UNIT ONE: CREATING & ACQUIRING PROPERTY
Methods of Acquiring Property:
1.
2.
3.
Creation – First Possession; Discovery/Conquest; Creation; (Subsequent) Possession; Accession; Adverse Possession
Voluntary Transfers - by contract or upon death
State Action
First Possession
Incentivizes: administrability, labor theory, notice
Cases: Pierson v. Post, Keeble v. Hickeringill, Popov v. Hayashi, Lone Star Gas Co. v. Murchinson
Conquest & Discovery
Conquest creates new root of title, undoing prior claims; US government is root of all title of US property
Labor alone does not create property because that labor must be recognized
Cases: Johnson v. M’Intosh, McGirt v. Oklahoma
Creation
Themes & Incentives:: labor theory, exclusion, opportunism
Incentivizes: labor theory
Cases: INS v. AP
Subsequent Possession
Title transfers when parties intend for it to, proven through earnest money
Finders have right against all but those w/ better title (Armory) even if obtained illegally (Anderson) or there is a second finder (Clark)
Themes & incentives: burden of proof, least cost avoider, administrability, exclusion, opportunism
Cases: Armory v. Delamirie, Clark v. Maloney, Anderson v. Gouldberg
Accession
Accession: if mix someone else’s property with your labor in good faith, in rem right to object, but in personum obligation to other to
compensate for their loss (Weatherbee)
Themes & Incentives: least cost avoider, prevent waste, highest and best use, prevent windfall, labor theory, opportunism,
administrability (tracing)
• Fixtures: depends on intent, determined by objective criteria including: nature of article, manner attached, amount of damage that
would be caused by removal (exception for trade fixtures)
o At common law, difficult if permanently attached because belongs to LL & attached by definition
• Rule of Increase: contested property belongs to the party with the greatest connection to it
• Applying accession
o Intentionally converts to new form -> item returned in any form
o According to Blackstone if “changed into different species” -> satisfaction (costs) but not orig. materials
o Under civil law if unintentionally converts and gives form that precludes restoration -> maybe compensation
o Mistakenly mingles goods with those of another so can’t be separated -> neitherer expected to forfeit their property
unless inevitable
Cases: Weatherbee v. Green, Edwards v. Sims, Goddard v. Winchell
Adverse Possession
Incentives: highest & best use
Theories: (1) labor (Locke), (2) personhood (Hegel/Radin), (3) efficiency/utilitarian
• Adjectival Requirements in MS (Scott)
1. Under claim of ownership - have a reason to think own it, disincentivizes theft
2. Actual or hostile - permission defeats a claim
3. Open, notorious, and visible - must provide notice (Scott)
4. Continuous & uninterrupted for 10 years – then title transfers (Howard)
5. Exclusive – if not, TO may not know you’re attempting a claim
6. Peaceful – this is unique to MS, disincentivize violence
Cases: Scott v. Anderson-Tulley Co., Howard v. Kunto
1
UNIT TWO: WHAT CAN BE OWNED?
What Can Be Property?
•
Demsetz Externalities Theory: property rights are anything one can derive value from so community has obligation to protect the
right to exclude (rights as economic opportunity)
o Externalities: harmful or beneficial effects of decision not brought home to the decision maker
Cases: Tribune Co. v. Oak Leaves Broadcasting Station, Inc. (wavelength), Intel v. Hamidi (not server without harm)
Personhood
•
•
Focus on recognizable characteristics created through labor (Midler)
Theories of Market Inalienability (Radin)
o Prophylactic justification: ban in circumstances where would arouse suspicions about coercion (e.g. sell children)
o Assimilation to prohibition: ban of commodified versions of things based on moral requirement, necessary
o Domino theory: noncommodified version is morally preferable and you can’t have both
Cases: Moore v. Regents of California, Midler v. Ford Motor Company
What Cannot Be Private Property?
Theories of public rights
1. Prescriptive easement (later unit): (1) openly (2) peaceably, (3) continuously), and (4) under claim of right adverse to owner
of the soil, and (5) with his knowledge and acquiescence, used a way over the lands of another for as much as 15 years
2. Custom: (1) ancient, (2) uninterrupted, (3) peaceful (4) reasonable, (5) visible boundaries, (6) obligatory, (7) not
repugnant/inconsistent with other laws and customs (Thornton)
3. Public trust: general public has right to use of land on the shore covered by the ebb and flow of the tide for navigation,
fishing, and recreation (Ill. RR)
Navigable Servitude:
• Navigable waters -> Commerce Clause (Art. I Sect. 8 Cl. 3) + Maritime Jurisdiction (Art. III Sect. 2)
• Navigable airspace -> above minimum safety flight altitudes; ad coelum as obsolete
Perprestures: encroachments on public waterways and highways; now governed by injunction
Cases: Illinois Central Railroad Co v. Illinois, Thornton v. Hay, McConico v. Singleton
The Commons
Types: commons, semi-commons (not open to general public), anti-commons (too many fragmented rights and permissions required)
• Tragedy of the commons: direct benefit with delayed cost
• Possible policy prescriptions:
o Levianthan – centralized power to prescribe methods
o Privatization – common usage as destruction
o Self-financed unanimous contract with commitment to cooperate
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UNIT THREE: REMEDIES AND THEIR LIMITS
Self-Help and Equity
Where there is no suitable remedy at law, move to equitable remedies because property as non-fungible
Important Equitable Maxims (TL;DR: bad guys win, good guys lose)
• Equity regards as done what ought to be done
• One who comes into equity must come with clean hands (Producers)
• Equity aids the vigilant and the diligent (Ryland)
Equitable defenses: estoppel (reliance as binding), laches (didn’t speak up quickly enough to resolve)
Property vs. Liability:
• Property Rules: equity, strong /strict enforcement of rights – right holder sets price (if any)
o Ex - specific performance, accounting, constructive trust, injunction, equitable lien, rescission
• Liability Rules: law, protect rights by requiring payment when right is violated – court sets price
• Somewhere between – ejectment, replevin, restitution
Hohfeld framework: right corresponds with affirmative duty; privilege corresponds with no-right (to interfere)
In protecting rights, consider economic efficiency, distributional preferences, other justice concerns
Self-help: steps to enforce property rights out of the legal system, though they can be scrutinized by a court
• Examples: locks, security guards, indelible serial numbers
• Certain actions are forceable as a matter of law
• Can retake property only if tenant (1) holds over after lease, or (2) peaceful (Berg)
o Otherwise, use judicial system
o Risk of breach of the peace is not enough (Williams)
Equity remedies balance: adequacy of remedy (Baker), good faith (Baker, Rylands, Eyerman), permissibility of self-help (above)
Cases: Golden Press, Inc. v. Rylands, Baker v. Howard County Hunt, Berg v. Wiley, Williams v. Ford Motor Credit Co.
Restitution and Reparations
Restitution: law of non-bargained for benefits; strong incentives against conversion and wrongdoing not found in law of possession
Elements of unjust enrichment:
(1) enrichment of the defendant, (2) at expense of the plaintiff, (3) under circumstances that are “unjust” (Olwell)
Injury is in the right to exclude
Main objection to reparations is error allocation: where the error will fall, when it comes, to whom, and for what comp. is due
Cases: Olwell v. Nye & Nissen
Abandonment, Destruction, & Waste
You cannot abandon perfect title in fee simple absolute (Pocono Springs)
• Test for abandonment: voluntary relinquishment of all rights, title, claim, and possession with intention to terminate ownership
without vesting it in another
• Waste: state can step in to prevent abandonment or waste post-death if against public policy and “merely capricious” (Eyerman)
o Committing waste means you are coming in with “unclean hands” and unentitled to equitable remedy (Producers)
Incentives: disincentivize waste, dumping of negative assets, alienability
Cases: Pocono Springs Civic Assoc. v. MacKenzie, Eyerman v. Mercantile Trust, Pocono Lumber & Supply Co. v. Olney Building
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UNIT FOUR: PRIMARY FORMS OF OWNERSHIP
Licenses vs. Ownership
License: temporary and revocable waiver of right to exclude (Wood)
Exceptions to irrevocable nature – license coupled with grant, license relied upon for labor
As long as there is an opportunity to review terms and opportunity to return/decline, enforceable (ProCD)
Bailment: relationship where possession and control of property temporarily delivered to another for safekeeping
• Bailee duty of care: reasonable care (lost item is dispositive) which can’t be waived with contract (Allen)
• Must be deposit and acceptance
o Some factors to consider re: parking garages: closed, indoor, attended, ticketed
• Burden of proof is on bailee to prove non-enforcement
Cases: Wood v. Leadbitter, ProCD, Inc. v. Zeidenberg, Allen v. Hyatt Regency
Estates in Land
Estate: type of property right, measures person’s interest in terms of duration
Estate Granted
Language
Future Interest(s) Created
FEE SIMPLE
to X and heirs
largest package of rights,
complete control, indefinite and
all others lose expectancy
to X in fee simple
To X
LIFE ESTATE
comes to natural end with life of
holder (pur autre vie: even if they
convey it)
to X for life and then to Y
FEE SIMPLE
DETERMINABLE
as long as
while
during
until
but if
on condition that
provided that
provided however
if
ends automatically at happening
of event
FEE SIMPLE SUBJECT TO
CONDITION SUBSEQUENT
indefinite but upon happening
doesn’t automatically end, but can
be ended by grantor (favored)
FEE SIMPLE SUBJECT TO
EXECUTORY LIMITATION
defeasible fee followed by an
interest reserved to 3d party
as long as
but if
Examples
None
To Marge (and her heirs)
(1) Reversion (to owner);
or
(2) Remainder (to 3d party)
To Marge for life
To Marge for life and then to
Lisa
Possibility of Reverter (to
owner)
To Lisa as long as she plays
saxophone
Right of Entry/
Power of Termination
To Lisa, but if she stops
playing saxophone, O may
retake the property
Executory Interest
To Lisa, but if she stops
playing sax, to Bart
To Lisa, as long as she plays
the saxophone, then to Bart
Remainder is either vested or contingent & can be subject to complete or partial divestment
• Indefeasibly vested: identity of takers is known and interest is ready to be possessory upon natural termination of preceding
interest; cannot be subject to anything
• Vested remainder: certainty about identity of class of takers/taker - can be subject to partial/complete divestment
• Contingent remainder: uncertainty about identity of class of takers (*RAP) – can be subject to partial/complete divestment
• Subject to partial divestment/subject to open: class may open, but still have divested right (*RAP IF VESTED)
• Subject to complete divestment: occurrence of condition causes interest to shift to someone else
Executory interest is either shifting (divests from 3d party) or springing (divests from grantor) (*RAP FOR BOTH)
Dead Hand Control
Benefits: planning, taking care of others, conservation, protects future interests
Harms: lack of foreseeability, disincentivizes improvement, needs change, hurts alienation, generational wealth, political consensus
Rule Against Perpetuities
No interest is good unless it must vest, if at all, not later than twenty-one years after some life in being at the creation of the interest
(can be measured by someone other than part mentioned)
Grantor cannot
Valid: “to my grandchildren who will reach age of 21”
Invalid: inter vivos trust for “my grandchildren who shall reach the age of 21” (may include member that can’t reach/qualify)
Remedies: invalidation, reinterpretation, cy pres (if two charities)
Note: alienation restrictions are invalid and unenforceable (Mountain Brow Lodge), but sever clauses and interpret for grantor;
repurchase options are also subject to RAP (Symphony Space)
Cases: Mountain Brow Lodge No. 82, Symphony Space, Inc. v. Pergola Properties
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Shared Ownership
Additional remedies necessary to control shared ownership and exit
• Accounting: forensic process where third party sees who owns what, how much has been paid (co-owners have right to this)
• Partition (co-owners have a right to this, will happen if requested)
o In kind: default (Delfino) - divide up parts to co-owners (property rule), may create duty to pay owelty
o By sale: sell and pay appropriate shares (liability rule) – favored because either
§ In kind is impracticable/inequitable because of geography or numerosity of owners
§ Better promotes interest of owners based on consent; consider all tenants, particularly those in possession
• Contribution: right to recover for repairs if (1) necessary (can be to avoid damage) or (2) get permission (Gillmore)
• Owelty: charge to balance any unequal split of parcel after partition in kind
• Severance: breaking of any interest (joint tenancy -> sever to tenants in common -> partition)
Forms of Co-Ownership
1. Tenancy in common (default): separate, but undivided interest
a. No right of survivorship; becomes part of estate at death
2. Joint tenancy: same except that the deceased’s interest is distinguished
a. Four unities: (1) time, (2) title, (3) interest, (4) possession
b. Either tenant can unilaterally sever or incumber without permission; giving or selling severs
i. Lien does not sever (Harms)
c. Right of survivorship: surviving co-owner automatically has asset passed to them upon death of other co-owner
3. Tenancy by the entirety: four unities + (5) marriage; separate and undivided interest
a. Right of survivorship
b. Can’t give/sell without divorce
4. Community property: married couples’ possessions, with limited exceptions, must have both approve before alienation
Ouster: when cotenant out of possession makes clear, unequivocal demand to use land that is in the exclusive possession of another
cotenant, and that cotenant refuses to accommodate the other tenant’s right to use the land, the tenant out of possession has the tenant
out of possession has established a claim for relief
Ouster creates right to contribution (looks like rent)
Right of survivorship: where ownership of an asset passes automatically by operation of law upon the death of an owner to a
surviving co-owner
Cases: Delfino v. Vealencis,, Gillmor v. Gillmor, Harms v. Sprague
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UNIT FIVE: TITLE RECORDS AND THE TRANSFER OF PROPERTY
Transfers
Policy incentives for voluntary transfers (sale, bequest, gift): autonomy, private ordering, keep the peace, administrability
T1=Offer
T2=Acceptance (Executory pd., title insurance here) T3=Closing/Delivery of Deed
T4=Recording
Requirements for conveyances:
• Statute of Frauds: must be put into writing for full force and effect unless lease of under three years
• Delivery: title transfers at delivery at law so seller bears risk, but equity considers done what ought to be done
• Gifts: final upon delivery, not promise
Void vs. Voidable Title:
Void: can never ripen into good title (e.g. thieves – Kunstsammlungen)
Voidable: can ripen into good title if purchased by good faith purchaser for value
Good Faith Purchaser for Value
• Good faith: honesty in fact, depends on actual belief of purchaser, not reasonableness (Kotis
o Burden of proof: party alleging lack of good faith (Hood)
o UCC: honesty in fact and the observance of reasonable commercial standards of fair dealing
o Sufficient consideration can be evidence (missing in Kunsts & Kotis)
• Purchaser: excludes thieves, gifts, but includes swindlers (Kotis)
• For valuable consideration:
o Burden of proof: party seeking GFP status (Hood)
o Look beyond recitals of deed to actual facts (Hood)
o Value at least means purchasing party not unjustly enriched (Timmer)
o Care work may not be consideration (Hood)
Cases: Kunstsammlungen v. Elicofon, Kotis v. Nowlin Jewelry, Inc.
Recording Systems
Recording: generates constructive notice to all subsequent purchasers; powerful incentives to file deeds
1. Race: first of two claimants to file prevails, any can prevail over one with prior unrecorded interest
a. Huge exception to nemo dat
b. No (i) conveyance of land, or (ii) contract to convey, or (iii) option to convey, or (iv) lease of land for more than
three years should be valid to pass any property interest as against lien creditors or purchasers for a valuable
consideration from the donor, bargainer or lessor but from the time of registration thereof in the county where the
land lies
2. Notice: should be good faith purchaser; requires good faith or actual notice
a. A conveyance of an estate in fee simple, fee tail or for life, or a lease for more than seven years from the making
thereof,, shall not be valid as against any person, except the grantor or lessor, his heirs and devisees and persons
having actual notice of it, unless it is recorded in the registry of deeds for the county or district in which the land to
which it relates lies
3. Race-Notice: records first without notice of another, conflicting deed
a. Every conveyance of real property or an estate for years therein, other than a lease for a term not exceeding one
year, is void as against any subsequent purchaser or mortgagee of the same property, or any part thereof, in good
faith and for a valuable consideration, whose conveyance is first duly recorded
Other Doctrines
• The Shelter Rule: grantee can transfer to a third non-good faith party because B has full ownership
o Original owner exception – doesn’t apply if try to convey it back to original owner
• Wild deed: not connected up to common grantor by continuous chain of recording, can’t benefit from nemo dat
• Late (& early) recorded deeds
• “Mother hubbard” clauses: no constructive notice because uses general description of collection of lands without enumerating
• Restrictions on adjacent tracts: conveys parcel while restricting retained land
• Improper indexing: not properly recorded; must look for similar names
• Quitclaim deed: no covenant of title, gives what seller has without saying what it was
• Marketable title: free from defects and encumbrances, doesn’t need to be perfect
• Warranty deed: guarantees grantor’s clear and superior title free from encumbrances with promise to defend against other claims
First in time is best -> legal interest -> equitable interest (for value and without notice to win)
Note: once title ripens on adverse possession claim, does not fall even if there is no longer notice
Cases: Hood v. Webster, Mugaas v. Smith
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UNIT SIX: ENTITY PROPERTY
Leases
Entity property: less than all the sticks, form of shared ownership that separates management rights and gives them to a third party
Differences from license: right to quiet possession (not just entry), not always terminable at will, action for eviction (vs ejectment)
Benefits: de facto financing device, risk spreading device, management of complex assets
Types of Leases:
• Term of years: fixed time at which terminates or ends (usually 1+ years)
• Periodic tenancy: automatically rolls over for stated period of time (month/year); party must give notice to terminate
• Tenancy at will: only lasts so long as both parties wish for it to continue, can terminate at any time for any reason
• Tenancy at sufferance: individual once in rightful possession holds over after right has ended (not traditional tenancy)
Covenant Theory: TT obligation to pay rent and LL obligation to provide quiet enjoyment independent, one can exist without other
Pay even if you lose possession (Paradine) or can’t use (Sutton), unless mixed lease with implied warranty (Smith)
Move to warrant of quiet enjoyment where LL responsible if natural and probable consequence (Blackett)
Constructive Eviction test:
(1) LL performs an act/fails to act/allows an act to occur; and
(2) Either (a) with intent of depriving the tenant of the enjoyment and occupation of the whole or part of the leased premises,
or (b) where natural and probable consequences of the act is to breach the covenant of quiet enjoyment; and (Blackett)
(3) TT must vacate the premises or file suit soon after the act occurs
• Warrant of habitability: residential TTs entitled to conditions that are habitable, sometimes defined as up to building code (Javins)
• Retaliatory eviction: can’t evict, refuse to renew, unreasonably raise rent, or pull unit off market with intent to retaliate
Themes & Incentives: avoid litigation, least cost avoidance, investment-backed expectations, customer choice, private ordering
Cases: Paradine v. Jane, Sutton v Temple, Smith v. Marrable, Blackett v. Olanoff, Javins v. First National Realty Co.
Condos & Co-Ops
On property to contract continuum: condo -> co-op -> lease -> license/grant -> license
Common interest community: undivided ownership interest equivalent to fee simple & common areas owned/managed by entity
Cooperative: corporation owns all units and common areas in fee simple; buy stock to own; common areas managed by BOD
Condominium: units owned by individuals in fee simple; common areas owned as TT in common under master deed
Associate subdivision: stand-alone units with facilities in common with other stand-alone units
Presumption of validity for CC&Rs in deed unless “unreasonable” – reasonable unless (Nahrstedt)
(a) restriction is arbitrary, (b) imposes burden that substantially outweighs benefit to homeowners, (c) violates public policy
Business Judgment Rule: CL doctrine by which courts defer to good faith decisions made by boards of directors in business settings
Exceptions if act (1) outside authority (2) in a way that did not legitimately further the corporate purpose (3) bad faith (40 W)
Incentives: decrease litigation, monitoring, info costs, promote predictability, customer choice, investment-backed expectations
Cases: Nahrstedt v. Lakeside Village Condo Assoc. 40 W 67th St. v. Pullman
Security Interests and Housing Law
Made up of two parts: (1) right to foreclose on specific property & (2) promise to pay – lien follows the debt
Lien theory: no transfer of title with mortgage, just right to foreclose; riskier for lender, doesn’t sever joint tenancy
Title theory: lender is said to take title until debt is paid
• Recourse loan: can be paid by debtor’s personal assets in addition to collateral
• Judgment lien: customer receives services/goods given (implied) promise to pay so judgment lien on encumbered property
• Mechanic’s lien: security interest by one who contributed labor or materials to improve, repair, or maintain the property
o Enforceable against any person who subsequently acquires except bona fide purchaser for value without notice (Timmer)
Mortgagee responsibility during foreclosure (1) comply with statutory requirements of sale, (2) good faith, (3) due diligence (Murphy)
Incentives: leverage, limit excessive borrowing, disincentivize waste, prevent windfall
Cases: Timmer v. Gray, Murphy v. Financial Development Corp.
Trusts
Parties in a trust: settlor (grantor), trustee (fiduciary, generally has possession), beneficiary
• When trustee sells for too low, will owe compensatory damages, but if also “dirty,” will owe appreciation damages (Rothko)
• If conditions change such that it is no longer possible to carry out a donor’s intent, courts may use cy pres to reform the trust to
best accomplish the settlor’s intent (Wilber)
• Spendthrift trust: can’t be reached by creditor of the beneficiary
Cases: Rothko v. Reis, Wilber v. Owens
Surfside Condo Disaster
Owned unit in fee simple with joint interest/tenancy in common-like of joint space -> claim to insurance and proportionate interest
7
UNIT SEVEN: THE LAW OF NEIGHBORS
Nuisance
Nuisance: unreasonable interference with another’s use or enjoyment of their property; impacts use or quiet enjoyment
Public nuisance if affects rights enjoyed by citizens as a part of the public, impact considerable number of people or entire community
Balance of harms remedied by permanent damages OR injunction + indemnification
• Permanent damages -> when economic benefit of nuisance is greater than harm (Boomer)
• Injunction + indemnification -> when come to the nuisance or bring others to it (Spur)
Coase: all entitlements of one are a harm to the other, so in the legal system the party with the legal right is generally dispositive;
skeptical of legal interventions, believes will be figured out without transaction costs otherwise
Themes/Incentives: use vs enjoyment, transaction costs, property vs liability rules
Cases: Adams v. Clevelan-Cliffs Iron Co., Boomer v. Atlantic Cement Co., Spur Industries, Inc. v. Del. E. Web Development
Easements
Servitudes: explicit infusion of contract with one other party or with other parcel of land governing interaction(s) of property use
Easement: irrevocable conveyance of right to particular use of land created by grant (in rem features)
Appurtenant: belongs to another parcel (default)
Gross: belongs to individual; if commercial may be transferable
Affirmative: allows to perform action
Negative: demand owner desist from action
Private: authorizes specifically named parties
Public: authorizes general pubic for designated purpose
Negative easements at English CL: (1) blocking sunlight, (2) interference with air flow, (3) interference with water flow, (4) removing
lateral support (only one not abolished)
Create Easements via deed OR
• Implication: act of common grantor or geography caused to be landlocked, necessity should be clear and absolute (Schwab)
• Necessity: right of way over conveyor’s adjacent land because only means of in/egress to important landmarks (Schwab)
• Prescription: (1) openly (2) peaceably, (3) continuously), and (4) under claim of right adverse to owner of the soil, and (5)
with his knowledge and acquiescence, used a way over the lands of another for as much as 15 years (no exclusive req.)
• Estoppel: license becomes irrevocable if made improvements w/substantial expenditures in reliance (Holbrook)
o Requires approval of servient tract or acquiescence + reliance
Terminate Easements via deed, estoppel OR
• Abandonment: test is prolonged nonuse -> absorbed back into whole (want to avoid anticommons)
• Prescription: owner of servient tract blocks easement and dominant owner fails to object before statute runs
• NOT changed circumstances unless (1) covenant is obsolete or (2) changed so no benefit to other landowners (Bolotin)
Test for Misuse: (1) situation of property, (2) surrounding circumstances, (3) purpose of giving effect to intention of parties (Penn);
misuse does not constitute forfeiture, but allows opportunity to cure
Remedies: if encroach on easement, court of equity may order injunction for removal at encroacher’s cost (Warsaw)
Incentives: waste, opportunism, who decides, reduce litigation, preserve the peace
Cases: Schwab v. Timmons, Holbrook v. Taylor, Waraw v. Chicago Metallic Ceilings, Penn Bowling v. Hot Shoppes
Covenants
Covenant: complex management agreements that can be affirmative or negative; no obligations on third parties, subject to SOF; more
contract-like and cannot be created by prescription, implication, necessity or estoppel
Tests for running with the land (look at RC first -> ES -> if none, maybe no covenant):
• Real covenants theory (damages/CL): (1) intent, (2) touch & concern, (3) privity
o Benefit – vertical privity includes voluntary transfers, foreclosure & some other involuntary transfers where notice
o Burden – horizontal & vertical privity; focuses on neighbors on the ground
o Note: privity can exist between property owners and POA as fiduciary (Neponsit)
• Equitable servitude theory (injunction/equity): (1) intent, (2) touch & concern, (3) notice
o Can have explicit notice (Tulk), inquiry/record notice, or constructive notice/duty to inspect (Sanborn)
Touch & concern: substantially alters the rights of parties as landowners (Neponsit, Eagle Enterprise)
Abandonment: habitual and substantial violations, make plan unenforceable & inequitable (Peckham)
Common plan: negative reciprocal easement, recorded on plat by common grantor
Conservation Easement: negative covenants in gross with enforcement rights to third parties for perpetual grants to space/land
Racially restrictive covenants not legally valid (Barrows) nor enforceable (Shelley)
Cases: Tulk v. Moxhay, Neponsit v. Emigrant Industrial, Sanborn v. McClean, Bolotin v. Rindge, Peckham v. Milroy, Shelley v.
Karmaer, Barrows v. Jackson
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Regulating the “Character” of Neighborhoods - Zoning
Benefit: potential to deal with land use externalities; harm: uniformity, opportunism, bureaucracy, administrative costs
Euclidean Zoning: map of community divided into uses (either cumulative or non-cumulative) (Euclid)
Planned Unit Developments: development occurs only by concession of municipality in negotiations with developer
• Limitations on Zoning: conflicting state and federal law, constitutional concerns (spot zoning), political process
• Downzoning generally not acceptable unless reasonable amortization (Harbison)
o Considerations for amortization: (1) length of am. Period, (2) social harm to surrounding owners from continuation of use,
(3) private injury to owner resulting from discontinuance
• Towns must allow reasonable opportunity for appropriate variety and choice of housing (NAACP)
• Rational & acceptable to zone based on definition of family that requires blood, marriage, or adoption relation (Ladue)
Cases: Euclid v. Amber Realty Co., Harbison v. City of Buffalo, Burlington County NAACP v. Mount Laurel, City of Ladue v. Horn
UNIT EIGHT: CONSTITUTIONAL INTERACTIONS
Eminent Domain
Amendment V: “Nor shall private property be taken for public use without just compensation”
Taking Analysis: Is the thing “property”? -> Is the proposed use “public”? -> Did the owner receive Just Compensation?
1. Property -> more likely to be considered property if tracks traditional form under numerus clausus
2. Public use -> Economic development is a valid because long-standing gov. function (Kelo)
a. Broad interpretation of public welfare(Berman, Midkiff)
b. Do not need lot-by-lot basis for economic development plan under eminent domain (Berman)
3. Compensation -> calculate FMV from date of plan if within the scope of the original government plan (Miller)
Quick take statutes: government gets access to the title/property before procedures are over and they decide on an amount for comp.
Cases: Kelo v. City of New London, Berman v. Parker, HI Housing v. Midkiff, United States v. Miller
Regulatory Takings
Regulation gone too far (appropriates/destroys use) is a taking (Mahon)
Formula: property impacted by regulation (excluding compliance costs) / total property pre-regulation = X
Total property determined by: (a) treatment of land under state & local law, (b) physical characteristics of the land, (c)
prospective value of regulated land especially compared to other holdings (Murr)
All/complete value is lost -> just compensation (Lucas Test) - taking per se unless gov. can argue it was a nuisance at common law
If some value is lost -> regulatory taking (Penn Central Test)
Factors: (1) extent of dimunition, (2) interference with investment-backed expectations (occurrence of risk not a disturbance),
(3) nature of government action (physical invasion vs. adjustment of benefits/burdens)
Now under Cedar Point – when third parties have “right to take access” -> appropriating right to exclusion -> per se physical taking
and move to just compensation
Academic Perspectives:
• Michelman: demoralization cost, erosion of public trust without compensation
• Epstein: disturbance of property; hard line so that every time it is disturbed the government should pay
• Evmore: concentration of harm; pay when harm is concentrated on one for benefit of the public
• Kaplaw: cost internalization
Constitutional limits on takings: Contracts Cl. (Art. I Sect. 10) (Mahon), Am. V & 14 Due Process Clauses
Cases: Pennsylvania Coal Co. v. Mahon, Penn Central v. City of NY, Murr v. Wisconsin, State v. Shack, Cedar Point Nursery
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