Tushnet, Property, Spring 2013 answer memo
Introductory note: the general quality and grasp of the fundamentals was high. This is good
news: this is a group of people who will become fine lawyers. But this also did put pressure on
the curve; if you missed one big issue, that could be enough to drive your grade downwards.
If you want to read my comments on your own exam, you may email my assistant, Tyrone
Manzey, tjm95@law.georgetown.edu, with your exam number.
Question 1: (The best name given here was The Sarah Connor Covenants, though honorable
mention goes to Hasta La Vista, Burden)
Sarah Connor bought a parcel of land in 2000 for use as a restaurant. Shortly thereafter,
she began discussions with Catherine Weaver, who owned the adjoining land, about buying
Weaver’s land, but the negotiations failed and the relations between Connor and Weaver
were acrimonious. In 2010, Connor sold her parcel to James Ellison for $1.5 million,
subject to the following restriction:
Grantee [Ellison] covenants for the benefit of Grantor [Connor] and her successors and
assigns that neither Grantee nor his successors or assigns shall at any time hereafter
develop, directly or indirectly, the land described above and conveyed by this deed (the
“Conveyed Land”) together with the adjoining land (the “Adjoining Land”) presently
owned by Catherine Weaver. In furtherance of the above, Grantee and his successors and
assigns shall not (i) grant for the benefit of the Adjoining Land, easements upon or rights of
way across the Conveyed Land or (ii) construct or permit any other party to construct a
building or other improvement which shall straddle the common boundary of the
Conveyed Land and the Adjoining Property. Grantee and his successors or assigns shall
maintain a fence or other device on the boundary between the Conveyed Land and the
Adjoining Land to preclude the passage of motor vehicles and pedestrians between the two.
Ellison defaulted on his mortgage in 2011, and the Zeira bank foreclosed. Zeira had
trouble finding a buyer because of the restriction, but eventually sold the property (for
$500,000) to Weaver. Weaver took subject to the restriction, but wanted to develop the
property in conjunction with the adjoining land. Connor offered to release the covenant
for $3 million, but instead, Weaver sued to invalidate the restriction. Who should win?
Initial notes: (1) I was serious that you should use the Restatement. If your answer used terms
like “horizontal privity” you had a problem. (2) There was no merger. Connor always held the
benefit (in gross; it was not appurtenant to any retained land mentioned in the facts); the benefit
and the burden were never united under joint ownership and therefore extinguished. Had there
been merger, there could not have been this lawsuit. (3) Although it can be difficult to
distinguish between an indirect restraint on land (valid unless irrational) and a direct restraint
(valid unless unreasonable), being able to categorize these restrictions was important. The best
answers noted that the restriction on granting easements to anyone who owned the adjoining land
was a direct restraint on alienation; the others were indirect restraints.
Sample student answer:
Catherine should win, and the court should invalidate the restrictions as invalid servitudes
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violating public policy under Restatement § 3.1. As a preliminary matter, the restrictive
covenants in the deed to James run with, or are appurtenant to, the land, because they apply
to the Grantee's "successors or assigns" indefinitely. The restriction on any development
with the adjoining land is a direct restraint on alienability, because it is a direct prohibition on
a certain type of transfer—a sale to the neighboring property. The other restrictions,
prohibiting easements and maintaining a fence, are indirect restraints on the alienability,
making the property more difficult to sell or otherwise reducing the sale price.
With respect to the invalidity on public policy grounds, the Restatement prohibits
servitudes that are arbitrary, spiteful, or capricious. § 3.1. Sarah's direct restriction on any
sale to or easement granted to the adjoining land presently owned by Catherine certainly
seems spiteful. The primary purpose of the servitude was to cause harm to Catherine,
depriving her of any easement on or opportunity to buy the land, as a result of Catherine's
previous refusal to sell her land to Sarah. The direct restriction on sale to Catherine may also
be capricious, since no legitimate explanation for that restriction seems discernible.
Even if the court finds that the restrictions werenot spiteful and/or capricious, they are
unreasonable restraints on the alienability of the land, another reason for their invalidity
under § 3.1. A servitude that imposes a direct restraint on alienation of the burdened estate,
such as the restriction against any sale to Catherine or later owners of the adjoining land, is
invalid if the restraint is unreasonable. Reasonableness is determined by weighing the utility
of the restraint against the injurious consequences of enforcing the restraint. Restatement §
3.4. Here, the utility of the restriction is minimal, if any. Sarah's personal reasons for the
direct restriction are not expressed in the covenant, nor are they apparent from the facts
provided. On the other side of the scale, the injurious consequences are significant. The
value of the land dropped from $1.5 million to $500,000 as a result of the combined
restrictive covenants. Moreover, there is a strong policy argument to be made that we should
not allow property owners to put unreasonable restrictions on the deeds to their land in order
to get the neighbor, who the property owner knows is interested in purchasing the land, to
pay a large sum of money to release the covenant.
With respect to the easement restrictions and fencing requirement, which are indirect
restrictions, they must only be rational. Restatement § 3.5. This standard is very deferential
to the grantor, giving Sarah a stronger case. Sarah might argue that the easement restrictions
and fence requirements have a rational basis in preserving the integrity of the property,
preventing minor encroachments by neighbors from becoming easements by prescription,
and preventing the path from becoming a public easement. However, if the development
restriction is invalid, due to spiteful creation or unreasonableness, requiring strict divisions
between the two properties no longer has a rational basis. Therefore, Catherine should win.
Question 2: (The best name was Pretty Little Land Grants)
(A) Ashley Marin conveys property to Hanna Marin for life, then to Spencer Hastings if
Spencer gets married, but if Spencer does not have a daughter, Emily Fields shall take the
property at Spencer’s death. Spencer Hastings has never been married or had children.
What is the state of the title?
(B) Hanna subsequently dies while Spencer is still alive, unmarried and childless. What is
the state of the title?
(C) After the events in (B), Spencer has a daughter while still unmarried. What is the state
of the title?
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(a) (.5) Hanna Marin has a life estate, subject to executory limitation if Spencer dies without
having a daughter while Hanna is still alive.
Spencer Hastings has (.5) a contingent remainder in fee simple (.5) subject to executory
limitation. She isn’t required to have a daughter in order to take, so her remainder is contingent
only on getting married. It’s not a contingent remainder in life estate because nothing in the
grant to Spencer limits the grant to her lifetime, and her death in itself doesn’t naturally terminate
the estate; only her death without having had a daughter would matter. (Consider what happens
on the other side: Emily’s interest can be destroyed long before Spencer’s death, when Spencer
has a daughter, suggesting that this is not an interest defined by Spencer’s death.) Other
wordings could have created a life estate, but not this one.
(.5) Emily Fields has an executory interest in fee simple.
(.5) Ashley Marin has a reversion in fee simple (.5) subject to Spencer and Emily’s executory
interests.
(.5) The grant to Spencer Hastings is subject to the RAP, but passes: we’ll know whether she’s
married within her lifetime, and she’s a life in being. The grant to Emily Fields is subject to the
RAP, but passes: we’ll know whether Spencer has a daughter within Spencer’s lifetime.
(b) (.5) Ashley Marin’s reversion will become possessory. (.5) The reversion will be subject to
Spencer’s executory interest (which will itself still be subject to executory limitation) and to
Emily Fields’ executory interest. Spencer now has an executory interest, not a contingent
remainder, because her interest no longer follows the natural termination of a preceding estate.
While Hanna’s life estate naturally terminated, Ashley’s reversion does not of itself naturally
terminate. So if/when Spencer marries, her interest will step in and cut off Ashley’s reversion.
(c) (.5) Emily Fields’ executory interest will be destroyed by the birth of Spencer’s daughter.
There’s no requirement that the daughter survive any particular period, just that she be born. (A
grant that required Spencer’s daughter to be “then living” to keep the property out of Emily’s
hands would be different.) But Ashley Marin will still be subject to Spencer’s executory interest,
which will become possessory if Spencer subsequently gets married.
Question 3: (Homeland Grants)
Saul Berenson conveys a parcel of his land to Carrie Matheson. The written deed does not
mention any easement over the remainder of Berenson’s land. Matheson records the deed.
Matheson’s land is surrounded on three sides by Berenson’s retained land, and the fourth
side is bounded by Okkervil River, which is not navigable. Matheson, who is a bit of a
loner, accesses the nearest public road, Langley Road, by means of a footpath over
Berenson’s land. The footpath goes through a part of the land Berenson uses to store
junked cars. Berenson never objects to Matheson’s use. Matheson builds a small cabin on
her land.
Two years later, Nicholas Brody wants to buy Berenson’s land, and asks Berenson about
Matheson’s parcel. “Carrie’s a good neighbor,” Berenson says. “She won’t give you any
trouble.” Brody buys the land and records the deed. Brody then starts to clear out the
junkyard in order to build a complex for his high-tech startup. Security will be tight, so he
builds a wall around the planned facility with only one gate, which opens onto Langley
Road.
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(A) Carrie Matheson sues for interference with her easement to cross Brody’s land. The
relevant recording statute reads: “Every conveyance of real estate which shall not be
recorded shall be void as against any subsequent purchaser in good faith and for a valuable
consideration of the same real estate whose conveyance shall be first duly recorded.” Who
should prevail and why?
The best way to avoid confusion was to identify Matheson’s easement, then discuss whether it
survived after the burdened estate was transferred without a recording of the easement. Creation
and survival in the absence of recording are separate issues.
First, what kind of easement did Matheson have? Prior use is not the best answer. The facts
don’t indicate that the footpath preexisted the severance of the parcels, which is the relevant
time at which we assess “prior” use. The best answer is “easement by necessity,” because she
didn’t have it long enough for prescription; there’s no estoppel since Berenson never gave her
explicit permission on which she relied; and she meets the requirements for an easement by
necessity, since her parcel is landlocked without an easement.
This is a race-notice statute. The key question here was whether Brody could qualify as a bona
fide purchaser, given the configuration of the land and the rather ambiguous statement made by
Berenson. My perspective: Even if she’s a good neighbor, Brody really should have been able to
look at her parcel and see that she had to have some sort of easement, or she’d be landlocked,
given the configuration of Matheson’s parcel. Berenson’s statement is simply too ambiguous to
provide the requisite clarity: Brody was on inquiry notice to seek further clarification.
Other people pointed out that the Restatement specifically indicates that easements by necessity
shouldn’t be destroyed by the operation of a recording statute that would otherwise apply if the
necessity still exists, since there’s a policy interest against having landlocked parcels and since
experience has shown that people fail to record even when they really should and are given
incentives to do so. This overlaps with the idea that Brody had inquiry notice: when a parcel
would be landlocked without an easement, that should probably be apparent by reasonable
inspection; the Restatement provides another path to the same result.
Sample student answer:
A) Was there an easement created?
Under normal circumstances, an easement is an interest in land and can only be created by a
contract or conveyance in writing that complies with the statute of frauds, and here the
written deed does not include any easement. Here, however, the court should find that there
was an easement created by necessity under §2.15.
Necessity
Carrie will argue that the court must find that an easement was created by necessity at the
time of the initial conveyance because an easement was “necessary to reasonable enjoyment
of the land,” i.e. her ability to even access her property without being a trespasser. §2.15. In
the absence of an easement it would be impossible for her to even get to her property in the
first place – the river is un-navigable and she’s surrounded by Berenson’s parcel. Moreover,
the language and circumstances of the conveyance contain nothing that would indicate the
intent to deprive Carrie of the right to access Langley Road. Even though the court is also
loathe to find an easement by necessity, again because of the desire to have interests in land
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found in writing, just looking at a map would show you that there would have to be an
easement for Carrie’s parcel for it to have even the slightest bit of value. So, the court should
probably find that an easement was created by necessity.
Other Options
Creation by prescription is out because the statutory period hasn’t run, §2.16. and prior use is
out as well because there was no similar prior use before the conveyance. §2.12. It’s also not
within the exception to the Statute of Frauds under§2.9, because it there wasn’t any verbal
agreement about a servitude.
Was it extinguished by Brody’s recording?
Good Faith?
Since this is a race-notice statute, the court would have to find that Brody was a good-faith
purchaser before Carrie’s easement could be extinguished. Brody will argue that because
Berenson said “[Matheson] won’t give you any trouble,” and that because the easement wasn’t recorded,
that there’s no way he could have known that an easement would exist.
However, the circumstances in this case are so extreme that Brody’s pleas will probably fall
on deaf ears. Just looking at a map would have provided constructive notice to Brody that
there was probably an easement for Carrie’s parcel,and at a minimum he should have had to
explicitly inquire about it. §7.14(3). In a sense, it’s analogous to Sanborn v. Mclean – while
there is not a general plan in this case, in both cases simply looking at a map of the parcels
would put someone on notice that there was an unmentioned covenant somewhere here.
Moreover, the statement “she won’t give you any trouble,” is very ambiguous, and it’s a
stretch to read that as saying “she won’t walk on your land.” If an easement was created,
Brody’s lack of good faith is one reason the recording act won’t extinguish it.
Recording Act?
The other issue is that the servitude here would probably fall under the exception in §7.14 –
servitudes created by estoppel or necessity can’t be extinguished by a recording act if they
would deprive the dominant estate of rights of way for access. §7.14(1). That’s precisely
what’s happening here – Carrie is losing her primary right of way to the road. Brody really
doesn’t have too much of an argument here – his only real argument is that he could say that
his facility hasn’t completely blocked off access to the road, in that perhaps Carrie could
walk around the facility in order to gain access to the rest of the world. That’s unlikely to cut
it – this is still substantial interference, and an easement is a broad enough right that such
interference would constitute an infringement. Carrie should win because an easement was
created in the conveyance, by necessity, and because Brody’s later recording cannot
extinguish that easement.
Alternatively, I consider this answer a very good try at a tough position:
Under the race-notice statute, only subsequent BFPs who record first and lack notice are
protected. The fact that Carrie doesn’t appear to be a BFP, and rather is a donee, is irrelevant,
because the point of the recording system is to identify what people own, and Carrie owns part of
Saul’s land since he gave it to her. Although Carrie recorded her parcel interest first, she did not record
her easement. And since the statute refers to “the same real estate,” and the only “same
real estate” that Carrie and Brody are claiming to have a right to is the easement, the fact that
Carrie’s easement was not recorded is likely indicative of the fact that she in fact did not record
first, even though she recorded her conveyance first.
Thus, there is the question of whether Brody, as a subsequent BFP, had notice, since
Carrie recorded her conveyance but not the easement(note – I’m calling him Brody because
that’s what he’s called in Homeland and how he’s referred to in the question, not because I’m
calling the men by their last names and the women by their first names). Although Brody may
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have known about Carrie’s parcel on the land if he did a record search, since the deed did not
mention an easement, he is likely not on record notice with respect to the easement. Thus,
another question becomes whether or not Brody was on constructive notice that Carrie had an
easement implied by necessity. He did not have actual notice from that conversation, since Saul
didn’t give any indication when talking about Carrie’s parcel that there was an easement. He may
have been on inquiry notice, but he did ask about Carrie’s parcel. Arguably, he should have
asked how she accessed the Langley Road, but if he didn’t know Okkervil River was not
navigable, maybe he thought she went places by boat. Likely, the court would find that Brody
was not on notice, because he did inquire, the inquiry did not reveal any information that would
have put him on additional notice, and he did not have record notice from his title search, or
actual notice. Thus, since Brody was not on notice that Carrie had an easement, and since he
recorded (as a BFP) his interest in the land where the easement is located, he may actually be
considered to have come first. It is likely that Brody comes under the protection of the racenotice statute,
and he in fact owns the easement.
Additionally, the court will have some discretion in how it wants to interpret the effect ofthe recording
statute on the easement. Restatement 7.14 recognizes that people often make
mistakes in recording, so it takes the position that the courts should ignore the effect of the
recording statute. It says although people should be recording, they don’t, so it’s costly to cause
them to lose the interest by operation of the recording statute. Thus, if the court takes this view, it
may not punish Carrie for not recording her easement, because it recognizes the reality of the
situation that people don’t always record. Generally, however, courts hold easements binding on
the BFP only when the easement doesn’t cause harm. Since it seems that Brody has already built
the wall, it may cause him substantial economic harm to cause him to tear it down. Also, since he
plans on starting a company there with tight security, he may have already invested a decent
amount of money into drawing up plans, getting permits, and the like. If the court finds that the
easement is binding on him, it may do him substantial harm. Thus, even if the court finds that
Carrie recorded her interest first, or that Brody was on notice [professor’s note: if he was on notice, he’s
out of luck unless the court moves the easement under principles of equity], it may still give effect to
Brody’s
interest in the easement. Thus, it is very likely that Brody will prevail.
(B) Regardless of your answer to the first part of the question, assume that Brody prevails.
Brody refuses Matheson access to her parcel. Matheson, furious, leaves to go live in
Washington, DC. Each and every year on January 1, she mails Brody a request to
purchase an easement to cross Brody’s land via some other path. Brody always ignores her
letters.
Brody’s daughter Dana moves into Matheson’s cabin. After ten years have passed, Dana
Brody brings an action to quiet title in the parcel, claiming ownership by adverse
possession. The statutory period for adverse possession in Disturbia is seven years, and
Disturbia does not require payment of taxes for adverse possession but otherwise has no
controlling precedent. Who owns the land and why?
The two key questions here were what standard of “claim of right” should apply (good faith, bad
faith, or objective) and whether Dana Brody’s occupation was open and notorious in the specific
circumstances of this case, where Matheson cannot access her parcel—and thus cannot see
whether it is being occupied—without trespassing on Nicholas Brody’s land. Absent control of
drones, it is hard to see how she could know, and therefore she’s not “sleeping on her rights” in
the way that we ordinarily think owners who don’t check in on their properties are doing. Her
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letters would not ordinarily be enough to interrupt adverse possession—actual ejection or at least
legal proceedings are required to do that—but in the specific circumstances here, Dana Brody’s
possession might not be open and notorious. In the alternative, some people argued for a good
faith standard, or for a special exception to the ordinary objective test when an owner has been
legally prohibited from determining whether her parcel is being adversely possessed. Others
argued that, despite the harsh results of the ordinary rule, it should be applied here in order to
further the policy of productive use of land. As long as you explained why Matheson’s legal
inability to check on her own land without engaging in trespass (or perhaps drone surveillance)
should be disregarded, that was a fine answer.
68767 for second half
Sample student answer arguing that Matheson should win:
Threshold Questions: Actual Possession, Exclusivity, and Continuity
Dana Brody meets three of the five requirements for adverse possession very clearly – she is
in actual possession of the property (having moved into the cabin and living there,) she is in
exclusive possession of the property (being the only person who lives there,) and she has
lived there continuously for the statutory period of seven years. The questions are whether
her possession was “open and notorious” under the circumstances, and whether her
possession was “adverse and under a claim of right.”
Open and Notorious
Under most circumstances, living on a property for ten years is open and notorious, because
property owners would be put on constructive notice– if they were paying any attention at all
to their property, they would have discovered the adverse possessor. However, because
Brody won on the previous question, Matheson has nolegal way to access her parcel, and
thus no realistic way of knowing whether someone was occupying it or not. Moreover, every
year she has sent Nicholas Brody letters indicatingher desire to purchase an easement.
Given that the Brody’s clearly have Matheson’s address, it seems reasonable that if Dana
wanted her possession to be open and notorious to Matheson she should have sent her a
letter. Additionally, this element is required because we want to prevent property owners
from “sleeping on their rights,” – but Matheson is clearly not doing that, every year she is
requesting an easement so she can access her land, which under the circumstances is
probably the best she can do. Ultimately, Dana’s claim should fail because her possession
was not open and notorious under the circumstances.
Adverse and Under Claim of Right
Even if Dana wins that her possession is open and notorious, she still could lose her claimdepending on
the standard that this state decides to use. Under an objective standard, Dana
would clearly prevail – she has objectively been in control of the parcel for the statutory
period. Under a good faith standard, it is very unlikely she would prevail – as Brody’s
daughter, she probably was very familiar with the situation and would almost certainly know
that the land she was occupying was not hers. Moreover, the fact pattern suggests she
literally moved into Matheson’s cabin – not exactly the most innocent course of action.
Under an aggressive trespass standard, she would succeed – this is about as aggressive a
trespass as you can get. While most states use theobjective standard to avoid fuss, the good
faith standard has serious merit here. This is exactly the sort of situation where good faith
would prevent a serious injustice. Further, if thecourt were to take such a broad view of
“open and notorious” that Dana’s behavior would be included, it would become even more
essential to use a good faith standard, because that world would be the ultimate crystalline
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world – hard-edged rules on easements, hard-edged rules on notice, and hard-edged rules on
adverseness. It would be the ultimate “winning on a technicality” – none of the real purposes
of adverse possession would be served (like preventing owners from sleeping on their rights,
and it would reward sharps like the Dana and Nicholas. The objective standard does have its
benefits in terms of objectivity and predictability; courts get to avoid telepathy and figuring
out exactly what people were thinking. As such, the best ruling is probably a narrow holding
that Dana’s possession was not open and notorious under these particular circumstances;
such a holding would only apply when someone was trying to adversely possess land that the
true owner did not have access to. But no matter what, Dana shouldn’t win here – she’s a
sharp. Carrie should still own the land.
Sample student answer arguing that Dana Brody should win:
Dana Brody owns the land because she met the elements necessary to establish adverse
possession. Whereas adverse possession can be seen as a “theft” of land that is rightfully owned,
especially in a case like this where the original owner is essentially forced off the land because
she is not allowed an easement to cross the land that stands between her parcel and the nearest
public road, adverse possession also ensures that land is not allowed to go to waste and benefits
those who are making use of it. Because Disturbia does not have prior precedent on point, I will
detail briefly the elements of adverse possession, as well as the different perspectives that have
arisen, as not all precedent in other jurisdictions would support Dana Brody taking the land.
Here, however, she should be considered the rightful owner of it to ensure that land is not
allowed to go to waste.
There are four elements of adverse possession that Dana Brody has met:
1. Actual entry giving exclusive possession,
There is little dispute here that Dana Brody did actually enter the land, as it is said
that she moved into the cabin.
2. Open and notorious,
Whereas Carrie Matheson may make the argument that the occupation was not open
and notorious if she was unaware of it given her location in Washington, DC (instead
of in the vicinity of the property in question), that argument is going to fail because
“open and notorious” is geared at ensuring that theattentive property owner would
notice. The statutes of limitation generally span over several years so that an attentive
property owner would have a reasonable opportunity to become aware of the situation
during that time period. Here, Dana Brody did meet the “open and notorious”
requirement, and Carrie Matheson failed to act as areasonable property owner by
failing to look in on her property.
3. Adverse and under claim of right, and
Here, Dana Brody met the requirement for “adverse” because she was claiming the
land for her own behalf. However, there are three distinct views on the “claim of
right” that can cause different outcomes. These views are as follows:
a. Objective standard – this is the majority rule in the United States, andsays
that the statute starts running as soon as the trueowner is dispossessed of the
land. The state of mind of the individual occupyingthe land is irrelevant.
b. Good faith standard – this standard is generally applied when we care about
rewarding “good faith acts” rather than penalizing an owner, and requires that
the person adversely affecting the land have thought that he actually owned
the land, with the idea being that they do not wantto support squatters who
come in bad faith.
c. Aggressive trespass or “Maine rule” standard – for this particular standard,
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adversity and hostility are a requirement, and it requires the adverse possessor
to intend to make the land his own while knowing that he did not own the
land.
Disturbia should adopt the objective standard of adverse possession because it
encourages land to be put to its best use, even when the original owners are no longer
willing to work the land or take care of it. It avoids the litigation that may come up with
the good faith and “Maine rule” standards where parties have to prove their state of mind
through litigation, and allows the courts to instead look at merely the time when the clock
started running. The litigation that may arise overthese intentions was seen in cases such
as Van Valkenburgh v. Lutz(the majority decision was later overruled by Walling v.
Prybylo) and Manillo v. Gorski, and the objective standard would help avoid one aspect
of lengthy litigation.
4. Continuous for statutory period
Dana Brody met this element because it appears thatshe moved into the cabin and
engaged of the kind of occupation that we expect ofan owner for the statutory timeperiod.
In light of the fact that Disturbia does not have precedent on point for this matter, they should
adopt the objective standard of adverse possession to ensure that land in the future is put to its
best and highest use by individuals who are willingand able to take care of the land. Whereas it
may initially seem “unjust” that Dana Brody is ableto take over land that Carrie Matheson
owned, and may even be granted an easement to the public road because her father was the
owner of the land that had prohibited the easement,such ensures that a cabin is not allowed to go
to waste. After all, Carrie Matheson could have saved the easement had she recorded it before
Nicholas Brody was able to record. For the foregoing reasons, Dana Brody owns the land by
adverse possession.
Question 4: Fringe Benefits
Walter Bishop, on his deathbed, tells Olivia Dunham, “Because I love you like a daughter
and I want to ensure your financial security, I want you to have my house in Disturbia
City. Continue to rent it out as I have done and you will always have an income.” He
hands her the deed to the house, then dies. Walter’s will leaves all his property to Peter
Bishop. For the last five years, the property has been rented to Astrid Farnsworth as a
furnished dwelling “from year to year” at an annual rent of $12,000.
(A) Peter Bishop sues Dunham for possession of the furniture in the house as well as the
rare book collection stored on the bookshelves of the house. Who owns the furniture and
the rare book collection, and why?
This is a question of gift law. Were the elements of intention, delivery, and acceptance satisfied,
and as to what? What did Walter Bishop intend when he directed Dunham to rent the house out
“as he had done”? And did he succeed in delivery?
Sample student answer arguing that Peter owns everything:
Bishop owns both the furniture in the house as well as the rare book collection. While
there is a clear tension here between Walter Bishop’s intent and the legal result of his action,
the public policy in favor of encouraging individuals to make wills to dispose of their
property will resolve ambiguities in Bishop’s favor. For Dunham to have a claim over the
furniture and books at all, Walter Bishop must havevalidly given them to her, satisfying the
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elements of (1) intention, (2) delivery and (3) acceptance. While courts have recently relaxed
some of the restrictions on intention and delivery as applied to gifts inter vevos, the
opportunity for fraud and the incentive to manipulate dying individuals make courts very
reluctant to relax the standards as to gifts causa mortis, as this one was; therefore, intent and
delivery must have been clear and unambiguous to bea valid gift. Walter Bishop did not
clearlyintend to give Dunham the furniture and the rare books. He said only “I want you to
have my house.” She will argue that his wish that she “rent it out as I have done” (which
included furniture) indicated an intent to give herthe furniture. While this is probably true,
the fact that Walter Bishop is dead, rendering verification impossible, and that he had a will
that contradicts this wish makes this ambiguous, and, as discussed above, the societal
preferences for written wills favors resolving ambiguity restrictively. Therefore, Walter
Bishop did not clearly intend for Dunham to have the furniture or books inside the house.
(2) Walter Bishop did not deliver the furniture or books to Dunham. While physical delivery
might have been impossible, Walter Bishop could have constructively delivered the furniture
to Dunham by giving her the keys to the house, as the decedent in Newman v. Bostdid, in
order to effectuate a valid delivery. Bost is a helpful comparison here. While the decedent
expressed a clear intent to give Julia the house and everything in it, he only delivered the
keys, thereby only actually giving her things to which the keys gave her access, and not the
house. Here, Walter Bishop may have ambiguously expressed an intent to give the house and
everything in it, but he has only delivered the deed, and therefore only actually succeeded in
giving her the house itself. If he had given her the keys, perhaps he result would be different, but, again,
the court will favor a narrow interpretation of his gift so as to favor the will.
(3) Dunham surely accepted whatever Walter Bishop validly gave her; there is no evidence
suggesting anything to the contrary.
Because Walter Bishop did not unambiguously expressan intent to give nor constructively
deliver the furniture and books to Dunham, he did not give them to her, and those items pass
to Walter Bishop’s heir as described in his will, Peter Bishop.
Sample student answer arguing that Dunham should get the furniture but not the books:
A. This question is a close one, but ultimately Peter should own the books, while Olivia
should own the furniture. For Olivia to receive either the books and the furniture, she must be
able to prove that she acquired them as a gift fromWalter. This requires proof of the three
elements of a valid gift: (1) intent to give a gift, (2) delivery of the gift, and (3) acceptance of the
gift. (as distilled from Newman v. Bost and Gruen v. Gruen). Acceptance is the easy element:
courts will imply acceptance “when a gift is of value to the done.” (Gruen). Thus, for all the gifts
that are at stake in this action, acceptance shouldbe implied, given that the furniture serves as
part of a valuable rental agreement that will provide income for Olivia, the book collection is
rare (implying, though not guaranteeing, value), and the house is the main source of value to
Olivia with its annual rental income. As for the house, there was clear intent to give Olivia the
house from Walter’s actual words, and delivery of the deed to the house constitutes delivery, as
Walter obviously cannot physically deliver a house,and a deed should stand in as well as a key
to the house would.
The question then is whether Walter intended to give Olivia either the books or the
furniture, and what type of delivery would be required to complete the gift. As for the books,
there is no clear expression of intent that Olivia receive the books; Walter made no mention of
them and they are certainly not necessary for Olivia to receive a fee simple in the house. Olivia
could argue that because the books were in the house, they were part of the gift Walter was
bestowing upon her. Under this view, Walter, not being a property lawyer (most likely), would
not know that conveying his house to Olivia would not include the contents of that house; in
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other words, Walter could be assumed to have intended to convey the house and everything
inside it. However, this is a weak argument. In any case, nothing in what Walter said to Olivia suggested
that she should retain his rare book collection. Without more information, it is safer to assume that Walter
did not intend to give her the books.
Even if Walter did intend to give Olivia the books, since they are small enough to handdeliver, he should
have made at least some effort to deliver them to her. (as suggested by the
court in Newman). Granted, it would be absurd to expect Walter to deliver the entirebook
collection to Olivia by hand, but even a single book would have sufficed as a symbolic gesture to
satisfy the requirement of delivery. This may seem somewhat overly formalistic in the modern
age, but it provides a safeguard against donees taking advantage of ambiguity in donations, and
specifically in the present case, it places the presumption against gift-giving unless intent is at
least somewhat clearly expressed (and it seems to me at least that the formal requirement of
delivery really is just an extension of the intent requirement). There is significant ambiguity in
Walter’s intent with respect to the books, so to besafe, a gift should not be presumed, and Peter
should ultimately win his suit for possession of the books.
The furniture, on the other hand, is more clearly intended to go to Olivia, and thus should
remain in her possession. In contradistinction to the books, the furniture in Olivia’s new house is
clearly a part of the rental agreement that previously existed between Walter and Astrid (and that
now exists between Olivia and Astrid). This makes a stronger case for finding intent; Walter
clearly suggested to Olivia that she should “rent it out as [Walter has] done,” and Walter has
rented it as a furnished dwelling for the past fiveyears (or more). Peter could argue that this does
not evince intent to allow Olivia to keep the furniture; instead, Peter would say that his father
merely intended her to have the house and provide new furniture for it. But this is counterintuitive to the
intent that Walter arguably was expressing in his gift to Olivia. Part of his words
to her were that if she continued to rent the house, she would “always have income.” While this
does not conclusively establish that Walter intended for her to have the house specifically to
have income, it does provide a strong argument thathe intended to provide Olivia a future
income by giving her the house, rather than requiring her to immediately go out and refurnish it.
This intent is less clear than the intent expressed in Newman (where the dying man tried to give
Newman “everything in [his] house”), but the issue in Newman was not about clarity of intent,
but whether there was delivery of the items promised. Thus, Walter’s intent to give Olivia the
furniture should be enough to satisfy the second element of a valid gift.
Given the much clearer intent expressed in relation to the furniture, along with the
physical characteristics of furniture that make it uniquely difficult to physically deliver, delivery
of the deed to the house should be sufficient to stand for delivery of the furniture as well. It
would never be possible for Walter to physically deliver furniture to Olivia (except perhaps for
certain small items, and as to any furniture items small enough for hand delivery, Peter should
probably get those at least), and it is not customary anymore to provide a mini of the furniture
being given or in any other way symbolically deliver furniture. Furniture generally does not
require a key (although again, any furniture requiring key access would be a tougher case as to
whether Peter should receive it because of lack of delivery, but closer than small items and
something I will not answer here), and people generally do not keep a deed proving their
furniture ownership, so the formalistic requirementof delivery is much less rational for furniture.
In addition, since intent is clearer as to the furniture, it would be reasonable for a court to excuse
the formal delivery requirement for the furniture as compared to the books (whether this is the
actual law anywhere I’m not sure, but it seems at least reasonable to draw such a distinction
here). Thus, Olivia should keep the furniture.
(B) Regardless of your answer to the first question, assume that Peter Bishop wins his case.
At the very beginning of Farnsworth’s new term, he brings a truck and empties the house
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of its furniture (and the book collection). Farnsworth asks Dunham to provide
replacement furniture, but Dunham does not. What are Farnsworth’s options and what
should she do?
The key here was to evaluate whether there’d been either a constructive eviction (in which case
Farnsworth needs to leave in order to have a claim and be relieved of her obligation to pay rent)
or a violation of the implied warranty of habitability (in which case she need not leave, but can
pay the actual value of the premises without the furniture/replace the furniture and deduct that
from what she owes Dunham).
Sample student answer:
Astrid should take Olivia’s refusal (or unwillingness) to be a breach of the covenant of quiet
enjoyment that will give rise to constructive eviction—allowing her to walk away from the lease.
This assumes Olivia has not bought new furniture within a reasonable amount of time, which is
unclear from the facts provided. While the implied warranty of habitability (IWOH) is also
possible, it seems less likely to succeed here.
Astrid could buy her own furniture and stay, but this seems unlikely: If she expects a
lengthy legal battle that would be costly over the unpaid rent if she leaves under constructive
eviction, maybe this could be a cheaper option. Butthat seems unlikely, and then Olivia would
have all the leverage over her in future tenant-landlord negotiations.
IWOH is unlikely to succeed: Under the IWOH, the tenant’s obligation to pay is conditioned on
the landlord’s implied warranty that the premises will be safe, decent, and habitable. Violations
of the health or safety code are usually prima facie proof of a violation of IWOH, giving
rescission or a rent abatement equal to the property’s value below what it was warranted. In
Hilder v. St. Peter, there were god-awful sewage leaks, a clogged toilet, a broken lock, broken
window, and a light that didn’t work. As there are no safety and health codes violated, though the
premises might not be “habitable,” they probably donot rise to a violation of the IWOH. IWOH
is also only in place in a minority of jurisdictions; it may not even be an option in Disturbia.
Constructive Eviction is the best option: Under this theory, there is an implied covenant of
quiet enjoyment inherent in the tenancy that, when breached, triggers constructive eviction and
allows tenants to lawfully vacate the property. Thefollowing elements must be met:
(1) the landlord must have breached a duty. That isthe case here—Astrid has a lease for a
furnished apartment that Peter Bishop just un-furnished. That is a breach of Olivia’s contractual
duty to provide furniture.
(2) The breach must have made the property substantially unsuitable for (i) the purposes
for which it was leased or (ii) beneficial enjoyment of the property. Here, the missing furniture
meets both. She rented a furnished apartment with an expectation of furniture, and anyone who
has ever lived in an apartment in the days before IKEA arrives can tell you there is not much
beneficial enjoyment. She satisfies the second element.
(3) The tenant must vacate within a reasonable timeafter the landlord has been given
notice to fix the problem. Assuming Olivia has not responded in what is considered a
“reasonable” time, (10 days was considered reasonable in Reste Realty Corp., but perhaps less
here if Astrid is sleeping on the floor), Astrid now has the right to leave under a breach of CE
giving right to constructive eviction.
Were Astrid to leave before Olivia has a reasonabletime to respond (which we assume
did not occur here, but just in case), she would beviolating her lease and surrendering her
tenancy. Under the majority property-theory rule, her abandonment of the periodic tenancy—if
she leaves with no intention to return and ceases to pay rent—would leave her liable for all the
rent that is due, without Olivia having to mitigate. If Olivia does not mitigate, that would cost
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Astrid the full $12,000 in rent for the year, but her notice would be within the six months under
the common law to free her for the next year. Underthe contract-theory minority rule, Olivia
would have to mitigate, and Astrid would owe for the time before Olivia rented, what she spent
to relet and any loss Olivia recurs in reletting.
Conclusion: Astrid seems to have all the elements of constructive eviction in place.
Assuming Olivia has been given a reasonable time and has not responded, that gives Astrid the
right to walk away from the periodic tenancy. It’s important she be sure that Olivia has been
given enough time or she will be responsible for the whole year’s rent under an abandonment
theory.
Question 5: Finding Serenity
Adult feral swine routinely weigh 200 pounds or more. They can tear up fields and lawns,
harm wetlands, kill livestock, spread diseases like pseudo-rabies that infect domestic pigs
and, occasionally, attack humans. While in 1990, fewer than two million wild pigs
inhabited 20 states, the number is now six million, with sightings in 47 states and
established populations in 38. The swine are thought to have spread largely after escaping
from private shooting preserves and during illegal transport by hunters across state lines.
Experts on invasive species estimate that they are responsible for more than $1.5 billion in
annual agricultural damage alone, amounting in 2007 to $300 per pig.
Wild pigs can dig under or climb over almost any barrier. Pig experts say that “if a fence
won’t hold water, it won’t hold a wild pig.” Allowing hunters to shoot them in the wild all
year round, as the state of Disturbia does, is not in itself enough to limit the population.
Disturbia’s Department of the Environment has budgeted $100,000 for trapping operations
for the next year, but estimates that this too will prove insufficient to prevent wild swine
numbers from growing.
Wild pigs are also highly desireable as a game species for hunters. They provide an
entertaining and exhilarating challenge for hunters, and the pork is quite tasty. Disturbia’s
wild pigs came primarily from escaped Russian wild boars imported from Canada for
hunting on private game ranches.
Disturbia has about 60 private game ranches offering wild boar hunts. If Disturbia hired
five additional animal inspectors, it could carry out routine fencing and health checks on
penned wild swine, which would probably diminish the number of escapes to a low but
nonzero level. This might be sufficient, in combination with shooting and additional
trapping, to keep wild swine numbers from growing.
Instead, Disturbia banned the keeping of wild swine. Mal Reynolds, who owns the 300-acre
Serenity hunting preserve, challenged the ban. Reynolds argued that he should not be
penalized for the actions of irresponsible ranch owners who have inadequate fencing. A
hole in his 10-foot reinforced fence that in one instance allowed some boar to escape was
made by vandals, he said. Wild boar are cheaper for hunters than other game animals,
and they made up 95% of his business. “I’m done if I don’t have hog hunts,” he said. The
land is zoned only for agricultural and hunting uses; to convert the land to agriculture
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would require a significant investment in clearing trees and preparing the soil, and in the
current economic downturn no one is willing to make such an investment.
Reynolds sued the state, alleging that the ban constituted a taking of (1) his boars—100
animals, which he will have to slaughter if the ban remains in place, worth $1500 each for
hunting and at most $50 per slaughtered carcass—and (2) his hunting preserve, which will
be unaffordable to run if he has to stock only deer and other non-boar game animals.
Assume that his challenge is ripe and that there are no other barriers to his lawsuit.
Evaluate Reynolds’ taking claims and explain who should win.
Initial notes: Wild boars may not have been kept for hunting in the 19th century, but that doesn’t
mean keeping them wouldn’t have qualified as nuisances then. (In fact, some people noted, the
discussion of foxes as nuisances in Pierson v. Post more readily supports the conclusion that they
would be common-law nuisances.) The analysis has to be of nuisance principles rather than of
known specific acts called nuisances in the past. Otherwise, as even Scalia recognized, helping
toxic waste on one’s property couldn’t be deemed a common law nuisance if the toxins were new
or newly proven dangerous.
Lucas said that if land was only valuable for a use that was a nuisance, a total wipeout was
legitimate. If the boars were a nuisance, it was hard to say that there was still a taking of the
preserve.
A good answer addressed the relationship between the current market value of the land for
nonhunting uses and takings: are successful regulatory takings claims more likely in a depressed
economy where it’s harder to find alternative investment? The answer might be yes, though I am
more persuaded by the idea that the problem in Lucas was that no theoretically productive use
remained, regardless of the momentary economic situation. Thus, as long as something
productive could be done, whether or not it would be profitable to do it at this point in time, no
total wipeout has occurred—compare Palazzolo, where the Court didn’t ask whether building a
single house would be economically feasible for the landowner’s particular circumstances but
simply held that this possible use prevented a total wipeout.
Sample student answer arguing that there was no taking:
The case here is very similar to Hadacheck v Sebastian, where the court ruled that there
was not a taking where a regulation prohibited the use of brick manufacturing that was
considered a public nuisance. Here, the pigs are likely to be considered a public nuisance.
The court must do a case-by-case analysis to determine if this is indeed a nuisance. The pigs
cause great harm to the land by the physical damagethey cause. Reynolds may be able to
argue that the pigs can provide a source of food considering they are tasty. However, this
seems to be negated by the fact that the boars killother livestock, diminishing other food
sources. Lessoning food sources and destroying landare certainly things that affect the
general welfare. The boars also have been known to spread diseases and even attack humans.
Public health is a major concern of the government.Any serious threat to health certainly
seems to constitute a public nuisance. A similar case is Del Webb that held that nearby cows
that caused a bad smell and attracted mosquitos wasa threat to public health and therefore a
nuisance. Reynolds may try to argue that the pigs provide a source of entertainment via its
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application to the sport of hunting. However, we have seen the court disregard gaming as a
serious consideration in their legal analysis. (Pierson v Post). Furthermore, the costs on
Disturbia are huge. In 2007, each pig contributed to about $300 worth of damage that year.
This is a large burden for Disturbia to bear just for the sake of maintaining a recreational
activity. Since, hunting the boar does not provide for any real value besides entertainment,
these pigs are a nuisance. Reynolds makes the claimthat he should not be penalized for the
actions of irresponsible ranch owners and that his pigs have only escaped once but due to
vandals. This does not help his case. Even if vandals had destroyed his fence the first time,
there is nothing stopping vandals from destroying his fence again, allowing the pigs to escape
and destroy neighboring lands. His good faith efforts should not be considered here when the
fact remains that these pigs may escape and cause damage to Disturbia.
Takings as to the Boars
The restriction making Reynolds kill his pigs willnot constitute a taking of his pigs. As
mentioned above, the boars are a nuisance and Hadacheckheld that a nuisance cannot be
considered a taking. Also in Hadacheck, the court stated that the brick clay still had some
value to sell as a raw material. The court didn’t seem to mind that the value of the clay was
much less than the value of the manufacturing of the clay into bricks. This is analogous to
this case. The pigs are worth much more for gaming purposes but they still have some value
as a slaughtered carcass. Furthermore, according toJed Rubenfeld’s theory on takings, a
regulation that is trying to curb a public harm is properly exercising its police power. As
evidenced by the fact that the government accomplishes its purpose by having the pigs
destroyed evidences that Disturbia did not have anyinterest in the pigs. Instead, they just
wanted to eliminate them from the community becauseof the harm they were causing. Under
these circumstances, this is not a taking.
Taking of the Hunting Preserve
Based on the discussion above, the court will likely find that since the boars are a
nuisance, the diminished value of the hunting preserve will not be considered a taking.
However, it is possible that the court may find this not to be a nuisance and could apply a
Lucas analysis. This scenario does not seem to be a totalwipeout. In Lucas, the only value of
the property came from being able to build a house on the beach. Here, agriculture and other
hunting initiatives could prove economically viablein time. The government should not have
to pay Reynolds simply because he structured his income around only one activity. It was
obvious that these pigs could pose a nuisance to society so he should have known that the
pigs might have been banned eventually. The land is only worthless because Reynolds has
not put forth any effort to make the land lucrative in any other way. Unlike the beaches in
Lucas, it is possible for Reynolds to come up with some sort of agricultural or hunting
business that may be profitable. It just might not be readily apparent at the moment.
However, the court will more likely do a Penn Central/Penn Coalanalysis for this case
rather than Lucas. The court will have to evaluate if the regulationwent too far. First we
must consider the character of the government action. This discussion is very similar to the
nuisance discussion above. But to reiterate, the government has a significant interest here in
curbing the harmful nature of these pigs. It is otherwise very costly for them ($100,000 plus
the cost of hiring 5 more employees to regulate fences). The pigs destroy land and livestock
and spread disease and injure humans. Therefore, the government’s action seems justified as
a way to save money in preventing the harm caused by these pigs. Secondly, under Penn
Central, we need to look at the economic loss from the regulated party. Here, Reynolds has
lost value in his hunting preserves due to the fact that he cannot use the pigs. However, as
discussed in the Lucas analysis, it is possible for Reynolds to find otheruses of his land in
agriculture and hunting or maybe a combination of the two. Third, we have to evaluate the
frustration of distinct investment back expectations (DIBE). Again, Reynolds may have had a
DIBE to game pigs but this seems to be unreasonablein light of the fact that the pigs are
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known to cause great damage to communities. In light of the recent growth of the pigs and
their expansion into almost every state, it appearsthat Reynolds had to have known the risks
he was taking. Therefore, since the ban on the pigsis related to a legitimate government
interest and the three Penn Centralfactors seem to suggest this is not a taking- thisis not a
taking. In sum, the court will likely find the pigs to be a nuisance and therefore the taking of
the preservers is not a taking. However, under other analyses, including Penn Centraland
Lucas, the result is the same. Reynolds will not win on his takings claims.
Sample student answer arguing that there was a taking:
A. The Boars
Reynolds would have to make his argument for takinghis boars under the Pennsylvania
Coal/Penn Central balancing test. The government is not physically appropriating his boars
(Loretto), nor are they completely eliminating their value (Lucas). Each boar carcass would still
be worth $50, so Lucasdoes not apply, and even if Lucasapplied, boars are not real property,
and Scalia in his Lucasrationale explicitly exempted personal property from the analysis.
Under Pennsylvania Coaland Penn Central, there are a variety of considerations in
determining whether the government’s action goes “too far” and constitutes a taking. Factors
include whether there is any nuisance rationale that exempts the regulation from takings
jurisprudence (Hadacheck), the character of the government’s action, the economic impact of the
regulation (including whether the regulation interferes with distinct investment-backed
expectations), and whether there was an “average reciprocity of advantage” (i.e. whether the
regulated parties also benefit from the regulation,despite its direct economic harms). Under this
test, the government action with relation to Reynolds’s boars is a taking.
The nuisance rationale is inapplicable here. Reynolds’s land is zoned for hunting uses,
and having boars on his property does not constitute a nuisance. The only identified instance
where a boar got away from Reynolds’s hunting preserve was not intentional, negligent, reckless,
or ultrahazardous, and even if it were any one of those, it would be hard to point to that single
boar and claim that it caused a nuisance that was unreasonable to the point where the government
may justify the regulation at issue here under a pure nuisance rationale. Also, any desire to defer
to the legislature using a rational basis test, allowing it to find there is a nuisance is ill-advised
under Lucas, especially in this particular instance. Having wild boars on a hunting preserve in an
area zoned for hunting uses, regardless of any state-wide problem with wild boars, cannot be
termed a nuisance. And even if such hunting preserves are contributing to the state-wide problem
in some way and the legislature may need to deal with it, it hardly seems rational to enact such a
harsh regulation when such an easy alternative (hiring a few more animal inspectors) is
available. Admittedly, this is not traditional rational basis, but more of a hard-look rational basis
test, but it seems a plausible and even reasonable outcome given the harder look rational basis
test used in Nollan. Ultimately, the nuisance rationale is not persuasive.
However, the general problems being caused by wildboars throughout Disturbia,
including those escaping from hunting preserves, doplay a role in the analysis of the character of
the government’s action. The government could say that it enacted this regulation in part to try to
reduce the population of wild boars, and its actionmust be looked at as a broader measure to
further this goal, rather than looking at its action specifically as applied to Reynolds’s hunting
land. However, this is unconvincing given that Disturbia could have hired just five more animal
inspectors and had almost the same effect as banning the keeping of wild swine. Admittedly, the
government is not required to use the least restrictive means to accomplish its regulatory
objectives, but since Pennsylvania Coaland Penn Centralurge a balancing of interests, it is very
telling that the government, thinking to enact its regulatory scheme more cheaply than by hiring
just five new animal inspectors, decided to simply tell wild boar owners to stop using them
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without paying for any resulting loss in value to those wild boar owners. This factor thus weighs
in favor of finding a taking.
The economic impact also weighs in favor of finding a taking. The regulation banning
wild boar ownership wipes out over 96% of the valueof wild boars. This is a steep financial
price to pay for the new regulation, centered on just a few individuals. It also interferes with their
distinct, investment-backed expectations in ownership of wild boars. Reynolds bought his wild
boars expecting to use them as a revenue-source forhis business (indeed, they constitute 95% of
his business). Until the regulation was enacted, Reynolds had a legitimate expectation that he
could do so, and his investment in those boars would be nearly wiped out if the regulation were
labeled a non-taking. The government could argue that his investment back expectations are still
available to him, because he can still sell the boar carcasses for meat, but this is not like in Penn
Centralwhere the Court found it possible for Penn Centralto obtain a reasonable return on their
investment as well as swap/trade their air rights to obtain more value; here, Reynolds will only
make 3.33% of what he was expecting, and definitelynot enough to even cover costs and
overhead. Because of the above, this factor also weighs heavily in favor of finding a taking of the
boars.
Finally, the government would have a very weak argument that there is anything
approaching an “average reciprocity of advantage” present here. Reynolds will only benefit from
the regulation as much as the average citizen of Disturbia, yet he will be disproportionately
affected by its costs by many orders of magnitude. He stands to lose 95% of his current business
and $145,000 or more in inventory value. Conversely, it is hard to see an argument that he will
somehow also benefit from this regulation more thananyone else in Disturbia. Perhaps his
fences would be more secure from intrusions by outside, actually wild boars, but this is a drop in
the bucket compared to his losses (and if he goes out of business, having unimpeded fences is
small comfort). Thus, this factor does not mitigate finding a taking here.
Thus, because the nuisance rationale is unpersuasive, the character of the government’s
action is suspect, Reynolds stands to be significantly affected by the new regulation, and he is
not compensated by any sort of “average reciprocity of advantage,” the new regulation effects a
taking of Reynolds’s boars.
B. Hunting Preserve
Reynolds would again have to make his argument for taking his boars under the
Pennsylvania Coal/Penn Centralbalancing test. The nuisance rationale explicated in the section
on boars sufficiently explains why that same rationale does not exempt the regulation at issue
from takings jurisprudence (Hadacheck). The government is not physically appropriating his
land (Loretto), nor are they completely eliminating its value (Lucas). Reynolds could attempt to
make a Lucas argument, given that he is only able to use his land for hunting or agriculture, and
it is worthless for agricultural use currently and unaffordable to run as a hunting preserve.
However, while these facts are suggestive of a total wipeout, there is still a chance that he could
sell the land to a neighbor or enter into some other sort of agreement to bring the land back to
profitability. Even failing that, he could at least use the land for his own personal hunting and
sell the proceeds (this may be extremely low value,but it is not a complete wipeout, and the rule
in Lucas seems a little bit of a stretch in any case). Thus, if Reynolds wishes to succeed, he must
argue under Pennsylvania Coaland Penn Central again.
Again utilizing Pennsylvania Coal and Penn Central, there are a variety of considerations
in determining whether the government has taken property. Factors include the character of the
government’s action, the economic impact of the regulation (including whether the regulation
interferes with distinct investment-backed expectations), and whether there was an “average
reciprocity of advantage” (i.e. whether the regulated parties also benefit from the regulation,
despite its direct economic harms). Again performing a balancing test, the case is even stronger
to find a taking of Reynolds’s hunting preserve.
The character of the government’s action here again is flimsy enough to weigh this factor
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in favor of finding a taking. As with the wild boars, the government could say that it enacted this
regulation in part to try to reduce the population of wild boars, and its action must be looked at as
a broader measure to further this goal, rather thanlooking at its action specifically as applied to
Reynolds’s hunting land. However, this is unconvincing given that Disturbia could have hired
just five more animal inspectors and had almost thesame effect as banning the keeping of wild
swine. Again, the government need not use the leastrestrictive means to accomplish its
regulatory objectives, but since Pennsylvania Coaland Penn Centralrepresent a balancing of
interests rather than a bright line rule, it is very telling that the government, thinking to enact its
regulatory scheme more cheaply than by hiring just five new animal inspectors, decided to
simply tell wild boar owners to stop using them without paying for any resulting loss in value to
those wild boar owners. This factor thus weighs in favor of finding a taking.
The economic impact of the regulation again unquestionably weighs in favor of finding a
taking. Wild boar hunts constitute 95% of Reynolds’s business. Forbidding him to own wild
boars would cut out 95% of his revenue stream, and he testified that he would be “done” without
the boars because he could not operate affordably without them. It is unknown what his actual
revenue is, but 95% is a huge chunk of whatever the total is. This also definitely interferes with
his distinct, investment-backed expectations. Although in theory there is no right to profit, and
the government is not stopping him from running a game preserve per se, the fact that Reynolds
will be unable to do so solelyas a result of this new regulation counsels in favor of finding that
his investment-backed expectations were violated. His only alternative to running an
unaffordable hunting preserve is to convert to agricultural use, and this is impossible during the
current economic downturn. Thus, his two alternatives are essentially impossible for him,
frustrating his investment-backed expectations throughout the years of his owning an operating a
hunting preserve. And even if he has no distinct, investment-backed expectations weighing in his
favor, the sheer loss of value of his property weighs this factor heavily toward finding a taking.
Finally, as with the wild boars, the regulation here secures no “average reciprocity of
advantage” for Reynolds. He stands to lose most of his property value and go out of business as a
result of the regulation; any marginal benefit he receives over and above the average citizen of
Disturbia cannot possibly recompense him for that loss. Thus, this factor also weighs in favor of
finding a taking.
Given that all the factors mentioned above hold, Reynolds should also win the takings
argument with respect to his hunting preserve.
Question 6: Free Enterprise
Based on evidence indicating that homeownership produces a small but statistically
significant increase in voting, participation in local government affairs, school parentteacher association membership, and other civic activities, and also that owner-occupied
homes have a 15% lower foreclosure rate than non-owner-occupied homes, the Disturbia
City zoning board adopts a zoning ordinance allowing only “owner-occupied housing.”
Multifamily dwellings are allowed and even encouraged as long as they are owner-occupied
(e.g., condominiums and cooperatives). Disturbia City offers low-interest loans to
qualifying low-income families so that they can afford to buy up to 15% of owner-occupied
housing units in the city.
Existing rental properties are allowed to continue as rental properties as long as the
current tenants are in place, but no new “tenants” are allowed. If existing tenants leave,
the owner must either occupy the property or sell it to someone who will occupy the
property. Multiunit buildings must convert to the condominium or cooperative form on a
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rolling basis as existing renters leave. Short-term rentals of up to 6 months are allowed
when the owner is actively engaged in attempts to sell the property, but no property may be
rented for more than 6 months out of every year.
The authority to zone has been sufficiently delegated to the town under state law.
(A) Hikaru Sulu, landlord of the 35-unit apartment building The Enterprise, exhausts his
state challenges to the ban. He wishes to hold his rental property as an investment; though
converting to condominiums will net him roughly $3 million, he will lose a revenue stream
of roughly $500,000 per year. He does not wish to sell the property, nor does he wish to live
in any of the units. Assume there are no ripeness or other barriers to his federal takings
challenge: how should a court rule?
Initial note: I was interested to see that many people who found no taking in the previous
question wanted to find a taking this time, perhaps because the justification for the government’s
action seemed much weaker than the justification for the action against boars, even though the
economic impact was much less significant.
Sample student answer arguing that there was no taking:
(A) The court should rule that this does not amount to a taking.
Amortization
When a statute is passed that forces a lawful act to be discontinued, but allows for a
period of amortization, some jurisdictions say thatthis will not constitute a taking because
the land owner will have sufficient time and ability to make new plans, and any loss suffered
will be mitigated. In PA Northewstern Distributors, Inc. a statute that allowed for 90 days
before the use must be discontinued was found to constitute a taking. Additionally, the
majority opinion rejected the constitutionality [in Pennsylvania] of amortization in general.
However, most states allow amortization to cancel out the effect of a taking. As a federal
challenge, it should be taken into account that this act will not immediately deprive Sulu of
The Enterprise. Allowing Sulu to continue to rent to existing renters leaves a substantial
amount of value, and will allow Sulu to make new plans. This should be a factor in the
takings analysis.
Taking
A government action can amount to a taking if it isnot regulating a nuisance, and it either
completely wipes out the economic value of the land, goes too far in exercising the police
power to effectuate its interests, or is shown to be a taking under the Penn Central test.
The government has the power, as part of its policepower, to regulate that which is a
public nuisance without it amounting to a taking. [Lucas; Hadacheck]. Unlike Hadacheck,
where Hadacheck’s business was found to be a nuisance ,and so the regulation forcing its
closure was not a taking, The Enterpriseis not a nuisance. The zoning board had public
interest in mind when it created this ordinance [for that reason it was presumably allowed
when Sulu challenged it], but that does not make that which it outlaws nuisances per se.
Causing a 15% higher foreclosure rate, and small decrease in participation in various civic
activities is not enough to demonstrate that something is a public nuisance. Although these
things do negatively impact the public ,it is probably not enough to amount to a nuisance.
More importantly, the data that the zoning board relied on seem to suggest correlation not
causation between owner-occupied homes and the desired outcomes. There are likely many
other factors that contribute that have nothing to do with renting a home instead of owning it.
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Overall, The Enterprise is not a nuisance.
There is no complete wipeout of economic value of The Enterpriseunder Lucas.
Sulu would be able to convert the apartment building into condominiums that would net him
$3 million. This is less overall than the $500,000 yearly revenue stream that he would
otherwise receive, but it is not enough to amount to a complete wipeout. The property is not
completely without productive and beneficial economic value to Sulu, so there is no taking
resulting from a complete wipeout.
Going too far in the exercise of the government’s police power can amount to a taking
that requires compensation under Pennsylvania Coal.In Pennsylvania Coal, the goal of the
ordinance was to protect the safety of homes from subteranean mining operations. This is a
very important interest. Nevertheless, the court found that there was a taking where the
mining rights of a company were made valueless by the ordinance. In this case, the interest of
the zoning board does not seem to be as strong as in Pennsylvania Coal. Increased
participation in civic activities may be important,but it is not the same safety concern.
Nevertheless, Sulu does not lose all of the economic value of his building, and he will have
time to amortize his losses so this does not amountto a taking requiring compensation.
In Penn Central, the court relied on a balancing test that weighed the economic impact
on the property owner, the extent the regulation interferes with distinct investment backed
expectations, and the character of the government action. In this case the economic impact on
Sulu is fairly great. He will lose out on the revenue stream, but he will still be able to convert
the apartment building to a condominium and make $3million. Sulu has some direct
investment backed expectations in the sense that he has invested time and energy into this
and expected to receive an income flow. Unlike in Penn Central, Sulu has no new plans that
are investment backed. His expectations are not overwhelmingly powerful. The government
action is part of a larger plan for the public good, and is not just an individual incident where
this apartment building is taken. Additionally, the government action allows Sulu to continue
to rent to existing renters. These factors suggest that the ordinance will not amount to a
taking.
Because the economic impact on Sulu will allow him to reap some benefit from his
property, there are not strong investment backed expectations, and the government action is
part of a larger plan the court should rule that this is not a taking.
Sample student answer arguing that there was a taking:
The court should rule that a taking has occurred, and compensation must be paid. In
evaluating Sulu’s claim first using the per serules of takings, this is not a permanent physical
occupation of The Enterprise because Sulu is not being dispossessed of any part of it, nor is any
physical intrusion upon it being made. Loretto. Additionally, there is no nuisance being
implicated. The intent of these regulations is to lower foreclosure rates and foster residents who
will undertake their civic duties, the lack of which is not nuisance, at common law or otherwise.
Hadacheck. Under Lucas, the concept of total wipeout is marginally more compelling but
ultimately unsuccessful. Sulu has not lost “all economically viable use” of his apartment
building. Although he will lose his revenue stream,the building will still net him $3,000,000, so
no wipeout has occurred.
The argument could be made that, like the mining rights in Penn Coal, rental rights are a
distinct legal right and the owner-occupied mandate is a complete taking of Sulu’s right to rent.
However, this is unlikely to be successful. The surface rights in Penn Coal were recognized as a
complete legal right largely due to the extensive pre-existing market in mining rights, which
were being bought and solid as distinct from surface rights. While it is true that people
commonly rent apartments, no one is buying or selling the right to rent an apartment distinctly
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from the right to own it or live in it. Analogizing to Penn Coal, the idea of someone purchasing a
home in which they will live, but authorizing someone else to rent it out, is ludicrous, while
purchasing a home on the surface but authorizing someone else to mine underneath it was both
conceivable and common practice.
Because none of the per se takings rules settle this case, it needs to be settled by Penn
Central analysis, which is an “essentially ad hoc” weighing of factual determinations. The
specific factors which might be significant include 1) economic impact of the regulation on the
claimant and interference with his reasonable investment-backed expectation, 2) the nature and
public function of the regulation, and 3) causing substantial individualized harm by prohibiting
previous beneficial use.
The economic impact on Sulu is clear: he had a reasonable expectation of keeping the
apartment complex as an investment property, and maintaining a revenue stream of roughly
$500,000 per year. While he would be able to profit in the short term under the regulation, the
restriction is costing him $500,000 per year for every year beyond the 6th that he would
otherwise have owned and rented the building for. [professor’s note: actually, since Sulu could reinvest
his $3 million, this isn’t really true: you should look at the present value of the two uses.] Given the
relative infrequency with which
large apartment buildings change hands, this is a considerably economic harm likely amounting
to millions of dollars in opposition to Sulu’s reasonable investment-backed expectation of being
able to rent out The Enterprise for profit.
The nature of this regulation is in no way physical, which strongly supports the finding of
a non-taking. The more similar a government action is to a physical appropriation, the more
scrutiny it comes under, because of the more severe burden to private property and infringement
upon personal rights that physical action invokes. Loretto and Penn Central both show a strong
disdain for physical actions, but this action is regulatory only, and serves the uniquely public
function of promoting voting, participation in local governmental affairs, and other civic duties.
While the increase in such activities is small, it is a significant and valid government aim.
Society as a whole values civic participation, and yet no one other than the government regularly
supports it, because of the minimal economic returns. It seems to be in the very nature of
government to benefit the public by fostering stronger participation on civic activities, even if
economically inefficient, because civil participation is something that local governments highly
value, and no private parties are in a position to enforce it. The government also has an interest in
both economically supporting itself through taxes and promoting the public welfare and upkeep
of the town by minimizing foreclosures wherever possible, and implementing owner-occupied
housing restrictions are a valid way to do that.
The counterargument is that, while government is ofcourse free to pursue economically
irrational actions in support of values that it favors, it is notfree to unduly burden people like
Sulu as a result. Even in pursuit of legitimate public objectives, when a government regulation
causes substantial individualized harm by preventing preexisting uses, they must pay
compensation. Especially in cases like this, where the owners of multi-family dwellings are
going to bear a disproportionate amount of the burden for what was previously a completely
valid use. Although not a dispositive factor, the diminution in value suffered by Sulu is so much
greater than that suffered by single-family homeowners as to be nearly discriminatory, especially
when, as a rental landlord, Sulu is not in any position to particularly benefit from a reduction in
mortgage foreclosures. [note that businesses have mortgages too—many landlords do!]
Sulu made a distinct investment in The Enterprisewith the reasonable expectation of
using it as a long-term income producing property, and under the Penn Central balancing test it
would be unconstitutional for Disturbia City to restrict his use in the proposed manner without
compensation, even for a valid and noble public purpose, because of the severe and
disproportionate impact that he would suffer as landlord for a multi-family rental property. The
regulation is a taking, and he should been compensated for the fair market value of The
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Enterprisebased on its use as an income-generating rental property.
(B) Pavel Chekov owns his own home. He participates in the online housing marketplace
Airbnb, which allows individuals to list extra living space for vacationers seeking shortterm accommodations, for a price. He charges $200 per night to stay in his house. He does
not intend to sell his house, but he does not stay in the house while Airbnb customers are
there. Instead, he camps in the nearby woods. The longest he’s ever had a customer stay
was two weeks. The zoning board fines him for violation of the zoning ordinance. Chekov
challenges the fine: how should a court rule?
Introductory notes: This question proved the most troublesome. I had thought that the main
focus would be on whether Chekov’s guests were “tenants” or instead licensees (which would
have implications for the next question too), but the responses convinced me that I should also
give credit for other ways of approaching the problem. Thus, many people instead asked
whether Chekov should be protected as a prior nonconforming user/get a variance. Others
discussed whether the restriction was valid under Belle Terre as applied to Chekov (the answer
would pretty much have to be yes; the Court has yet to protect commercial transactions between
strangers as strongly as the rights of grandparents to live with grandchildren).
Note that any nontakings challenge to the rationality of the ordinance as applied to Chekov
would have a steep uphill battle: the whole point of the rational basis standard is that
overinclusiveness and underinclusiveness is not fatal to a regulation. That barring Chekov’s
moneymaking endeavor wouldn’t support the goals of the ordinance is not itself a reason that he
didn’t violate the ordinance. Rather, this argument could be best employed as a reason to
interpret the ordinance’s reference to “tenants” narrowly, to cover only people renting on a morethan-extremely-short-term basis.
Sample student answer:
B. Pavel’s best arguments are either to challenge his fine on grounds that (a) this is a taking
(b) he is not actually violating the ordinance, (c) he is a nonconforming use, and is thus entitled
to either a reasonable amortization period or the forced phase-out is invalid per se, or (d) he
should seek a variance allowing him to do this.
(a) This is a taking
Pavel could try to argue that this is a taking. This regulation is not a taking as applied to
Pavel, but it simply restricts one possible use outof many for his property. The total wipeout
analysis from Lucasand the diminution in value test from Penn Centralmakes this clear.
Using the same taking analysis that applied to Hikaru, we can see that it is not banning a
nuisance and it is not a permanent, physical occupation.
Pavel could argue that under Lucas, this was a total wipeout. However, this cannot be
true because he is only being deprived of rental income in the extra rooms in his house. The
property is still very economically valuable because he can live there or he could sell it to a
purchaser. Although Pavel could argue that technically he is being totally deprived of all rental
income, the court is unlikely to accept this argument because the house is still valuable as a
home.
Pavel could also the Penn Centraldiminution in value test renders this a taking, but that
result is unlikely. The character of the regulation analysis is the same as applied to Hikaru—it is
a very small gain. The economic harm though is a very different analysis as applied to Pavel
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because he is only being deprived of a fairly small amount of money, though this really depends
on how often he rents out his rooms. It seems though that economic harm is fairly low. Finally,
a distinct investment-expectation is wanting. Although he expects to get income from this rental,
he knows that hotels and other businesses that rent rooms are highly regulated, and it seems
pretty reasonable that a regulation could be enacted that prevents this kind of agreement.
Therefore, no taking, as applied to Pavel, has occurred.
(b) He is not violating the ordinance because his guests are not tenants
Pavel should challenge the fine as applied to him, arguing that he is not in violation of the
ordinance. The ordinance only says that no new tenants are allowed. Here, Pavel’s situation is
more akin to a license to allow someone to stay at his house in exchange for money. From what
is indicated in the explanation, there appears to be no lease, no agreement on the length of time,
and the periods of time are very short (no more than two weeks). It appears that Pavel’s guests
might actually be licensees and not tenants becausethey lack a possessory interest in the home.
They do not have the right of exclusive possession because Pavel can always kick them out and
can regulate who comes to the house. One of Pavel’s guests would lack all of the possessory
powers given to a tenant, such as the right to sue for trespass, the right to eject others, and the
right to bring a nuisance claim. Because they are only given permission to enter Pavel’s property,
they do not violate the ordinance.
The city would want to argue that they are actually tenants, but because they are staying
for such a short period of time, there is no Statute of Frauds requirement for their tenancy at will
or periodic tenancy. The city could argue that the exchange of money constituted a lease. If it is
a periodic tenancy, perhaps the period was each day, and the contract renewed each day. That
Pavel could kick them out at will or the tenant could leave at will could indicate that this is a
tenancy at will, as both parties have the right to end the tenancy at any point. He also advertised
his services, demonstrating perhaps that he intended for them to be considered tenants. Because
Pavel left the house whenever the guests were there, the city could point to the fact that maybe
the guests do have exclusive possession because Pavel is not concurrently using the property.
The court should rule that Pavel has not violated the ordinance and should not be subject
to the fine. There is no written lease, the guests stay for only brief periods of time, and they do
not have any rights associated with tenants. This is very much like a hotel, in which guests are
not considered tenants for only a two-week stay. Perhaps, if the stay exceeded some certain
period of time, the guest could become more akin to a tenant. However, here, two weeks is not
enough time.
(c) Apply for nonconforming use
Assuming that Pavel has been conducting this business since before the regulation, and
unlike Hikaru, he hasn’t exhausted his state claimsyet, he could just try to claim that he is a
nonconforming use and hope that the state will accept the approach of states like Pennsylvania,
who rule that forced phase-outs of nonconforming uses are invalid per se, and if done, constitute
a taking. In Pennsylvania Northwestern, Pennsylvania’s highest court ruled that amortization
and discontinuance of a lawful pre-existing nonconforming use is per se confiscatory. If
Disturbia accepts this, then the state cannot take away his right to conduct this business without
compensating him.
If Disturbia were to adopt the majority rule that forced phase-outs are allowed if the
amortization period is reasonable, then Pavel will probably be out of luck. The court would look
to factors such as the nature of the use, the character of the structure, the location, what portion
of the business is affected, the salvage value, theextent of depreciation of the use, and any
monopoly advantage that has been conferred. Here, it seems unlikely that there needs to be a
long amortization period. Typically, the court will look accept an amortization period that
allows the nonconforming use business owner to receive an equal return on his investment.
Here, Pavel’s investment was in buying his house, which presumably he’s already gotten back
because he’s living in it. The income from the guest rentals is just an added bonus, and it does
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not burden him to lose this income.
Depending on which standard the court in Disturbia adopts, Pavel might have a chance of
having the court excuse his nonconforming use. However, Disturbia would have to adopt the
invalid per se rule.
(d) Apply for variance
Pavel’s final and most unlikely way to avoid to the penalty is to apply for a variance.
However, he would have to prove exceptional and undue hardship and that getting a variance
would not be detrimental to the area. The owner cannot create the undue hardship, and it cannot
be peculiar to the owner. Commons v. Westwood Zoning Board.It’s hard to argue that this
creates an undue hardship on Pavel because he can still use the house as a place to live, and the
income from the rental was not so substantial (assuming again that he’s not making a great
amount of money from the endeavor since the stays are so short). The zoning board has also
already spoken on the issue of detriment to the area because they view rentals as harmful to civic
participation (or at least the inverse is true because ownership, not rentals, increase civic
participation). Therefore, the variance should not be granted.
(C) Chekov also advertises on Airbnb that he will only provide accommodations for
American men. Nyota Uhura, a female citizen of Kenya seeking accommodations in
Disturbia City, sues him for discrimination. How should a court rule?
Note: although it was good if you considered the Civil Rights Act, which doesn’t exempt small
owners from liability for discrimination the way the Fair Housing Act does, the CRA does say
that all “citizens” shall have the same rights as white citizens—thus, Uhura, as a non-US citizen,
might not be able to bring any CRA claim for Chekov’s race discrimination. (“American” might
also not be a race even under precedent that discrimination in favor of/against “Germans”
violates the CRA, though I wouldn’t advise anyone to proceed under that assumption.)
The key here was to discuss the FHA’s ban on discrimination in advertising, which applies even
if the “Mrs. Murphy” small owner exception applies to allow discrimination in renting. (If
Chekov’s guests aren’t tenants, the FHA isn’t implicated. There are in fact other federal
prohibitions on discrimination in the provision of public accommodations such as hotels, though
you didn’t need to know this.) The strongest answers also discussed the Ninth Circuit’s
narrowing of the FHA in Roommates, allowing discriminatory advertising when living space
would be shared, on the theory that the FHA “stops at the door.”
Sample student answer:
A court should rule in favor of Nyota because Pavel has violated both the Fair Housing
Act and the 1886 Civil Rights Act, two important laws that help reduce discrimination and could
have a small part in promoting greater geographicalintegration. Under the Fair Housing Act,
landlords cannot advertise discriminatorily in regards to either sex or national origin (§ 3604(c)).
While Pavel would fall under the § 3603(b)(1) exception, which allows a person who owns less
than three single-family residences to discriminate in the sale or lease of a single-family home,
he is not permitted to advertise that discriminatory intent. By prohibiting such advertisement, the
FHA incentivizes sellers and landlords to rethink their discriminatory preferences and minimizes
the social effect of discrimination by keeping it from being further imprinted on the collective
conscience through its reinforcement in advertising. The ninth circuit has ruled that where
individuals are seeking roommates, they may advertise their discriminatory preferences, because
FHA “stops at the front door.” Pavel, again, is not seeking a roommate, as he establishes a
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tenant-landlord relationship with those who stay at his home by setting a defined period in which
the home can be used and by ceding exclusive right of possession to those who stay there. The
discrimination would additionally run afoul of the 1866 Civil Rights Act, which prohibits
discrimination in the sale or rental of real property on the basis of race or ethnicity; while
accepting any “American” indicates a willingness to accept any race or ethnicity, those terms, in
the 19th century were indicative of national origin. The advertisement discriminating against
female non-Americans is therefore unlawful under both the FHA and the Civil Rights Act.
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