Inheritance of a Fee Simple

1.       Heirs: people who at law get your property – made up of

                                                                                                                                       i.      Issue (descendent but not children – does include grandchildren)

                                                                                                                                     ii.      Ancestors (parents, etc. working backwards)

                                                                                                                                    iii.      Collaterals (cousins, etc.)

C.      Fee Tail

                                                               i.      Does not really exist in the US but is important in England

                                                             ii.      To A and the heirs of his body

                                                            iii.      Ties land up with the family

1.       Goes down the line of descendents – once no more descendents, goes back up

                                                            iv.      If there is a fee tail in US (which is now abolished), then turns into one of the following

1.       A ends up with a fee simple (statutory disentailment)

2.       A has a life estate and A’s issue gets a fee simple

3.       If A leaves no surviving issue, then a gift over A

D.      Life Estate

                                                               i.      To A for life …

                                                             ii.      White v. Brown

1.       Writes a holographic will (handwritten) giving pl a life estate and appointed her niece executrix

2.       Stated that her home was not to be sold

3.       Have to worry about intestate succession here even though there is a will bc did not say what happens after the life estate expires

4.       Two statutory rules that will apply

a.       Unless expressly stated otherwise, pass as a fee simple

b.       Conveys all the real estate unless expressed differently

c.       Reasons for these rules

                                                                                                                                       i.      Easier for the court

                                                                                                                                     ii.      Want to discourage people from coming out of the woodwork

5.       Start with the testator’s intent

a.       Have to look at the entire instrument – not just certain parts

                                                            iii.      Baker v. Weedon

1.       Provides a will

a.       Leaves a life estate to his current wife and the remainder to her children

b.       If she does not have children, then to his grandchildren

c.       Intentionally wrote his daughters out of the will

2.       The wife, Anna, wants to sell the property and put the money in trust for the remaindermen

3.       Economic waste

a.       Life estate holder has to ensure economic waste does not occur in order to protect the remaindermen

b.       Value of property will increase and therefore selling it now will be a waste

c.       Building something that will increase the property such as a shopping center would not be waste

4.       Just bc wife outlived grandchildren, does not change to a fee simple

                                                            iv.      Seisin

1.       Seisin is possession

2.       Ceremony called the feoffment with livery of seisin

a.       Pick up dirt on the property and give to another to signify changing of seisin

E.      Leasehold Estates

                                                               i.      Do not have seisin

                                                             ii.      Tenant has mere possession for a certain time period

F.      Defeasible Estates

                                                               i.      Fee Simple Determinable

1.       To … for so long as …

2.       Future interest that goes along with this is the possibility of reverter

                                                             ii.      Fee Simple subject to a condition subsequent

1.       To … but if it should not … then reserve a right to reenter and take premises

2.       Future interest created is the right of entry

a.       Cannot be given, only descended by intestate succession

                                                            iii.      Difference between the two

1.       Future interests

a.       In fee simple determinable, the future interest is automatic when the condition is not met

b.       In fee simple subject to a condition subsequent, the future interest is not automatic – the transferor has to do something (suit, actually entering land, etc.)

2.       Transferable or not

3.       Statute of Limitations

                                                            iv.      Mahrenholz v. County Board of School Trustees

1.       School given interest and years later used as storage which was against condition

2.       Decision of this case depends on whether the court decides it is a fee simple determinable or subject to a condition subsequent

3.       Court determined it was a fee simple determinable

a.       Def argues that the default is condition subsequent because it reduces the harshness

b.       If not sure, would rather err on the side of someone taking responsibility instead of happening automatically

                                                              v.      Mountain Brow Lodge v. Toscano

1.       In this case the argument is about the habendum clause (the part of a deed that defines the extent of the interest being granted and any conditions affecting the grant)

2.       Land conveyed to a fraternal lodge

3.       Does not matter what type of defeasible fee – the focus is if valid or not

a.       Anticipating a breach, did not happen yet

4.       Question of restraint of alienation

a.       A market of 1 indicates a restraint

5.       Not hard and fast rules on if valid – factors considered

a.       How many buyers

b.       Is it for spite

c.       Charitable

6.       Dissent

a.       Eventually have too much land subject to interest of the past (dead hand on future interests)

                                                            vi.      Ink v. City of Canton

1.       Does not matter which defeasible fee – only concerned with how to split money from just compensation

2.       Government can use authority to wipe out any interest (current or future)

a.       Get a fee simple absolute

b.       The future interest problem is left for the court to work out

3.       Problems

a.       Do not know if future interest will ever be possessory interest then def would get something for nothing

                                                                                                                                       i.      Donated to the def for park purposes

4.       Traditional Rule (give all to the city) – based on two things

a.       Right of reverter was unknown as to when would happen

b.       Impossibility of completing the condition

5.       ALI Rule

a.       Should be a division if the condition is probable to happen soon

b.       Came up with this rule on their own with no basis for rule

6.       Difficult to value a possibility of reverter

                                                           vii.      Regarding Marriage

1.       Determinable is ok regarding marriage but a condition subsequent is not ok bc it is penalizing marriage

2.       Courts are shying away from this distinction

IV.                Future Interests

A.      In the Transferor

                                                               i.      Reversion

1.       Goes back to transferor when he does not provide what will happen when lesser estate expires

                                                             ii.      Possibility of Reverter

1.       Created by fee simple determinables

                                                            iii.      Right of Entry

1.       Created by fee simple subject to a condition subsequent

B.      In Transferees

                                                              i.      Remainders

1.       take place as soon as prior estate ends

2.       Vested if:

a.       Given to an ascertained person; AND

b.       Is not subject to a condition precedent (a condition that must happen first)

c.       Examples

                                                                                                                                       i.      To A for life then to B

                                                                                                                                     ii.      Vested subject to open or vested subject to partial divestment: To A for life, and then to the children of A (will not know entire class until A dies)

                                                                                                                                    iii.      Vested subject to full divestment: To A for life, and then to B and her heirs, but if B does not survive A then to C and his heirs

3.       Contingent if:

a.       Given to an unascertained person; OR

b.       Is made contingent upon some event occurring other than the natural termination of the preceding estates

c.       Examples

                                                                                                                                       i.      Takers are unascertained: To A for life, and then to the heirs of B

1.       Do not know who heirs are until B dies and if alive, do not know who they are

2.       CANNOT have heirs while still alive

                                                                                                                                     ii.      Remainder subject to a condition precedent: To A fro life, and then to B if B survives A

1.       We know when A dies if B will get property but do not know when A will die so a condition precedent

4.       Important to look at the ordering of the words – ordering can change the meaning

                                                             ii.      Executory Interests

1.       Two types

a.       Shifting: to A and his heirs, but if B returns from Rome, then to B and his heirs

b.       Springing: to A and her heirs when A marries

c.       Do not worry about the different types bc both have same legal consequences

2.       Cuts short someone else’s interest before the natural termination

C.      Trust

                                                               i.      Broadway v. Adams

1.       Adams is the beneficiary of the trust and Broadway is a creditor trying to get money

2.       Under English rule, cannot restrict use bc it is a restraint on alienability

3.       Limitations of trust: cannot assign right to his creditors

4.       Court here allows the limitations

D.      Rules Furthering Marketability by Destroying Contingent Future Interests

                                                              i.      Rule against Perpetuities

1.       Common Law Rule

a.       No interest is good unless it must vest, if at all, not later than 21 years after some life in being at the creation of the interest

b.       How to determine if an interest violates the rule

                                                                                                                                       i.      First: look to see if it vests definitely

                                                                                                                                     ii.      Second: look to see if the vesting happens within the 21 years given

                                                                                                                                    iii.      Third: look for the life in being – look for not only validating life but also invalidating life

                                                                                                                                    iv.      Fourth: look for when created (if will written in 1995 and dies in 2025, then 2025 is the creation)

c.       Exceptions – does not apply to:

                                                                                                                                       i.      Fee tail

                                                                                                                                     ii.      Fee simple

                                                                                                                                    iii.      Interests retained by the grantor (reversion, possibility of reverter, right of entry)

                                                                                                                                    iv.      Gift to charity followed by an interest to a charity

d.       Brown v. Independent Baptist Church of Woburn

                                                                                                                                       i.      Church’s interest goes to legatees when the church stops using for religious purposes

                                                                                                                                     ii.      The whole idea is to avoid a remote interest but the court allows in this case

1.       Still have some respect for the intentions of the testator

e.       Central Delaware County Authority

                                                                                                                                       i.      Option to repurchase is subject to the rule against perpetuities

f.         Jee v. Audley

                                                                                                                                       i.      Interest goes against RAP

                                                                                                                                     ii.      The Jees could have an afterborn daughter that will not vest wi the 21 years

                                                                                                                                    iii.      A person can have a child until death

                                                                                                                                    iv.      If the gift fails to one member of the class, fails for all

g.       Savings Clause

                                                                                                                                       i.      String out interest as long as possibility but vests before RAP

                                                                                                                                     ii.      Can use extraneous lives

1.       Able to use all of Queen Victoria’s issues now living

2.       Cannot be innumberable such as all the people in the world who are living

2.       Wait and See Doctrine

a.       Advantage - Upholds more transfers

b.       Disadvantage – can be strung out for a long time bc you have to wait and see

c.       Common Law

                                                                                                                                       i.      Have to wait until all lives in being that can affect vesting are over with plus the 21 years

                                                                                                                                     ii.      Wait for anyone who can affect the identity of the takers – anyone who can affect the condition precedent

d.      90 Years

                                                                                                                                       i.      USRAP (Uniform Statutory Rule Against Perpetuities)

                                                                                                                                     ii.      Test

1.       First look to see if good under common law – if so then valid

2.       If not, then see if it will vest within 90 years

3.       If not, then see if it does vest within 90 years

                                                                                                                                    iii.      Preserves exemption for possibility of reverter and right of entry

V.                  Eminent Domain and the Problem of Regulatory Takings

A.      Power of Eminent Domain: Sources and Rationales

                                                               i.      Takings terminology

1.       Eminent domain: power of the government over private property to take it for public use

2.       Condemnation: procedural means that government has to exercise its eminent domain

a.       Can be that the government needs the property or that the property is in such bad shape

3.       Takings: claim by private property owner that government has, by its actions, exercised its eminent domain – also called inverse condemnation

                                                             ii.      Why Government should have this power

1.       Might makes right

a.       It is the duty of the government to protect people and lands so they should have the right to take it if necessary

2.       By giving the government the power of eminent domain, they have the ability to take someone to court and the court will determine how much the owner should get

B.      Public-Use Puzzle

                                                               i.      Hawaii Housing Authority v. Midkiff

1.       Case of condemnation – state decided too much land held by too few people so redistributed the land

2.       Public use: creating a healthier economic market which benefits society

3.       Test: if public purpose can be achieved by taking from one to give to another then it is ok

a.       Public use: if you can rationally relate it to a conceivable public purpose and you compensate

b.       Difficult to find anything that fails the public use test

                                                             ii.      Hoffman Estates (p. 1121)

1.       Usual measure of compensation is the market value of the parcel

a.       What a willing buyer would pay a willing seller

2.       Do not take into account any other factors

a.       Hard to value subjective factors

                                                            iii.      General Rule: if the government downgrades the value of the property then thy have to pay for what they have taken and the diminishing value of the parcel – if there is an increase in value, do not have to pay anything

C.      Physical Occupations and Regulatory Takings

                                                               i.      Rules of Decision (Before 1987)

1.       Loretto

a.       Government required people to have cable installed on their property

b.       The public use here is the educational benefits of cable

c.       If this were a condemnation case then there would be public use and compensation may be nothing since the value of the property increases with the availability of cable

d.       Actually challenging the constitutionality of the statute

                                                                                                                                       i.      Penn Central

1.       Taking more readily found when there is a physical operation

e.       Rule: if there is a permanent physical occupation by the government then it is a taking

f.         Taking landowner’s right to exclude is a major concern

                                                                                                                                       i.      Kaiser

1.       Navigational Servitude: all land that is subject to the ebb and flow of the tide or below mean low water mark of navigational waters then the government has rights to it according to navigational servitude

g.       Taking is not dependant on size

2.       PA Coal v. Mahon

a.       Divides property into three estates

                                                                                                                                       i.      Surface: top of soil

                                                                                                                                     ii.      Mineral right: in this case it is coal

                                                                                                                                    iii.      Subsidence: the layer between the surface and the mineral

b.       This is more of a restriction than a taking

c.       The police power is that which gives the states general power to watch out for health and welfare of citizens

                                                                                                                                       i.      Do not have to compensate bc it is not a taking when it is a safety regulation

d.       Rule: taking if the regulation goes too far – diminution of value (this is not a test within itself)

                                                                                                                                       i.      Denominator Problem: this is what happens when the government wipes out a portion of the estate – do you look at if it went too far or just the portion taken

3.       Hadacheck v. Sebastian

a.       Changed regulations regarding land to disallow brick making

b.       Clay on the property is perfect for brick making and would make a poor home site

c.       Nuisance: under the city’s police power, they have the power to ban nuisances

                                                                                                                                       i.      Do not have to compensate bc in the public good

4.       Penn Central

a.       Test: three part

                                                                                                                                       i.      Diminution of value – must show you lost something

                                                                                                                                     ii.      Interference with distinct investment backed expectations

                                                                                                                                    iii.      Character of government’s actions

                                                             ii.      Matters of Remedy

1.       First English Evangelical Lutheran Church of Glendale v. County of LA

a.       Flood destroyed the church camp which was built at a foothill between two hills

b.       Regulation did not constitute a taking because should not have built there to begin with

c.       Fighting for a temporary taking, not a permanent

d.       Rule: government has the obligation to pay from the time of taking until the taking ends

                                                            iii.      Rules of decision (1987 and Beyond)

1.       Nollan

a.       Government says yes, but

b.       Here the government would allow to build a house if they provided a lateral throughway along the water

c.       Would not have been a taking if the commission just said no to the permit

d.       Court says that when the commission assigns a condition it is the same as extortion

                                                                                                                                       i.      The condition is not related to the permit – if said have to build a smaller house then that would be ok

                                                                                                                                     ii.      Would be ok to insist on a viewing spot

e.       Test to see if the permit is ok

                                                                                                                                       i.      Substantially advances legitimate state interests

f.         Test: nexus – what the government is asking for and why they are asking for it must be connected

2.       Dolan

a.       Another situation like Nollan where the government is saying yes, but

b.       Connections the government made

                                                                                                                                       i.      Bike path would decrease traffic and congestion

                                                                                                                                     ii.      Increased runoff

c.       Test: there must be a rough proportionality once nexus is established

d.       Burden of evidence is on the commission and they did not prove a link between the bike path and reduced congestion

3.       State v. Shack (p. 87)

a.       Migrant workers seeking services on the farm land

b.       Challenged constitutionality of trespass statute

c.       Ownership of property does not allow owners to bar access to governmental services

4.       Lucas v. South Carolina Coastal Council

a.       Pl bought two lots on the beach and the regulation changed after buying and before building to the effect that no building allowed

b.       New regulation put in force for ecological reasons

                                                                                                                                       i.      Erosion

                                                                                                                                     ii.      Destruction of a public resource

c.       Two situations that the court would say there is a taking

                                                                                                                                       i.      Physical invasion

                                                                                                                                     ii.      Denies ALL economic benefit

1.       If there is no economic benefit, then no reason to have the property

d.       In this case, the court determined first that it was depriving of all economic benefit

e.       On appeal, the court determined that it was a nuisance regulation

D.      Wrap up

                                                               i.      Third Avenue Associates/Sage v. US

1.       Yugoslavian businesses closed by the government and broke the leases with the pl

2.       Government allowed to disban because of the International Emergency Economic Powers Act

3.       Temporary taking that is theoretically physical

4.       Frustrating a contract does not take the force away from the contract

5.       Court determines that the pl remedy lies within the tenants, not the government

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

FUTURE INTERESTS IN GRANTEE

 

FUTURE INTEREST

EXAMPLE

REVERSION IN GRANTOR FOLLOWING FUTURE INTEREST?

TRANSFERABLE?

Indefeasibly Vested Remainder

“To A for life, then to B”

No; remainder certain to become possessory

Yes; B’s remainder transferable during life and at death

Vested Remainder Subject to Open

“To A for life, then to A’s children”

A has a child, B. B has a vested remainder subject to open

No; A’s children are certain of possession

Yes; B’s remainder transferable during life and at death

Vested Remainder Subject to Divestment

“To A for life, then to B, but if B dies before A, to C”

B has a vested remainder subject to divestment by C

No; no possibility of property reverting to grantor

B’s remainder transferable during life but not transferable at B’s death if B predeceases A

Contingent Remainder

(1)     “To A for life, then to A’s children” A has no child

(2)     “To A for life, then to A’s children who survive A” A has a child, B

(3)     “To A for life, then to B if B reaches 21” B is 17

(4)     “To A for life, then to B’s heirs” B is alive

(5)     “To A for life, then to B if B survives A, and if B does not survive A, to C”

Yes

 

 

 

Yes

 

 

 

 

Yes

 

 

 

Yes

 

 

Yes

 

(1) No; no child is alive

 

 

(2) B’s contingent remainder is transferable during life, but is not transferable at B’s death if B predeceases A

 

 (3) B’s remainder is transferable during life, but remainder fails if B dies under 21

 

(4) No; no one is heir of B until B dies

 

(5) B’s remainder transferable during life, but fails if B predeceases A; C’s remainder transferable during life and at C’s death if A is then alive

 

Executory Interest

(1)     “To A, but if B returns from Rome, to B”

(2)     “To A for life, then to B, but if B does not survive A, to C”

(3)     “To A upon her marriage”

No

 

 

No

 

 

 

No reversion, but grantor has possessory fee until A’s marriage

Yes

 

 

C’s executory interest is transferable during life and at C’s death if A is alive

 

Yes

RULE AGAINST PERPETUITIES EXAMPLES

 

EXAMPLE

VALIDITY

EXPLANATION

“To A for life, then to A’s children for life, then to B”

 

“To A for life, then to A’s children for life, then to A’s grandchildren”

Valid

 

 

Invalid

B’s remainder is vested on creation

 

A may have a child after the interest is created and so may have grandchildren beyond the perpetuities period

“To School Board so long as it is used for a school, then to the Red Cross”

 

“To School Board so long as it is used for a school, then to A”

Valid

 

 

 

Invalid

This falls within the charity-to-charity exception

 

 

The interest may vest in A’s heirs or devisees hundreds of years from now (A’s interest is stricken)

“To B for life, remainder to those of B’s siblings who reach age 21”

 

“To B for life, then to such of B’s children who become lawyers”

Valid

 

 

Invalid

B’s parents can be used as measuring lives

 

B may have a child born after the disposition who becomes a lawyer more than 21 years after B’s death

“To A for life, then to his wife, W, for life, then to A’s surviving children”

 

“To A for life, then to his widow for life, then to A’s surviving descendents”

Valid

 

 

 

Invalid

No unborn widow problems because the gift is to W, a life in being

 

Unborn widow problem

“To X for life, then to Y, but if at her death Y is not survived by children, then to Z”

 

“To M for life, then to M’s children for their lives, then to M’s grandchildren” M is 80 years old and has had a hysterectomy

Valid

 

 

 

Invalid

Y is the measuring life

 

 

 

Fertile Octogenarian problem

“Trust income to Polo Club. At the death of A, B, C, D, and E (all born today at Obie Hospital), the corpus to Z and his heirs”

 

“The residue of my estate to my descendants who are living when my estate is distributed”

Valid

 

 

 

 

Invalid

A, B, C, D, and E are measuring lives

 

 

 

Administrative contingency – the slothful executor problem