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OUTLINE DETAILS:
School:
Harvard Law School
Course:
Property
Year:
Fall, 2004
Professor:
Charles Donahue
Text:
Cases and Materials on Property: An Introduction to the Concept and the Institution
(American Casebook Series), 3rd Edition
Text Authors: Charles Donahue, Thomas E. Kauper, Peter W. Martin
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Page 1 of 74
Property – Professor Donahue – Harvard Law School – Fall 2004
1. Acquisition of Property – how do you acquire property? (Right of Possession)
a. First-in-Time Rule: fundamental rule of ownership – first person to take possession of a thing owns it (rule
of capture).
b. Rule of Capture: prior in time wins; first person to take possession of a thing owns it. prior possessor
prevails over a subsequent possessor.
i. Occupation Theory vs Labor Theory
1. occupation theory: possession = ownership. (see Hobbes, Puffendorf, Justinian,
Blackstone)
a. what individual can take out of common stock she has a right to.
b. individual based theory – go out and claim your property, possess it, defend it.
c. protect first / current occupant – easy to apply and to enforce
2. labor theory: investment = ownership – want to reward person that invests labor (see
Barbeyrac, Locke)
a. protect acquisition and, by so doing, protect the effort they put into the property.
3. generally: the occupation theory seems to win out in the courts (i.e. Pierson)
ii. Wild animals: animals ferae naturae must be captured to be owned; mere chase is not enough
1. capture not pursuit required (Pierson v Post)
a. rationale: foster competition; easier rule to administer.
i. competition – society’s objective is to capture (i.e. foxes to get rid of them);
rewarding captor fosters competition by bringing more than one person into
pursuit. increased rate of capture.
ii. ease of administration – capture is an objective act; pursuit is hard to define.
public policy concern – want to keep lawsuits down by making bright-line
rule.
b. note: a wounded or trapped animal where capture is virtually certain is considered
captured; if animal could still escape then it is still pursuit. (see Justinian)
i. EX: can’t argue in Pierson v Post that capture was virtually certain – P was
still in pursuit. hadn’t even wounded the fox yet.
c. note: custom may sometimes supercede the rule of capture (as dissent in Pierson
argues, and as is the case in whaling industry)
2. Interference by noncompetitor not allowed (Keeble v Hickeringill)
a. rationale: a competitor may interfere but not a noncompetitor – the goal is to
encourage capture.
i. EX: Keeble puts out decoys in pond to attract ducks. Hickeringill cannot fire
his guns to scare ducks away.
ii. but he could shoot ducks flying over his land to capture for his own use.
3. Regulation by State (Commonwealth v Agway)
a. rationale: game laws / regulations prevent overkill, preserve natural resources.
i. fictional argument that state owns wild game and can prevail over
subsequent possessor (this argument didn’t succeed in Agway and action for
trespass failed)
ii. better argument – state has power to regulate game under its police power –
can prevent conduct harmful to public.
iii. Discovery of America (Johnson v M’Intosh)
1. rule: US has possession of America either by (a) discovery (land first ‘possessed’ by
Europeans, transferred to US) or (b) by conquest.
2. Indians may have had possession but that is not the same as power to convey – power to
convey is a matter of positive law; depends on jurisdiction (i.e. what is allowed by US
courts). Thus, Indians could not convey land that they possessed; US retains title.
3. subsequent: congress not the courts have decided whether Indians have right to comp for
property
4. see also US v Percheman – case discussing jurisdiction, whether US courts must respect
private property held under a prior sovereign.
iv. Caves: landowner owns the earth below his surface – property rights ‘from heaven to hell’.
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1. cave extending under two or more surface tracts does not belong to discoverer (who is
regarded as trespasser below other lots) or to owner of entrance. Cave ownership is divided
proportionally to surface ownership.
a. EX: Edwards v Sims. majority theory is segmented ownership (this is the rule).
dissent’s theory is to allow joint or co-ownership – either can develop or make use
of cave, they just need to share the profits.
2. Profit Sharing (Edwards v Lee’s Administrator) – each surface owner entitled to a share of
the process
a. in Edwards suit is for restitution, Lee to recover unjust enrichment by Edwards
b. discounted present value (pg 37) used to calculate award
3. criticism: doesn’t strictly follow capture rule (give ownership to owner of entrance) and is
less efficient.
a. Res Nullius Theory – nobody owns it until somebody finds/explores the cave.
i. access theory: possession is to person who owns mouth of cave
ii. explorer theory: possession is to one who invests in cave (labor theory)
b. Regalian Rights Theory – this theory ultimately prevails in Edwards – go to gov’t
because they can make best / efficient use of land.
c. Acquisition by Creation:
d. Acquisition by Find:
e. Acquisition by Adverse Possession
i. General – if a landowner does not bring action to eject AP w/in statutory period then TO is barred
from later bringing ejectment. AP is now the owner.
1. rationale: want to encourage productive use of land; if TO has been around for SOL period
and not making use of the land (or objecting to AP’s use) then let AP claim title.
a. relatively better possessory title: foundation of ownership in our property system is
relatively better possessory title – AP is the one in possession, not TO.
i. AP has right of possession good against the whole world after SOL expires;
even before he has right of possession good against rest of world provided
he can show relatively better possessory title.
b. protect true owner: AP serves to protect title and TO. If title is difficult to prove AP
can help secure it.
i. virtually no titles that don’t have some problem in the chain if you go back
far enough. protects deficient titles and bars stale claims against current
possessor. (Ballantine view)
ii. protect expectations of actual possessors / owners – quiet title on basis of
productive use. protect what has become a part of somebody through
continued possession / use (Holmes view)
1. related to Hegel and theory of will – don’t want to diminish
individuals. want to protect investment of will.
c. discourage lawsuits: discourage suits that reach far back in time – should have
brought it earlier. punish the laches of TO. (less heavily emphasized than (b))
2. marketable title / recording: title acquired by AP cannot be recorded; must file a quiet title
action against former owner (now barred by SOL) to gain legal title. Necessary to give AP a
marketable title.
ii. Requirements for AP:
1. Actual Entry giving exclusive possession
a. trigger the cause of action and start SOL running
b. constructive adverse possession – may be implied from entry onto part of the land
c. exclusive – cannot be sharing with owner or with public generally
i. there may be other people on the land but exclusivity must at least be an
option – rationale: owner’s have the right to exclude
ii. note: it is possible for private individuals to AP as tenants in common (EX:
pg 26)
2. Open and notorious
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a. must occupy in an open, notorious, and visible manner. Acts must provide
reasonable notice to TO of AP. i.e. Acts that look like typical acts of an owner (as
observed by community).
b. Acts must be appropriate to land, thus depend on the context.
i. EX: Farmland: fencing, cultivating, and erecting building on farm land (See
Jarvis v Gillespie)
ii. EX: Wild, undeveloped land: can still be AP.
1. See Alaska National Bank v Linck – Erecting a hunting cabin and
using the land regularly during hunting season.
2. Paying taxes on the land, selling timber, executing oil leases, etc.
iii. EX: City land – totality of acts must clearly show dominion
3. Adverse and under a claim of right
a. adverse or hostile – possession must be w/out owner’s consent. poss. cannot be
subordinate to owner. (See Peters v Juneau-Douglas – permission negates claim of
right)
b. under claim of right
i. objective test (Donahue prefers) – actions of possessor are what matter; need
to look like the owner. AP’s state of mind is unimportant.
1. Must look like AP to community even if there is no actual claim to
title. Important is occupying land w/out permission.
2. even if you say you aren’t making a claim if you are acting as an
owner and possessing w/out permission you are legally AP.
ii. subjective test – AP must have a bona fide or good faith belief that he has
title. Mere squatter cannot be AP.
1. mistaken belief –minority of states hold that if possessor mistakenly
believes he has title but would not claim title if he knew then no AP
(EX: boundary disputes)
2. criticism: subjective test encourages honest neighbors to allow.
objective test is cheaper to administer and more reliable than
subjective.
iii. Color of Title – claim founded on written instrument which is defective and
invalid.
1. not required in most states
2. note: distinguish color of title (claim based on written instrument)
from claim of title (belief in title, used to express necessary
adversity).
iv. Boundary Disputes:
1. estoppel: if a party makes positive representations or conduct
indicating location of boundary, and the other party relies, then
actual owner is estopped from denying his statements. has also been
applied when TO remains silent in the face of substantial
expenditures.
2. Mistaken Improver: A erects a building (or part) on B’s property by
mistake. B discovers this before the SOL has run so A does not AP.
a. common law: B can force A to remove the encroachment.
i. See Geragosian v Union Realty: B entitled to
injunctive relief even though he has not lost
anything – would be no claim for monetary
damages. issue injunction and allow A to buy its
way out of the injunction – transfer some monetary
benefit to B and save A some money (doesn’t have
to replace drain pipe, remove fire escape). danger of
misallocation of resources if negotiations break
down.
ii. See Peters v Archambault:
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b. modern law: good faith improver may be allowed to pay A
damages to B, or court may award building to B but require
him to pay value to A.
c. note: encroachment must be in good faith.
4. Continuous, uninterrupted possession
a. continuous – requires degree of occupancy that average owner would make.
i. requires AP w/out break in essential attitude of mind; can be continuous
even if considerable intervals where property is not used.
ii. rationale: need to give owner notice that AP is claiming ownership, not just
trespassing.
iii. Seasonal Use – if land is normally used seasonally this will be sufficient for
continuous requirement. Intervals where property not used must be
consistent with the type of property.
iv. Abandonment – abandoning w/out intent to return restarts SOL upon return.
b. Tacking – AP can tack her own period to that of predecessor in interest provided
there is privity of estate between adverse possessors.
i. EX: Belotti – transfer of possession transfers rights, powers, privileges that
AP has; tacks.
ii. note: privity of estate requires transfer to be voluntary. adverse possession
(or ouster) against prior adverse possessor will not tack.
1. ouster – when AP is ousted by X, X cannot tack A’s period of
possession. If A recovers possession from X she can tack her prior
possession onto her later possession, but not the time that X had
possession.
iii. Tacking on owner’s side: AP runs the statute against O and all successors in
interest.
1. interruption by owner – if owner disrupts AP (by using property as a
TO) and regains possession the SOL is stopped.
2. presumption that use of land by owner is exercise of his right to use
it and thus use presumptively asserts ownership (See Mendonca v
Cities Service Oil)
iii. Disabilities of Owner
1. statute may be tolled if owner is disabled and cannot bring claim against AP (i.e. infancy,
mental disability, etc.)
2. note: only initial disability at time of entry tolls the statute; different disability arising
subsequent to entry by AP does not toll; once original disability is removed the SOL runs.
iv. Extent of Land acquired by AP
1. Without color of title: AP only takes possession of land actually occupied or controlled.
2. With color of title – Constructive Adverse Possession
a. good faith claimant under color who actually possesses a significant portion takes
control by AP of everything described in instrument.
b. i.e. constructive adverse possession of remaining portion of land not actually in
possession of.
c. but note: if instrument conveys land of two owners (A + B) but AP is only on A’s
land then AP gets all of A’s land described in the instrument but none of B’s.
rationale: B had no cause of action, was not aware of AP.
v. Interests Not Affected by AP
1. Future Interests (see hypos in notes, pg 24-25)
a. AP does not run against owner of a future interest if entry made when life tenant has
possession (after conveyance).
i. rationale: remainderman cannot bring a cause of action on behalf of the life
tenant; since he has no cause of action his future interest cannot be adversely
possessed.
b. note: if entry is made while original owner still possesses the statute is run against
owner and his successors in interest (i.e. life tenant, remaindermen, etc.).
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f.
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i. champerty – all TO can convey is cause of action (no longer in possession
of land). life tenant and remainderman jointly acquire a cause of action
which must be exercised w/in SOL.
ii. rationale: TO out of possession can only convey right to bring cause of
action.
c. note: if AP conveys LE to W, remainder to C then:
i. AP + W + C can run out SOL – privity of estate
ii. if W runs out SOL and conveys to her 2nd husband (or whatever), C
(remainderman) can bring a cause of action. W is not holding adversely
against C – W can only convey what she had which is life estate.
iii. but note: if conveyance by O (or AP) to W is void for some reason than W is
adversely possessing and C is out of luck (unless C is O’s intestate heir –
then W was not on land adversely (pg 25))
2. Liens, easements, equitable servitudes.
a. AP does not by itself destroy liens, covenants, etc.
b. must actually interfere with these other property interests so as to give holder of
right a cause of action against AP.
3. Governmental Land: generally exempt by public policy from AP
4. generally: SOL only runs on a person who has a cause of action and does not bring suit.
vi. Adverse Possession of Chattels
Remedies of a Possessor
i. Forms of Action:
1. Historical Background:
a. common law: required P to bring suit in appropriate form of action
i. real actions:
1. deal with ‘real estate’ – land not personal property
2. actions to recover land
3. only apply to people claiming a freehold interest in land (i.e. not
peasants, leaseholders, etc.)
b. modern law: highly technical actions largely abolished. general rule: to recover you
need only show that you have a relatively better claim to title than the other party.
2. Actions to recover damages (actions at law)
a. Trespass – injury to possession
i. rule: P must show defendant intentionally or negligentally inflicted direct,
forcible injury to P’s person or property in his possession.
1. EX: Pierson – court does not find valid trespass action because
Pierson did not have possession of the fox.
ii. note: if trespass shown but no substantial harm demonstrated then nominal
damages are given.
iii. Trespass to chattels:
1. P can sue and recover only for the damage done by having
possession disturbed / injured.
2. EX: cow stolen and then recovered. P can sue only for lost milk
while cow was stolen.
iv. Trespass to land: (trespass quare clausum fregit or trespass q.c.f.)
1. action for any forcible interference w/ P’s possession of land
2. P can sue for decrease in value of land / damaged property on the
land.
b. Trespass on the Case (“Case”)
i. rule: for an action on the case P need not allege prior possession. Must only
demonstrate substantial harm.
ii. rationale: developed as an action where one of elements of trespass was
missing.
1. if D’s acts are not immediately injurious but cause indirect or
consequent injury. (EX: nail through cow’s hoof later causes
infenction)
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2. if D has duty to act but fails to do so
3. if injury is to property not in P’s possession
a. EX: Pierson v Post
i. Post sued in action on the case for tortious
interference w/ pursuit. court incorrectly interpreted
it as an action for trespass and considered
possession. this shouldn’t have mattered.
ii. the country lawyer got it right, originally, but Post’s
new layer blew it at SC level by focusing on
possession and not on malicious interference.
b. EX: Keeble v Hickeringill – damages granted to P for D’s
malicious interference (firing his gun) with lawful
occupation (catching ducks).
c. Trover
i. def: suit to recover value of P’s chattel (does not apply to land) that D has
converted (i.e. through sale).
ii. P entitled to full value of chattel at time of conversion; effectively force a
sale from P to D.
3. Actions to recover possession – if P does not want damages (equitable actions)
a. Replevin – to recover possession of chattel; P must allege prior possession or
ownership.
b. Ejectment – to recover possession of land; method of trying title (‘ejectment to try
title) where P alleges prior possession or title to land.
i. do not need to show ownership or title of land; only need to show relatively
better title than D.
ii. EX: Belotti v Bickhart – use ejectment in combination with injunction to
remove encroaching structure and person from land.
ii. Defense of Jus Tertii
1. def: a defense that neither P nor D but a 3P is the TO.
a. actions to recover possession: not allowed as a defense (replevin, ejectment)
i. EX: Tapscott v Cobbs – TO owns, A takes possession then leaves. Then B
takes possession. A sues B in ejectment. A prevails over B even if A is not
TO because A is a prior possessor. Defense of just tertii cannot be used by
B. TO could then sue A in ejectment.
1. rebuttable presumption: possession passes to heirs unless shown
otherwise
2. Tapscott must show Cobbs was not in possession; otherwise all
Cobbs needs to do is show Tapscott is not TO and then his claim as
prior possessor will win.
ii. rule: peaceable possessor has a claim good against all of the world except
TO.
b. actions to recover damages: not allowed as a defense (trespass, case, and trover)
i. EX: B may be liable to both A and TO for damages but cannot raise just
tertii as defense.
ii. rationale: title is difficult to prove; A must not prove he is TO, must only
show he is a prior possessor.
iii. note: if A alleges ownership but cannot prove it then a suit for damages fails
even if A was prior possessor. lesson: don’t allege more than you can prove
(See Winchester v City of Stevens Point)
2. general rule: jus tertii is not a winning defense. Will not be enough to show that other party
is not TO, you must show that you have a relatively better claim to title. (Winchester,
Tabscott)
iii. Measure of Damages
1. Permanent Damages vs Damage to Date
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a. courts are split – some allow prior possessor to recover permanent damages from
subsequent possessor while some only allow mesne profits (damage sustained while
out of possession).
i. permanent damages: upside is that it may fully compensate prior possessor
(who may in fact be TO as well). downside is that it exposes subsequent
possessor to multiple liability. but this can be solved by requiring TO to
recover from prior possessor.
ii. mesne profits –this was the only option available at common law.
1. this makes most sense when P is put back into possession of what
she had before (as with an ejectment)
2. doesn’t make sense when there is permanent damage to the land (as
in Winchester where the dam is not coming down and the land is
flooded)
3. note: action for mesne profits does pass w/ transfer of title – you can
bring an action even if the ouster/trespass occurred before you ever
owned the land. (see class notes pg 155)
2. Life Tenant vs Remainderman
a. majority view: life tenant and remainderman must bring separate actions for
damages. criticism: if remainderman is unborn or not ascertained yet then
wrongdoer may escape some punishment.
b. minority view: life tenant has possessory title and can recover for all damages –
holds amount recovered as trustee for owners of remainder who must sue life tenant
to recover it. Criticism: this restricts remaindermen to relying on life tenant to
representing their interests.
iv. Law and Equity: most jurisdictions law and equity courts have merged and legal remedies (damages)
and equitable remedies (injunction) may be sought and applied in same action.
g. Rights of Owners
i. owner has right to use, transfer, and exclude subject to restrictions
ii. right to exclude is fundamental right of property but it is in tension with the rights of other property
owners.
2. Personal Property – What have you acquired (personal)? (Right of Possession)
a. Bailments
b. Gifts of Personal Property
c. Bona Fide Purchasers of Personal Property
3. Possessory Estates – What have you acquired (land)? (Power to Convey)
a. Introduction and Background
i. Feudal Background
1. The Rule in Shelley’s Case – not on exam
2. Statute of Uses – 1536 – purpose was to restore feudal incidents which were being bypassed.
lays foundation for modern conveyancing and modern trust.
3. rationale: desire to protect lucrative feudal incidents
ii. System of Estates
1. estate: an interest in land that is or may become possessory and is measured by some period
of time.
2. develop standardized system of estates for simplicity – six types of estates (three leasehold,
three freehold) at common law.
iii. Types of Estates
1. Fee Simple – the entire thing; has the potential of enduring forever. absolute ownership.
2. Fee Tail – may also endure forever but ends iff the first fee tail tenant has no lineal
descendants to succeed him in possession.
3. Life Estate – ends with the death of the life tenant.
4. Leasehold Estate – lasts for a fixed time or by agreement between landlord and tenant.
a. term of years – for any fixed calendar period
b. periodic tendency – from period to period until one party gives notice to terminate
c. tenancy at will – so long as both landlord and tenant desire
5. notes:
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a. hierarchy: estates are ranked according to potential duration – longer-lasting =
higher-ranked.
b. personal property: possessory estates and future interests can be created in personal
property.
c. no new estates: any estate created will fall into one of the four categories above.
these are the only four present possessory estates.
iv. Freehold vs nonfreehold estates
1. fee simple, fee tail, and life estate are freehold – freeholder in possession has seisin.
2. leaseholder has only possession.
v. Purchase vs Limitation
1. Words of Purchase – identify person in whom the estate is created
2. Words of Limitation – describe the type of estate created.
b. Fee Simple
i. Fee Simple Absolute – absolute ownership for potentially infinite duration.
1. no limitations on inheritability.
2. cannot be divested, and will not expire on occurrence of any condition.
3. Creation:
a. common law – necessary to use words of inheritance (i.e. “and his heirs”) to create
fee simple by deed. otherwise life tenant assumed. rationale: heir might be a
weakling.
i. “and his heirs” – words of limitation – no present interest in the estate.
b. Modern Law – requirement of words of inheritance abolished. presumed to convey
the largest estate possible in the absence of words of limitation.
4. Alienation:
a. Statute of Quia Emptores (1290) – freehold tenants right to transfer land without
lords consent.
b. Statute of Wills (1540) – fee simple owners right to devise their land. If not devised
(no will) then heirs inherit the land.
5. Determining Heirs
a. See Uniform Probate Code (class notes, Gilbert’s pg 77)
b. Escheat – if fee simple owner dies w/out will and w/out heirs the property escheats
ot the state.
ii. Defeasible Fees
1. Overview
a. fee simple can be defeasible on happening of certain event.
b. Defeasible fees are thus not absolute but are still fee simple because they may
potentially last forever (if event doesn’t occur).
c. rationale: often found in deeds restricting use of land.
2. Fee Simple Determinable – estate automatically ends when some specified event happens.
a. Creation: look to language (i.e. “to A as long as”, or “to A until”) that indicates land
is to revert to grantor on happening of some condition.
i. note: motive or intent to limit is not enough. it must be found in language –
words limiting the duration of estate.
ii. EX: “to A for purpose of being used as a school” is not sufficient
b. Reverter – grantor retains a future interest which is possibility of reveter.
3. Fee Simple Subject to condition subsequent – does not automatically terminate but may be
divested at grantor’s election when condition occurs.
a. Termination – O (or heirs) must chose to exercise power of reentry upon occurrence
of condition. Otherwise the fee simple does not terminate. This is grantor’s option.
b. Creation: look to language (i.e. “upon condition”, “provided, however”) that
specifies a condition with subsequent right of reentry.
c. Implied Right of Entry – future interest created by fee simple subject to condition
subsequent?
i. generally: court will imply right of entry if not expressly retained if words
of instrument are amenable to this interpretation.
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ii. but see Storke v Penn Mutual – court will not imply right of entry when not
in deed – equity will not aid a forfeiture. In Storke, a fee simple on condition
subsequent was created but no right to reentry specifically reserved. Court
will not imply one and the condition subsequent is ignored.
4. Ambiguity:
a. condition subsequent preferred over determinable if language ambiguous.
b. rationale: want to avoid automatic forfeiture (See Storke – “equity abhors a
forfeiture”)
5. Statute of Limitations
a. will begin to run automatically if determinable.
b. does not begin to run until O exercises right to reenter – until then there is no AP.
i. but note: laches or estoppel may be applied to do equity if O does not
exercise right to reenter.
6. Restraints
a. Marriage – restraints on marriage may be struck down if it discourages marriage
7. Fee simple subject to executory limitation – on happening event the fee simple is
automatically divested in favor of a third person.
a. forfeiture interest is in a 3P – that person has an executory interest.
c. Fee Tail
i. background: designed to keep land within the family for succeeding generations. Created by the
STattute de Donis Conditionalibus in 1285.
ii. modern law: abolished in England and in most American states. Traditional fee tail language of “to
A and heirs of his body” is construed to read “to A and heirs” and thus create a fee simple (some
give fee simple absolute, some give fee simple subject to conditions if A has no kids)
d. Life Estate
i. Definition and Background:
1. life estate endures for a period of one or more human lives
ii. Types of Life Estates
1. For life of grantee
2. Pur autre vie – measured by the life of somebody other than the owner of life estate.
3. In a class
4. Defeasible Life Estates
5. Construction
iii. Alienability
iv. Waste – life tenant is entitled to use and enjoyment of land but cannot waste it (i.e. permanently
impair the value of the land)
e. Rule against direct restraints on Alienation
i. Intro and Background - Statute Quia Emptores (1290) – principle that land should be alienable
ii. Types of Restraints
1. forfeiture – if grantee attempts to transfer his interest it is forfeited to another person.
2. disabling – withholds from grantee the power of transferring interest.
3. promissory – provides that the grantee promises not to transfer his interest.
iii. Restraints on a Fee Simple
1. Total Restraints –
a. any total restraint on a fee simple (forfeiture, disabling, or promissory) is void.
Grantee may alienate estate w/out penalty.
b. rationale: restraints on alienation take property out of the market, making it
unusable for best use. concentrate wealth, prevent creditors from reaching assets,
etc. ties up land.
2. Partial Restraionts –
a. older view is that partial restraints (restricting power to transfer to specific persons,
or by specific method, or until specific time) are also void.
b. exceptions:
i. sale with consent of another (i.e. entry into subdivision) is void. See
Northwest Real Estate Co. v Serio – restraint repugnant to fee simple; if you
can’t alienate it you don’t have a fee simple.
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ii. sale to a member of the club – if the restriction on sale has no reasonable
standards for admission (arbitrary) the provision is void.
c. Reasonable Restraints Doctrine
i. modern trend: partial restraints are valid of reasonable – must have a
reasonable purpose and be limited in duration.
ii. EX: Preemptive Option, Sale of a cooperative apartment
3. Co-Tenants – agreement by tenants in common or joint tenants that they will not partition
property is valid if reasonable in purpose and limited in time.
4. Restraint on Use – almost always upheld even though it makes property less marketable by
eliminating prospective purchasers.
5. Racial (or religious, ethnic, etc) Restraints – not valid; equal protection clause of 14th
amendment.
a. See Shelley v Kraemer – judicial enforcement of racially restrictive covenant or
racial restriction (i.e. right of entry) not enforceable by court.
b. Determinable Fee – even though it doesn’t require court action (automatic reversion)
still violates civil rights statutes.
iv. Restraints on a Life Estate
1. Legal Life Estate – life estates are not really marketable (life tenant can die at any time) but
disabling restraints are still not allowed. Forfeiture and promissory estates (which can be
released) are generally allowed.
2. Equitable Life Estate – disabling restraint on an equitable life estate = spendthrift trust.
v. Avoiding the Rule:
1. Leasehold Estate:
a. tied up in the notion of the fee – doesn’t apply to leasehold estates because you don’t
actually own the land.
b. can give a leasehold estate for a long time and place all sorts of restraints on it – give
them economic equivalent of a fee but w/ restraints.
2. Restraint on Use – can be used to effectively limit who land can be alienated to.
vi. note: rule against restraints on alienation applies only to legal interests; restraints on alienation of
equitable interests are valid.
4. Future Interests
a. Introduction and Background
i. future interest – nonpossessory interest capable of becoming possessory in the future. presently
existing but not presently possessory.
1. vested interest – no precedent condition to be met for the remainder to become possessory
other than expiration of preceding estates. vested does not mean possessory, indeed may not
become possessory for a long time.
ii. Retained by the grantor
1. reversion – future interest left in G after G conveys a vested estate of a lesser quantum. (i.e.
life estate)
2. possibility of reverter – G conveys a determinable estate of same quantum (i.e. fee simple
determinable)
3. right of entry – G creates an estate subject to condition subsequent and retains right of
reentry. (i.e. fee simple on condition subsequent)
iii. Retained by grantee
1. Remainder – future interest that (1) has capacity of becoming possessory at expiration of
preceding estate(s) and (ii) cannot divest prior estate(s).
2. Executory Interest – future interest in grantee that must divest a prior estate OR spring out of
grantor in order to become possessory.
a. c.f. remainder – remainder never divests a prior estate, executory interest almost
always does.
b. first authorized by Statute of Uses (1536)
c. Shifting Executory Interest – divests the prior estate.
d. Springing Executory Interest – springs out of G’s estate.
iv. Legal vs Equitable – unless created in a trust all future interests will be legal.
b. Reversion – left in G after she conveys vested estate of a lesser quantum than she has.
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i. conservation of estate - If not expressly retained reversion arises by operation of law.
ii. note:
1. Common Law: reversions cannot be divested. Once land reverts to G nothing can get it out
of him other than subsequent conveyance. Future interests that have not yet fallen in are out
of luck.
2. Modern Law: reversion can be divested. No destruction of future interests (see below).
iii. note: reversions are always vested. will fall in on expiration of preceding estates unless it is divested
(in which case reversion is gone) at modern law. rationale: allows reversions to be alienable (also
reachable by creditors) and not subject to RAP.
c. Possibility of Reverter - G carves out of her estate a determinable estate of same quantum. (almost always a
fee simple determinable) will be implied if not expressly retained
i. Alienability:
1. not alienable inter vivos at common law (though it could be released). rationale: only a
possibility, not something that could be transferred. but did descend to heirs upon death.
2. freely alienable at modern law. rationale: possibility of reverter now viewed as property
interest.
ii. Termination (see below)
d. Right of Entry – when G creates an estate subject to condition subsequent and retains power to cut short or
terminate estate (almost always a fee simple subject to condition subsequent)
i. Alienability:
1. not alienable inter vivos at common law, treated as a chose in action. could be released or
inherited.
2. modern law: alienable in some states, some states follow common law, some states say
attempt to transfer right of entry destroys it.
ii. Termination:
1. common law: right of entry or possibility of reverter could endure indefinitely and not
subject to RAP.
2. modern law: most states follow common law though some enact statutes limiting the period
they last.
e. Remainder –
i. Definition:
1. future interest in grantee capable of becoming a present possessory estate on expiration of a
prior possessory estate
2. note: remainder must be created in same conveyance as estate which it will succeed.
3. remainders do not divest or cut short preceding estate – waits for it to expire.
ii. Essential Characteristics
1. must have a proceeding possessory estate in the same interest. Cannot arise by operation of
law.
2. must follow a fee tail, life estate, or term of years – cannot follow a fee simple.
3. must be capable of become possessory on natural termination of preceding estate.
iii. Estates in Remainder – remainder may be a fee simple, a life estate, a term of years (or fee tail if
allowed).
iv. Vested vs. Contingent Remainders
1. Vested Remainder – created in an ascertained person and not subject to any condition
precedent. Must be able to fall in immediately upon termination of preceding estate.
a. Indefeasibly vested remainder – holder of remainder is certain to acquire a
possessory estate at some time in the future and is certain to be entitled to retain it
permanently.
b. Vested remainder subject to open – class remainder if one person is qualified to take
possession but class is not yet closed.
c. Vested remainder subject to divestment – subject to being divested by a condition
subsequent or by an inherent limitation of estate in remainder.
2. Contingent Remainder – either created in an unascertained person OR subject to a condition
precedent.
a. disfavored at common law – (i) destruction of contingent remainders, (ii) Rule in
Shelley’s Case, (iii) Doctrine of Worthier Title, (iv) Rule Against Perpetuities
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f.
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i. preference is for vested remainders
ii. See Browning v Sacrison – presumption of early vesting if ambiguous.
rationale: quickens commerce, facilitates alienability.
b. reversion in O whenever there is a contingent remainder created.
i. alternative contingent remainders: can still create reversion in O if it is not
clear which contingent remainder will fall in (or if both fail to satisfy
conditions at the same time)
c. note: termination of estate is not a condition precedent.
3. Condition Precedent vs Condition Subsequent
a. look to language / words of instrument – if the condition is incorporated into
description of the interest then it is a contingent remainder (subject condition
precedent). if condition divests an interest (i.e. comes in a following clause) then it is
a vested remainder (subject to condition subsequent).
v. Class Remainders:
1. if no members of class at time reversion kicks in then hold class open then each new class
member gets a present possessory interest subject to the possibility that they will have to
share (i.e. with future siblings)
2. if there is at least one member of the class at expiration of estate (remainder kicks in) then
rule of thumb is to cut off possibility of further open (future siblings out of luck). partial
destructibility
3. rationale: don’t like to keep estates open. if it can be closed shortly after death of life tenant
than do so. If it is going to need to be kept open anyway (i.e. no actual remainders born yet)
then keep it open until class is complete.
4. note: these general rules of thumb can be altered by explicit intent of G.
vi. Alienability:
1. common law – vested remainders alienable and devisable; contingent interests (contingent
remainders and executory interests) not alienable inter vivos except (1) for valuable
consideration or (2) by estoppel or (3) when released.
2. modern law: contingent interests alienable inter vivos in many jurisdictions today. note: if
interest is contingent because it is to unborn person then it is not alienable.
Executory Interests
i. Historical Background of Uses
1. the use
a. ownership of property vested in a person (feoffee to uses) who would hold it for use
and benefit of another (i.e. owner absent, fighting a crusade)
i. feofee to uses was seised of property by the feoffment from O
ii. cestuis que use – beneficiaries of the use / feoffment.
b. originally not enforced in common law courts but were enforced in equity
c. note: comparable to modern notion of trustee / beneficiaries.
2. Common Law Conveyance before Statute of Uses
a. livery of seisen required – ceremony; feoffment must be performed on the land.
i. capable of bypass in equity
b. No Springing Interest - ) could not create a freehold estate w/out conveying seisin
(which could not spring out in the future)
i. capable of bypass in equity
c. No Shifting Interest – O could not derogate from his grant to A.
i. capable of bypass in equity – chancellor allowed shifting interests.
3. Creating a Use
a. feoffment to uses raised a use
b. bargain and sale – for consideration
c. covenant to stand seised for the use of a relative raises a use
4. Statute of Uses (1536)
a. much of England held in use; holder of use had no seisin and feudal incidents only
due when seisin passes – so not much in the way of feudal incidents collected.
b. Statute – abolished uses in order to revive crown’s feudal incidents. Mandated that
anybody having a use was also deemed to be in seisin.
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5. Effects of Statute of Uses
a. Makes possible Springing and Shifting Interests – executory interests
b. no longer necessary to raise a use – implied where necessary to carry out intent of
parties.
c. effectively abolishes feoffment / livery of seisin – can now transfer title by deed
i. SOF (1677) enacted, requiring written instrument. Makse livery of seisin
obsolete unless accompanied by written instrument.
d. Gives Rise to Trusts
e. Destructibility – at common law after statute of uses contingent remainders are
destructible but executory interests are not.
ii. Springing Executory Interest – springs out of the grantor at a subsequent date; divests grantor.
1. See Abbot v Holway
iii. Shifting Executory Interest – future interest in a grantee that divests a preceding estate in another
grantee prior to natural termination; divests grantee.
iv. note: future interest in grantee following fee simple determinable is neither springing not shifting –
nothing is divested, it simply succeeds the estate.
g. Rules Restricting Contingent Remainders (mostly abolished)
i. Common Law Rule: contingent remainder in land is destroyed if it does not vest at or before the
termination of the preceding freehold estate.
1. only applies if preceding estate is fee tail or life estate. does not apply to leasehold (no
seisin)
2. note: life estate can terminate before death of life tenant (i.e. forfeiture, merger)
3. note: destructibility due to gap in seisin does not apply to vested remainders or to executory
interests.
ii. Avoiding the Rule: create either (1) a term of years or (2) trust) to avoid the rule.
iii. Types of Destructibility:
1. common law: three kinds of destructibility:
a. failure to fulfill condition at all – still exists at modern law.
b. failure to fulfill condition at expiration of preceding estate - if contingent remainders
not satisfied prior to expiration of preceding estate then destroyed – abolished at
modern law unless expressly written into instrument.
c. by merger – interest of life tenant combined w/ interest of reversion to destroy
contingent remainder - abolished at modern law.
2. modern law: abolished most destructibility: no default destruction of contingent remainders.
reversion to G/O but create a fee simple subject to being divested.
a. contingent remainder can take effect if condition is met either before or after
expiration of prior estate.
b. note: allows conveyance of contingent remainder (not allowed at common law) but
conveyance does not destroy the condition.
iv. Rule in Shelley’s Case – abolished in most states (pg 135 Gilbert’s)
v. Doctrine of Worthier Title (pg 141 Gilbert’s)
h. Rule Against Perpetuities
i. Historical Background
1. Statute Quia Emptores (1290) – promotes idea of free alienation of property. gives freehold
tenants right to transfer land w/out lord’s consent.
2. Tension: landed aristocracy trying to keep land in the family, judges trying to make sure land
is alienable. trying to defeat the dynastic urge.
3. RAP – foundation laid in Duke of Norfolk’s Case – applies to all contingent future interests
(contingent remainders as well as executory interests). rationale: limit control of the dead
hand.
ii. Rule: 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.
1. Interests governed by the rule:
a. applies to contingent interests, not to vested interests (i.e. all grantor’s interests
(reversions, possibilities of reverter, rights of entry) always OK under RAP because
they are always vested).
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i. rationale: conservation of estates; must have a safe haven to dump property
– this is estate of grantor/testator.
ii. executory interests: are never vested as interests; vest only when they
actually become possessory or when they fail.
b. class gifts exception: gift to a class is not vested in any member of the class until the
interests of all members have vested. all or nothing rule.
i. a remainder vested subject to open may not be vested under RAP.
ii. rationale: not marketable until all class members are known and have vested
interests.
2. Possibility not Actuality/Probability: apply the what might happen test – any possibility that
the RAP is violated then the interest is void. do not wait and see what actually happens; do
not consider what is likely to happen.
a. most prove it is logically impossible not to vest in time. any possibility of remote
vesting is void.
b. must necessarily vest or fail within the period – must be resolved one way or
another.
3. Life in Being – look for the validating/measuring life
a. relevant lives – only those who can affect vesting – ignore all others. generally these
lives are those mentioned in the grant.
b. validating life must be a person alive at the creation of the contingent interest (i.e. at
testator’s death, date of conveyance, etc.)
i. note: child in womb is treated as a life in being. include gestation periods
w/in permissible perpetuities period.
ii. note: measuring life does not need to be a beneficiary.
iii. Examples and Remote Possibilities (pg 58 in notes, and in Gilbert’s 151)
1. general example: grant to grandchildren of a living person will violate RAP
2. Fertile Octogenarian
3. Unborn Widow
4. Slothful Executor / Administrative Contingency
a. See Ryan v Beshk
5. Precocious Toddler
6. Fortuitous Adoption – similar to unborn widow
iv. Applying the RAP
1. strike out all void interests and read the document as it is now written.
2. avoiding the RAP – exceptions:
a. since rights of reverter are exempt use two deeds to establish a right of reverter in a
3P who would normally have an executory interest (Gilbert’s 153)
b. gift from one charity to another charity – exempt from RAP. both possessory estate
and future interest must be charities.
c. term of years: executory interests following term of years not subject to RAP.
rationale: otherwise you could not convey an interest following a term of years
longer than 21 years.
d. Brown v Independent Baptist Church of Woburn – T grants to church, executory
interest to A. Residuary clause to B. Court rules that possibility of reverter in
testator passes to B under residuary clause. This is logically false – assumes T died
twice or else it is creating a property right in a dead person. Most cases go the other
way, don’t allow possibility of reverter to pass under residuary clause, passes instead
to T’s heirs.
i. rule: possibility of reverter cannot be created in a transferee/grantee.
3. Application to Options – preemptive options not subject to RAP (notes pg 67)
v. Wait-and-See Doctrine - modern approach to reform the RAP – validity of interests judged by actual
events as they happen
1. for the perpetuities period: measured by the lives that can affect vesting plus 21 years.
2. for ninety years: if contingent interest satisfies the what-might-happen test of common law
or actually vests w/in 90 years it is valid under Uniform Statutory Rule Against Perpetuities.
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3. criticism: (1) don’t know whether or not interest is valid or void and (ii) extends the dead
hand and allows tying up of wealth.
vi. Cy Pres Doctrine – “as near as possible.” Reform an invalid interest w/in limits of RAP to
approximate the interest of the creator of interest. (EX: reduce age contingencies to 21 years)
1. can be coupled w/ wait-and-see doctrine.
vii. Justifying the Rule Against Perpetuities
1. Economic Arguments
a. bad idea to remove property entirely from market forces – want it to go to highest
and best use. efficiency.
b. hold-out problem: interests that become effective a long time from now because
holder of interest still needs to be bought off; value of his interest is small but holdup value is high.
c. transaction costs: more people / interests you have the harder it is to get everyone to
agree. critique: RAP is a crude way of addressing this.
2. Policy Arguments:
a. prevent the creation of familial dynasties. but, isn’t this what estate and gift tax is
supposed to do?
b. tension between desire of present generation holding wealth to provide for future
generations and desire to limit control of dead hand. rationale: dead hand can’t
anticipate what will happen beyond the lives in being (people that they know) + 21
years (allow them to reach age of majority)
c. RAP seems to be a reasonable way to address this tension.
i. Trusts
i. two generally agreed upon propositions:
1. spendthrift trusts: where they are legal they cannot last longer than the perpetuities period
a. def: beneficiary of a trust cannot pledge his beneficial interest.
2. irrevocable trusts: irrevocability feature cannot last longer than perpetuities period.
3. charitable trusts: not subject to RAP for most purposes.
5. Concurrent Ownership and Marital Rights
a. Tenancy in Common
i. Nature of the Tenancy: concurrent ownership where each co-tenant os owner of a separate and
distinct share of the property (which has not been divided among co-tenants). Each owner has a
separate undivided interest in the whole property.
1. Creation: by devise, express conveyance, or inheritance.
2. Right to Possession: each tenant has right to possess and enjoy the entire property subject to
same right of other tenants. One co-tenant can go into possession of the whole unless other
objects. if they can’t agree on possession court may partition the property.
3. No Right to Survivorship: interest passes to devisees or heirs at death of tenant; does not go
to surviving tenant. note: this is the chief distinction between joint tenancy.
4. Equal Shares not necessary: presumed that shares are equal but this presumption can be
overcome if unequal shares were intended and can be demonstrated.
5. Same Estates not necessary: tenants in common may have different types of estates (i.e. life
estate and fee)
ii. Alienability: tenant in common can sell, give, devise, etc. her undivided share as if she were sole
owner.
iii. Presumption of Tenancy in Common:
1. at common law there was a presumption of joint tenancy – if nothing further is said than a
joint tenancy is created.
2. at modern law the presumption is for a tenancy in common. Presumption can be overcome
by evidence. to get a joint tenancy the grant must expressly indicate this.
a. note: if tenants are husband and wife the presumption is for tenancy by the entirety
in jurisdictions that recognize that estate.
b. Joint Tenancy
i. Nature of the Tenancy: form of concurrent ownership wherein each co-tenant owns an undivided
share of property (see tenancy in common) with right of survivorship. No limit to number of joint
tenants – tenant who lives longest takes the entire property to himself.
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1. Creation: conveyance or devise required or can be created by joint adverse possession. does
not arise where persons inherit property.
ii. Four Unities Requirement
1. Fiction of One Entity – joint tenants regarded as composing one entity (fiction) and each, in
theory, owns the undivided whole of the property.
a. rationale: when one joint tenant dies noting passes to surviving joint tenant, estate
simply continues minus one joint tenant.
b. important consequences for inheritance taxes (similar to feudal incidents), etc.
c. no right to devise: joint tenant’s interest vanishes at death, so it cannot be devised.
2. Four Unities – common law requires that their interests be equal in all respects. If four
unities (time, title, interest, and possession) are not present than a JT cannot be created.
default is tenancy in common in most states.
a. Unity of Time – interest of each joint tenant must vest at the same time.
b. Unity of Title – joint tenants must acquire title by same deed or will, or by joint
adverse possession.
i. common problem: conveyance by G to G + another party as joint tenants
(i.e. from H to H and W as JTs) – this violates the unity of time and title
because one person cannot convey to himself (common law rule). thus there
is a tenancy in common created.
ii. solution: use strawperson (i.e. lawyer’s secretary) to get around this.
iii. modern law: abolishes this problem by statute in many states.
c. Unity of Interest – interest of each joint tenant must be equal in an estate of one
duration. otherwise tenancy in common created.
i. Equal Shares – required in addition to equal duration. tenants hold in equal
shares but upon partition the proceeds may be divided in accordance with
proportionate consideration paid (in equity only).
ii. Another Interest in same property – property can be divided into fractional
shares, one of which may have tenants in common, and the other may have
joint tenants. between the two halves the groups will be tenants in common
(no right of survivorship).
d. Unity of Possession – each joint tenant required to have right to possession of the
whole. JTs can agree that one has right to exclusive possession after creation (this
does not violate unity of possession).
3. Creation of Joint Tenancy
a. Presumption at Common Law – any conveyance or devise to two or more persons
(other than H + W) created a joint tenancy, subject to evidence of contrary intent.
i. rationale: favors sole ownership over multiple ownership (for feudal
reasons); easier for lords to collect/enforce incidents. reduced amount of
incidents owed (only one owner).
ii. H+W – presumed at common law to take as tenants by the entirety.
b. Modern Law – presumption of joint tenancy abolished; modern presumption is for
tenancy in common.
i. H+W – in some states still presumed to take by entirety; in others in
common; still in others as JTs.
ii. Distinguish – executors and trustees – presumed to hold as joint tenants,
even under modern law. rationale: Don’t want heirs of executors getting
involved.
c. Overcoming presumption of tenancy in common – JT can only be created by express
words in instrument (i.e. “joint tenants w/ right of survivorship, not as tenants in
common”) – anything less might not work.
i. survivorship may need to be expressly provided for in some states
ii. “jointly” may be ambiguous – often used to refer to tenancy in common
iii. some states have abolished joint tenancy –
1. create a tenancy in common w/ remainder in fee to survivor instead.
result: survivor’s remainder cannot be destroyed w/out consent (c.f.
right of survivorship)
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2. see Holbrook v Holbrook – in a joint tenancy the survivorship
remainder can be severed; it cannot be defeated if you have
alternative contingent remainders.
4. Severance of Joint Tenancy – any joint tenant can destroy right of survivorship by severing
the joint tenancy; tenancy then becomes a tenancy in common
i. common law – severance occurs automatically when any of four unities is
severed.
ii. modern law – generally follows same rule but may look to intent of parties.
b. Conveyance by a joint tenant – severs JT w/ respect to joint tenants share (but other
joint tenants may still have a JT between them)
i. EX: A, B, C are JTs. A conveys to D. D now owns 1/3 as tenant in common
w/ B, C (who remain joint tenants between themselves). If B dies, C owns
2/3 and D owns 1/3 and they are tenants in common.
ii. see Giles v Sheridan
iii. contract to convey or conveyance to self may destroy JT.
iv. note: wills do not take effect until death so a will does not sever a JT.
c. Lease by joint tenant
i. common law – lease severs JT
ii. modern law – lease does not sever
d. Agreement to exclusive possession – does not sever joint tenancy; look to intention
not to four unitites.
e. Murder of one joint tenant by another – effects a severance, converting JT into
tenancy in common. Murderer is thus not entitled to victim’s share by right of
survivorship.
f. Simultaneous Death – property is divided between applicable estates.
c. Tenancy by the Entirety
i. Nature of the Tenancy: form of concurrent ownership created only between H + W, holding as one
person. Just like joint tenancy but it introduces a fifth unity (marriage) in order to be created.
Surviving spouse has right of survivorship.
1. fiction of one person – H+W considered in law to be one person. reflects realties of English
common law.
2. severance by one tenant impossible – neither tenant acting along can destroy right of
survivorship.
ii. Creation of Tenancy by the Entirety:
1. English Common Law – impossible for H+W to hold as anything other than tenancy by
entirety. abolished under modern law – allow H+W to take as joint tenants or as tenants in
common.
2. Modern Presumption – if ambiguous presumption in most states is for tenancy by the
entirety. Can be rebutted by evidence.
3. Conveyance to unmarried persons – no tenancy by the entirety; either in common or joint
tenancy presumed depending on state.
iii. Rights of Tenants During Marriage:
1. English Common Law – heavily favors husband
a. H’s rights
i. exclusive right to possession and all rents and profits while tenancy endured.
could convey this right to 3P.
ii. right of survivorship – H has right to entire property if he survives; can
transfer this right to 3P.
b. W’s right of survivorship – if she survives the husband; only right the W has.
i. could not be destroyed w/out wife’s consent
ii. remained w/ wife even after H conveyed his entire interest in the property
iii. not alienable by W w/out H’s consent – therefore not reachable by creditors.
c. No right to partition the property
d. Curtesy
i. jure uxoris (in the right of the wife)
1. right to rents and profits
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2. alienable executable
3. need W’s consent to convey more than this estate
4. ceases upon death of either H or W or on divorce if no children have
been born
ii. curtesy initiate – upon the birth of a child
1. applies to lands of which wife is seised
2. larger estate – lasts for life of husband
iii. curtesy consummate – solely seized of life estate in all of W’s lands if W
dies first.
e. Dowery
i. dower – an estate for life in one-third of the lands of which her husband was
seised of a beneficial interest during coverture in fee simple or fee tail, of
which the issue of the marriage, whether or not there were issue, might have
been heir (437)
ii. inchoate – not a transferable interest and gives W no right of action
iii. on H’s death W acquires no seisen – only right against H’s heirs to have 1/3
of land assigned to her; after assignment she is life tenant w/ transferable
and defendable interest.
2. Modern Law
a. Married Women’s Property Act – remove common law disability of married women
to control and dispose of their property.
i. married woman may receive, hold, manage, and dispose of real and personal
property as if she were a single woman.
b. Act forbids either spouse to convey separately – majority view (generally found in
West – debtor states)
i. both H + W have equal right to possession during marriage
ii. forbid H or W, acting alone, to convey his or her interest (protection from
creditors)
iii. rationale: protect the family home from assignment and from creditors
c. Act gives W same rights H had – minority view (generally found in East – creditor
states)
i. W acquires right to possession of ½ and the right to convey her interest in
the same manner as H.
1. Creditors can reach H or W’s interest
ii. neither spouse can destroy right of survivorship of the other.
3. Spousal Share
a. rather than taking dower or curtesy the surviving spouse could opt to take a
percentage of the estate. rationale: prevent disinheriting of surviving spouse.
irregardless of what will says, spouse will still get a percentage.
b. spousal share virtually universal in common law property states (but does not exist
in community property states – spouse gets ½ of community property)
4. Current Status – not recognized in many states. rationale:
a. common law unity of H + W repugnant to modern ideas of marital relationship.
b. tenancy by the entirety abrogated by Married Women’s Property Act.
c. community property states – inconsistent w/ underlying equality principle.
5. Trends:
a. even in common law states you have a tendency to attempt to create property
division upon divorce
b. community property tendency – look at assets accumulated during marriage and split
down the middle.
c. move toward community property system even in states that purportedly don’t have
community property.
d. Donahue – argues in favor of community property; encourage couples to work
things out…
d. Rights and Duties of Co-Tenants
i. Introduction
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ii.
iii.
iv.
v.
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1. rights and duties more or less the same regardless of type of co-tenancy
2. generally a mess – basic propositions are not followed everyplace.
Possession by One Co-Tenant – each tenant equally entitled to possession and enjoyment of entire
co-tenancy property. may not exclude other co-tenant. What happens when one goes into exclusive
possession?
1. Agreement by parties to allow exclusive possession OK; encourage parties to resolve this for
themselves.
2. Accounting for reasonable rental value by co-tenant in possession
a. Majority Rule – exclusive possessor (A) only required to pay other co-tenant (B) if
B has been ousted (excluded) or A agreed to pay B or A is in a fiduciary relationship
to B.
i. rationale: promote productive use of property; reward possession.
ii. Carrying Charges – A must pay ordinary expenses of upkeep (taxes,
mortgage interest, repairs, etc) but can seek contribution if these exceed the
fair rental value.
1. A will also be credited for more than his proportionate share in an
accounting or partition.
iii. Ouster – ousting co-tenant must pay the other his share of reasonable rental
value of property.
1. ouster deprives other co-tenant of possession – refuses to admit
them.
2. remedies: ousted co-tenant can bring suit to collect share of
reasonable rental value (suit for mesne profits) or to partition.
a. mesne profits – reasonable value of the land (while out of
possession); not the profits actually made.
b. note: action for mesne profits does pass w/ transfer of title –
you can bring an action even if the ouster/trespass occurred
before you ever owned the land. (see class notes pg 155)
b. Minority Rule – A must account to B for B’s share of reasonable rental value, even
if there is no ouster.
i. rationale: places burden on occupying co-tenant to show agreement not to
pay. induces private agreement between co-tenants.
ii. Carrying Charges – occupying co-tenant is accountable for her share of the
net reasonable rental value after deducting upkeep expenses.
3. Account for Rents Received from 3P – must be shared equally w/ all co-tenants. Established
by Statute of Anne (1704).
4. Exploiting Natural Resources
Reimbursement of Co-tenants
1. while co-tenancy continues occupying co-tenant is entitled to a share of the carrying charges
(mortgage, taxes, etc.)
a. but note: co-tenant in possession is only entitled to comp for carrying charges that
exceed the reasonable rental value of property.
b. mortgage
i. payment on principal – of co-tenant pays off principal of mortgage gives cotenant a lien on property. See Giles v Sheridan
2. repairs are responsibility of occupying co-tenant – but will be factored into an accounting /
partition as a set off.
3. improvements are at the option of occupying co-tenant – will get value added (not cost of)
by improvements in a partition / accounting action. improver bears the risk.
Adverse Possession – co-tenant can adversely possess against another co-tenant; exclusive
possession or collecting rents is insufficient. co-tenant must give other co-tenants clear and
unequivocal notice of repudiation of the common title.
Partition – any tenant in common or joint tenant has right to bring suit in partition. Equitable
proceeding – adjust and separate all claims of parties.
1. Partition in Kind – order partition of property into separate tracts if feasible; each party then
owns tract alone in fee simple.
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2. Partition Sale – when physical partition is not feasible; divide proceeds appropriately among
co-tenants.
a. rebuttable presumption is that each co-tenant entitled to equal share.
e. Marital Rights on Divorce
f. Marital Rights on Death
g. Community Property
i. General Overview:
1. three pots – his, hers, ours – need to keep track of what comes out of which pot and what
goes in
2. generally: community property and common law property are moving towards civil law
ideas and away from common law ideas.
ii. trends: see tenancy by entirety section
h. Rights of Unmarried Partners
i. See Beal v Beal – how to distribute property from nonmarital domestic relationship where couple is
cohabiting. See also Jezo (pg 516)
ii. generally: doesn’t end up as marital property for the unmarried. try to divide equitably.
1. try to divide the land itself 50/50 – each has an undivided interest in ½ of the property
2. divide the contributions proportionally – equitable remedy; get out what you put in.
iii. Same Sex Partners – may make contracts governing property rights but may not enter into marriage
and acquire rights granted to married persons as a matter of status
1. Rent Controlled Apartment – in NYC rent-controlled apartments on T’s death can be passed
to member of his ‘family’ – this includes same-sex partner living in the apartment (See
Braschi)
2. Discrimination Statutes – may forbid housing discrimination on basis of sexual orientation
6. Landlord and Tenant
a. Introduction and Background
i. grant from L to T reserves to grantor a property interest known as a rent (i.e. money)
1. contractual promises invariably attach to rent
a. promises from T to L though can go the other way (less common)
b. grant is combined with contract – not separated
2. generally: forfeiture of grant if rent is not paid (either expressly in grant or by statute)
a. most leases provide for forfeiture if tenants violate other covenants in lease
ii. recent developments in L-T relationship strongly influenced by pairing of property and contract law
b. Types of Tenancies and their Creation
i. Tenancy for Years
ii. Periodic Tenancy
iii. Tenancy at Will
iv. Statute of Frauds
v. Holdover Tenant
c. Selection of Tenants
i. Introduction
ii. Civil Rights Act of 1866 (i.e. §1982)
iii. Fair Housing Act of 1968
iv. Discrimination
d. Landlord’s Duty to Deliver Possession
e. Landlord’s Duty not to interfere with “quiet enjoyment”
f. Landlord’s Duty to provide habitable premises
i. Common Law – no implied covenant by L that premises are habitable or fit for purposes intended.
caveat lessee. tenant is able to inspect the premises and so no warranty implied.
1. Exceptions:
a. Furnished house for short term – implied covenant that premises are tenantable.
rationale: T does not have time to inspect.
b. Hidden (latent) defects – if known to landlord and not easily discoverable by
ordinary inspection. rationale: nondisclosure borders on fraud.
c. Building Under Construction – implied warranty that it will be fit for purposes
intended. rationale: T has no opportunity to inspect.
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2. Independent Covenants Rule – T not excused from performance (paying rent) by L’s breach;
T’s remedy is to sue for damages.
a. T must overcome this rule if they want to be excused from paying rent or from the
lease entirely.
b. must prove constructive eviction – substantial interference w/ use and enjoyment
3. Implied Covenant of Habitability – growing trend in recent years.
a. dependent covenant doctrine applies – T is relieved of obligations when L breaches
implied covenant of habitability.
i. See Lemle v Breeden – implied covenant of habitability that, when breached,
justifies T in rescission of lease and vacating premises; entitled to get
deposit back.
1. rescission and restitution are classic contract remedies
2. doctrine of constructive eviction is a property one – the house was
not habitable so, in essence, T was evicted. deprived of use and
enjoyment.
ii. rationale: (Gilbert’s 243)
1. landlord is in best position to make premises habitable – and to
know if they are not; duty to disclose.
iii. criticism: on economic grounds (Gilbert’s 244)
b. Scope of Warranty
i. Latent Defects Only – landlord only responsible for these OR
ii. Housing Code – landlord must satisfy standards of local housing code.
c. Remedies for Breach
i. Contract Remedies – damages, restitution, and rescission.
ii. may also include using rent for repair and rent withholding.
iii. usually: tenant moves out and recovers any prepaid rent OR stays in
possession and recovers damages (rent reduction)
d. Waiver by Tenant – if willing to take premises “as is.” but may be against public
policy
i. See Javins – does not permit waiver of substantial breach
ii. rationale: don’t want to permit tenant to waive defects that make premises
unsafe or unsanitary – want to enforce housing code. moves beyond basic
contract law.
4. Illegal Lease – if code prohibits rental in violation of the code then it may be illegal. If
illegal L cannot enforce covenant to pay rent and can only sue for reasonable rental value of
premises as they exist (see Brown v Southall Realty Co)
ii. Landlord’s Duty to Repair After Entry by Tenant
1. Common Law – L has no duty to maintain and repair; essential thing bargained for was land;
buildings were incidental.
a. covenant to repair may be made expressly but deemed independent of covenant to
pay rent
b. breach by L does not excuse T from paying rent.
2. Implied Covenant of Haibitability
a. majority of courts imply a continuing covenant of habitability – for L to sue on T’s
covenant L must not be in breach herself. breach by L is a defense if T does not pay
rent.
i. See Javins – L has duty of maintaining premises in habitable shape.
b. rationale: T bargains for and expects to get continuing services (i.e. maintenance)
from L.
i. in contrast to common law, it is more efficient for L to repair and maintain
land than for T to do so.
1. note: market does not support this…why?
ii. needs to be a minimum standard of housing – if this is not what landlords
are providing then courts/government must step in.
c. Scope of Warranty
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i. Housing Code (See Javins – substantial violation of housing code breaches
warranty)
ii. Fit for Human Habitation – violation of housing code is compelling
evidence of breach but not conclusive. Standard may be higher or lower than
housing code.
3. Result of Javins – does it produce more housing? (notes pg 81)
a. end result is less housing – impose costs on L, deprive him of revenues. drive
marginal L out of business.
b. OR economic argument that this results in improvement; if L is making supracompetitive profits then additional costs (enforcing housing code) shifts some profits
from L to T
g. Landlord’s Tort Liability
h. Tenant’s Duties
i. Duty to Pay Rent –
1. Background:
a. T has duty to pay any rent reserved in lease.
b. Traditionally it is an independent obligation – not excused by breach of L’s
covenants (i.e. repair).
c. Many jurisdictions T’s duty is now dependent on perf. of L’s obligations (if
premises are residential) – if L does not perform T can terminate the lease, withhold
rent, or receive a rent abatement.
2. Implied Agreement – if rent not reserved T has duty to pay reasonable rental value.
3. Illegal Agreement – T has no duty to pay rent if rental agreement is illegal; must pay
reasonable rental value of premises (See Brown v Southall)
4. Rent Passes with Reversion
ii. Rent Control –
1. Background:
a. form of price regulation.
b. Held constitutional on the theory that it bears a rational relation to legitimate public
purpose: welfare of housing consumers
c. See Pennell v City of San Jose – no actually takings has occurred; statute was
challenged as facially in violation of DP (takings w/out compensation) – not
unconstitutional because it serves a legitimate public purpose.
2. Reasonable Return – rent control must provide L with just and reasonable return on
property; must provide mechanism for resoning to chaning economic conditions – otherwise
it is confiscatory and a taking of L’s property w/out compensation
3. Eviction of Tenant – L cannot evict a tenant under rent control ordinances and then rent to a
new tenant at the market rate.
a. rationale: would undermine rent control – provide security of tenure at existing rate
only during existing lease period.
b. solution: rent control provisions accompanied by provisions requiring renewal of
lease unless there is good cause for evictions (e.g. default in rent payment)
iii. Rent Controlled Apartments – See Braschi
1. Rent control vs rent stabilization
a. rent stabilization is less burdensome
b. if same sex partner doesn’t count as family for rent stabilization (Sullivan), shouldn’t
it not count for rent control as well?
c. No – court expands the definition for Rent Control – trying to respond to
legislature’s intent
d. response by NY legislature was to expand statutes accordingly
i. Landlord’s Remedies
j. Assignment and Subletting
7. Easements and Covenants
a. Basic Questions and Distinctions
i. Is it possessory interest (easement) or non-possessory interest (covenant)?
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1. look to the language but this isn’t always clear – try to look to facts/situation; courts use
“know it when we see it” test
a. affirmative easements or covenants are usually clear from the situation – language
will not matter much (See Waldrop)
b. negative easements / covenants are a much closer call
2. if that doesn’t work then language may be dispositive
ii. Affirmative or Negative
1. affirmative easement – gives the holder right to do something on the burdened property
(affirmative use)
2. negative easement – holder has no active right; rather right to prevent owner of burdened
property from doing something on their property
3. negative covenant – person making the covenant promises not to do something
4. affirmative covenant – give holder of covenant the right to compel holder of burdened
property to do something
5. note:
a. negatives (easement and covenant) are basically the same but easement is interest in
land. consequence: when somebody is prevented from doing something it is difficult
to tell whether it is negative easement or covenant
b. affirmatives (easement and covenant) are basically opposites – one applies to me,
one to you. consequence: if owner is allowed to do something it is affirmative
easement; if he can require other party to do something it is affirmative covenant.
iii. Dominant or Servient
1. dominant used to describe the tenement that benefits
2. servient used to describe the tenement that is burdened
iv. Notice – covenants have a stronger requirement of notice to be enforceable in equity then easements
do.
b. Easements
i. Introduction and Background
1. easement: grant of an interest in land which entitles a person to use of land possessed by
another. damages are difficult to calculate so usual remedy is injunction.
2. Types of Easements:
a. Affirmative Easement – right to go onto servient land and do something.
i. See Waldrop – right to use the land as a garbage dump. gives right that they
otherwise wouldn’t have; burdened land loses right (to bring a nuisance
action)
b. Negative Easement – right to prevent owner of servient land from doing something
on his land
i. See Peterson v Friedman – scenic easement San Fran 3. Easement appurtenant – benefits owner in use of another tract of land
a. dominant tenement – land benefited from the use of other land
b. servient tenement – land burdened by the easement.
c. appurtenant easements pass with the dominant tenement to subsequent owners. this
means that they cannot be alienated for use by another party; they stay with the land.
(See Anne Arundel – this is what court should have decided in this lake / dumping
case)
4. Easement in gross
a. easement benefits an individual personally (not as owner of land) and is not
appurtenant to any piece of land; gives holder the right to use the servient land.
i. note: burden of easement is rarely (if ever) held in gross
b. note: easements ‘in gross’ may still be assigned if parties so intend.
5. Ambiguity
a. in case of ambiguity easements appurtenant are favored.
b. rationale: (1) Intent - parties usually intend to benefit a tract of land (2) increases
land value (increase in value of dominant land greater than decrease in value of
servient land) if appurtenant. If in gross there is only decrease in value of servient
land.
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6. Interest in Land – easements are interests in land; burden passes to subsequent owners of
servient land; not just a contract right (against original grantor) but a property right.
7. Profit
a. right to take something off of another’s land that is part of the product of the land
(i.e. timber, minerals, etc.)
b. Grant of profit implies easement to go onto land for removal purposes.
8. License
a. permission to go onto another’s land (i.e. plumber / repairman) and is generally
revocable at licensor’s will unless combined with an interest or estoppel applies.
b. Court’s prefer licenses to easements in gross. (See Todd v Krolick – laundry
machines)
i. note: in NY there are two lines of cases – washing machine cases are
deemed licenses; billboard cases are deemed easements
1. billboards contain description of the land subject to easement – this
is what distinguishes them
2. w/out description of the land you have a license
3. Todd – not a lease because lease is possessory interest and there was
no exclusive possession over any definite space given; no area that
company can exclude people from.
4. but note: Todd could have easily been considered an easement
c. Rationale: ‘in gross’ clogs title. Licenses are not binding on new owner unless
owner chooses to renew (See Todd)
i. licenses are contractual – can assign contract rights but not contract duties
unless the new party to the contract agrees.
ii. mutual assent is required in forming the K.
d. Irrevocable Licenses:
i. license coupled w/ an interest (i.e. O sells A a car on O’s land)
ii. Estoppel – if licensee has constructed substantial improvements relying on
license then estoppel may apply; rationale: protect reliance interest.
1. critique: irrevocable license given to A at no cost – permits A to
damage O w/out paying for it. might be fairer to require A to pay for
license.
2. note: license are irrevocable only as long as necessary for licensee
to reap fruits of expenditures (i.e. life of pertinent structure or
improvement)
3. but note: some courts have held irrevocable license to last forever –
See Cooke v Ramponi – find estoppel in this case
e. Assignability – licenses usually held to be personal and nonassignable unless parties
otherwise intend.
i. license may be terminable by attempt to alienate – See McCastle v Scanlon –
attempt to sell timber license causes it to be terminated
ii. alternative: would have been to call it an easement in gross w/ intent to
make it unassignable; this wouldn’t have resulted in forfeiture
ii. Creation of Easements
1. Express Grant – G grants easement over G’s land
a. SOF:
i. as an interest in land easement must be in writing and signed by G in order
to satisfy SOF. Oral easement is converted into a license.
ii. exceptions: fraud, part performance, estoppel, and easements by implication
and prescription
1. part performance – i.e. if grantee commits acts of unequivocal
reference to the grant – pays for the easement AND begins use
AND relies, etc.
2. somewhat easier to get an oral grant of easement out of SOF by part
performance than an oral grant of fee interest
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a. easement – just requires behavior indicating what easement
refers to
b. fee – usually requires detrimental reliance as well (See
Hayes v Hayes)
b. Duration – easement in fee simple if it endures forever. Can also be created for a
person’s life, for period of years, etc.
c. Ambiguity –easement or fee simple created? A grant for limited use, or limited
purpose, or of a space without clearly marked boundaries indicates an easement (and
not a fee). Also look to price paid – does it indicate fee or easement.
i. exception: some courts presume largest interest possible is conveyed and
assume a fee.
2. Reservation
a. Def: grantor may convey land and reserve for himself an easement over that land
(making it the servient tenement).
b. Reservation vs Exception
i. Reservation is regrant of new easement. legal fiction: O conveys to A, A
conveys back to O an easement.
ii. Exception refers to where an easement has already been granted over land
(i.e. to A) and then O grants to B the entire land except for the easement
already granted. So A retains easement.
iii. distinction between reservation and exceptionhas disappeared in American
Law today.
c. Reservation in Third Party: majority view follows common law prohibition of this
practice.
i. solution: use two pieces of paper – convey first to 3P, then have 3P reserve
an easement when conveying to other party.
ii. c.f. covenants – covenants can be created to benefit 3P
3. Implication – created by operation of law, not by written instrument. exception to SOF.
a. Limited Kinds:
i. when parties intended an easement based on apparent use existing at time of
severance of tract (including paper plat) OR easement by necessity
ii. all easements by implication (including easement by necessity) require
original unity of title – then later subdivision of land
1. See Cooke v Ramponi – no easement by implication because can’t
show unity of title
2. exception: private right of eminent domain given to landlocked
party w/out original unity of title
iii. no easement implied by reservation – See Adams v Cullen
1. if you want to retain an easement you must say so; won’t be implied
2. court’s move is to imply an easement in favor of the grantee –
quasi-easement
3. rationale: want to put pressure on grantee to get easements into the
record; same does not apply to grantee
b. Easement from existing use (quasi-easement)
i. Def: if, before tract of land divided, a use exists on servient part that is
reasonably necessary for enjoyment of dominant part and court finds that
parties intended the use to continue after separation, then easement may be
implied.
ii. Requirements:
1. implied easement can only be over land granted or reserved when
tract divided, and only in favor of dominant tenement (no easements
‘in gross’ implied)
2. use must exist at time of tract division (quasi-easement); use must
have been continuous, apparent, and reasonably necessary to
enjoyment
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a. Apparent – discovered by a reasonable inspection of the
premises (does not mean visible)
i. See Van Sandt – implied sewer easement when
sewer serves both houses on a lot.
ii. See Romanchuk v Plotkin – implied easement from
existing use; sewer hookups
iii. generally: courts are pretty strict on the reasonable
inspection duty of parties – have an obligation to
poke around and ask questions.
iv. but see: Todd – washing machine case; reasonable
inspection would have certainly given notice – but
court still found license not easement.
b. Continuous – previous use must be continuous and not
sporadic. rationale: should be high probability that use was
known to parties at time of grant.
c. Reasonably Necessary – strict necessity not required;
flexible.
3. note: stronger showing of necessity may be required for implied
reservation than for implied grant.
4. Conveyance by Paper Plat – requirement of quasi-easement
waived; purchaser receives an easement by implication in streets
delineated in paper plat though not yet in existence.
a. rationale: purchaser buys in reliance on easement of use;
purchase price reflects this.
b. See Putnam v Dickinson – use of alleys and park - easement
not explicit but hard to imagine that parties intended
otherwise
i. case note: the real problem was for buyers who
bought before paper plat filed
ii. they must rely on advertisements, parol evidence
(that survives PER scrutiny) in order to demonstrate
implied easement to use the park – court basically
ignores PER in order to do justice
c. Easement by necessity – when lot is divided and one lot is deprived of access;
usually an easement of way is then implied.
i. rationale: public policy requires access to each piece of land in order to use
it; parties intended to do this but overlooked putting it in deed.
ii. must be strict necessity (not convenience) in order to imply easement
iii. implied only when tract is divided (and rendered inaccessible or somehow
unusable), easement terminates when necessity ends.
iv. No prior existing use required.
v. Location and Termination – owner of servient tenement has right to relocate
easement to do less damage; can terminate easement when necessity ends.
4. Prescription
a. Historical Development: easements may be created by adverse use (prescription)
i. Common Law – lost grant fiction if using land for requisite period of time.
ii. modern law – prescription as public policy, analogous to adverse possession
b. Elements of Prescritption
i. Open and Notorious Use
ii. Adverse and Under a Claim of Right
1. prescriptive rights cannot be acquired when use is permissive
2. but: if initial use is permissive but subsequent acts provide notice
that user is claiming a right then use because adverse.
a. EX: use of driveway becomes adverse if user widens or
paves driveway; not adverse if user simply makes repairs.
3. color of title not required.
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iii. Continuous Use
1. seasonal use can establish sufficient continuity; can acquire
prescriptive easement in gross
2. note: tacking is allowed
iv. Uninterrupted Use
1. owner may interrupt by protesting the use though some require the
use to actually be interrupted.
c. Public Easements – can be required if public uses private land in such a way as to
satisfy prescription elements.
i. note: does not apply to use of vacant, undeveloped land – presumption of
permissive use
d. General Notes
i. no prescriptive easements against the state – similarly, you can’t adverse
possess against the state (See Cooke v Ramponi)
ii. generally negative easements cannot arise by prescription
iii. Scope of Easements
1. generally: intent of parties is used to determine scope – what is a reasonable scope and what
changes in use could have reasonably been foreseen or are required given the purpose of the
easement?
2. How was easement created?
a. Expressly Created – look to instrument’s language and surrounding circumstances to
determine scope.
b. Implied Easements – scope is generally the use existing at the time of tract division.
Changes necessary to preserve the use or that might have been reasonably foreseen
at time of division are allowed.
i. limits on changes allowed:
ii. necessity: extent of the necessity determines the use.
c. Prescriptive Easements – scope cannot usually be expanded because there is no
assumption that parties intended to allow anything other than what was gained by
prescription.
3. Subdivision of dominant tenement
a. rule: each subdivided lot of dominant estate has right to use easements appurtenant
to dominant estate
b. but the total burden on servient estate cannot be more than parties originally
contemplated / intended when creating easement or is necessary to accommodate
normal development of the dominant estate
i. question of judgment – use by 4 subdivided lots may be OK, use by 40 may
not.
ii. See Cox v Glenbrook – subdividing into 40 to 60 lots may constitute
unreasonable burden; but court will not declare in advance.
iii. rationale: rather than issue a declaratory opinion, encourage parties to work
it out themselves.
4. Use for benefit of nondominant land
a. rule: scope of easement cannot be increased by using it for the benefit of
nondominant land.
b. If extended to another parcel and the unlawful use cannot be eliminated the
easement may be extinguished entirely.
5. Change in Easement Location: mutual consent required if easement has been granted in a
specific location or located by mutual consent.
a. note: not required when easement obtained by prescription
b. Widening of Easement – unless intent to allow inferred from circumstances,
easement cannot be widened w/out consent of servient owner.
6. Use by servient owner
a. rule: servient owner may use land in any way that does not reasonably interfere with
easement (i.e. not an exclusive easement)
b. EX: can erect structure over easement provided vehicles can still pass through
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7. Division of Easements in Gross
a. nonexclusive: if use is enjoyed both by beneficiary and servient owner then
easement cannot be apportioned or expanded. rationale: unfair to servient owner –
not contemplated.
b. exclusive: if use is exclusive to beneficiary then easement can be apportioned or
divided.
8. Profits in Gross
a. rule: almost all profits are held in gross (not appurtenant).
b. Profits are not divisible (would lead to a race for resources – i.e. timber) but can be
assigned as “one stock” to two or more people acting jointly.
iv. Transfer of Easements
1. Easements Appurtenant:
a. rule: transferred along with transfer of dominant tenement. Burden is transferred
along with servient land.
b. appurtenant easements are attached to dominant land – benefit possessor of land
(including AP)
i. can’t transfer w/out the land – See Anne Arundel
c. note: default is to pass with the land – need not be specifically mentioned in the deed
(c.f. covenants running with the land)
2. Easements in Gross:
a. rule:
i. old rule – not assignable or inheritable. didn’t exist at old Common Law.
ii. modern rule – most jurisdictions allow transfer of easements in gross,
especially commercial easements (i.e. primary benefit is economic) which
are assignable.
iii. in noncommercial situations need to look to parties intent
3. Profits in Gross: have always been assignable.
v. Termination of Easements
1. unity of title: easement extinguished when servient and dominant tenement acquired by same
owner.
a. note: easement not revived by subsequent division.
2. dominant owner:
a. easements may be released by a writing by dominant owner (otherwise SOF applies)
i. note: oral release may give rise to estoppel if servient owner relies
ii. oral release valid if accompanied by act showing intent to abandon.
b. nonuse or misuse does not extinguish easement but impossibility of achieving the
easement’s purpose does extinguish it.
i. note: don’t confuse nonuse w/ abandonment – nonuse alone is not sufficient
to extinguish easement
ii. must have unequivocal intent to abandon the easement – i.e. allow easement
to become unusable, or oral release + failure to maintain
c. easements by necessity end when necessity terminates.
3. servient owner:
a. destruction of servient tenement – if servient tenement destroyed w/out fault of
owner then easement is destroyed as well.
b. prescription – servient owner can destroy easement through prescription; interfere
w/ easement in adverse manner. (see prescription elements above)
c. change of conditions – not applicable to easements
i. See Waldrop v Town of Brevard – changed conditions applies to covenants
(equitable servitudes), not easements.
d. misuse or overuse – does not terminate easement; appropriate remedy is injunction
against misuse.
vi. Negative Easements
1. generally: four categories of negative easements: light, air, subjacent or lateral support, or
flow of an artificial stream
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a. leads to development of equitable servitudes (negative covenants) to account for
other kinds of negative easements
b. rationale: why limit the categories of negative easements?
i. Alienability: limits alienability of land because easements are property
interests but even though they decrease value of servient tenement they
increase value of dominant tenement.
2. expansion of the four categories:
a. scenic easements and solar easements
b. See Peterson v Friedman – CA scenic easement case – easement resembles one for
light or air even though it is a scenic.
i. why draft as a negative easement and not as a fee interest in airspace?
ii. problem of trespass – anytime somebody went onto roof of other building
that would be trespass – easier to just have an easement.
iii. plus, airspace rights more valuable – might have to pay more for those.
3. Rationale of limiting:
a. negative easements require promise by servient owner not to use land in a certain
way. negative covenants are preferable – achieve the same objective but do not give
another a property interest in the land.
4. Cannot arise by prescription – prescription bars a cause of action and where owner has no
cause of action prescription does not apply.
c. Real Covenants
i. Introduction and Background
1. Background at Common Law
a. Warranties in Deeds – sell a piece of property and promise to do something if your
possession is interfered w/.
i. that promise clearly runs to assigns – benefit runs to future purchasers
ii. but burden stays w/ original promisor – problem of how to make that
warranty pass on when promisor dies or conveys land.
b. Spencer’s Case –
i. facts: affirmative covenant, tenant promises landlord to build a wall; tenant
sub-leases; is sub bound to build a wall?
ii. hold: no. covenant does not run – does satisfy privity and touch and concern
– does not satisfy intent because “assigns” is not used.
2. Definitions:
a. covenant: promise to do or not to do something
b. real covenant: promise relating to use of the land
i. affirmative covenant – promise to do something vs negative covenant
promise not to do something
ii. runs with the land at law so each successive land owner is either benefited
or burdened by it.
c. c.f. equitable servitude: covenant enforceable in equity by or against successors to
the land.
d. c.f. condition: condition is created by limiting duration of estate or cutting it short.
Breach of covenant is damages, breach of condition results in forfeiture (i.e. fee
simple determinable or fee simple subject to condition subsequent)
3. Applicable Law: law of contracts applies if the action is between original promisor and
promisee; otherwise, if there is a successor to the land involved, the law of property applies.
4. Remedies for Breach:
a. suit for damages must be filed in law; suit for an injunction or specific performance
must be filed in equity.
b. real covenant gives rise to personal liability only and is enforceable only w/ money
damages. equitable relief is for equitable servitudes.
ii. Creation:
1. rule: writing is required for real covenant even though it is not an interest in land. Usually
only grantor signs (as on a deed) but grantee is also bound (deed poll)
2. note: covenants are never implied, nor can they arise by prescription.
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iii. Enforcement
1. Does the covenant run with the land? If yes it can be enforced by or against assignees. Since
covenants are not interests in land the intent of the original parties must have been for the
covenant to run.
2. Requirements for Burden to Run
a. intent of the parties
b. privity of estate
i. majority view – requires privity
c. the covenant touches and concerns the land
d. assignee has notice of the covenant before buying
e. generally: the more you have of one element the less you will need the other
requirements.
3. Requirements for Benefit to Run
a. intent of the parties
b. some form of privity of estate
c. covenant touches and concerns the benefited land
d. note: no notice requirement for benefit to run. more lenient.
4. Intention of parties [955]
a. Rule in Spencer’s Case: covenant concerning a thing not in being (“in esse” i.e.
something to be built later) will not bind “assigns” unless expressly mentioned (e.g,
“and her assigns”).
i. “assigns” not used in Spencer – therefore covenant does not run
ii. Abolished in majority of states (not CA) – look to intent not specific word
‘assigns’.
iii. note: this requirement is not enforced at all for equitable servitudes
b. modern rule: look to the language of deed or contract as a whole; if ambiguous look
to circumstances.
i. See Charping v J.P. Scurry – intent not sufficient to allow benefit of
covenant to run w/ land
c. but see: dissent in Charping argues that covenant clearly touched and concerned
(release covenant to permit 6 houses as opposed to 4 on neighboring property) and
that this should overpower ambiguity about intent; infer from the effect that
covenant was intended to run w/ the land
i. note: some jurisdictions follow dissent’s view and look to infer intent from
the nature of the covenant itself
ii. courts are generally more willing than in Charping to infer intent from
circumstances
d. solution: better make your intent clear through instrument – “promise shall run w/
the land”
5. Privity of Estate
a. Horizontal Privity – Burden [textbook 957-959]
i. horizontal privity: relationship that exist between original promisor and
promisee.
ii. majority rule: for burden to run to assignees covenant must be in privity of
estate (rule of Spencer’s Case). But what is privity?
1. English view – only privity in landlord – tenant relationship.
England - burdens of covenant at law run only if contained in a
lease (or life estate?).
2. Minority View (Mass, etc) – mutual interest (simultaneous privity)
in property (apart from the covenant) is sufficient privity.
a. EX: if a party has an easement in the land, covenants will
also be enforceable.
b. rationale: want covenants to maintain easements to be
allowed to run
3. Majority View: successive relationship – if covenant is conveyed
in conveyance of interest in land then there is privity.
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a. note: this is a substantial weakening from the English view.
b. this is the First Restatement view – problem is that it allows
for straw man work around
4. Restatement Third: do away w/ horizontal privity entirely; all that
needs to exist is privity of K.
iii. minority rule – no privity required
iv. note: privity concerns only the original parties
b. Horizontal Privity – Benefit – not required in most jurisdictions for running of
benefit.
i. rationale: reason for privity requirement was to keep land free of burdens
undiscoverable by purchaser inspecting the land. since benefit increases
marketability there is no requirement of privity.
c. Vertical Privity
i. burden: privity requires that assignee succeed to the identical estate owned
by promisor.
1. estate must be of same duration
2. covenants really run w/ estates in land – only will run with identical
estate
ii. benefit: privity requires that assignee succeed to identical original estate or
any other estate.
d. Restatement of Servitudes
i. discards vertical privity for running of burden and of benefit.
ii. distinguishes instead between affirmative covenants and negative covenants.
e. Homeowner’s Association Exception
i. rule: may enforce benefit of covenants even though it succeeds to no land
owned by original promisors; considered an agent of real owners.
ii. See Neponsit
6. Touch and Concern – mostly discussed w/ relation to equitable servitudes (see equitable
servitudes)
7. Notice
a. Rule: bona fide purchaser not bound by covenant he has no notice of (see equitable
servitudes)
b. Actual vs Constructive Notice
d. Equitable Servitudes
i. Introduction
1. Def: a covenant that equity will enforce against assignees of the burdened land who have
notice of the covenant; injunction is usual remedy.
2. English common law:
a. need develops to have covenants run with the land
b. See Tulk v Moxhay – Leicester Sq / city planning case - originates equitable
servitudes – chancellor grants injunction to avoid building by subsequent purchaser
who had notice of restriction
i. rationale: Moxhay paid less for the land; to not run the covenant gives
Moxhay unjust enrichment (windfall)
ii. covenant would not have run at law: no horizontal privity because not a
tenurial interest (required from Spencer’s case)
iii. not a negative easement (negative equitable servitude instead): doesn’t fall
into one of the traditional four categories (light, air, flowage of stream,
support)
c. Theory of Enforcement (see policy section)
i. is equity court granting specific performance of contract or is it enforcing a
property right?
ii. modern view: equitable servitude is an interest in land
ii. Distinguish – Real Covenant
1. Remedy – crucial difference: damages for a real covenant; injunction for equitable servitude.
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a. use an equitable lien if you are trying to enforce covenant to pay money and are
doing so in equity
b. normally what you want for an equitable servitude is just a plain injunction
c. covenants are rarely enforced at law
2. Creation – in writing for a real covenant; many states will imply an equitable servitude.
3. Privity
a. equitable servitude is an interest in land (analogous to an easement) so neither
horizontal nor (generally) vertical privity required. equity notice substitutes for
privity.
b. exception: some states require vertical privity when a person other than original
promisee is enforcing the benefit.
4. Similarities
a. Touch and Concern: both must touch and concern the land
b. Notice: neither is enforceable against a bona fide purchaser without notice
i. but note: covenant at law requires notice by recording act; equity may have
looser notice requirements (see below)
c. note: Restatement of Servitudes abolishes distinction between real covenants and
equitable servitudes.
iii. Creation
1. general rule: writing is required by SOF because equitable servitude is an interest in land.
a. deed poll – binding on grantee as well as grantor, as w/ real covenants.
2. General Plan Exception – Implied Negative Equitable Servitudes – see below
3. Real Covenants – not implied by courts. rationale: do not impose personal liability (i.e.
damages) on somebody who has not given express consent. Injunction limits liability to
value of the land.
iv. Enforcement by or against assignees (requirements)
1. Intent
a. no technical words (i.e. “assigns” – see covenants running at law) are required
b. look to purpose of covenant and surrounding circumstances
2. Privity Estate – generally not required
a. tracing title – some states require person seeking to enforce to trace title to original
promisee (i.e. must be able to trace to original subdivision purchaser) (minority
view)
b. Third Party Beneficiary – majority of states allow 3P beneficiary to enforce
covenant in law or equity if contracting parties so intend.
i. See Stream Sports – allow enforcement by 3P (sports club) because two
parties (developer and buyers) agree
ii. if burden of obligation can run and it was enforceable by a 3P to the initial
K, then allow enforcement of covenant by 3P
iii. blends property law w/ K law
c. Distinguish – easements – easements cannot be reserved in favor of 3P
3. Touch and Concern Requirement
a. generally: touch and concern is a general notion – affecting physical use or
enjoyment or economic value may qualify.
b. Negative Covenants – touch and concern by restricting what owner of burdened land
can do; also enhance the value of benefited land.
i. EX: covenants not to compete
ii. but note: in some jurisdictions this do not touch and concern. rationale:
disfavored covenants because they are anti-competitive
c. Affirmative Covenants
i. England – refusal to enforce affirmative covenants. rationale: equitable
servitude is substantially a negative easement.
ii. Modern view – permit affirmative covenants to run both in law and equity;
usually held to touch and concern
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1. exception: an affirmative covenant that imposes a substantial burden
on property which receives no benefit from it and has no clear
expiration date may be found not to touch and concern
2. See Eagle Enterprises v Gross – covenant to pay for water has no
means of expiration; thus doesn’t touch and concern even though
there is intent and privity; so it does not run.
3. compare Neponsit – covenant does have expiration date and so does
touch and concern. see also Nicholson
iii. Perpetuity Problem
1. covenants w/out time limitations are problematic
a. probably will not touch and concern for affirmative
covenants
b. may need statutory support for negative covenants (i.e.
historical preservation)
2. touch and concern used as a catch-all for policy concerns – doesn’t
just deal w/ physical nature
3. want to avoid undue restrains on alienation that last forever
a. need to have some mechanism to get rid of covenants if
conditions change
b. note: because changed conditions is an equitable doctrine
this is especially important for real covenants / enforcement
at law
d. Covenants to pay money
i. if covenant enhances value of promisor’s property (even if the
improvements or money is directed to other land – i.e. common areas) then
it generally will touch and concern
ii. but: formula for calculating the sum must be reasonable clear.
iii. See Stream Sports Club v Richmond – sports club membership – covenant to
pay money can be enforced by an organization that holds benefit in gross
iv. See Neponsit – covenant to pay money does touch and concern; thus an
affirmative equitable servitude can be made to run with the land
v. note: enforce these in equity by means of an equitable lien
e. Benefits in gross – if benefit of covenant does not touch and concern land (i.e. it is in
gross) then the burden is unlikely to run with the land.
i. English Rule – English courts refused to recognize easement in gross –
easements must be tied to land. since servitudes are, basically, negative
easements they must have a servient and dominant tenement (See London
County Council)
1. thus, only person against whom covenant can be enforced is against
original promisor – enforced as a K; doesn’t run w/ land
ii. The Polar Opposite Van Sant
1. Van Sant v Rose – holder of benefit in gross holds an interest in
burdened land, thus touch and concern, thus he can enforce the
covenant.
a. thus, there is no such thing as a covenant the benefit of
which is in gross
b. problem: this is an obviously circular argument
2. see also Restatement position – allows enforcement in equity of
benefits in gross so long as burden touches and concerns the land
iii. Middle position of American Law – most courts are in between the two
extremes
1. easements in gross recognized and burden of easement runs w/ the
land.
2. but: nevertheless servitudes “in gross” do not have burdens that run
w/ the land (See Snow v Van Dam, Neponsit).
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3. outcome: covenant is declared to be personal to the holder of the
benefit, does not run w/ the land.
4. rationale: where burden devalues land public policy requires
accompanying benefit to other land. also, finding owners of benefit
in gross and buying them out may be difficult.
iv. generally: look to intent and see whether person seeking to enforce covenant
has a real reason to do so. if not then courts generally don’t enforce
1. EX: developer who has sold all property in development seeking to
enforce
a. if he owns other land in the area – court might allow
b. if he’s totally cashed out – court won’t allow
2. EX: Stream Sports – same jurisdiction as Van Sant – comes out
same way (allows covenant to run) but for different reasons
a. relies on 3P beneficiary K notion (see above)
3. EX: Neponsit – homeowner’s assn is really composed of land
owners in the development; turns out the covenants are not really in
gross; so let them run.
4. Notice – assignee as subsequent purchaser for valuable consideration who takes w/out
notice is not bound by servitude. If there is notice then servitude is enforceable.
a. Actual Notice
b. Record Notice – if covenant is in a deed to the assignee’s lot OR if covenant is in a
deed or deeds to other lots in a subdivision conveyed by developer to prior grantees
if deeds to neighboring lots are in assignee’s chain of title.
i. courts are split as to whether prior deeds by developer not directly in chain
of title but purporting to restrict all subsequent lots in subdivision give
record notice.
c. Inquiry Notice – purchaser buying into residential area should look at other deeds
and actually inspect the premises
i. See Sanborn v McLean – purchaser should inspect first deed out, and ask
neighbors in the area
v. Common Plans – Serve Three Functions
1. Intent – are covenants to run w/ the land and which land do they benefit?
a. general plan can be used to show who developer intended to benefit from written
restrictions on other lots – who has right to enforce
b. EX: Snow v Van Damn - inference from plan is that developer intended covenants to
run with the land and to apply to all land in the development.
c. Developer’s Right to Modify
i. retention of right to modify in developer – courts may interpret that as
covenants benefiting developer personally, other lot owners cannot enforce
them
ii. See Suttle v Bailey – destroys the common plan; Donahue says this is a
bizarre case
d. see also Benefit in Gross discussion above
2. Enforcement – can prior purchasers enforce covenants on subsequent purchasers?
a. developer extracts covenants on lots as he grants them (in accordance w/ common
plan) – once he has conveyed all the lots who is to enforce the covenants?
b. subsequent purchasers – can clearly enforce against prior purchasers; they are in
vertical privity
i. grantor conveys prior lots and extracts covenants, still owns other lots which
are benefited by extracted covenants
ii. those lots are then conveyed (to subsequent purchasers) and thus there is
privity, thus the covenants run
c. prior purchasers – can they enforce against subsequent purchasers?
i. Werner v Graham – if there was written evidence of common plan (which
there wasn’t) that would have been enough to give prior purchasers right to
enforce covenants
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1. rationale: what matters is what subsequent purchaser thought at
time of purchase – did he know / expect there to be covenants /
common plan?
2. absence of written common plan this cannot be inferred.
ii. See also Riley – no evidence of common plan
3. Implied Covenants – Create covenants where they aren’t really there
a. Reciprocal Negative Easement implied on a lot in restricted residential subdivision
even if no writing creating servitude
i. reciprocal – i.e. a similar covenant binds other lots in the subdivision
ii. negative (or restrictive) – forbids some use of land (affirmative covenants
are not usually implied)
iii. easement – servitude is in the nature of an easement because it is an interest
in land
b. rationale: equitable estoppel – purchaser buys a lot restricted to residential use does
so relying on promise by subdivider that subsequent lots will be similarly restricted.
i. result: the minute first deed is issued, if there is a common plan in mind,
then all other land retained by developer is bound by same covenants; an
implied covenant to include covenants.
1. note: if developer wants to avoid this he will need to be very explicit
ii. EX: Sanborn – some evidence of a common plan but not overwhelming; but
court implies covenants anyway
1. how is purchaser supposed to have notice of covenants not in his
deed?
2. inquiry notice: ask the neighbors whether or not there are any
covenants.
iii. c.f. Werner v Graham – court refuses to imply existence of common plan
and thus no implied covenants.
c. requirements:
i. intent - developer must have had a general plan indicating an exclusively
residential subdivision
1. general plan arising later – does not impose burdens on lots
previously sold w/out the burdens.
2. note: if many lots are sold w/out covenants courts may find a
general plan lacking – inequity of enforcing covenants against some
but not all owners in subdivision
3. but note: existence of general plan can be inferred even if one is not
officially recorded
ii. subsequent purchasers (w/out written covenants in deeds) must have had
notice of prior restrictive covenants
d. Covenants not implied - some courts refuse to imply reciprocal negative easements
i. See Riley v Bear Creek – equitable servitude not implied from existence of
restrictions on other subdivision lots
1. goes against Sanborn – not willing to imply covenants out of thin
air; there is no evidence in writing of any kind of covenant in the
deed
a. difference between Riley and Sanborn – in R the first deed
out had no covenants of any kind; in S the first deed out did
contain covenants and so those were implied on later lots
w/out covenants in the deed
b. rationale: subsequent purchasers could have obtained
record notice by looking at first deed out
2. rationale: planner may not have intended to have all lots have same
covenants (i.e. mixed use, or trying to sell less desirable locations);
also very difficult for purchaser to obtain notice of the covenants
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ii. See Werner v Graham – court will not infer the existence of a common plan
(and thus imply covenants) when there is no written indication of common
plan at time obligations arose.
1. outcome: all covenants extracted are deemed not part of a common
plan, are personal only between the parties (like a K) and do not run
w/ the land
iii. note: look at notes for discussion of Riley as SOF case and Werner as a PER
case (even though Riley claims Werner is SOF as well)
vi. Construction of Covenants
1. covenants construed to carry out intent of parties
a. Single Family Dwelling – what constitutes a single-family?
i. Group Homes
ii. Commercial Use
b. Residential Use Only
i. by implication – covenant that does not specifically limit use of land to
residential may do so inferentially.
c. Architectural Controls – specific standards are not necessary but architectural
control committee must act reasonably and in good faith.
i. See Jones v Northwest Real Estate
d. Exclusion of Churches – churches and religious schools can be excluded from
residential areas by restrictive covenants (when those covenants restrict the area
generally to residential use)
i. rationale: not state action for a court to enjoin religious use of residentially
restricted land
ii. See Ginsberg v Yeshiva of Far Rockaway
1. Constitutional Issue:
a. 14th amendment – equal protection; not dispositive but it
was close
b. c.f. Shelley – Shelley is racially discriminatory on its face;
Ginsberg deals facially w/ a residential restriction
i. not discriminating against religious institutions
specifically
ii. doesn’t want any institutions
2. Estoppel: does not apply
a. Yeshiva barred by covenant where Synagogue isn’t.
rationale: Yeshiva is a school, operates every day, more
traffic and greater disruption to quiet use and enjoyment
b. just because you acquiesce to one violation of a covenant,
you may be estopped from complaining of similar
violations, but you have not acquiesced to every violation
3. Changed Conditions – does not apply – court says area retains a
substantial residential character; judgment call by court
iii. but see Marsh v Alabama – exclusion of Jehovah’s witnesses from passing
out handbills is not allowed
1. there is a line that private developers can cross when they develop
large enough areas – eventually they function like a state
2. then even their private covenants may not be discriminatory, as in
Marsh
e. Racial Restriction – racially restrictive covenants will not be enforced by courts, this
is deemed state action and violates equal protection clause
f. Shelley v Kraemer
i. Holding: covenant itself does not violate 14th amendment but judicial
enforcement is state action and does violate 14th (equal protection)
ii. Rationale
1. Racial Separation in Zoning Ordinances (Buchanan v Warley [pg
180])
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a. SC holds this unconstitutional – cannot set up zones where
property ownership or use is contingent on racial
classification – violates 14th amendment
b. to say you can’t live someplace is to deny equal protection
2. Civil Rights Cases; 109 US 3 (1883) [180]
a. Facts: Civil rights cases – consolidation of cases involving
private companies (theatres, buses, inns, etc) discriminating
against blacks
b. Hold: private individual could deny equal protection of the
laws to citizens under 14th amendment
i. congress does not have power under implementing
section of 14th amendment to regulate private
actions – they can only regulate state action
c. Result: led to private discrimination against blacks and
minorities. State could essentially discriminate w/ impunity
by outsourcing it to private companies.
3. Gray area between public and private
a. company town (Marsh v Alabama) – company can’t limit
1st amendment rights when they own the whole town;
basically a city
4. then you get Shelley – doesn’t make sense to say that the private
covenant is valid but it is invalid if the state enforces it
a. if you believe Bentham or Holmes, the only way the
covenant means anything anyway (and property rights in
general) is because the state stands behind it
b. so even private covenants that are racially restrictive should
be void
g. The Line Between Public and Private as it relates to race
i. Damages Suit – enforcement of damages unconstitutional (Barrows)
ii. Racially Discriminatory Gifts / Interests
1. Smith – creation of executory interest that would fall in if racially
discriminatory covenant is violated will not be enforced – involves
state action (CO case)
2. Charlotte Park – creation of reversion is OK – falls in automatically
so no state action (SC case)
3. executory interest vs. possibility of reverter makes a difference to
the court
4. Evans – park for white citizens only cannot be maintained; park was
created by grant
a. fee simple subject to a condition precedent but not right of
reverter reserved
b. SC sends to GA court to use cy pres – winds up implying
right of reverter and sending park back to heirs; result is that
city loses a park.
iii. Hypo: Racist Dinner Invitations and people I don’t want come anyway
1. can you use state action (i.e. police) to enforce your private
discrimination?
2. enforcing trespass depends on state action – so is that barred?
3. Depends on how open to the public the action is.
a. if it is open in the public at all (i.e. land restriction) then
enforcement involves state action and may be subject to 14th
equal protection
b. if it is largely in the private sphere (i.e. dinner party) then it
is probably private action and not governed by 14th
amendment
vii. Termination of Covenants and Servitudes
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1. Merger – if benefited and burdened land are merged
2. Equitable defenses to enforcement
a. Estoppel – if reasonable person would believe covenant was abandoned and
burdened party relies on these actions
b. Relative Hardship – if hardship to burdened property is great and benefit to
dominant property is small
c. Changed Conditions
i. argument: character of neighborhood has so changed that restrictive
covenants no longer provide the benefits intended; so no need to enforce
them. if this is shown equity will refuse to enforce covenant.
ii. but: note that change outside the subdivision affects only border lots and is
not sufficient to prevent enforcement of covenants against border lots
1. rationale: purchaser of border lot may have paid lower price, don’t
want unjust enrichment
2. rationale: allowing those covenants to lapse will just allow
encroachment on next ring of house in.
3. rationale: the covenants are still valuable to the houses w/in the
buffer zone.
iii. See Camelback v Warner
1. buffer zone: border lots serve purpose of protecting residential
community w/in, even if conditions have changed outside the
development.
2. generally: changed condition arguments don’t typically involve
constitutional issues, and typically are unsuccessful – court is likely
to hold the buffer zone and enforce covenants unless conditions
have changed inside the development / community
iv. note: this is an equitable doctrine only; does not apply to real covenants.
does not apply to easements either.
3. Abandonment – affirmative covenants cannot be abandoned (c.f. easements)
4. Eminent Domain – gov’t that condemns burdened land must pay the holder of the covenant
(owner of benefited land) the difference in value of benefited lot w/ and w/out the covenant.
rationale: equitable servitude is a property interest analogous to an easement and must be
paid for if taken.
e. Common Interest Communities
i. Condominiums
1. Background / Features:
a. owner has a fee interest in own unit; also has proportional share of property held in
common (tenants in common)
i. no right to partition
ii. easement for entrance and support – through common areas
b. reminiscent of a leasehold – numerous restrictions on what you can and can’t do.
c. need to promote community interests to keep things harmonious.
2. Restrictions on Transfer – typically requires consent of the condo association. problems:
a. Restraint on Alienation: courts more tolerant of restraints on condo units, because of
interdependent ownership. restraint is generally valid if it is a reasonable means of
accomplishing valid objectives.
i. See Aquarian Foundation – restraint here is invalid because it does not
require restrainer to match the highest real offer. scares off potential buyers
too much, crosses the reasonable means line. lots of latitude for condos but
there are still some restrictions.
ii. solution would be to use a preemptive option: allow owner to sell to
whoever but give condo board right to match any offer.
b. Illegal Racial Discrimination: prohibited by Fair Housing Act.
ii. Cooperatives
1. Background / Features:
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a. corporation holds title to apartment building; shares of stock sold to occupants who
receive leases from corporation.
b. in between an apartment building (leasehold) and a condo (fee interest owned) – not
quite an apartment because landlord and tenant are the same person.
2. Restraints on Alienation: more justification for restraints in coops than in condos because
members are in a joint financial venture. Because members hold leaseholds restraints are
valid.
a. restrictions must be reasonably tailored to purposes of assuring financial
responsibility and social compatibility.
b. cannot be totally arbitrary.
8. Rights Against Neighbors
a. Nuisance
i. Introduction and Background
1. nuisance – unprivileged interference w/ use and enjoyment of another’s land.
a. private nuisance – interference w/ the private use and enjoyment of one or a number
of nearby properties.
b. public nuisance – interference w/ a right common to the general public
2. general notes:
a. distinguish between nuisance (interfere w/ use and enjoyment of land) and trespass
(invasion of possessor’s interest in exclusive possession). Consider different
remedies (i.e. injunction and damages)
b. private nuisance if: (a) P has a possessory interest in the land; (b) D has done an
affirmative act that interferes w/ use and enjoyment of P’s property; (c) interference
is substantial and unreasonable in nature (compare burden of interference to
benefit)
c. nuisance vs taking:
i. compare Boomer vs Winchester v City of Stevens Point – big difference is
whether nuisance is created by private individual or by government
ii. determines whether you can bring a nuisance action or an inverse
condemnation action
1. no injunctions when it is eminent domain – state may need to pay
but you can’t stop them from taking your land
2. injunctions can be issued in nuisance actions
ii. Private Nuisance
1. Definition:
a. substantial interference w/ private use of land that is either (i) intentional and
unreasonable or (ii) unintentional but negligent, reckless or resulting from
abnormally dangerous activity.
b. Cannot sue for nuisance unless you have a (1) have a property interest or (2) can
allege bodily harm.
2. Intentional Nuisance
a. Definition
i. primary factor is unreasonableness of interference w/ use and enjoyment
ii. balance gravity of harm against utility of conduct (alleged nuisance)
1. look to particular factors in each case
2. even if balance is in favor of D, it can still be a nuisance if harm is
serious and D can afford to pay t hose damaged
b. Gravity of Harm - consider
i. extent of harm
ii. character of the harm
iii. social value of the use or enjoyment invaded
iv. suitability of the use invaded to the locality
v. burden on the person harmed of avoiding the harm.
c. Utility of Conduct – consider
i. social value of the primary purpose of the conduct
ii. suitability of the conduct to the character of the locality
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iii. impracticability of preventing or avoiding the invasion
d. Fault – D generally must take due care in avoiding the harm, though fault is not
required to find a nuisance. Can have nuisance if D has done everything possible to
avoid harm. rationale: some nuisances are just too grave / damaging. Economic
justification – society is better off w/out the nuisance.
e. “Nuisance per se” vs. “Nuisance in Fact”
i. nuisance per se – nuisance no matter how reasonable D’s conduct or
attempts to mitigate is (typically limited to hazardous activities)
ii. nuisance in fact – unreasonable under particular facts
iii. EX: Waldrop – garbage dump is a nuisance ‘per se’ – only reason it is
allowed is because Town of Brevard has an easement giving right to create a
nuisance. but note: somebody not burdened by easement could bring a
nuisance action if they could satisfy requirements (i.e. harm)
f. Unintentional Act – may be a nuisance if risk of harm makes the conduct
unreasonable.
i. compare actor’s conduct (whether negligent or reckless – not utility) against
gravity of harm.
ii. utility of conduct cannot be used as a defense
iii. EX: storage of dangerous explosives.
3. Types of unreasonable interference
a. Character of the Harm
i. Depreciation of Property Value – not enough by itself to constitute nuisance
but an important factor. may be important in ‘psychological nuisance’ cases
(i.e. funeral home)
ii. Discomfort – i.e. objectionable noise, odors, etc. Measured by reasonable
person standard.
iii. Fear of Harm – significant factor if neighbor lives in fear of harm (i.e.
mental hospital, explosives, etc.)
b. Character of the Neighborhood – residential areas are often given preferred status
and protected against incompatible uses.
i. look to uses authorized by zoning ordinance – can be used to show
community policy.
ii. but: just because a use conforms w/ zoning ordinance does not mean it isn’t
a nuisance in that particular case (See Boomer v Atlantic Cement – cement
plant located in industrial district declared a nuisance)
c. Social Value of Conflicting Uses – want to resolve conflict so as to allow the more
valuable use to continue
i. if conduct is of great social value (i.e. factory employing many people)
courts are reluctant to declare it a nuisance
ii. but: if harm is serious and payment of damages will not end the socially
useful element court may order payment of damages but refuse to issue
injunction
iii. See Boomer – court won’t issue injunction to stop dirt and smoke emissions
but will award permanent damages.
d. Priority in Time – if D’s use was first then P has come to the nuisance and has a
weaker case.
i. note: this fact is not determinative
ii. still must consider all other factors (i.e. suitability of use, value of
properties, cost of eliminating condition complained of, social benefits of
allowing the use, etc.)
4. Distinguish – Trespass
a. physical invasion – can be either trespass or nuisance.
i. trespass – actionable invasion of possessor’s interest in exclusive possession
of land.
1. P must show intentional and unprivileged physical intrusion to
claim relief.
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2. does not need to show substantial injury. entitled to damages for
invasion + injunction against future trespass.
3. rationale: no balancing of equities, trespass is simply not allowed.
ii. nuisance – actionable invasion of possessor’s interest in use and enjoyment
of land.
1. P must show (1) unreasonable conduct (2) substantial injury and (3)
in most jurisdictions, equities must balance in P’s favor.
2. more flexible remedies – at discretion of court whether to give (1)
damages for past conduct (2) permanent damages for future conduct
or (3) injunction.
iii. rationale: absolute possession is easier to enforce than absolute use and
enjoyment. Consider right of absolute possession vs. privilege of use and
enjoyment.
b. Air Pollution – can be classified as either trespass or nuisance.
5. Economic analysis – increasingly used to solve nuisance problems
a. Who is at Fault?
i. Neither party alone causes conflict – nuisance inherently requires presence
of two parties.
1. “higher uses” (i.e. residential over industrial) does not make
economic sense
2. should look to what is more valuable (in economic terms) to society.
ii. Externalities – what to impose costs of doing business on those creating
them; force them to internalize
b. Coase theorem
i. market determines whether activity will continue, not initial allocation of
rights by the courts.
ii. initial allocation only makes one party richer – does not change who the
right ultimately winds up with.
iii. EX:
1. A can stop polluting for $50, worth $100 to B for A to stop. If
injunction issued, A will simply stop polluting rather than try to buy
B off. If injunction not issued B will pay A somewhere between $50
and $100 to stop.
2. A can stop polluting for $100, worth $50 to B for A to stop. If
injunction issued, A will buy off B for somewhere between $50 and
$100. If no injunction issued A will keep polluting.
3. either way the court decides, the higher value use is what will
continue to happen.
c. Transaction Costs
i. Coase Theorem depends on transaction costs being zero in order for market
to automatically move the right to highest valued use.
ii. The Holdout Problem – if A has to buy out a number of parties (i.e. a whole
neighborhood) in order to defeat the injunction he will probably not be able
to. Each neighbor has incentive to hold out and, even if they don’t, difficult
to negotiate with so many.
iii. Free Rider Problem – neighbors may not be able to get together and buy out
A (if A initially gets the right) because not every neighbor will pay his
share.
iv. Strategic Behavior Problem – may create bargaining problems as both
parties try to get as much of the gains from trading the right as possible.
1. bilateral monopoly situation – parties must negotiate with each other
only.
2. if one party walks away from the table negotiations break down; no
transfer is made; sometimes this is a strategically effective
maneuver (if negotiations repeated or reputation are known)
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d. Initial allocation – who is entitled to the right? Where you put the initial liability
results in transfer of wealth (redistributive effect).
i. Highest Valued User –
1. economic argument; avoid transaction cost problems of above by
initially giving right to highest valued user.
2. rationale: eliminate transaction costs and increase total wealth of
society.
ii. First in Time Prevails
1. first user may have irretrievable or “sunk” cost of investment – so
force second user to buy out the first.
2. rationale: force second user to consider carefully when choosing
where to locate; also avoid “demorilization costs” in enjoining longestablished uses.
3. criticism: doesn’t seem fair if second user (1) could not have
foreseen the conflict and/or (2) it wasn’t a nuisance when they
began.
iii. Wealth Redistribution
1. initial allocation affects wealth positions of parties; so court may
allocate to poorer party.
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2. rationale: argument based on public policy, not economics.
3. but: consider other issues of fairness. is the cost going to passed to
consumers? Did one party pay a lower price for the land because of
the nuisance?
iv. Healthy Environment
1. value healthier / safer uses higher
2. EX: cumulative zoning – which uses are intuitively valued higher
a. notion that harm flows from bottom up
b. industrial zones are harm-causers, residential zones are
harm-receivers
c. disagrees w/ Coase Theorem which says it takes two to
make a nuisance – but there is almost always an active party
and a passive party
e. Remedies
i. Enjoin A – gives the right to B and allow A and B to bargain for it.
ii. Give B damages – gives the right to B but forces sale to A
1. See Boomer – permanent damages awarded.
2. criticism: this is arguably a taking for private use because sale is
forced (dissent in Boomer)
a. allow private individuals to exercise eminent domain
b. permanent damages usually only awarded when injunction
not available (as in eminent domain)
3. but if both parties share in the fault it is unclear whose property is
actually being taken.
a. courts do not always issue injunctions to stop nuisance
b. don’t always issue injunctions in trespass cases (See
Geragosian)
iii. Enjoin A and give A damages – give the right to B but force B to pay A for
it
1. criticism: may not work when there are many potential B’s and high
transaction costs (i.e. a neighborhood)
iv. Refuse B any remedy – give the right to A and force B to try and buy it.
iii. Public Nuisance
1. Definition:
a. affects the general public (c.f. private nuisance – only affects particular individuals)
and is widespread in its range or indiscriminate in its effects.
b. Exs: gambling, rock festivals, prostitution, etc.
c. test: substantial harm caused by intentional and unreasonable conduct or by conduct
that is negligent or abnormally dangerous.
i. unreasonableness – same as private nuisance – balance gravity of harm
against utility of activity.
2. Enforcement by Private Persons
a. only if private individual can show that public nuisance is specially injurious to her
b. P does not need to own land but must show that damage to her is of a different kind
then to public generally
c. note: not sufficient to show that she suffers the same kind of harm as public but to a
greater degree.
d. rationale: avoid excessive number of lawsuits – suit should be brought by public
officials
iv. Statutorily authorized use – if use authorized by statute it is not a public nuisance. may be considered
a private nuisance if special injury is shown.
1. rationale: zoning ordinances are not defenses to a private nuisance suit (see above).
b. Right to Support
c. Airspace Rights
i. Navigable Airspace
ii. Solar Enjoyment
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9. Public Land Use Controls
a. Zoning
i. Theory of Zoning
1. Related to Nuisance
a. designed to prevent incompatible uses; idea is to codify nuisance law and make it
predictable by declaring in advance what uses are harmful and prohibited.
b. Village of Euclid v Ambler Realty – classic case declaring zoning constitutional on
this basis
i. deals with general scheme of zoning plan
1. allows exclusion of all industrial uses from commercial and
residential zones
a. challenged on grounds of overbreadth (i.e. not all industrial
uses are actually harmful)
b. defended and sustained because it was the type of
classification a reasonable legislature could make
2. allows exclusion of apartment buildings from residential areas
a. close issue for the court but justified on traditional health
and safety grounds
c. but can also be used to achieve public benefits, maximize property values, and to
exclude
2. Separation of Uses
a. Highest Use – Housing – protect residential areas from harmful neighbors. singlefamily house > two-family house > apartment building, etc.
b. Commercial and Industrial districts – lower uses – typically subdivided into several
kinds of zones.
c. Principle of cumulative Uses – allow higher uses than what is zoned in any district,
but not lower.
i. note: many zones today are not cumulative and are exclusive or limited
zones
ii. rationale: prevent discord between incompatible uses
3. Density Controls – indirectly control number of people using an area of land by means of
height limitations, setback requirements, minimum lot / house sizes, etc.
ii. Source of Zoning Power
1. Enabling Acts – usually enacted by city or county but must be given power by state
legislature via a Zoning Enabling Act.
a. All ordinances must conform to the act; if not it is ultra vires (beyond the authority
of the local body) and void.
b. note: legislature cannot delegate discretionary power to an administrative body
w/out standards to govern the exercise of the power. Delegation w/out standards is
improper and if standards are vague they may be attached as improper delegation of
power.
c. note: Zoning Enabling Acts are enacted under the state’s police power to regulate
human affairs so as to effect the purposes of government.
2. Standard Zoning Enabling Act
a. Section 1 – must be justification for limitations of owner’s property rights; police
power to regulate health, safety, morals, and general welfare
b. Section 2 – zoning by districts; districts must be uniform for each class and kind of
building
i. no spot zoning
c. Section 3 – scheme needs to be in accordance w/ comprehensive plan
i. doesn’t entail a separate master plan in detail
ii. just means comprehensive planning – needs to be rational and have been
though through
d. Section 4 – administrative requirements
e. Section 5 – change and amendment process
iii. Constitutional Limitations
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1. Police Power and General Constitutionality of Zoning
a. Zoning has been upheld as a valid use of this power (Euclid)
b. ordinances enjoy a presumption of validity but they must be constitutional as applied
to each individual lot.
i. result: an ordinance may be valid in general but unconstitutional as applied
to a particular lot
ii. EX: Nectow v City of Cambridge
1. challenge to ordinance on its face – property was zoned residential
even though everything else on the block was industrial
2. city couldn’t defend this – it was pure politics – so court ruled it an
irrational classification and unconstitutional as applied to that
particular property
2. Due Process Clause of 14th Amendment – no deprivation of life, liberty, or property, without
due process of law
a. Procedural Due Process
i. argument: ordinance enacted w/out notice to landowner and w/out owner’s
opportunity to be heard
ii. legislative vs. administrative actions
1. legislative actions – notice not required for each individual
landowner
2. administrative actions – notice must be given to every owner (ex:
variances and special exceptions, granted by zoning board of
adjustments)
b. Substantive Due Process
i. argument: refers to fundamental rights and liberties not enumerated in Bill
of Rights. the ordinance does not bear a rational relationship to a
permissible state objective.
1. permissible objectives: public health, safety, general welfare, etc.
2. note: ordinance is valid if it is a rational way of achieving the
objective, it does not need to be the best way.
3. note: court will look for any rational basis it can think of to support
the ordinance, even if it is not at all the one the legislature used /
intended
a. look to legislative purpose, not to legislative motive
b. can’t look to remarks of individual legislator – they do not
reflect the overall purpose of the legislature.
ii. EX: Village of Belle Terre v Boraas
iii. EX: Pierro v Baxendale
1. close decision – could have gone either way – ordinance excluding
motels but not boarding/rooming house is not unconstitutional
passes the rational relationship test – boarding houses are more
residential in character
2. rationale: city does not have the responsibility to provide space for
motels in residential zone or in any other zone – OK to exclude
completely
3. criticism: just displaces the problem (motels bring drugs, sex, crime)
to neighboring city
4. further criticism: dissent objects that this ordinance is overbroad –
not every motel brings crime; not OK to exclude all motels simply
because some of them are bad; that is what you have police officers
for.
iv. Strict Scrutiny Standard
1. if ordinance infringes on a fundamental right (e.g. right to vote, free
speech, interstate travel, etc) burden is on state to justify the
legislation by showing it has a compelling state interest
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2. note: strict scrutiny rarely applied under DP to zoning ordinances
because housing has been held not to be a fundamental right. Strict
scrutiny is a difficult issue to raise.
c. State Due Process – state constitutions also require DP – state due process clause has
considerable substantive as well as procedural content
i. outcome: strike down legislation that is “arbitrary” or “unreasonable” even
though it may be a rational way to achieve the objective.
ii. but: presumption of validity of ordinances remains
iii. generally: some things may be OK under Federal constitution but not under
State
3. Equal Protection Clause – 14th amendment – no sate shall deny any person equal protection
of the laws
a. requires landowners who are similarly situated to be similarly treated, except when
justified.
i. Distinguish – Due Process: under DP the question is whether the gov’t can
take away the right; under Equal protection the question is whether the gov’t
can take away the right from some but not from others.
ii. to establish a violation of Equal Protection P must prove discriminatory
purpose or intent
iii. EX: Village of Arlington Heights
iv. EX: Moore v East Cleveland; Boras
b. Rational Relationship Standard – legislation need only bear a rational relation to a
permissible state objective
c. Strict Scrutiny Standard – if zoning ordinance operates by reference to a suspect
classification (race, national origin, religion, or possible age or sex), the burden is on
state to demonstrate a compelling state interest in the legislation’s objective.
i. note: rarely applied because zoning ordinances rarely operate by reference to
a suspect classification.
4. Taking Clause – 5th Amendment – private property shall not be taken for public use w/out
just compensation
a. expressly applicable to federal gov’t but has been read in to 14th amendment to
apply to states (under DP clause)
b. often mixed w/ DP even though they involve different standards and different
remedies
i. ordinance that violates DP is void
ii. ordinance that constitutes a taking entitles owner to injunction or possibly
temporary or permanent damages
5. Summary of Arguments against zoning actions
a. Ultra Vires – action not authorized by or in violation of the Zoning Enabling Act.
b. Improper Delegation – ordinance unconstitutional because of delegation of
discretionary authority to local decision maker w/out governing standards
c. Procedural Due Process – administrative decision taken w/out notice and hearing
d. Substantive Due Process – deprives persons of DP of law because (i) it lacks a
rational relationship to a permissible state objective or (ii) it infringes on a
fundamental right and cannot be justified by a compelling state interest
e. Equal Protection – deprives of equal protection because (i) it has no rational
relationship to a permissible state objective or (ii) it operates by reference to a
suspect classification and cannot be justified by a compelling state interest.
f. Taking – takes P’s property w/out compensation
iv. Nonconforming Uses – a use in existence when the zoning ordinance is passed that is not permitted
in district under new zoning ordinance. Allowed to remain because immediate termination would
violate substantive DP or constitute a taking.
1. Limits on Changing Use
2. Amortization
a. Majority View – Amortization valid
b. Minority View – Amortization unconstitutional
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c. Vested Rights
v. Administration of Zoning Ordinance
1. Comprehensive Plan – Section 3 of Standard Zoning Enabling Act requires ordinances to be
in accord w/ a comprehensive plan
a. Legal Effect of Plan – guide for development; does not have legal consequence of
restricting property but serves as guide for ordinances which do
b. Existence of comprehensive plan – many cities don’t have them but have enacted
ordinances; ordinances in absence of a plan are generally held valid on theory that a
separate comprehensive plan is not required – zoning ordinance itself is a plan
i. note: comprehensive plan means comprehensive planning
2. Amendments of zoning ordinance
a. Spot Zoning – amendment not in accordance w/ comprehensive plan and unlawful
i. note: to determine if spot zoning consider size or number of lots rezoned –
though this is not controlling. deviation from plan is controlling.
ii. EX: Town of Preble v Song Mountain – ski resort wants to hold rock concert
1. every road around Song Mountain labeled residential – looks like an
example of spot zoning to sock it to Song Mountain
2. rather than framing this as a zoning case the town should’ve treated
it as a nuisance
b. Amendments Generally presumed valid – burden is on person objecting to prove
that ordinance is not in accord w/ comprehensive plan
3. Variances – board of adjustment (or board of zoning appeals) can grant relief from
ordinances by way of variances when restrictions cause owner practical difficulty or
unnecessary hardship
a. Standards for Variance – practical difficulty or unnecessary hardship which have a
high standard of proof
b. hardship must be due to unique circumstances (i.e. peculiar to that particular lot)
c. note: if hardship applies to entire neighborhood or multiple lots an amendment, not a
variance, is proper
i. Distinguish – Use vs. bulk variance
ii. Runs with the land – variance, when granted, runs with the land to
successive owners
iii. Conditions Attached – may be possible to attach conditions to a variance
4. Special Exception – exception to ordinance allowed where certain specified conditions in the
ordinance are met
a. distinguish from a variance – does not operate on a hardship theory
b. rationale: certain special uses can peacefully coexist when specified conditions are
met
c. Standards for special Exception –
d. EXs: schools, hospitals, funeral homes etc. often wish to be located in residential
areas – permissible if the zoning ordinance so provides and they meet conditions
5. Discretionary or non-Euclidean Zoning
a. Background
i. Euclidean zoning is what we started w/ and, largely, it is what we’ve got
even though it may not be the best way
ii. Euclid only allowed variances and special exceptions as flexibility in zoning
ordinance
iii. but more flexibility is needed – so planners have experimented with nonEuclidean or discretionary zoning which gives more discretion (and also
creates problem).
iv. generally held to be valid
b. Contract Zoning
c. Density Zoning
d. Floating Zones – zone provided in ordinance to which no land is assigned until a
landowner makes a request and is granted a zoning classification. zone floats over
the city until it is needed or requested.
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i. criticism: violates the comprehensive plan requirement which is meant to
make future use predictable; thus shouldn’t be permitted by enabling act
ii. further criticism: denies equal protection because where zones ‘land’ is
discretionary
iii. generally: floating zones upheld
e. Planned Unit Development (PUD)
i. developer allowed to mix uses and can ignore specific lot and density
requirements provided overall density of development does not exceed the
average requirement; ordinarily requires a large amount of land
ii. criticism: argued that this violates the enabling act by mixing uses and
ignoring lot lines and violates the essence of zoning (lot by lot development)
iii. further criticism: does not give predictability (see floating zones)
f. Zoning by Referendum – some ordinances provide that a zone change amendment
can be made only by public referendum.
vi. Purposes of Zoning
1. Aesthetic Purposes
a. Old Doctrine – police power cannot be used to accomplish primarily aesthetic
objectives – no statutory or constitutional basis for this doctrine.
b. New Doctrine – cities may enact regulations primarily for aesthetic objectives
i. some courts apply average person standard and consider whether the
prohibited use tends to depress property values
ii. rationale: try to make aesthetic judgments more objective by tying them to
property values
iii. Architectural Review Boards – city review board can deny building permits
for buildings it disapproves of
1. but: raises problems of improper delegation of power and equal
protection because the standards are very vague
2. ex: building “must conform to the existing character of the
neighborhood and not cause a substantial depreciation in
neighboring property values” – this has been upheld as valid (See
State ex rel. Stoyanoff v Berkeley)
3. EX: Stoyanoff v Berkeley – authorizes aesthetic regulation but ties it
to traditional police power notions
a. property values – affects the tax bracket which affects the
general welfare
b. show that an usually designed house depresses property
values.
4. note: review board probably needs some sort of authorization in the
Zoning Enabling Act; cities only operate on delegated power – need
to look at ZEA to see if it allows creation of review board.
iv. Advertising Signs – commercial advertisements may be prohibited in
residential areas
1. rationale: if commercial use can be excluded so can the
advertisements for it
a. problem – collects garbage, promotes illegal behavior, etc.
b. basically an aesthetic regulation being sustained by specious
reasoning to traditional notions of health and safety.
2. problem: freedom of speech issue - what about political
advertisements or banning of commercial billboards from
commercial areas.
3. Political Advertisements – preferred position, given greater
protection.
4. Commercial Advertisements
a. emerging area of law – commercial speech starting to enjoy
a substantial amount of 1st amendment protection
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b. See Metromedia Inc v City of San Diego – unclear what this
case holds (Gilbert’s 390)
2. Zoning against adult entertainment
3. Preservation Purposes
a. Historic Preservation
i. Historic Districts
1. ordinances directed towards preservation of historic districts are
generally valid. standard is conformity with character of the district
and is usually pretty clear when the district is of a uniform character
(i.e. French Quarter)
2. rationale: preservation of historic district often results in gain, not
loss, to landowners so there is reciprocity of benefit from the
regulation
ii. Individual Landmarks
1. preservation of individual buildings not in a historic district raises
serious equal protection and takings constitutional issues
2. problem: may impose a large cost on one individual who reaps no
reciprocity of benefit (i.e. by being in a historic district)
3. EX: Penn Central – sustains NYC’s landmark law – no taking
established merely by showing denial of right to exploit air space
a. focus on the property as a whole in determining if there is a
taking
b. permitted use included terminal, office space, etc. which
was P’s primary expectation concerning use – P was getting
reasonable return on its investment, so no taking.
b. Preservation of Open Space
i. Agricultural Zoning
ii. Wetlands Zoning
1. See Palazzolo which deals with a case regulating fee that is partially
wetlands and partially regular land – SC didn’t decide whether
wetlands zoning is unconstitutional or not
2. states are split but more seem to think it is unconstitutional
vii. Exclusionary Zoning – consider difference between intentional and de facto exclusion
1. Nontraditional Families
a. How to define a single family?
i. If the definition bears a rational relationship to preserving ‘family values’
and quiet seclusion then the definition is constitutional
ii. See Village of Belle Terre v Boraas
b. Excluding Group Homes – may conflict w/ Fair Housing Act (FHA)
i. Occupant Caps – FHA exempts any ‘reasonable’ zoning regulation
restricting the maximum number of persons permitted to occupy a dwelling
1. SC holds family composition rules that cap the total number of
occupants are exempt but rules trying to preserve family character
of neighborhood by focusing on composition of households are not
exempt
2. thus, family composition rule (i.e. no more than five unrelated
occupants or unlimited related occupants) is not a maximum
occupancy restriction
ii. Reasonable Accommodations
1. in accommodating group homes a city may not require a permit for
group homes that is not also required for other multiple-residence
dwellings.
2. rationale: special permit reflects prejudice against handicapped
persons and does not bear a rational relationship to a legitimate state
objective.
3. See City of Cleburne v Cleburne Living Center, Inc
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c. Excluding Traditional Family – if definition of family excludes traditional family
(including extended family) the ordinance requires a higher standard than rational
relationship but not as much as strict scrutiny
i. EX: extended blood relatives are protected (i.e. cousins, grandparents, etc.
sharing household) but others (students, unmarried persons living together)
are not.
d. Not In My Back Yard Tips – Gilbert’s 395
2. Low Income Persons
a. Def:
i. ordinances may operate to exclude low-income persons partially or entirely
from a community
ii. EX: minimum house size, lot size, front footage, etc.
iii. conflict: between preserving the character of the community and making
housing available to all persons
b. Validity of Density controls (Mt. Laurel cases)
i. Rational Relationship Test
1. older cases uphold density controls w/ argument that they tend to
prevent overcrowding and bear a rational relationship to density.
2. thus, they are considered valid even though they operate to exclude
low-income groups
3. but density controls are scrutinized more closely when they have an
exclusionary effect (ex: violation of substantive DP to exclude all
apartments from a developing city)
ii. Enabling Act Violation
1. argument: enabling act requires the city to provide space
somewhere for each type of housing w/in its borders
2. See Britton v Town of Chester
iii. Fair Share Test
1. Mount Laurel Cases – each community must provide its fair share
of housing needs in the region
2. Mt. Laurel I
a. failure to provide fair share violates state constitutional
requirement of substantive due process and equal protection
because regulations not concerned w/ general welfare
3. Mt. Laurel II
a. reaffirms requirement of opportunities for constructing fairshare of low-income housing
c. Growth Controls
i. generally: slowing growth to allow construction of public facilities has an
exclusionary impact
ii. argument: ordinances (1) violate DP because they lack a rational
relationship to public welfare and (2) constitute a taking because some
landowners may not be able to develop for a period of time
iii. generally: upheld if the purpose of the ordinance is not exclusionary and the
ordinance is a rational method of timing development according to a
comprehensive plan
iv. EX: Lake Tahoe case
d. The Mount Laurel Cases (cont.)
i. Background:
1. NJ – lots of people living in small area – bounded by huge urban
areas (Philly and NYC) that are out of state
2. the result of this is that there may not be a good solution for the
problem of low-income housing in NJ
ii. Brief overview of three Mt. Laurel cases
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1. Mount Laurel I (1975) – municipalities must presumptively make
realistically possible an appropriate variety and choice of housing –
effectively meaning low and moderate income housing.
2. Mount Laurel II (1983) – in the absence of legislative assistance the
judiciary is going to enforce the Mt. Laurel doctrine.
3. Mount Laurel III (1986) – rules that the NJ Fair Housing Act is
constitutional; strikes down all the constitutional challenges to the
statute…with the notion that if it doesn’t work the court may once
again intervene.
a. deferential relationship between the judiciary and the
legislature –
b. court makes clear (as it had indicated in Mt. Laurel II) that
it will defer to the legislature here; this is their job and the
only reason the court was involved was because they
weren’t doing their job and implementing the constitutional
principle.
iii. Mt. Laurel I
1. Do municipalities have obligation to provide for low and moderate
income housing?
a. Equal Protection Argument
i. perfectly plausible argument here against
exclusionary zoning – protect minority groups
through oversight of legislature
ii. but this is not what the court does here (though it is
present in the argument – see below)
iii. compare analysis of equal protection to that in
Boras and Moore v City of East Cleveland – the SC
analysis of equal protection is very different there
b. Substantive Due Process Argument (the court’s argument)
i. power to zone is delegated to municipality by the
state (not inherent) by the ZEA
ii. obligation is to zone for health, safety, and general
welfare of the people of NJ, not just the people of
the municipality – zone as if they were the state
legislature
2. Does a municipality need to provide for every land use?
a. no – while housing is a fundamental right (and falls under
equal protection clause) not all uses are (i.e. disposal of
nuclear waste)
b. note: this means that there must be an equal protection
element to the DP argument the court uses, even if it is not
explicit.
c. result: everybody has responsibility to provide their fair
share of low and moderate income housing.
3. Should the court defer to the legislature?
a. legislature has not done anything to defer to – court is
attempting to impose an affirmative obligation; force them
to act.
b. this is incredibly activist court (see below – judicial
activism section)
4. Why is the court so activist?
a. this is Preeble revisited – a not in my backyard problem
b. municipality is only responsive to its citizens – if nobody
wants low income housing in the city then nobody (at least
in the municipality) is going to take responsibility for
providing it.
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c. this should be the legislature’s job to oversee this – not the
court – but the legislature is idle
iv. Mt Laurel II
1. 10 years worth of litigation after Mt Laurel I produces no results
2. Court’s response
a. use rule-making power to create a super-state zoning board
of appeals
b. three special judges hear all Mt. Laurel cases
v. Mt Laurel III - Is the NJ Fair Housing Act constitutional?
1. basic assumption of deference
2. Objections to FHA
a. possibility of delays
i. not a problem – there was never an explicit
timetable for application of Mt Laurel doctrine and
delays might be necessary in order to get things
right.
ii. similar to reasoning in Lake Tahoe – yeah there are
delays but ultimate this is the most efficient and
best way to do things
b. moratorium of builder’s remedy
i. not a problem – building remedy is not a
constitutional right
c. separation of powers argument
i. FHA denies judicial review of some administrative
actions?
ii. court doesn’t think so – no constitutional right to a
particular type of judicial review provided there is
some standard of review in the courts
vi. Outcome:
1. Mt Laurel hasn’t really solved the problem – credits allow suburbs
to buy off Mt. Laurel obligations
2. court intervention was not a success – didn’t get much housing built
3. Racial Exclusion
a. Generally:
i. ordinance that has an exclusionary effect is not unconstitutional solely
because it has a racially discriminatory impact – discriminatory intent or
purpose must be shown to sustain equal protection claim
ii. how to show discriminatory intent: disproportionate impact, clear pattern of
discrimination, unexplainable on grounds other than race, historical
background of challenged ordinance, departures from normal procedures,
statements of legislators, etc.
iii. Fair Housing Act
1. under FHA P need only show discriminatory effect (not intent) in
refusal to rezone to allow low-income housing
2. discriminatory effect makes out prima facie case that FHA is
violated which city must rebut
3. result: easier to prove violation of FHA than Constitution
4. Federal Courts
a. Generally:
i. Difficult to litigate exclusionary ordinances in federal court.
ii. standing: to litigate a P must show a “case or controversy” between himself
and D; controversy must be actual and not hypothetical
1. P must allege “specific, concrete facts demonstrating that the
challenged practices harm him” specifically in order to challenge
zoning ordinance as exclusionary
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2. speculative harms will not suffice – thus nonresidents, developers,
and nonprofits can not generally sue the city
5. c.f. Euclid
a. Ambler Realty Co. launched a general attack on the ordinance
b. had standing to do so by virtue of owning property in the area that was affected by
the very existence of the ordinance.
c. this deprived it of the ability to raise specific issues about whether or not the
ordinance was appropriate as to particular parcels / land uses.
b. Subdivision Control and Maps
i. Subdivision Regulations
1. On-site beneficial improvements
2. Off-site improvements
ii. Official Maps
1. Street Maps
2. Park Maps
c. Eminent Domain
i. General Overview
1. Eminent Domain Power
a. governments (federal, state, and local) have power of eminent domain - to take
property against owner’s will.
b. 5th Amendment – “…nor shall private property be taken for public use, without just
compensation.”
i. held applicable to states as well under DP clause of 14th
2. Three major questions of “Takings” – answer these
a. What is public use?
b. What is a taking?
c. What is just compensation?
ii. What is Public Use?
1. Public Use or Purpose
a. earlier rulings: public must have right to use the condemned property – narrow
reading
b. modern rulings: most courts (including SC) use “public use” more broadly – public
use must benefit the public
i. result: this makes most condemnations permissible as public use
2. Public purpose very broad – examples
a. public purpose may be served by transferring ownership from one private person to
another
i. EX: urban renewal – land condemned and resold to a developer; land
condemned to resell to private corp for creating jobs; land condemned to
break up land ownership oligarchy and reestablish free market
ii. test: where exercise of eminent domain is rationally related to a
conceivable public purpose the legislature may take property – great
deference paid to legislature by courts
iii. What is a “taking”? (See Gilbert’s chart, 402)
1. Taking title – formal exercise of eminent domain (bringing condemnation proceeding)
requires government to pay for land.
2. Taking possession
a. Overview
i. taking permanent possession of a property, even without taking title, is a
constitutional taking and gov’t must pay.
ii. doesn’t matter how trivial the physical invasion – gov’t must still pay.
iii. categorical rule – taking possession requires payment
iv. rationale:
1. possession is the valuable thing – equivalent to depriving owner of
title.
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2. SC attaches a “peculiar talismanic force” to physical invasions
(saying comes from article, not from SC)
3. most importantly, taking possession interferes with the owner’s
RIGHT TO EXCLUDE which is the most fundamental of all
property rights!!!
b. Invasion by third parties
i. if gov’t authorizes 3P to permanently occupy private property this is a
constitutional taking
ii. EX: Loretto v Teleprompter Manhattan CATV Corp (statute authorize
installation of TV cables constitutes taking)
iii. EX: US v Causby (chicken farm case, Air Force establishes a base next door
– landing planes over airspace of farm causes demise of farm; the fact that
the planes were coming in over the airspace of that property – and not right
next door – seems to make a difference to the court. “peculiar talismanic
force” in effect)
iv. EX: Kaiser-Aetna v United States (opening of private property [imposition
of navigational servitude on marina created and rendered navigable at
private expense] to public constitutes taking)
v. Kaiser-Aetna v United States
c. Occupancy by Tenants
i. if city prohibits demolition of rental housing and requires owners to lease
units at controlled rents (rent control) for an indefinite period, the ordinance
is a taking.
ii. Even though it is an effort to preserve stock of rental housing it permits 3P
to occupy premises permanently, thus it is a taking.
iii. See Seawall Associates v City of New York
d. Rent Control Ordinances
i. rent control ordinances involve restrictions on L-T relations where landlords
voluntarily put their properties to use for rental housing. This is not a
physical taking.
ii. Taking only when gov’t requires owner to submit to physical occupation of
land by itself or 3P
iii. But See Yee v City of Escondido – this is the case that Gilbert’s rests the rule
for rent control ordinances on. But the court did not consider whether or not
this rent control (fixing mobile home rates well below market value, making
it very difficult to evict) ordinance was a regulatory taking or not.
3. Regulatory Takings
a. Overview:
i. question: when is gov’t regulation of a person’s property a taking?
ii. police power –
1. gov’t can regulate use of property under police power for purpose of
public healthy, safety or public welfare
2. at what point are these regulations too onerous and become a
taking?
iii. consider the several tests below – see which makes the most sense…
b. Harm Test
i. overview: Police Power vs. Eminent Domain
1. police power: when regulation has purpose or effect of protecting
public from harm (or prohibiting a nuisance) it is police power and
noncompensable
2. eminent domain: when regulation has purpose of extracting a public
benefit it is eminent domain and there must be compensation
3. See Hadachek v Sebastian
ii. problems:
1. Distinction may be illusory – all restrictions preventing A from
causing a harm on B also confer a benefit on B.
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2. similar to nuisance situations – you only have a nuisance w/ two
incompatible uses – neither by themselves constitutes a nuisance.
c. Test of severe economic loss
i. Pennsylvania Coal Co v Mahon
1. Facts: Coal mining case – statute forbid coal mining that caused
subsidence of any house; before statute enacted Coal company sold
surface right to Mahon, reserved right to remove coal underneath
and to undermine any house on the land. then Mahon goes and gets
a statute passed.
2. Hold: “property may be regulated to a certain extent, if regulation
goes too far it will be recognized as a taking”
a. statute is invalid as a taking w/out compensation
b. statute effectively destroys the mineral rights
3. “Goes too far” – refers to diminution in economic value
ii. What “property” is focused on? The Right to Exclude (and others? – see
Indian cases)
1. Mahon – court is willing to look at mineral rights and at surface
rights separately.
a. rationale: they were already severed and owned by two
different landowners – must be considered separately.
b. court does look at total fee simple here – surface rights were
in separate ownership and surface owner had agreed not to
sue
2. Penn Central – terms “property” as the entire fee – surface and air
rights together because there is one ownership.
a. rationale: court does not engage in conceptual severance
3. Keystone Bituminous Coal Association v DeBenedictis – looks at
entire ‘mining operation’ and determines that Subsidence Act
requiring operators to leave 2% of coal in ground is not a taking,
even when they have purchased the support estate.
a. Distinguished from Mahon:
i. looks similar but legislature adds evidence that this
is a problem not just for person owning surface
rights but for people in surround area - causes
ecological / environmental disasters
ii. Subsidence here involves protecting a public
interest, not a private one (just one person) as in
Mahon.
b. Distinguished from Goldblatt
i. Goldblatt rests on the nuisance exception – can
prohibit nuisance use even if the impact on property
is virtually 100%
ii. here – regulation requires only 2% of the coal to be
left as a general matter; not too onerous
iii. court leaves open possibility that for a specific
property owner it might take much more, be more
onerous.
iv. but in Keystone we have a facial attack on the
statute – not attacked by a particular owner
4. Hodel v Irving – “sticks in the bundle of rights”
i. Facts:
ii. Indian Land Consolidation Act – can’t sell pieces of
land, must pass by descent, small fractional shares
escheat to the tribe.
b. Hold: this is a taking
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i. rationale: “property” here refers to a different
property right
ii. passage of property at death is one of the
fundamental “sticks in the bundle of rights” that a
property owner has; congress cannot just take it
away.
iii. may not be as important as right to exclude which is
what possessory takings are mostly about, but it is
important nevertheless.
c. note: congress later amended the provisions to extend grace
period to preserve rights, give more power to tribe, etc.
court said this practice was still unconstitutional.
5. Compare Andrus v Allard
a. Facts:
i. other Indian case – ownership of Eagle Feathers OK
but not sale – this restricts a property right
(conveyance) – not considered a taking
b. Issue: which case is confined to its facts?
i. justices do not agree in Hodel (which came after)
which case is confined
c. The issue is, has another absolute (right to devise) been
added to the right to exclude such that anytime it is
infringed it will constitute a taking?
i. no – not if Hodel is confined to its facts which
seems likely.
iii. Investment-backed Expectations – Penn Central
1. Background:
a. careful SC opinion attempts to set out a very general
framework for public land use discussions
i. still good law today
b. Standard Zoning Enabling Act / Landmark Statute
i. NY could not have done this under standard act –
looks a lot like spot zoning which may very well be
unconstitutional
ii. had a statute (historical landmark) backing it up –
creates a separate administrative structure; this was
a good idea by NY
iii. why: don’t want basic planning and landmark
determination decisions to fall to the same people.
2. Facts: Penn Central designated a landmark, commission doesn’t
approve their building design to build office space on top of the
terminal. submits two designs, neither approved – then challenges
the regulation as unconstitutional taking.
3. Issue/Arguments (Part One):
a. Property right to airspace taken?
i. court distinguishes from Causby – gov’t is not
physically invading the airspace
ii. court will not engage in conceptual severance –
consider the property as a whole while it has not
been severed in actuality
b. Loss of Economic Benefit
i. P argues market value of land has increased and
they are not able to capitalize on this; substantial
reduction of value
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ii. court responds: loss of economic benefit happens
all the time – this alone isn’t enough to establish
taking.
c. Designation as landmark is spot zoning
i. no it’s not – part of a comprehensive plan covering
the hall city
ii. buildings happen to be spread out but that is the
nature of historical landmarks (as opposed to
historical districts)
d. Particular Use
i. it is ok to focus on the particular characteristic of
land (i.e. historical landmark) even though it does
not apply to all the land in the area.
ii. See Goldblatt (quarry case) – it isn’t the neighbors
fault that they don’t have landmark buildings.
e. the city is not out to get Penn Central
f. SC shows this is not a physical taking
i. this should have been enough – demonstrate that
ordinance is rational, directed toward a legitimate
public purpose, does not physically take property
ii. but the court continues on…
4. Issues / Arguments (Part Two) – Regulatory Taking considered
a. Armstrong – Regulatory Taking
i. at a certain point the public, rather than the
individual property owner, must bear the cost of
what is legitimately a public burden
ii. even where there is a legitimate public purpose, if it
falls too heavily on the individual, it becomes a
regulatory taking.
b. Penn Central not a regulatory taking
i. reasonable investment-backed expectations – not
frustrated
ii. not all building proposals denied – P only proposed
two
iii. transfer of development rights – allowed by statute,
this is valuable to P
5. Hold: look to extent the regulation has interfered with “distinct
investment-backed expectations.”
a. Penn Central is left w/ a reasonable return on its
‘investment’ – getting what it initially bargained for out of
the property.
b. also: P has not been deprived of all economic value –
consider the property as a whole means that even if he can’t
use the airspace (which is not definitely decided) he still has
lots of valuable uses
6. rationale: gov’t should not be permitted to frustrate / demoralize
investors by destroying their reasonable expectations – reliance
interest of investors deserves protection
a. court distinguishes between cases where owners buy
property in reliance on existing scheme and those cases
where owners buy property with notice of the ordinance /
regulation in question.
b. this should affect their expectations – know they might not
have a certain use of the land
d. Reciprocity Test
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i. Mahon – Holmes opinion – regulations that involve reciprocal advantages
and disadvantages are not a taking
1. if regulated owners obtain some advantage, even if it is less than
others, then regulation is w/in police power.
2. EX: zoning – landowner w/ residential zoned lot loses ability to put
a store on his land, but also gains advantage of having no
commercial use next door.
a. “average reciprocity of advantage” – no taking
b. if landowner obtains no advantage then there may be a
taking
ii. See also Tahoe (below)
e. Destruction of all economic value
i. Lucas v South Carolina Coastal Council
1. Facts: developer wants compensation for Acts which bar any
building on beachfront lots in SC hurricane zone.
2. Issue:
a. Legitimate Public Purpose
i. hurricane damage prevention – this is not contested
b. Ripeness
i. same issue as in First English
ii. the Act looks categorical on its face (line is drawn
beyond which development can occur) but do you
need to go try and get the line changed?
3. Hold: where the regulation achieves a total deprivation of value it
can be justified only if the regulation serves to reinforce a nuisance
principle that was already in the background (Donahue)
a. if regulation denies all economically beneficial uses of land,
it is a categorical taking, unless the state can justify its
actions as preventing a common law nuisance (Gilbert’s)
4. Rationale:
a. Total Deprivation of Value
i. can’t build homes on the property – is there other
value to the land?
ii. not really – this is also in a private community w/
restrictions – couldn’t camp (tents) or park an RV
on the land either
iii. what causes the total deprivation of value? the
public regulation or the private regulations?
b. common law nuisance
i. at common law, and today, nuisances can be abated
w/out paying compensation (See Goldblatt)
ii. the issue is – was this a nuisance at the time he
bought the property?
iii. P could have easily anticipated regulations to cover
hurriance threatened land; compare to Asbestos
which comes out of nowhere; hurricanes have been
a problem for years.
c. expansion of nuisance categories difficult:
i. cannot be expanded to include all harmful activities
ii. rationale: this would allow the state to take all
economic value out of the land under the harm
theory
iii. result: state can deprive of all value of land w/out
compensation only if the activity is a nuisance
under traditional state common law
ii. Palazzolo v Rhode Island
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1. Facts: developer purchases salt marsh subject to tidal flooding; P
proposes to fill the marsh, then to build a beach club – both are
rejected; P then files an ‘inverse condemnation’ action and alleges
taking (relying on Lucas – deprivation of all economic value)
2. Issues:
a. Ripeness – is the issue ripe for review?
i. intermittent applications to develop property by SGI
(Palazzolo ultimately became sole shareholder)
ii. then P’s applications for bulkhead, and beach club
iii. is that enough for claim to be ripe?
b. Does P’s acquisition of title after regulations’ effective date
bar his takings claim?
i. regulation passed after SGI acquired company, but
before P takes over as sole shareholder
c. Can he assert takings claim based on denial of all economic
use when he has unused development value on upland
parcel of property?
d. Does regulation interfere with P’s reasonable investmentbacked expectation of developing property under Penn
Central?
3. Holding:
a. Yes – ripe for review
i. dissent: P has not submitted a plan that indicates
any effort at compromise; thus it is not clear how
far regulation goes and Penn Central analysis can’t
be done.
ii. generally: court seems to be relaxing ripeness
requirement – allow more people their day in court.
b. takings claim not barred – the mere fact that he officially
acquired the property after the regulations were passed does
not bar the takings claim.
i. O’Connor – whether or not the regulation is pre- or
post-acquisition should be used in Penn Central
balancing
ii. critique: how do you do this given you are already
considering reasonable investment-backed
expectations
iii. goal: prevent unjust enrichment – prevent buying a
cause of action (basically champerty);
iv. but: is this really reasonable? is a regulation
unconstitutional regardless of when you buy in
(Scalia)?
v. response: No – part of what makes it unreasonable
is whether or not it is a taking w/out compensation.
if you ‘create’ the taking by buying in after the
regulation then you have created the problem – and
it isn’t really one of constitutionality (my analysis)
vi. general: can you buy a potential takings claim? Not
clear from Palazzolo – this case does not stand for
the categorical proposition that you can pick up
property governed by what may be an
unconstitutional regulation and then sue.
c. P fails to establish deprivation of all economic use based on
upland parcel – entire parcel serves as basis for takings
claim.
i. thus only a partial taking so Lucas does not apply
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f.
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d. Penn Central analysis not done below – remand to consider
this.
iii. Strategic Splitting
1. issue: court will not engage in conceptual severance (Penn Central)
but it will consider whether there has been total deprivation of
economic value of the property rights (considered in total) that
owner actually has (Lucas)
a. presents an opportunity for strategic splitting – sell airspace
rights above Penn Central, then allow them to bring the
claim
b. OR sell upland portion of land in Palazzolo off and then
bring the takings claim.
2. The Court:
a. O’Connor – worries about this – wants to make Lucas total
deprivation only one factor in the balancing test.
b. Scalia – encourages strategic behavior.
c. Rest of the court – unclear?
3. Penn Central v Palazzolo
a. Strategic Splitting of different rights (Penn Central) is less
of problem – the regulation is still not taking an entire fee,
even if it is taking all the rights you happen to own.
b. Strategic Splitting of fee into separate fees (Palazzolo) is a
much bigger problem – then you’ve got a total taking of the
fee.
i. court has found a way around this? how?
Exactions
i. Overview
1. exaction: gov’t may imply conditions on development or issuance of
permits which benefit the city (or state, etc) and not the owner.
ii. Nollan v California Coastal Commission - rational nexus
1. Facts: city requires public path to be built across owner’s property
for beach access (essentially demands an easement)
2. Hold: Exaction must be logically related to the specific public need
or burden that the owner’s building creates or to which it
contributes. not found here so exaction is unconstitutional.
3. Rationale:
a. Rational Nexus
i. there must be an essential nexus between legitimate
state interest and the permit exacted by the city
ii. condition attached to the permit must be a credible
way of securing the state’s interest
iii. rationale: dispels suspicion that exaction is simply
allowing physical occupation of property w/out
paying.
b. general point: regulations of property are subjected to
something like intermediate scrutiny for rationality
i. this is probably not going to pose a problem for
PUDs
ii. it will only to the extent that the city tries to extract
totally unrelated things in exchange for the
development
iii. Dolan v City of Tigard – proportionality / reasonable relationship
1. Facts: city required dedication of open space (for flood plain / storm
drainage) and bicycle path at back of a store that was being allowed
to pave its parking lot.
2. Issue:
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3. Hold: Even if logically related to public interest the exaction must
exhibit rough proportionality
4. Rationale:
a. even if city can show logical nexus for exaction it must also
show that permit conditions imposed on owner bear a
‘rough proportionality’ to the negative impact of
development on public.
b. reason: owner should only be required to pay a cost roughly
proportionate to the injury inflicted on the city.
iv. note generally: both Nollan and Dolan deal w/ exactions that deal w/ owners
consenting to trespass violations (physical invasion); how much of the
holdings in these cases are based on the exaction principles (rational nexus,
proportionality), and how much can be attributed to ‘peculiar talismanic
force’?
4. Remedies for Regulatory Taking
a. Suit for Injunction
i. sue and ask court to invalidate regulatory legislation on grounds that it
“takes” property w/out compensation and is, therefore, a violation of police
power under DP clause.
ii. outcome: declaring the regulation as a taking means that ordinance is void as
it is
1. but note: unless it is challenged as constitutionally invalid on its
face the ordinance is probably only void as long as state continues
not to compensate.
2. they can keep up the same practice / ordinance if they want, they
just need to pay for it.
b. Suit for Damages
i. inverse condemnation - sue and ask for damages because regulatory activity
has taken the property; essentially requiring government to pay for a
negative easement
1. landowner suing for compensation instead of government instituting
formal condemnation proceedings; thus “inverse condemnation”
ii. interim damages – if regulation deprives owner of all economically viable
use of the land then gov’t must pay interim damages for the period the
regulation is in effect
1. See First English; Lucas
iii. permanent damages – if ordinance is declared a taking and government
decides to keep regulation in force then it must pay “permanent damages”
c. First English v Count of LA
i. Facts:
1. county announces it will grant no building permits w/in floodplain
area; property owner brings proceeding asking for compensation for
regulatory taking
2. had been a series of dangerous flash floods (debris getting swept
downhill) – CA applied the nuisance exception to this case,
considered it not a taking
ii. Issues:
1. Was case ripe for adjudication given that P had not submitted
building plans?
a. yes, if regulatory body has stated they will not grant any
permits (3 justices dissent – need to file plans)
2. Could state make the sole remedy for P the declaration of invalidity
/ unconstitutionality and accompanying injunction – or does it need
to provide compensation (damages) as well?
a. real question: does state have to pay for a temporary
taking?
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b. note: this presumes that state then modifies the ordinance
once it is declared unconstitutional
iii. Hold: a temporary regulatory taking (interim taking) requires that the state
pay compensation.
1. note: only if regulation is held unconstitutional – which it wasn’t in
this case (CA justifies using the nuisance exception)
2. if unconstitutional then either pay for interim taking and modify the
statute or keep the statute and condemn the land
iv. Dissent (Stevens) – penalty for enacting invalid regulations is too high.
v. Outcome:
1. Does First English create consequences that are so dire that they
chill land use regulation (by requiring payment anytime something
is invalid)?
2. answer: it does raise the bar but it probably does not apply to
moratoria (see Tahoe) which are passed in conjunction w/ zoning
changes
d. Tahoe
i. Issue: Does a moratorium require compensation?
1. argument: coming Lucas and First English to argue that something
that deprives total economic value (Lucas) and is temporary (First
English) requires compensation.
ii. Hold:
1. a temporary building restriction (moratorium) does not constitute a
temporary taking and require compensation
iii. Rationale:
1. moratorium:
a. Lucas and First English do not apply – they both involved
total takings; moratorium is temporary
b. moratoriums also do not involve physical invasion of
property
c. since there is no physical invasion, and not a total taking (it
is temporary) you go to Penn Central analysis
2. Penn Central – lower court did this – determined no taking under
Penn Central
3. Armstrong
a. court moves on to consider Armstrong – more general test –
has too much of the burden been placed on individual by the
regulation?
b. court concludes no but it is a close case
i. moratoria lasting more than a year will need
substantial justification
ii. found here due to the incredible complexity of the
problem and the fact that people were taking a long
time to actually build on their land anyway (they
were just letting the property appreciate)
c. reciprocity of benefit
i. if moratorium succeeds and Tahoe is preserved
ii. this will increase valuation of land – everybody
wins, so this is not an unfair burden / taking
e. Physical Invasion vs Regulatory Taking (Tahoe cont.)
i. Physical Invasion –
1. always entails a taking – this is a ‘per se’ rule and compensation is
required
2. right to exclude violated – size of physical invasion doesn’t matter
3. but: what about temporary physical takings?
ii. Regulatory Taking
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1. court refuses to engage in conceptual severance – even if there is a
property right that has been taken you must consider the entire piece
of property over an infinite time period
a. no conceptual severance applies to different types of
property rights, as well as different slices of time
b. taking airspace rights is the same as denying all uses on
land for a limited period of time.
2. If no total taking then use Penn Central analysis to determine if
compensation is due
5. General Points on Takings
a. ripeness – SC shows a reluctance to come up w/ categorical rules when they don’t
have all the facts
i. what this means is that if you’re going to challenge an ordinance as a taking
you probably need to have gone through hall of the possible steps of appeal
w/ the administrative agency first
ii. but see First English – declaring no granting of permits made the case ripe
iii. but see Penn Central – should P have been required to submit more /
different building plans?
b. Relationship between goal and means of the regulation
i. Goal:
1. nuisance exception – the goal justifies pretty much any means. Even
if the impact is near 100% (Goldblatt) this won’t be a taking if you
can fit it into the nuisance category.
2. not everything qualifies as a nuisance but there is relatively little left
to the idea that the goal of land use regulation is regulated – almost
anything can be found to be rationally related to a valid public goal.
ii. Means:
1. unconstitutional extractions – can’t require somebody to do
something totally unrelated to the development.
iii. the middle ground – how much can you take if it is rationally related to a
legitimate public goal but what you are prohibiting isn’t a nuisance?
1. at what point is it just “too much”
2. consider using Penn Central, Lucas, Armstrong
iv. see Ackerman car example (below) – what means you use to pursue the
goal will determine whether or not there is a taking
c. Challenging the Ordinance – Facially or Specifically
i. Facial Challenges
1. Pierro (boarding houses but not motels)
ii. Specific Challenges
1. ordinance makes no sense when applied to a particular piece of
property (Nectow)
2. ordinace deprives that particular property of all economic value
(Lucas)
3. ordinance as applied to the particular property does not produce a
sufficient corresponding benefit to the landowner (Armstrong test)
a. trickiest test – is the individual landowner being made to
bear too much of the cost.
b. EX: in Penn Central and Palazzolo they said no –
landowner was, on balance, getting enough.
c. EX: wetlands – if owner was bearing too much of the cost
of wetlands preservation this might constitute an Armstrong
taking.
iv. What is just compensation?
1. Market Value
a. general rule: just compensation means that owner must be paid fair market value for
property taken.
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i. note: this does not mean the value to the owner (does not include
idiosyncratic valuation)
ii. thus: if owner has personal attachment / subjective valuation of property a
taking will constitute a penalty even if “compensation” is paid
b. justification: efficiency grounds – easiest, least costly, most objective test to apply.
i. critique: fair market value does not award objectively verifiable costs (i.e.
moving expenses) and it also imposes costs of going to court (either to
challenge the regulation initially or to dispute the gov’t’s offer)
ii. justified: as “part of the burden of common citizenship”
iii. Exception: if there is no relevant market for the property any just and
equitable method of valuation may be employed
1. special purpose property: EX: school, church, park
2. possible valuations: replacement cost, depreciated/adjusted original
cost, capitalization of income, or some other method.
c. Loss of Business – if business is on condemned land it must move. Owner is not
entitled to be compensated for taking of the business; only for the land.
i. EX: Hamburger Heaven
1. situation 1: small commercial establishment operating in an area
subsequently zoned residential. Can the establishment be told to
shut down? Is there a taking?
a. not an open and shut question; but there is considerable
unease about making use of zoning regulations to require
the abandonment of uses that are in fact in effect.
b. whether or not it is a constitutional requirement…
c. it is a statutory requirement in many states as part of Zoning
Enabling Act (ZEA)
2. situation 2: Is there a taking if the commercial establishment is not
yet built and in use but could have been and then the zoning is
changed?
a. not if the regulation is passed properly.
b. these two situations seem to be very similar but society
regards situation one as requiring greater land use
protection.
i. the highest and best use of the land is with the burger
shop on it – this is the same whether or not the business
is actually built or not.
ii. the value of the land taken (rezoning from commercial
to residential) is the same in both situations.
i. look at the value of the land looking forward. don’t
consider sunk cost.
d. Expectations about possible future uses
i. market value test considers possibility of future uses (i.e. speculation) as
well as existing uses
ii. judge must tell jury to consider any evidence that indicates a buyer would
have paid more based on possibility of future use
iii. Expectations about leasehold renewal
iv. Expectations about rights revocable by government
2. Partial Taking
a. generally: if only part of property taken owner can recover for resulting damages to
part not taken (called severance damages)
b. Two methods of “severance damages”
i. Before and After Rule – give owner the difference between the entire tract
before the taking and the value of the land that is left to him. consistent w/
market value approach.
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ii. Value plus damage rule – give owner the sum of the value of the part taken
and any net damages to the remainder after offsetting benefits. separately
evaluate the tract of land taken and the damages to the remainder.
10. The Sale of Land
a. Conveyancing Process
i. contract and conveyance are separate for real estate; note that they are the same for chattels.
ii. need to determine whether seller owns the property – title search, etc.
b. Delivery
i. writing not enough; need to have manifestation of intent to convey (pg 41)
ii. History: basis in transfer or real estate through ceremony of livery of seisen
iii. note: deed in escrow may be considered delivered at date it was placed into escrow if conditions for
relation back are satisfied (See Hood v Webster)
c. The Deed Itself
i. Deed vs Will
1. Deed – actually presently conveys some kind of interest to grantee as of time instrument is
delivered.
2. Will – doesn’t do anything until testator dead. Can always be torn up.
ii. Statute of Frauds
1. Requirements (Section I of SOF – see pg 38) – necessary in order to actually create a
possessory estate; otherwise it will just be an estate ‘at will.’
a. name of grantor and grantee
b. description of property
i. See Harlan – affidavit, mineral leases – not adequate description of
interests.
c. words of conveyance indicating present passage of interest
d. signed and in writing
i. but note: w/out something in writing look to actions of parties as evidence of
terms of transaction (See Hayes v Hayes) – if elements of SOF are satisfied
by actions then you can “take the conveyance out of the statute”
1. by part performance – tenant at will is acting like an owner (See
Hayes)
2. by estoppel – requires more evidence; must show detrimental
reliance and justice can only be done by giving person the property
(money damages will not be enough)
ii. need to look for evidence that what was conveyed was not just an estate at
will – this usually takes the form of detrimental reliance. estate at will can be
converted to estate in fee by detrimental reliance and inaction of fee owner
(See Hayes)
2. note: SOF does not require all elements to be satisfied in a single document (See Metzger v
Miller)
iii. Words of Grant
iv. Consideration
v. Parts of the Deed
vi. Description of the Grantee
d. Description of Land Conveyed
i. Admission of extrinsic evidence
ii. Canons of construction
11. Title Assurance – The Recording System
a. Common Law Rule – Prior in Time
i. first in time is stronger in right – even if A’s deed is not recorded he will win over a subsequent deed
to B that is recorded.
ii. to allow B to prevail requires statutory authority.
b. Recording Acts
c. Mechanics of Recording – see property notes pg 103 – title recording and searching
d. Types of Recording Acts – how to prevail over a prior conveyance
i. Race statutes (least common)
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1. B (subsequent conveyee) must (1) record first and (2) be a purchaser (can’t be a gift – must
be consideration)
2. even if B knows about prior conveyance he will win if satisfies statute.
3. note: notice is irrelevant – doesn’t matter whether prior purchaser had notice or not.
ii. Notice statutes
1. B must (1) have no notice and (2) be a purchsaser. bona fide purchaser w/out notice
2. no requirement to record so B prevails over A if neither record. C will then prevail over B.
3. rationale: encourages conveyee to record – that gives notice to any subsequent conveyees.
iii. Race-Notice statutes
1. B must (1) have no notice, (2) be a purchaser, and (3) record before A.
2. rationale: remove protection of Notice statute – require recording to prevail over A.
iv. generally: if terms of statute not satisfied then common law prior in time rule applies.
v. Different Types of Notice:
1. Actual Notice – means just what it says
2. Constructive Notice – notice of what a reasonable search of records would have discovered.
(also called record notice – see Waldrop, notes pg 104)
3. Inquiry Notice – notice of what is in the record + what reasonable inspection of premises
would have shown.
e. Effect of Recordation
i. Effect of failure to record – recording not required but unrecorded deed may not be as effective
(marketable).
f. Requirements for Recordation
g. Who is Protected by Recording Acts
i. Purchasers
ii. Without notice
iii. Valuable Consideration
h. Chain of Title Problems
i. Wild Deeds
ii. Estoppel by deed
iii. Deeds recorded late
iv. Deeds from common grantor
i. Defects in Recording System
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THE THEORY AND POLICY SECTION
1. General Theory of Property
a. Hohfeld - Rights, Powers and Privileges: W. Hohfeld (supp 25) – property refers to relationships between
human beings. Rights are not in a piece of property, they are rights vis-à-vis others w/ regard to a particular
piece of property. Look at correlative definitions:
i. Right to possess –Everyone else has a duty not to interfere with that possession. (possible exception
gov’t).
1. absolute duty for everyone not to interfere in all circumstances? no – possible exception is to
escape a crime; certain extreme situations.
2. this is still as close to an absolute right as you can get. notice to the world – stay off unless
you have my permission.
ii. Privilege of use
1. not a right – others don’t have any duty to use or not use your land. do say you have a right
implies others have some duty.
a. You have privilege to use your land but other people do not have a right to stop your
use of the land.
b. privilege implies an absence of duty on my part – and ‘no right’ on part of others.
2. EX: Keeble – Keeble’s privilege (of use of pond) involves a right to keep others from using
decoy pond; and to be free from interference in his exercise of that privilege.
iii. Power – to change existing state of right/duty or privilege/no right
1. power to convey – don’t necessarily have to convey the whole thing. could convey a
privilege to enter onto property, or to use property. this changes situation of person to who
this is conveyed – no longer have a duty to stay off, they have the jural opposite of duty
which is privilege.
2. correlative of power – virtually everyone in the world is potentially liable to the exercise of
that power. (can convey privilege or property to just about anybody)
iv. Immunity – you’ve got an immunity from having somebody else make changes to what you’ve got.
1. EX: limited immunity – government is disabled from taking your property away from you
unless they pay compensation.
2. immunity is similar to freedom from legal power or ‘control’ of another as regards some
legal action
b. Natural Law (from possession section above)
i. occupation theory: possession = ownership. (see Hobbes, Puffendorf, Justinian, Blackstone)
1. what individual can take out of common stock she has a right to.
2. individual based theory – go out and claim your property, possess it, defend it.
3. protect first / current occupant – easy to apply and to enforce
ii. labor theory: investment = ownership – want to reward person that invests labor (see Barbeyrac,
Locke)
1. creation myth – property is created by putting effort into harvesting (i.e. acorns, apples, etc)
2. protect acquisition and, by so doing, protect the effort they put into the property.
iii. personality theory (Hegel)
1. Differs from Labor Theory (Locke)
a. no creation myth
b. Hegel makes use of will; Locke makes use of labor – individuals invest their will
into something and that creates property
i. the only way for an individual to express his will is through property
ii. thus, to classify something into which will has been invested as something
other than property is to diminish the individual (EX: Flemming v Nestor –
classify social security not as property then this diminishes individual)
c. result: easier to justify state control of property as a manifestation of the collective
will.
2. State Control of Property
a. by and large Hegelians have less difficult justify state control of and interference in
property
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i. you would think Hegel would have trouble w/ this given that taking property
from an individual involves taking part of his will
b. Hegel on Civil Society
i. society consists of the sum of the individual wills of the members of the
society
ii. that sum is greater than its parts
iii. so the collective will is even more important than individual will in Hegel’s
political theory – collective will dwarfs the interests and property rights of
the individual.
c. but: the function of the collective will is to maximize, to the extent possible,
individual wills
i. this reflects Hegel’s basis in Kant
ii. want to improve society overall but do so w/out making any individual
worse off than absolutely necessary
3. Results / Consequences
a. very unclear – anything from Nazis to Oxford Idealists
b. Property incorporated in Personality
i. interfering w/ property is a violation of personhood
ii. you may be able to justify this in light o the collective will but it certainly
should not be done lightly
1. similar to Bentham – hesitant to destroy property expectations
4. Reich
a. similarities to Hegel
i. people depend on gov’t largess (i.e. social security, See Flemming) – to the
extent that the gov’t does not treat this as property it diminishes individuals.
ii. this has a Hegelian ring to it (see above – investment of will)
b. differences from Hegel
i. Hegelian inequality
1. Hegel believes the state advances reason – wants to allow full
freedom of will/property in order to further this
2. Hegel believes that because everybody has a different will there will
never be equal distribution; different wills acquire more or less
property
3. full freedom + different wills means that some people will have
much more in the way of property (and will) than others
a. doesn’t this create a scarcity problem? what if the total
available will exceeds the total available property. then
some wills are getting stifled?
ii. Reich is more egalitarian
1. doesn’t think society is progressing in any meaningful way
2. so he thinks what we should be doing is engaging in redistrubtion
c. article on The New Property prompted by Flemming v Nestor
c. Utilitarian Theory - Bentham – Theory of Legislation / Expectations
i. Generally: do the sum of benefits produced exceed the sum of costs? If yes then proceed
1. note: benefits here refers to happiness, however that is determined.
2. c.f.: Demsetz – benefit he refers to is wealth maximization
ii. No natural property – no property w/out law
1. property is created entirely by law
2. the notion of property is one of expectation – expectations about what the law will do
a. property rights are those expectations which the law stands behind – this is Bentham
and Holmes in Willow River
3. denies prior natural law theory of property (above)
iii. State of Nature
1. doesn’t quite get away from notion of pre-state origin of things – people have property in
what people can physically possess and defend
a. see Hobbes – nasty, mean, brutish and short
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b. pre-property hoax – this isn’t actually real property
2. to the extent people agree to respect property (i.e. the deer you killed) it is really law
iv. Legislator’s Responsibility
1. the one making the law has complete power to change the notion of property – what the law
creates the law can take away
2. but if the law creates an expectation than it is the duty of the law to preserve that expectation
a. must consider the costs of frustration of expectations when doing utilitarian
calculations
b. few changes in the law which cause frustration of expectations will result in net
increase in happiness
3. goal of legislator is to increase sum total of happiness.
v. Consequences of Bentham’s argument
1. biased in favor of the status quo – don’t want to upset expectations
2. why is expectation in property more important than in other areas of law (i.e. contract or
tort)?
a. unclear
b. perhaps it is easier to remove expectation of something (say tort) that you have not
personally invested in
i. difference between right to possess what you have and right to be free from
harm (which is a negative right)
ii. but this is a Lockean idea – based on labor theory
iii. so unclear…
3. Private vs Public (state) Action
a. Bentham hypothesis is that all property is created by the law (i.e. by the state) and
that you have no property w/out it.
i. set natural law theory to the side
ii. this creates a severe problem with the public-private distinction (i.e. the
important questions in cases like Shelley v Kraemer; Civil Rights Cases as
well as many, many other areas – eminent domain, etc.)
b. Justice Holmes supports this notion – if the law doesn’t stand in back of a right there
is no right at all
i. is this really true? are there some rights, at least minimal rights, that don’t
require the enforcement of the law? would be hard to show this…
d. Kantian Approach
i. Overview
1. only vaguely related to Kant – start w/ the same utilitarian approach as above but add a
caveat:
2. only proceed if no individual is made worse off as the result of the regulation
a. doesn’t this sound Rawlsian?
b. consider pareto condition
3. categorical imperative entails that people not be used instrumentally and add the Hegelian
notion that people’s property is somehow in them (via the will) – thus you can’t use property
instrumentally
a. see Ackerman
b. look at activist judge section
ii. Ackerman – Private Property and the Constitution
1. Property Law should not be instrumental
a. consider both the benefit that accrues generally from the property law / rule (i.e. a
regulation requiring a 5 ft set-back) but also the costs / benefits this imposes on
specific people
b. ex: regulation takes a 5 ft strip of my property
i. I’ve lost something but, suppose, everything else that I own increases in
value 5x.
ii. This is something that we in fact do take into account when considering
payment for taking of property today.
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iii. but – also need to consider the benefits that accrue to the person as the result
of living in an ordered society
1. part of the tradeoff for living in a functional society is submitting to
regulations like these
2. this starts to look like the Armstrong calculation – what is the fair
burden of citizenship?
2. Ackerman on Takings – how you choose to effectuate policy is important
a. Car hypo – how to limit exhaust fumes
i. take the second (or third) car away from every family
ii. impose a tax on people who have more than one car that would be economic
equivalent of taking their car
iii. pass a regulation that allows people to own as many cars as they want but
only one can be driven
b. from an environmental point of view, all three achieve the same result. from a policy
perspective:
i. definitely requires compensation
ii. almost certainly constitutional but would be politically very difficult
iii. unclear whether or not this is a taking
c. point: the method by which you pursue your goals is hugely important
e. Demsetz – Maximization of Wealth
i. Origin of property
1. starts w/ notion that property is held communally
2. similar to Blackstone, Locke who have notion of common stock but Demsetz’s origin idea
includes a society (as opposed to just collection of individuals) that is happy / accepting of
communal ownership of property
3. note: community property means that not everybody in the world can access it; only people
of the recognized community can access the property
ii. Development of private property – from origins of communal property
1. emerges as means to maximize wealth
2. EX: Montagnes (fur trapping Indians, Quebec, 18th Century) – move to private property
a. before arrival of European fur trade land / property is held in common
b. arrival of fur traders increases economic value of fur – creates a problem of
conservation; now all of a sudden you have limited resources
i. before you were only trapping for fur – there was more than enough to go
around
ii. no you are trapping to sell – try to trap as much as there is which necessarily
creates a problem of over-use
c. rise of demand and decline in supply cause property to be divided between
individual hunters/families w/in the tribe – set up a system of private ownership in
order to facilitate conservation
iii. Benefits of Private Property
1. economically efficient – allows maximization of wealth
a. premised on the notion that the ultimate goal of society is wealth maximization
b. compare Bentham / utilitarianism – ultimate goal is maximization of happiness
2. allows internalization of costs – place what losses do occur (from lack of conservation, overtrapping) on the individual rather than the collective
3. problem
a. this works fine with stationary resources
b. less clear that it would work w/ movable ones (i.e. animals that range beyond
property boundarires) or w/ intangible things (i.e. environmental concerns like
global warming)
4. another problem – IP
a. intellectual property is not a problem of scarcity – there an be an infinite amount of
intellectual property; so there isn’t the same resource allocation problem
b. so why does private ownership, instead of communal, make sense in this context?
f. Western theory of property law (Donahue) - Absolutism
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i. Absolutism
1. attempt to give absolute power to convey, absolute privilege of use, etc.
2. tension – absolute property right of mine comes into conflict with your absolute right; no
man’s land is an island
a. nuisance: only a nuisance if it interferes with your use – takes two. EX: my privilege
to build a rendering plant interferes w/ your privilege to play piano w/ windows
open.
b. estates and future interest: absolute power to convey not absolute unless I can
condition the conveyance. but that is in tension with your absolute power to convey,
absolute privilege of use, etc.
i. Rule Against Perpetuities helps to mediate this tension
ii. Legal Conception of Property vs. Social Conception of Property
1. the two may not coincide (Ackerman)
2. EX: airplanes in your airspace
a. Legal Conception: property rights extend all the way to heaven and all the way to
hell; airplane in your airspace is trespass
b. Social Conception: nobody actually believes airplane at 10,000 feet is trespass. But
what about at 50 feet?
3. Ackerman:
a. suggests that the social conception, which is intimately connected with the physical,
is driving the conception of property as it is embodied in constitutional
jurisprudence. And this is what prevents us from taking a more intellectual/scientific
approach to solving this problem
b. overemphasis of physical property rights (‘peculiar talismanic force’) gets in the
way of coming up w/ a more rational framework for property.
i. EX: hamburger example
1. look forward when considering the value of the land taken – this is
the same (rezoning from commercial to residential) whether or not
there is a business on the land at time of rezoning
2. yet, people don’t feel the same way about it. strong feeling that,
even if not unconstitutional, it is more wrong to close down the
existing business (use)
a. that is why there are provisions against this as part of ZEA
b. see more detailed explanation above for more
c. bottom line: something about our concept of property; and our privileging of the
expectation of property over other expectations; and our association of property with
tangible things…that makes intelligent policy making very difficult.
2. Deciding what is good property law
a. Judicial Review and Deference
i. Activist judges – weak deference to legislature; legislature may get calculations wrong frequently
and, thus, they should make their own inquiry to see whether the property law makes sense.
1. See Mt. Laurel cases – need to diffuse not in my backyard problems
ii. Passive Judges – strong deference to legislature. By and large legislature can more accurately make
these calculations.
iii. passive and activist judges can be found in both utilitarian and Kantian camps
1. but activist judges more likely to be Kantian – fear legislatures ignore individuals (especially
minorities) in the calculations and simply sum across all of society
b. Legislative Calculations
i. all policy makers should consider that we can’t determinatively say where costs and benefits lie with
the appropriate degree of accuracy
ii. transaction / process costs
1. how high these are may effect how active a stance a judge will take – did the legislature even
have a prayer at getting the calculations correct?
2. but no matter what, nobody will be able to overcome all these costs
iii. Benefits over judges
1. can ask questions judges cannot
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2. legislators chosen by democratic vote – selection process builds in some rough reflection of
costs / benefits – ideally people vote for electors who benefit them
iv. issue: who is better at managing transaction costs and making calculations about whether or not
proposed law or rule of property benefits society? legislators or judges?
c. Hypo: a regulation that makes one group significantly worse off but benefits society overall. Good or bad
law?
i. Utilitarians – this is fine; greatest good to greatest number
ii. Kantians – no good as is; need to find a way to transfer at least enough of the benefit to those who
are harmed by regulation so that they are no worse off. if transaction costs involved in this are too
high then regulation shouldn’t be passed.
d. ultimate problem: the law is miles away from even this hypothetic scenario; we don’t even engage in
anything like a debate over whether Kantian or Utilitarian analysis makes sense (Ackerman); so Donahue
thinks we may need to start over.
3. Intellectual Property
a. Locke’s theory as foundation – right to exclude is basic premise; once you invest time and effort there ought
to be legal protection; reward inventor, author, etc.
b. Article 1, section 8 of Constitution
4. Interests in Land
a. Covenants
i. Pistons Theory – the more you have of one requirement the less you need of another
1. particularly true with touch and concern and intent
2. reality: different sets of rules but most covenants are sustained one way or another
ii. Running with the Land – Covenants Disfavored
1. 19th and early 20th century – decided discomfort w/ having covenants run
a. rationale: create restraint on alienability
2. subdivision developments change courts attitude
a. rationale: in these situations covenants actually enhance marketability
b. private land use controls by and large a valuable thing; people willing to pay for
them
iii. Creation of Equitable Servitudes – from contract to property in Tulk v Moxhay
1. want to enforce the covenant made re: Leicester Sq. But negative easements are limited to
four categories and covenants do not run with the land..
2. interference: contract theory employed by court
a. general duty of anyone who has notice of a K not to interfere w/ performance of that
K
b. this is normally a negative doctrine – comes to be a positive one tha compels
positive performance, not just non-interference
c. rationale: if I turn myself into the only person who can perform the K (and I know
about the K) then the negative duty becomes a positive one to honor the K
i. promisor can’t satisfy K anymore – he doesn’t own the land
d. note: this is likely the theory that the court actually used in Tulk – court uses contract
theory
e. problem: might leave promisor open to continued liability after parting w/ property
i. solution: tenant who sub-leases is liable; fee owner who conveys his land is
not
3. equity: equity opens up easements – property theory
a. add new categories to the four basic categories allowed.
b. but if this is all that equity did then how do we get affirmative covenants running
with the land?
i. look at Neponsit – touch and concern allows it to run w/ the land where prior
covenants did not
ii. covenant was limited in duration – helps prevent perpetual covenants;
reduces fears about restraints on alienation
iii. but see – Eagle Enterprises – affirmative covenant not enforced – but note it
was at law
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4. Courts Today – use contract theory for covenants contained in a lease, and property theory
for covenants contained in an agreement between owners in fee.
a. lease covenants
i. contract theory prevails – original promisor remains liable on covenants
even after assigning a lease
b. fee owner covenants
i. property theory prevails – once the fee owner sells property he is no longer
liable on covenant.
iv. Touch and Concern – what qualifies?
1. some courts – require covenant that physically relates to the land (as in the wall in Spencer’s
case)
2. restatement first – for burden to run both burden and benefit must touch and concern same
land (not a problem in Spencer’s case; will be a problem for neighbors);
a. thus, benefit of covenant cannot be held in gross if burden is to run w/ land at law
3. Judge Clark’s view [956] – anything that affects legal relations of landowner in his or her
capacity as a landowner will meet requirement
a. critique: this is circular – if it runs with the land it will of course affect their interests
4. Professor French – turn touch and concern requirement into an investigation into the content
of the covenants from a policy point of view; is this the kind of covenant that we want to
impose on somebody who did not actually promise themselves?
v. Benefit in Gross – property vs. contract theory
1. property theory – courts that use this theory have problems holding / assigning the benefit of
an equitable servitude in gross
a. EX: English courts – benefit of equitable servitude can’t be held in gross
b. original K (granting benefit in gross to someone) is only enforceable between
original promisor and promisee
c. once promisor conveys the land the promisee is out of luck – can’t enforce benefit in
gross
d. rationale: property theory relies on equitable servitudes as an expansion of
easements – so if problems with easements in gross then problems with equitable
servitudes in gross
2. contract theory – less of a problem allowing assign of benefit of an equitable servitude in
gross
a. no particular reason why beneficiary of K has to be owner of property
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