Property Law Outline

I. Introduction to Property Law (1-12)

Restatement View of Property
1. The legal relations between persons with respect to a thing.
a. Thing may be an object with a physical existence or an intangible object.
2. Bundle of Sticks – each stick represents a right
a. Posses, use, manage, consume, destroy, modify, alienate, etc
Classical Perspectives
1. Occupation - one of the natural modes of acquisition
a. Taking possession of property of no man with the intention of keeping it (sometimes had to be manifested by certain acts)
a.i. Either never had or have not an owner - Res Nullis
a. Occupant acquires full rights of dominion
a. Basis of International Law
a. Critique - joint ownership vs individual ownership is the really archaic institution
a. National Parks and Wilderness Preserves are the antithesis of Occupation theory
a. But the land has been claimed for the most part - what's left to take occupancy of
a.i. Ideas
a.i. Wild animals
a.i. Outer Space?
a.i. Natural Resources
a. Ultimately about possession (9/10th of the law)
1. Natural Law - God made stuff and man can exert a natural dominion over them for his own profit
a. Conducive to order and peace if people know what's theirs.
a. Animals included
a. Man can do two things with property
a.i. Posses and dispense
a.i. Use - posses things not for yourself but to share with others
1. Labor - John Locke
a. Mix your work with a good from nature and that's your personal property
a.i. Picking stuff in nature also makes it yours
a.i. But only up to your share, the rest belongs to others
a.i. You can do this with land as well, unless its England or some other country
1. Utilitarianism - Jeremy Bentham
a. No natural property, only the work of law
a. It’s a basis for an expectation of deriving an advantage
a. The expectation that you can keep the things in your possession come from the law
1. Economics - Adam Smith: labor theory of value
a. Protect the fruits of one's labor as property
a. Invisible Hand: people who promote self interest unconsciously promote public interest
a. By recognizing property rights, we encourage people to maximize its use
First Amendment and Right of Publicity
Broad ROP may begin to impede people’s First Amendment rights. (Tiger Woods)
Professor Radin – Property and Personhood
Property Rights could be considered on a smooth continuum between personal and fungible.
The closer property is to personal, the stronger the entitlement
Fungible rights cannot be overridden in some instances whereas personal property would not.
Implications: Adverse possession and takings.
The Commons and Anti-Commons
1. Hardin - famous for this idea. Mostly the middle part that's talked about.
a. What does this say with regards to property law?
a.i. Commons - everyone has rights to use (open range farming, public parks, public domain) – no one has the right to exclude
a.i. Tragedy is that individuals are incentivized to keeping using the commons but then it gets destroyed. Resource must be scarce.
a.i. Solution: Keep it from being destroyed by regulating use. Or divide it between people.
a. How does this relate to the right of publicity? Overuse of a person's name will reduce its value. So you can either assign the right or allow the government to regulate the name of the celebrity.
1. Heller - Anti-commons
a. Multiple people have the right of exclusion, no one has an effective privilege of use
a.i. Ex - Heirs are left control of a property. Each has equal say.

What are the goals of property law?
a. Reconcile competing claims to property
b. Reconcile individual & societal interests
c. Encourage the productive use of property

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II. The Right of Publicity (12-36)

The right to publicity (which ensures survivability) is the right to control use of one’s own name, picture, voice or likeness for purposes of profit & to prevent another from using it for commercial benefit without one’s consent. It was developed to protect the economic value of the names and identity/image of celebrities
We want to fulfill the expectations people have in giving their name value for their descendants
No protection for infamous and persona survives death
Battle between privacy and publicity
They also have the right to attribution (credited for his work), integrity (prevents alterations), destruction.
Consistent with recognition that one can leave his property to beneficiaries after death.
Consistent with the expectation (Bentham) of a celebrity that he’s creating a valuable right.
“One cannot reap what the other has sewn.” (want to prevent unjust enrichment following theft)
Recognizes K rights of those who sought permission originally to use image/name. (right is only valuable if it is durable & exclusive)
Protects the public from confusion from fraudulent celebrity endorsements.
Consistent with policy against unfair competition through the use of deceptively similar persona.
Economic incentive to be a celebrity; subsequent incentive to produce and license.

Policy Arguments against recognition of Publicity as a Property Right:
Limits the freedom of others
Limits “good” uses (ex. Elvis trauma center)
Limits creativity (SNL)
Sometimes a restriction on 1st amendment rights to free speech

Right of Publicity
a.I. Has been recognized as an independent property right by SCOTUS
a.II. States have recognized it though either common law or statute.
a.III. It is descendible right. Why?
a. Testamentary distribution is an essential right
a. Don't want to encourage unjust enrichment
a. Consistent with view that celebrity is a creating a valuable asset
a. Recognizes contractual rights of those who contracted for license before death
a. Public is free from deception
a. Consistent with policy against unfair competition through deceptively similar corporate names.
a.IV. It is limited to commercial exploitation
a. An impersonation was viewed as non-commercial. Could go either way.
b. Doesn’t include literary works, musical compositions, film, radio or television programs
c. Famous Person needs to be alive somewhere that recognizes the ROP (Andrew Jackson & Marilyn Monroe)

I. Facenda v. NFL Films, Inc.
a. Facenda’s voice-over work in Madden 2006, estate “claims that the program was an unauthorized use of Facenda's name or likeness in violation of Pennsylvania's "right of publicity" statute”
b. The courts held that the NFL violated this statute with its use of Facenda's voice because
b.i. his voice's commercial value was not disputed,
b.ii. the NFL used his voice for a commercial purpose, and
b.iii. the standard release Facenda signed did not consent to the use of his voice in endorsements

II. State of Tennessee ex rel. Elvis Presley International Memorial Foundation v. Cromwell
a. two entities regarding the use of Elvis’ fame
b. Tennessee common law encompasses an expansive view of property
b.i. This case views publicity as a species of intangible personal property
b.ii. Court must conclude right of publicity prior to asserting whether it is descendible
c. Analogizing publicity to property
c.i. Investing effort to accrue value to pass on to heirs
d. Policy arguments sufficiently persuasive to making this right descendible to his heirs
d.i. Did not die with Elvis, was property upon death
d.i.1. Heirs/estate held exclusive right to license/share/restrict/exclude
e. Andrew Jackson—featured on the $20 bill and advertisements
e.i. First, laws of property/publicity enacted post mortem?
e.ii. Anticommons—multitude of people with exclusion rights as paralyzing
e.iii. Preponderance of heirs? There is an extent to which the “common law” nature of publicity allows states to make it up as they go along
e.iii.1. Common law is crafted when people have a problem
e.iii.1.a. Shaw Family Archives Ltd. v. CMG Worldwide:
e.iii.1.a.i. No right because to publicity rights has been crafted, at the time of her death in California (where she died), New York (where her will was probated) or Indiana (where the shirts were sold

In most jurisdictions, an actor, solicitation, or other famous person has a property right to the exclusive use of his name and likeness for financial gain. For example, if L renames his liquor store “George W. Bush’s Liquor Store,” George Bush could sue to enjoin this unauthorized use of his name.

III. Midler v. Ford Motor Co.
a. Midler declines offer to have her voice used in a commercial
b. Ford/Ad Agency recruited back-up singer to impersonate Midler
b.i. Purchased copyright license
c. Midler claims that even though she doesn’t own/control the song, this is a violation
d. CA statute protects actual voice, but also likeness
d.i. Likeness can broadened to voice, as a feature of identity
e. “when...deliberately imitated in order to sell a product, the sellers have appropriated what is not theirs”

(extending protection to unique voice of Bette Midler, because “[a] voice is a distinctive and personal as a face … [t]o impersonate her voice is to pirate her identity.”).

Today, however, the law protects a celebrity’s “right of publicity”—the right to the exclusive use of the celebrity’s name and likeness for commercial gain.

IV. Romantics v. Activision Publishing Inc.
a. The court dismissed the case because “while Michigan law protects against the unauthorized use of a plaintiff's name or likeness, it does not recognize an analogous claim based on the sound of a voice, let alone the allegedly distinctive sound of a combination of voices”
a.i. The court relied on Edwards v. Church, 2002 Mich. App. LEXIS 2390 (Mich. Ct. App. 2002), which held that “no cognizable tort for negligent misappropriation of an unknown singer's voice exists in Michigan”
a.ii. The court also explained that “Defendants make no reference to The Romantics or to individual Plaintiffs in the advertising of the Game; that it is possible to play the Game and never reach the level of play necessary to encounter the Song; and that when the Song is encountered in the Game, it is clearly identified by the Song title and the words "as made famous by The Romantics," thus informing players and onlookers that The Romantics are not actually performing the Song”

V. ETW Corp. v. Jireh
a. Jireh makes living exploiting images of people’s publicity
b. How is this distinguishable from the Bette Midler case?
c. Exploitation is done in such a way that it is speech
c.i. Not including naming a hospital
c.ii. First amendment narrows the scope of the right of publicity in this case
c.iii. Property law (primarily a virtue of the state) shares borders with a lot of federal spheres, which occasionally intersect
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III. Cultural Property (36-46. 54-64)
Cultural Property
General Rule – in determining ownership of cultural property between government and private party, common presumption that possession is prima facie evidence of a legal title in the possessor for reasons (Willcox v. Stroup)
a. Cultural Property: Property which is specifically designated by each State (statutory interpretation) as being of importance for archaeology, prehistory, literature, art, or science – belongs to society as a whole, no private ownership.
b. Argument for stability – government needs to protect it or people won’t develop property
c. Argument against letting private ownership decide it – may wind up some random place
d. Policy: Seeks to limit the ability of individuals to assert property rights (opposite of right of publicity)
e. Policy supporting Possession Rule
e.i.1. Gives answer to ownership when no title can be found (prevents “historical goose chase” for courts)
e.i.2. Promotes Stability – protects the expectations of those in possession, thus encouraging them to make improvements that increase social wealth. (Locke, Bentham)
e.i.3. Determines which party has the burden of proof to defeat the presumption – prevents immense litigation over cultural property currently held by private owners, museums, etc.
e.i.4. Presumption in no way frustrates public interest (here, papers available for study on microfilm) – State could always buy the rights to a cultural property on the open market (theory of entitlements)

Most jurisdictions have recognized a right of attribution and right of integrity for artists. Destruction of some publicly displayed works are prohibited
1. Right to destroy art – VARA protects things done for artistic purposes (Carter v. Helmsley-Spear, Inc.)
a. Art done for compensation might not be protected
b. Different than normal property, can normally destroy normal property if you want
c. Comes from the idea that artists have moral rights – this is an application of natural rights theory

Statutory schemes for Cultural Rights (United States v. Schultz)
a. Cultural property emerges from statutes, not C/L
d. Cultural property is not a fix determined category in the law right now
e. Most of the time, cultural property is used to defeat private ownership

Cultural Property is different than normal property.
1. Both parties own it. Get different sticks in the bundle
2. Protects the public from the privatization of important things

I. Wilcox v. Stroup
a. Documents prepared under duress by governors amidst the civil war
b. Wilcox wants them for money; state wants them for preservation
c. Why are these documents themselves uniquely valuable?
d. There is no knowledge regarding the chain of custody between the governors and Wilcox
d.i. Did governor abandon to General Law, are his heirs rightful owners?
d.ii. The true owners are governors descendent unless he could be shown to have abandoned them
e. Any laws would have to be read retroactively, custom was that a governor retained,
f. What could the state do besides win the auction?
f.i. Eminent domain—take your property if they provide just compensation
f.i.1. Public use and just compensation

II. Carter v. Helmsley-Spear
a. Three artists employed/contracted to do installation pieces throughout the building
b. New building owners want to remove this art
c. The idea that you retain certain rights regarding an artwork after you sell it
d. Statute entails protection of unique artwork
d.i. Attribution—that art be attributed to them
d.ii. Integrity—changes, destruction, art of “recognized stature”
e. Balancing test—were these artists working as employees
e.i. Salary, extra commissions, degree of control over placement
f. The Right to Destroy—
f.i. Why? Prevent use, shift allocation of use, hazard, nuisance, personal preference
f.ii. Cannot destroy? Money, cultural/historical artifacts, non-property, endangered species, American flag (except for First Amendment purposes), financial documents, some trees, pets
g. VARA only applies to art which is otherwise subject to copyright
g.i. Fixed and authored (garden can not be said to be authored)

(owner of sculpture could modify or destroy it, despite objections by sculptors)

It is common to describe property as a “bundle of rights” in relation to things. But which “sticks” make up the metaphorical bundle? We traditionally label these sticks according to the nature of the right involved. Under this approach, the most important sticks in the bundle are:
(1) the right to exclude;
(2) the right to transfer; and
(3) the right to possess and use.

The right to destroy may also be apart of the metaphorical bundle of sticks. One major exception to the basic rule is the work made for hire, that is, a work made either in the course of an employee’s job duties or a special type of work that is commissioned by another party (e.g. an instructional text). Carter v. Helmsley-Speak (sculpture was work made for hire).

III. Kelley v. Chicago Park District
a. “Because Kelley’s garden is neither ‘authored’ nor ‘fixed’ in the senses required for basic copyright, it cannot qualify for moral-rights protection under VARA”

IV. United States v. Schultz
a. Patrimony laws of Egypt do not apply to Schultz?
a.i. Schultz claims that discoverable is private property
a.ii. You can only be convicted of stealing if someone else owns it
b. Significant number of art collectors agree with Schultz
c. Continuum of ownership: private, national and global
d. Three very different statutes
d.i. South Carolina statutory law re: gubernatorial papers
d.ii. Visual Artists Recording Act
d.iii. National Stolen Property Act and pursuant treatises
V. Cultural Property are advanced to defeat claims of individual rights/Right of Publicity is advanced to defeat claims of general/communal rights
a. Cultural property does not literally assert property as cultures’, is primarily advanced to defeat individual assertions
b. There is no single, legal definition of cultural property
b.i. Still must be predicated upon a statute; there is no ontologically independent notion of cultural property
b.ii. Did not evolve up from the common law (like right of publicity)

VI. Quechan Indian Tribe v. United States
a. Inhabitants of Southwestern Arizona for thousands of years, the 2500 persons of Yuma, Arizona's, Quechan Indian tribe maintain a close relationship with the terrain and the Colorado River
b. “The Tribe argues that it holds a property interest in lands by the unique nature of cultural property”
c. “This Court does not find the journal and law review articles persuasive authority and the Tribe cites no case law or other persuasive authority for its position that the nature of the cultural artifacts provides them with a proprietary interest in the lands”
IV. Personal Property

Possession- requires 1) intent 2) possession

Relativity of Title- The idea that a person can have a relatively better title or right to possession than another, while simultaneously having a right inferior to yet another person.

Determining Possession
1.) First-in-time, first-in-right- establishing a priority of rights based on the time of acquiring the right in question. When all other things are equal the chronologically first possessor has the better title. (normally other things are not equal)
2.) Constructive Possession- Having the right to possession that is not yet actual possession. i.e.-owning the land with unextracted minerals.
3.) Custom- Using market or locale specific traditions to determine when/what possession is. Normally not determinative for several reasons: 1.) not for the benefit of the society, just industry, 2.) could be dangerous, 3.) can be wasteful of the resource, 4.) can lead to over-investment in technology.

Misapproation-When a plaintiff has by a substantial investment created an intangible thing of value not protected by patent, copyright, or other intellectual property, and the defendant appropriates the intangible at little cost so that the plaintiff is injured and continued use is jeopardized.

Tangible- Property of physical nature (see and touch it). i.e.- cars, books, clothing, lumber, jewelry, paintings.
Intangible- Assets that cannot be touched or seen, but still have value. They are normally represented by a writing. i.e.- stock, bonds, patents, copyrights, goodwill, and contract rights. Even right of publicity and privacy to a person’s name, face, or other attribute of the person for commercial purposes.
Distinction between Real and Personal Property- “Rights among person with respect to things…”
Real Property deals with the rights associated with the land, owners are able to obtain specific relief (restitution) from wrong doers.
Personal Property deals with the rights associated to moveable things (goods) and intangible rights not associated with land (copyrights), which the owner has “personal” actions to recover damages.

An improvement denotes a transformation from goods to part of real property. As soon as stone/concerte becomes fixed to the land it loses its personal property attributes. -house, fence
A fixture is an item which is attached to the land or building, but can be detached from the land without losing its character. -fridge, shed, mobile home (good in a ucc sale, but taxed as real property.) -Tests for fixture or improvement: 1.) physical attachment, 2) adaptation to property, 3) intent

Rule for Crops - Typically crops are attached and are therefore part of the Real Property. + The exception is for fully matured crops, then they become personal property. +Mature: is a factual determination. Decided by an industry standard. + This is the default rule. Can be contracted around or changed by statute. UCC says that growing crops are personal property. + Improvements and fixtures tend to be part of the Real property

I. Wood v. Wood
a. Warranty Deed—half-section of land which contains corn
a.i. He sells “Rent” of corn interest after the execution of the land deed
b. When he gave her the land, did he also give her the corn
c. Once matured, corn transcends from realty to personalty
c.i. Once it has stopped being nurtured by the land; it holds a different relationship to the land (fixture v. non-fixture)
d. Personal v. Real Property—
d.i. Personal—more movable, basically “stuff”
d.ii. Realty—more specific performance, idiosyncratic
d.ii.1. Owning land—voting rights, class distinctions, commitment to the community, idiosyncratic preference, visceral
d.ii.1.a. Land “they don’t make it anymore”
d.ii.2. Usually this distinction is obvious
d.ii.2.a. Real to personal—oil, minerals, diamonds
d.ii.2.b. Personal to real—building materials, wells, copper pipe

Real property consists of rights in land and anything attached to land (e.g. buildings, signs, fences, or trees). But see Wood v. Wood (holding that mature corn crop was personal property)

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Finders (65-91)
Finders
General Rule - Finder has property rights against anyone but the rightful owner

Not the most helpful. Let’s classify the kind of property found. (Statute can always rebut the common law)
1. Abandoned – owner discarded or voluntarily forsook with the intention of terminating ownership
a.a. FINDER obtains right to possession and title if he exercises control over the property with intent to assert ownership.
2. Lost – the owner has involuntarily and unintentionally partied with through neglect, carelessness or inadvertence and does not know the whereabouts
a.a. FINDER obtains right to possession against all the world except the true owner or a prior possessor. (encourages people to find lost things)
3. Mislaid – owner intentionally set down in a place but then forgets where it is
a.a. OWNER OF LOCUS IN QUO obtains right to possession. (facilitates the return to the rightful owner)
4. Treasure Trove – Exclusively for gold and silver coin, plate and bullion or sometimes money. Carries the thought of antiquity. Owner is dead or unknown (discourage trespassers)
a.a. FINDER obtains right to possession in most jurisdictions.---Exception– Trespassing
5. Embedded – personal property that has become part of the earth
a.a. OWNER OF LOCUS IN QUO obtains right to possession.

Rules:
Finders of Lost, Abandoned or TT – right against all but rightful owner no matter where found
Mislaid property – required to turn it over to the owner of the premises who has the duty to safeguard for the true owner
Embedded – goes to the owner of the property where found

Court tend to not characterize property as TT because of the bad policy incentives
1. Don’t want to encourage trespassing
Admiralty Law for Salvages: Owners gets possession but salvager gets paid.
2. Have to prove that you actually found the wreck

Equitable Principles (Popov v. Hayashi) – Courts sometimes adopts equitable principle and gives half money to each side, as both sides presented good evidence that they had interests in the property

General Rule - Finder has property rights against anyone but the rightful owner
a. Actions to Recover Personal Property
a.i.1. Trover – Liability Rule – Action to recover monetary damages for wrongful taking of property.
a.i.1.a. Traditional common-law writ against another who was wrongfully using one’s property.
a.i.1.b. Forced Sale of finders rights – defendant is an involuntary purchaser of the taken chattel.
a.i.2. Replevin – Property Rule – Action to recover possession of property from wrongful possessor.
a.i.2.a. Specific Performance – get actual object back.
a.i.2.b. Part of modern property law; extends the scope of replevin to allow owners to recover chattel from any wrongful possessor.
a.i.3. Conversion – Modern Law – Has largely replaced Trover & Replevin
a.i.3.a. Tort Claim
a.i.3.b. Definition: any act of dominion or control that’s inconsistent with the owner’s rights, including wrongful taking, using, detaining, destroying, or selling.
b. Object on Private Property
b.i. Generally, if the landowner is in control of the land, he is entitled to property that is found on it:
b.i.1. Public (less control): Finder Prevails
b.i.1.a. can’t claim possession unless you exercised a right to exclude
b.i.2. Private (practically exclusive control): Owner Prevails
b.i.2.a. Possession of land carries with it possession of everything that is attached to it or under it
b.i.2.b. Land owner doesn't have to be aware of presence of the chattel on his land, so long as it is his private land.
b.i.2.c. Land owner is entitled to anything found on his property by a servant or employee
b.i.2.d. By generally excluding and only allowing limited invitation, an owner or a locus in quo may receive finder entitlement though they did not find the lost items themselves. (prior possession)
b.i.2.d.i.1. (policy)When a person has control over a house or land, he has an obvious intent to exercise control over it and then things that might be on or in it.
b.i.3. Owner Has Never Occupied his Private Property: Finder Prevails

Types of Delivery
1. Actual- physically handed over
2. Constructive- one gives the means of access to an object (normally too hard to give at the moment) without actual delivery
3. Symbolic- receipt by the bailee of a thing symbolizing the object of the bailment
4. Policy – Why do we require delivery?
RITUAL – The delivery makes vivid and concrete to the donor the significance of the act he is doing
-The “wrench of delivery” = the little mental twinge the donor gets at seeing his property pass from his hands into the hands of another is an important element to the protection of the donor. Handing over his property endures that the donor understands what he’s doing, and that he’s giving up a right.
EVIDENTIARY – It provides clear evidence of the transaction. (witness)
a.1. If he hands over the property, he has done an act that will settle many doubts, an act perhaps capable of more than one interpretation, yet readily and naturally susceptible to only one.
-It defines the subject of the gift and clarifies that an exchange has taken place.
PROTECTIVE – The fact of the delivery gives the donee at least prima facie evidence in favor of the alleged gift.
-The law does not presume unlawfulness, possession is ordinarily rightful.
-The evidence is merely presumptive at best, but it’s at least better than no evidence at all.

I. Armory v. Delamire
a. Found gem, took it to goldsmith; goldsmith kept stones and returned socket
b. Finding is not an absolute property right, but a rebuttable presumption successful against all but the actual owner

The leading case illustrating this rule (“Finders Keepers”). Plaintiff, a poor “chimney sweeper’s boy,” found a “jewel” in 1722 and took it to the defendant’s goldsmith shop for identification. After an apprentice removed the “stones” from their socket, the defendant refused to return them to the boy. The court concluded that by finding and possessing the jewel the boy had acquired “such a property as will enable him to keep it against all but the rightful owner.” The defendant was accordingly held liable in trover for the value of the jewel.

The facts in Armory help illustrate the justification for the general rule preferring the finder over third parties. The rule allows a finder like the sweeper’s boy to return a “found” item to productive use, rather than encouraging him to keep it hidden. Moreover, the boy’s prior possession is an efficient standard for determining ownership, with minimal expenditure of societal resources. Finally, this result honors the reasonable expectations of the competing parties; the goldsmith is the moral equivalent of a thief.

II. Bridges v. Hawkesworth
a. Man finds money parcel in shop; gives it to shopkeeper to hold
b. Notes were never in custody nor house prior to finding

A valuable object left in a public place such as a store, bank, or restaurant is usually considered mislaid property and awarded to the owner or occupant of the premises, not the finder. But see Bridges v. Hawkesworth (banknotes in parcel found on floor of shop were not “intentionally deposited” there by owner; they were thus considered “lost” property and awarded to finder, not shopkeeper).

III. South Staffordshire Water Co. v. Sharman
a. Found rings in pool
b. Landowner invites people to clean out, and they find the rings in course
c. Nature of ownership of the land, intended to own
d. Manifest intention to exercise control  coupled with finding by guest/stranger/employee still confers possession on landowner

In general, objects found either within a house or embedded in the soil on private land are awarded to the landowner, not the finder. See South Staffordshire Water Co. v. Sharman (gold rings in mud at bottom of pond).

IV. Hannah v. Peel
a. Soldier boarded at house during requisition; finds brooch; gives to commanding officer; who gives it to police; who return it to Peel; who sells; finder wants brooch or its value
b. Defendant never lived in the house; was sort of kicked out
c. Distinction: defendant never lived in house

In general, objects found either within a house or embedded in the soil on private land are awarded to the landowner, not the finder. But see Hannah v. Peel (under English law, brooch found by lawful occupant of home awarded to finder, rather than to landowner who had never lived in the home).

V. Corliss v. Wenner
a. Jann Wenner hires Anderson and employee Corliss to construct driveway
b. Finds glass jar with paper-wrapped gold coins amidst excavation
b.i. No trust in banks, proceeds from illicit enterprise, &c.
c. Corliss—argues for Treasure Trove
c.i. Prima facie: (1) buried; (2) gold, silver, precious metal; (3) old/antique
c.ii. Specific, small niche, to encourage re-circulation of purposefully hid resources
c.iii. Purposefulness v. accidentally happening upon

VI. Columbus-America Discovery Group v. Atlantic Mutual Ins.
a. Columbus-America finds gold; petition for declaration of ownership
a.i. Underwriters who originally insured gold and map-makers intervene
b. Trial: all gold goes to Columbus-America (underwriters paid out, gained rights and maps were not used)
b.i. Appellate: whether underwriters hold right
c. Demonstration of abandonment of gold
c.i. Intentionally destroying documents—evidence is cloudy, remand for discovery
d. Dissent—has trial court made a clear error?
e. Abandonment is a factual determination

Property is abandoned when the owner intentionally and voluntarily relinquishes all right, title and interest in it. For example, if O deposits a broken toy on the sidewalk so that it can be removed by garbage collectors, he has abandoned it. On the other hand, if O merely leaves the toy on the sidewalk overnight, intending to reclaim it in the morning, no abandonment has occurred. Thus, one illustrative decision held that the owners of “up to one billion dollars in gold” sunk in an 1857 shipwreck did not abandon their rights merely by failing to recover the gold.

VII. Popov v. Hayashi
a. Popov almost catches but gets mauled by crowd; Hayashi picks up from the ground
b. Popov has pre-posessory
c. Courts end up splitting the difference—equitable is equal and undivided interest
c.i. Not sure if this would have held up if either party had appealed
d. Ball is treated as abandoned property

Pierson in Context: Pierson is important at several levels. It established the actual capture rule as the American standard for acquiring title to wild animals. As a prominent decision in a legal system with little case law, it also provided a bridge for extending the capture rule by analogy to other natural resources.

In Popov v. Hayashi, the trial court held that the capture rule would apply (“A person who catches a baseball that enters the stands is its owner.”), but found on the facts that the plaintiff had not “achieved, complete control of the ball.” Considered a modern day Pierson v. Post.

VIII. Black Hills Inst. of Geological Research v. South Dakota School of Mines
a. Sue Hendrickson discovered Sue, the most complete and valuable Tyrannosaurus rex skeleton known to man
a.i. Working on a project for Black Hills, which collects and restores fossils for display in museums
a.ii. Found in western South Dakota on a ranch held by the United States in trust for Maurice Williams, a Native American
b. Black Hills then purchased from Williams the right to excavate Sue for $ 5000
c. Question is whether the fossil is real or personal property
d. The court held that the fossil was "land”
e. "Real or immovable property consists of: (1) Land; (2) That which is affixed to land; (3) That which is incidental or appurtenant to land; (4) That which is immovable by law. Every kind of property that is not real is personal." "Land," in turn, "is the solid material of the earth, whatever may be the ingredients of which it is composed, whether soil, rock, or other substance."
f. The fossil was an “ingredient” comprising part of the “solid material of the earth”
g. That the fossil once was a dinosaur which walked on the surface of the earth and that part of the fossil was protruding from the ground when Hendrickson discovered it are irrelevant because for millions of years it been an "ingredient" of the earth that the United States holds in trust for Williams.
h. Although it is movable, personal property now, at the time Hendrickson discovered the fossil it was part of Williams' land
IX. Franks v. Pritchett
a. Alex Franks was working on a highway project, and he checked into the Comfort Inn in Searcy, Arkansas on September 10, 2001
b. The hotel had a history of drug trafficking
c. Franks checked out on the 12th, but before another guest occupied it, he returned to retrieve his laundry
d. He found $14,200 of $100 and $20 bills neatly wrapped in masking tape in plain view in the left part of the left drawer of his dresser
e. He notified Perri Pritchett, the hotel manager, who notified the police
f. The City of Searcy held the money in trust pending the outcome of the case
g. Who owns the money?
g.i. The original owner (unless abandoned or contraband)
h. Court says money was mislaid, intentionally placed and forgotten
h.i. Stands with shop case so the hotel owner gets the money (3-2 decision)
i. Finding property—what justifies ensuing possession
i.i. Allocate efficiency—but it’s who found it, not best use of it
i.i.1. This is the best proxy, minimizes litigation
i.ii. Finders is also about possession, rebuttable presumption of ownership

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V. Bailees & Bona Fide Purchasers (91-110)

Bailees & BFPs
A bailment occurs when one person give temporary possession of her property to another. A bailment is the rightful possession of goods by one who is not the owner, however the title doesn't transfer with the goods. It requires possession (intent), consent from bailee, knowledge. Bailments are usually limited to personal property, but can sometimes include securities, bonds, and negotiable instruments.
-Burden of proof is with the bailor to prove the bailment, then the bailee to prove SOC
-If something is concealed in an item it doesn't mean that they are a bailee for that
-Bailee always has a duty to redeliever the goods.
Creation of a Bailment:
b.ii. Contractual – resulting from a contract or agreement (express or implied).
b.iii. Conduct – implied through the conduct of the parties.
b.iv. Combination – resulting from some combination of both an agreement (usually implied) and conduct (as evidence of the implied agreement).
Types of Bailment:
b.v. Voluntary Bailment – A delivery of personal property by one person (bailor) to another (bailee) who holds property for a certain purpose under an express or implied contract.
b.v.1. This is the standard
b.v.2. There is a change in possession, not title.
b.vi. Constructive Bailment– When either delivery or acceptance is not actual. This type of bailment arises when possession of personal property is acquired and retained under circumstances in which the recipient has a duty to keep it safely and return it to its owner.
b.vi.1. Quasi Bailment – Voluntary acceptance of possession by one who expects some reward for service. (A form of constructive bailment.)
b.vii. Divisible Bailment – Bailee is only responsible for the portion of the bailment that’s foreseeable.
b.viii. Involuntary Bailment – Arises when one person accidently, but without any negligence, leaves personal property under another’s possession. As long as it remains involuntary, he is not under the slightest duty to care for it, but if he exercises any dominion over it, he becomes responsible as if he were a voluntary bailee.
a. Duty of Care (lost or damaged)
a.a. Gratuitous bailment-Benefit to baliee is slight, requires GROSS NEGLIGENCE (slight care) to be liable
a.b. Bailment for hire- Both benefit- REASON PERSON UNDER THE CIRCUMSTANCES
a.c. Sole benefit of bailee- slight negligence (EXTRA ORDINARY CARE)
a.d. The modern trend is to have everything done with an ordinary standard of care because it is more fair and the categories don't always fit.
b. Duty of Care (misdelivery)
b.a. Strict liability and Negligence- Normally strict liability for misdelivery, however some states assume negligence unless otherwise proven
b.b. Burden of Proof- on the baliee because they know the history of the bailment best, bailee can sue thieves, best position to take recovery steps, can spread risk, and prevents fraudulent misdelvieries

Bona Fide Purchasers (UCC 2-403)
A Bona Fide Purchaser is someone who doesn't know of the seller’s wrongful possession but has a good faith belief that the seller has title, and, pays valuable consideration. This is done as a narrow exception to the rule that a person cannot transfer title to things they don't own in order to protect people with apparent title. -Stolen goods will go back to the original owner -Have to have gotten it by Fraud, entrustment (merchant in the kinds), or cash sale
-If the original owner helps the 2nd party appear to have good title- BFP keeps it

Void title is one a person cannot transfer (thief), but voidable can be transferred to the BFP.

I. Buena Vista Loan & Savings Bank v. Bickerstaff
a. Safety deposit box disappears over a decade
b. Why cash in a safety deposit box? Banks have other mechanisms.
b.i. Nefarious activity, doesn’t trust bank, at least unusual banking strategy
c. Negligence on the part of the bank; lost key
d. Theory that bank must reimburse: bailor and bailee
d.i. Status of property during successful bailment:
e. Can’t presume upon someone, the shifting of property from you to them, absent their agreement
f. Bailment-for-hire—traditional negligence reasonable standard of ordinary care
f.i. Need not require monetary exchange
f.ii. Does this track the circumstantial cues of invitee, licensee in Torts
f.ii.1. Gratuitous bailment—watch, take on as a gift (gross negligence)
g. Summary judgment not established; fact-finder could find negligence
h. Bank is not guaranteeing against Ocean’s 11; this isn’t strict liability
i. Bank argues lessor/lessee distinction: affirmative duty on Bickerstaff

II. Shamrock Hilton Hotel v. Caranas
a. Women leaves pursue in hotel restaurant; busboy discovers; delivered to cashier (per procedure); imposters comes to receive purse
b. Cashier accepting purse from cashier was effectively accepting the bailment
b.i. Hotel assumed duty of the bailment, of ordinary care
b.ii. There is a certain point, at which, the cashier will have deemed to have fulfilled ordinary care in spite of the imposter’s thief
c. Hypo: Busboy finds and keeps it: theft and then whether hotel is vicariously liable
c.i. Not a bailment
d. You can think of a finder as a permanent Bailee
d.i. Statutes which specify the shifting of permanent bailee to owner
e. DISSENT: Divisible bailment because only cash and credit cards were foreseeable
e.i. Dissents unusual for bailment cases
e.ii. Hotel would have done something different had they realized that this was a bailment for $13K

Regardless of the category of bailment involved, this modern view requires a bailee to exercise the same degree of care that a reasonable person would exercise under the circumstances. For example, in Peet v. Roth Hotel Co., a hotel was held liable for the value of a ring that was lost after the plaintiff bailor entrusted it to the hotel’s cashier for deliver to a hotel guest. As is typical in bailment disputes, the plaintiff was unaware of the circumstances surrounding how the hotel lost the ring, and thus unable to prove negligence. The Minnesota Supreme Court followed the modern solution to this proverbial dilemma; it ruled that plaintiff established a prima facie case by proving only that the bailment existed and the ring was not returned to him. This shifted to the hotel the burden of providing evidence that the ring was lost without any negligence on its part, a burden it could not meet.

III. Marchello v. Perfect Little Prod., Inc.
a. Peppi Marchello performed with the Good Rats in the 1970s
b. Between 1994 and 2001, he recorded 2,000 hours of music at Perfect Little Productions’ studio
c. Marchello stopped recording in 2002 because of a heart ailment, and when he returned in 2005, all of his recordings were lost on a crashed hard drive
c.i. Is the studio liable for breach of a bailment?
c.ii. Bailments can cover intangible property
d. Marchello has established a prima facie case of gross negligence through his request for the return of the hard drives containing his music and the studio’s failure to comply

IV. Charles Evans BMW, Inc. v. Williams
a. Plaintiff/Williams sells his car to Hodge (imposter); Hodge impersonates William and sells the car to BMW; BMW sells it to a customer (gets back with police order)
b. Court rules for the dealer Hodge had voidable title: power to transfer good title to BFP
c. Q: why did BMW think Hodge was Williams 1) paid a fair market price; 2) signature was not forged 3) identification was provided (with William's DL #)  dealer is BFP
d. Williams is out of the car can't we provide remedy for that?
e. BFP cases, there are always two innocent parties: true owner and the new owner
e.i. how best to determine what to do with the scenario?
e.ii. as a general rule, you can't sell what you don't own: but, you can sell something you don't own to BFP

V. Lindholm v. Brant
a. Lindholm (true owner) but when the art is displayed, it says "courtesy of Malmberg not Lindholm". Brant pays Malmberg 2.9m and gets possession of the painting
b. General rule: if you buy from a bailee, it's generally considered as buying from a thief (void title)  has to return to the owner
c. Exception:
c.i. idea of entrusting a thing to a merchant (Malmberg)
c.ii. buyer (Brant) in the ordinary course of business
c.iii. Brant is a BFP: followed the ordinary custom, hired counsel, got assistance on formal contract, Malmberg had trustworthy reputation Brant keeps the painting

VI. Chen v. Bell-Smith
a. Sara Lee and Gavin Chen refinanced their home at the invitation of a mortgage refinancing company because it was facing foreclosure, but they didn’t realize that one of the documents that they signed actually sold their home to Jewell Bell-Smith & Darryl Smith
b. The Smiths financed their purchase of the home with loans from the Pinnacle Financial Corp., which were subsequently assigned to HSBC
c. HSBC is a bona fide purchaser
c.i. The alleged fraud would only make the sale voidable, not void
c.ii. HSBC did not have actual or constructive notice of the fraud
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VI. Gifts (110-126)

A gift is a voluntary transfer of property by one to another without any consideration or compensation. All gifts can be testamentary (by will) or inter vivos (during the lifetime). All gifts require intent (irrevocable transfer of immediate title not just possession), delivery, and acceptance. Intent is the most important element of a gift. -Deliveries can be constructive (letter) and if the gift has value then it counts as acceptance -If the person writes a check and then dies before the person cashes then it isn’t a gift because they could have revoked it -Can be voided if donor is senile, mentally infirm, influenced by others or medication
a.i. Policy for Acceptance
a.i.1. Acceptance provides a conclusion of the bargain.
a.i.2. We have this because there are some cases when people don’t want a gift (Acceptance requirement, in effect, gived the donee the right to reject the gift): getting rid of it could be more expensive than what it’s worth or it could have really bad memories for the person

A Gift Causa Mortis is a gift that is given when someone is apprehending death, intents to give the gift, delivery of the gift (can be symbolic or constructive), acceptance, and the death must occur in a reasonable time after the delivery. They can be revoked if the person doesn't die or changes their mind because it is conditional on the death. -View toward suicide: .
a.i. Majority View – permits gifts causa mortis in anticipation of suicide. Permitting them will further the public policy against suicide since the donor may receive the gifts the suicide is not completed These courts focus on the utter despair attendant upon someone contemplating suicide – this may reasonably be viewed as even more imminent than a person struggling with a fatal illness.
a.ii. Minority View – does not permit gifts causa mortis in anticipation of suicide because suicide is voluntary, controlled by the will of the donor, and easily subject to change by the decision not to take one’s own life. Also suicide is destructive behavior, against public policy – therefore gifts made in contemplation of suicide are also against public policy and should not be enforced. Feel it would be rewarding suicide if they are held as valid gifts.

A Conditional gift, is when a gift is given with either a condition precedent or subsequent that has to be fulfilled.
1. Condition Precedent- no gift/property interest until the condition is completed
2. Condition subsequent- gift/property interest is given and the condition is negated
a. Wedding rings are a special exception
a.1. PA rule of a no-fault conditional gift is becoming the majority rule.
a.2. The fault rule is the traditional one though.
a.3. Restatement has the ring stay with the wife except in fraud or if she ends it

Conditional gifts ,– a condition is not fulfilled, so the ring goes back to the donor (Lindh v. Surman)
3. Here, the court goes with a non-fault based rule as fault based would be very hard to determine
4. However, cases often come out on the other side and wedding ring stays with party (Albinger v. Harris)
5. Generally, the law disfavors conditional gifts, because it does not satisfy the intent requirement (Albinger v. Harris)
6. However, wedding rings are a special exception
a. PA rule of a no-fault conditional gift is becoming the majority rule.
b. The fault rule is the traditional one though.

I. Simpson v. Simpson
a. Guns “given” on hunting trip. Inter vivos requires intent and delivery; here no delivery.
b. Could have evinced constructive delivery (no evidence here).
II. Gruen v. Gruen
a. Does gift of remainder with reservation of life estate lead courts effectuate otherwise invalid/insufficient testamentary disposition of property—does intended gift have immediate effect (transfer interest)
a.i. Gift of remainder with reservation:
a.i.1. Once made gift is irrevocable and donee is reduced to life tenant
a.i.2. With gift of remainder, titles vest immediately with possession postponed
a.i.3. Express terms include postponement of enjoyment
a.ii. Testamentary disposition/will:
a.ii.1. Upon death becomes full owner
a.ii.2. Title nor possession vest immediately
a.ii.3. Nature of instrument implies postponement
a.iii. Gift of remainder, effective on death (valid) v. promise to give upon death (invalid)
b. Intent and Delivery
b.i. Delivery—either physical or constructive/symbolic (instrument)
b.i.1. Illogical for law to require delivery of painting for only remainder interest
b.i.1.a. Such a symbolic delivery would defeat the purposes of delivery standard
b.i.2. Generally, if something is small enough that you can physically deliver it, then you have to deliver it in order to show that it was a gift—more manageable, require delivery
b.i.3. There can be constructive delivery, like letter (Gruen v. Gruen)
b.i.4. Courts are pretty stingy with delivery
b.ii. Acceptance—where the gift is of value to done, courts will infer acceptance

If the donor intends the “gift” to take effect in the future (e.g., upon the donor’s death), it is a nullity that confers no rights on the done. Suppose R plans to produce a musical comedy, and tells E: “After my musical is produced, I’ll give you 5% of my share of the profits.” Because R intends a future transfer only, no gift results. But the requisite intent for a present transfer will be found if R states instead: “I give you 5% of my share of the future profits from the musical.” Because R intends a future transfer only, no gift results. But the requisite intent for a present transfer will be found if R states instead: “I give you 5% of my share of the future profits from the musical.” See also Gruen v. Gruen (father intended the immediate transfer of a remainder interest in a painting to his son, even though the father retained a life estate).

The modern trend is to recognize an informal writing as symbolic delivery even when manual delivery is possible, as evidenced by the well-known New York decision of In re Cohn. There, the donor signed and dated a memorandum that recited “I give this day to my wife … five hundred shares of American Sumatra Tobacco Company common stock,” but failed to hand over the stock certificates to her. As the dissent protested, “there was no physical or other impossibility to the actual delivery of the stock.” Reasoning that the delivery requirement was intended to guard against fraud, mistake, or undue influence—and finding none—the majority found the memorandum to be effective symbolic delivery. See also Gruen v. Gruen (letter from donor to done constituted valid symbolic delivery of vested remainder in painting; physical delivery of painting to done not required because “it would be illogical for the law to require the donor to part with possession of the painting when that is exactly what he intends to retain”).

Future interests may be created in a variety of legal settings. Future interests can also be created in personal property. See, e.g., Gruen v. Gruen (remainder created in painting).

III. In re Estate of Smith
a. Writing of four checks prior to suicide; also holographic will providing for the selling of his car for $12,000
b. Prima facie of gift causa mortis:
b.i. at the time of the alleged gift, the decedent intended to make a gift
b.ii. the decedent apprehended death – was planning on killing self, but dissent gives a public policy argument to not allow this gift – can be generally inferred, need not be evinced
b.iii. Gift was actually or constructively delivered – giving check counts
b.iv. Death actually occurred
b.iv.1. Death can’t be a precondition of the gift
c. Gift causa mortis v. oral will—wills require strict formalities/instrumentation

IV. In re Jelnek
a. Vincent Slavin had been living with his fiancé Anna Baez for four years
b. His salary was directly deposited into a checking account which they both used
c. He was a partner at Cantor Fitzgerald who died in the World Trade Center attack
d. Three days later, $58,264.73 was automatically deposited into his checking account
e. Court held that the $58,264.73 was not a gift to Baez
e.i. Gruen distinguished because the transfer of ownership must be irrevocable for the gift to be complete
e.ii. Slavin retained the right to change his direct deposit, so his future earnings were not irrevocably transferred during his lifetime
f. So the money will go into Slavin’s estate, where it will be distributed to his heirs because he died without a will

V. In re Hansen
a. Roger Hansen died in 2009 at the age of 88
b. Intestate (i.e., no will)
c. Heirs included his brother and sister, their children, and his deceased siblings’ children
d. Roger had loaned $278,000 to his three nieces
e. Shortly before he died, he wrote a note on the draft of his will saying that he was going to forgive the loans, and then he returned the draft to his attorney
f. Court held no gift causa mortis
g. No delivery to the nieces
h. Not an effective will because not validly executed

VI. In re Kelligrew
a. Roger Hansen died in 2009 at the age of 88
a.i. Intestate (i.e., no will)
a.ii. Heirs included his brother and sister, their children, and his deceased siblings’ children
b. Roger had loaned $278,000 to his three nieces
c. Shortly before he died, he wrote a note on the draft of his will saying that he was going to forgive the loans, and then he returned the draft to his attorney
d. Court held no gift causa mortis
e. No delivery to the nieces
f. Not an effective will because not validly executed

VII. Lindh v. Surman
a. Gift of engagement ring is a conditional gift; condition is marriage not acceptance of proposal
b. Courts implement a no-fault analysis for these cases—consistency and stability
c. Conditional gifts– a condition is not fulfilled, so the ring goes back to the donor
c.i. Here, the court goes with a non-fault based rule as fault based would be very hard to determine
c.ii. However, cases often come out on the other side and wedding ring stays with party (Albinger v. Harris)
c.iii. Generally, the law disfavors conditional gifts, because it does not satisfy the intent requirement (Albinger v. Harris)
c.iv. However, wedding rings are a special exception
c.iv.1. PA rule of a no-fault conditional gift is becoming the majority rule.
c.iv.2. The fault rule is the traditional one though.
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VII. Trespass (127-149)

Protecting Possession
Possession and Sovereignty
Sovereignty of United States (Johnson v. M’intosh)
History – people appropriated land from Indians when they first came here
All premised upon the initial assertion that the land became Great Britain’s from conquest and discover
Conquest – law will recognize what is happening
Discovered – tribes, if they remained peaceful, can be occupants, they cannot transfer possession
Enough backing in the law that this is not going to be changed by one Supreme Court decision
Ownership and sovereignty are different – ownership still fall under the law, sovereigns make the law

Trespassers and the Right to Exclude
Right to Exclude – can keep people off of your property (Jacque v. Steenberg Homes, Inc.)
Trespass – violates the right to exclude, we want to protect the right to possession
Historically, you need something sufficiently tangible to have trespass, and you don’t need to show actual or substantial damage (Adams v. Cleveland-Cliffs Iron Company)
Things like dust, noise, vibrations don’t come under trespass
However, can probably get nuisance suit
a.1. Minority view (recent view) – can treat something intangible as trespass, but need actual and substantial damage (Adams v. Cleveland-Cliffs Iron Company)
Have a right to exclude anyone no matter what they’re talking about, but can’t get advanced approval or denial protection from government because it violates 1st Amendment rights to free speech (Watchtower Bible and Tract Society of New York, Inc. v. Village of Stratton

Vertical Limits: One does not own all of the airspace above their house, but some amount of it such that an interference with the enjoyment and use of the land constitutes a taking IP

I. Johnson v. M’Intosh
a. Why give the title to discoverer? Allocative efficiency principles evoked?
a.i. Are we able to put property to better use than Native Americans
b. Why does the title not transfer from the Indian tribe?
b.i. Marshall walks a fine line between what should be and what is
b.ii. Native American rights include occupation but not alienation; unable to transfer rights
c. Emphasizes distinction between sovereignty and property
d. Occupy Wall Street movement
d.i. Does public property mean Occupy Movement is not trespassing?
d.ii. When government owns property, government sets rules for access
d.ii.1. Occupy is starting to but up against some of those public space ordinances

The Supreme Court’s 1823 decision in Johnson v. M’Intosh reflects this approach. Two Native American tribes sold a huge parcel of wilderness land to a group of private buyers for $55,000. The federal government later conveyed part of this property to one M’Intosh, who took possession of the land. Representatives of the first buyer group leased the tract to tenants, and the tenants sued in federal court to eject M’Intosh from the land. The case revolved around a single issue: did Native Americans have the power to convey title that would be recognized by the federal courts? The Court held the tribes lacked the power and ruled in favor of M’Intosh.

Writing for the Court, Chief Justice Marshall stressed that under the law of the United States, only the federal government held title to the land before the conveyance to M’Intosh, while the Native Americans merely held a “right of occupancy” that the federal government could extinguish. The title to land, he explained, “must be admitted to depend entirely on the law of the nation in which they lie.” The Court’s decision could not rely merely on “principles of abstract justice” or on Native American law, but rather must rest upon the principles “which our own government has adopted in the particular case, and given us as the rule for our decision.” In short, under the laws established by the United States, must a United States court hold that the United States owned the land? For Marshall, the answer was easy: “Conquest gives a title which the Courts of the conqueror cannot deny.” Property rights, in short, are defined by law.

By 1823, when deciding Johnson v. M’Intosh, the Supreme Court could easily dismiss the natural law argument that “abstract justice” required recognition of Native American land titles. (Example of diminishing influence of natural law theory).

II. Jacque v. Steenberg Homes, Inc.
a. Steenberg takes mobile home through property against express wills of Jacques--$30 sheriff fine
b. Court awards compensatory damages of $1, punitive damages of $100,000
c. Punitive damages used to punish/dissuade—punitive explains discrepancy in harm/damages

Right to Exclude: One stick in the metaphorical bundle is the right to exclude others from the use or occupancy of the particular “thing.” If O “owns” Redacre, O is generally entitled to prevent neighbors or strangers from trespassing. See, e.g., Jacque v. Steenberg Holmes, Inc.

Another important—but distinctly secondary theme—is that the trespass doctrine minimizes the risk of violence. See Jacque v. Steenberg Homes, Inc. (affirming $100,000 punitive damages award against company that delivered mobile home by trespassing across plaintiffs’ field, based in part on the law’s policy against self-help remedies).

A trespasser is liable even if the entry causes no actual damage. A court will hold a trespasser liable for nominal damages, and upon request, will routinely enjoin any further trespass. The recent decision of Jacque v. Steenberg Homes, Inc. illustrates the potential severity of this rule. The defendant, attempting to deliver a mobile home, discovered that the only road to the delivery site was nearly impassible. The road was covered with seven feet of snow, and contained a sharp curve that could be negotiated only with extensive labor. Defendant accordingly delivered the mobile home by crossing plaintiffs’ snow-covered field, over their strong objection. Although the crossing caused no harm at all to the land, plaintiffs received $1 in nominal damages and $100,000 in punitive damages, a result affirmed by the Wisconsin Supreme Court.

III. Halpern v. Michel
a. Walked onto property then walked back—no de minimus rule (all physical intrusions, damages undecided)

IV. Adams v. Cleveland-Cliffs Iron Co.
a. The people want more than the Clean Air Act gives them re: tolerable airborne pollutants
b. The court narrowed the definition of trespass (admittedly aribitrarily) to only include tangible trespasses, so that P could only recover under nuisance theory.
c. Nuisance law does that balancing act: weight injury/intrusion against social utility of relevant conduct?
c.i. Noise of vibrations, dust particles do not fit within trespass—Arbitrary line of tangibility
c.ii. The courts would prefer this action be brought within nuisance
c.iii. Minority view—can have intangible trespass but need actual or substantial damage

Today, many courts reject this simplistic distinction (between Trespass & Nuisance). In a very real sense—reflecting the limited scientific knowledge of the era—the common law distinction ultimately turned on visibility: were the invading particles large enough to be visible (usually a trespass), or so small as to be invisible (a nuisance)? Courts are now increasingly willing to stretch the boundary of trespass (e.g., in air pollution or toxic contamination cases) to encompass microscopic particles, usually by focusing on the nature of the harm caused, not the size of the particle. Thus, in borderline cases, a plaintiff may choose to sue in either trespass or nuisance. But see Adams v. Cleveland-Cliff Irons Co. (entry of dust particles was not a trespass).

V. Watchtower Bible and Tract Society of New York, Inc. v. Village of Stratton
a. Ordinance flips the burden: if you complete the no solicitation form than automatically anyone who come onto your property is deemed a trespasser
a.i. 1st Amendment—state interfering in right to free speech; when the state gets involved in the inhibition of speech, legitimate reasons need to be satisfied
b. Have a right to exclude anyone no matter what they’re talking about, but can’t get advanced approval or denial protection from government because it violates 1st Amendment rights to free speech

VI. Catron v. City of Petersburg
a. Two city ordinances
a.i. Trespass ordinance authorizes “a temporary trespass warning for specific city land – in effect, a exclusion from property”
a.ii. Storage ordinance prohibits storage of personal property on city land
b. Court held that the trespass ordinance fails to provide the notice required by due process
c. Court held that the storage is not unconstitutionally vague

VII. Universal Tube & Rollform Equipment Corporation v. Youtube, Inc.
a. Is Youtube trespassing on Universal Tube's website?
b. H: wasn't trespass (though you can have trespass to chattels) but for unsolicited phone calls and junk mail there is a possibility of claim

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VIII. Adverse Possession Land (153-172)

Adverse Possession – Real Property
Adverse Possession is the taking of another’s property and requires 1) actual possession, 2) continuously and uninterrupted, 3) open and notorious, 4) adverse/hostile, 5) exclusive, and 6) for a required (statutory) period of time.
1. Actual possession- use as if he owns it
2. Continuous and uninterrupted – can add consecutive adverse possessors together, also, being at a summer home just for summer counts as continuous. continuous during the entire SOL period without abandonment or interruption, type of land may determine what is continuous, can be broken by the owner reentering land with unequivocal intent to challenge AP (courts may not prefer self help), or filing a lawsuit (preferred), mere letters and demands may not be enough to interrupt
3. Open and notorious - parties involved can see it- slight encroachment wont work
4. Adverse (or hostile)
Objective test – possessor uses it as a reasonable owner would (w/o permission of the true owner)
Minority Rule – Require good faith (don't know they are violating someone’s right—Conn. DOCTRINE) or subjective knowledge (know they are violating someone’s right in boundary disputes—MAINE DOCTRINE)
5. Exclusive - acting like a true owner in order to be exclusive
-Can be under color of title which is when a claim to title that appears valid, but may legally be defective (may arise when there is evidence such as writing that suggests valid title) and this counts as constructive title to the whole land.
-May need to pay taxes
6. Required time period, often statutory
-Tacking- current adverse possessor may be able to add time from previous adverse possessor to meet the SOL if 2 AP’s are in privity (requires a deed (has to mention the actual land/even if it isn’t a perfect description) run between the parties-agreed upon continuous relationship)
-Tolling is when the statutory period is extended if the owner has disabilities, incarceration, being a minor, or being overseas for military duty, generally disability must exist before AP and the AP cant tack.
-If you mistakenly improve, you don't get the property. But if the value added is high enough, you'll probably get equitable compensated.
-Quiet title is when someone moves to establish title when they have the property (but no real title).
Policy – Adverse possession operates as a bias in favor of human development as opposed to leaving everything undeveloped. Also, same policy as for the statute of limitations. Have to use your property. Maintain productive use of the land, compensate for inadequacies (Tran v. Macha) Same policy as for the statute of limitations. Have to use your property Have to use your property. Maintain productive use of the land, compensate for inadequacies

I. Tran v. Macha
a. Real property line severs driveway from garage; common belief that property line was on opposite side of drive
b. The court of appeals found that plaintiffs' predecessor's use of the strip and everyone's mistaken belief that she owned it were legally sufficient evidence of adverse possession.
c. Actions which evinced an unmistakable claim of exclusive ownership
c.i. Here the shared use is not hostile (hostility to rights)
c.ii. Building on the property would convey exclusivity of action (hostility)
c.ii.1. Objective test – possessor uses it as a reasonable owner would (w/o permission of the true owner
c.ii.2. Minority Rule – Require good faith
d. The court reversed, noting that Tex. Civ. Prac. & Rem. Code § 16.021 (1) required visible appropriation and that mistaken beliefs about ownership did not transfer title until someone acted on them.
d.i. Plaintiffs' predecessor shared use of the strip with defendants' predecessors in title, so her use was not inconsistent with or hostile to their ownership.
d.ii. The court of appeals held that plaintiffs' predecessor adversely possessed the strip by building a driveway and garage on it, but the court found nothing in the record that showed she did either.
d.iii. To the contrary, both were in place before she bought her property, and nothing showed who built them or when.
e. What should we imply about a neighbor using another’s property? Tacit permission.
e.i. If consent is removed, then trespass.
f. Hostile possession: sign, fence saying it’s yours, building, excluding (shared use can never act as hostile possession)

II. Howard v. Kunto
a. The error before the court is the 50-foot parcel of land occupied by the Appellants is not the parcel of land described in the deed, rather, the Appellants’ house stood on one lot and his deed described the adjacent lot. This error in the deed likely occurred over twenty years prior, with the Appellants predecessors to the land.
b. The trial court denied the Appellants’ claim of adverse possession, stating they failed to show continuity of possession or estate to permit tacking of adverse possession from the predecessors.
c. The trial court also found the Appellants’ possession not to be continuous as it only included summer possession.
d. Overruled. Tacking of adverse possession is permitted if the successive occupants are in privity, if there is a reasonable connection between the predecessors and the successive occupants. Summer possession can constitute continuous possession if such possession is similar to the conduct of surrounding owners.
d.i. Only summers can still meet continuous use with only consecutive summers in a case like a beach house. The simple rule is whether the property was used in way in which it was reasonably expected.

Halfway between these two situations is the illustrative case of Howard v. Kunto, involving adverse possession of a beach house property. For over 30 years, the Kuntos or their predecessors occupied the house during the summer, allowing it to remain vacant during the rest of the year, under the good faith belief that they owned the title. A later survey revealed that the Kuntos in fact owned an adjacent lot, not the beach house. When the true owners of the beach house sued to quiet title, the Kuntos asserted the defense of adverse possession. The court held that seasonal occupancy was continuous possession because the average owner of similar property would use it in this way: “We reject the conclusion that summer occupancy only of a summer beach home destroys the continuity of possession required by the statute.”

Successive period of adverse possession by different persons may sometimes be combined together to satisfy the statutory duration requirement. This process is commonly known as tacking. Tacking is permissible only if the successive claimant transfers possessory rights to another. This transfer is most commonly made by deed but can also be effected though devise or intestate succession. See, e.g., Howard v. Kunto

III. Mannillo v. Gorski
a. During the summer of 1946, the Defendant’s son made additions and changes to the Defendant’s house. Some of the changes to the house encroached on the Plaintiffs’, Fred Manillo and Alice Mannillo (Plaintiffs), land by 15 inches. The Defendant contends she is entitled to the land by adverse possession. Plaintiffs contend the Defendant did not obtain title to the land because the possession was not hostile in nature, as the Defendant did not intend to encroach upon the land. Trial court rules for plaintiff, saying all elements are met except for hostility.
b. What kind of hostility was the trial court looking for?
b.i. Intentional knowledge of trespass?
b.ii. The fact that they did not know would mean no hostility.
b.ii.1. Not open and notorious: ordinary person would have to be put on notice
c. Remand to trial court to figure out if the owner actually knew the building of the step was encroaching on neighboring property. Without knowing  no adverse possession.
c.i. When seller is put on notice, clock begins to run (and needs to run for the requisite time)

The claimant’s possession must be open and notorious. The acts of possession must be so visible and obvious that a reasonable owner who inspects the land will receive notice of an adverse title claim. It is not necessary to show that the owner obtained actual knowledge of the claim, or that the owner conducted an inspection; the owner is charged with the knowledge that a diligent inspection would reveal. But see Mannillo v. Gorski (minor encroachment along common boundary is not open and notorious unless true owner has actual knowledge).

Most jurisdictions apply the objective test. Cf. Mannillo v. Gorski (adopting majority rule, but holding that true owner must have actual knowledge of minor encroachment along common boundary line in order for possession to be deemed open and notorious).

IV. ITT Rayonier, Inc. v. Bell
a. The adverse possessor purchased a houseboat, which he moored on a lake. The property that was the subject of the action was directly adjacent to that moorage and was purchased by the landowner, who had paid the property taxes continuously since its purchase. The landowner filed an action to quiet title and prayed for damages for trespass and for the ejectment of the adverse possessor. The trial court quieted title in favor of the landowner based on the adverse possessor's failure to establish his exclusive possession of the disputed property for the statutory period. The appellate court affirmed and provided an alternative ground for its decision, holding that the adverse possessor did not raise a genuine issue of fact on the question of his good faith claim of right to the property. On appeal, the court held that the adverse possessor's shared and occasional use of the property did not rise to the level of exclusive possession indicative of a true owner for the full statutory period. However, the court held that good faith no longer constituted an element of adverse possession.
b. D needs to demonstrate that he has the right to use (possession has to be adverse: D thinks it's D's and exercise rights to exclusion)
c. Could show use of property, but not the kind of use that rises to the exclusivity which implicates ownership
c.i. He could be friendly OR he could think he doesn’t have the right to exclude
c.ii. The structures he built don’t convey permanence or historical presence
c.ii.1. These could have been used by anyone
d. Bell thought state owned the property
d.i. There’s no requirement that you be right about who you think you’re adversely possessing from
d.ii. Adversely possessing public land owned by the government is actually a higher burden

The adverse possessor must hold exclusive possession. In effect, this means that possession must not be shared with either the true owner or the general public. See ITT Rayonier, Inc. v. Bell (no exclusivity because claimant and other members of public all used land).

V. Halpern v. Lacy Investment Corp.
a. On review the court held that one had to enter upon the land claiming in good faith the right to do so and to enter upon the land without any honest claim of the right to do so was but a trespass and could never have ripened into prescriptive title. The court held that it was possible to maintain hostile possession of land in good faith but noted that there was evidence that the putative landowner knew the parcel of land was owned by another yet they simply took possession when their offer to purchase was declined.
b. Holding: Not adverse possession—coming from courts notion that trespassing and and adverse possession are mutually exclusive (thereby imputing a good-faith requirement on adverse possession)

In a dwindling minority of states, the adverse possessor must believe in good faith that he owns title to the land. See, e.g., Halpern v. Lacy Inv. Corp.

VI. Helms v. Manspile
a. The Helms and the Manspiles own adjoining tracts of land in Botetourt County
a.i. The Helms purchased their land in 1972, including Parcel 2, which is a rectangular strip of land 102 feet in length
a.ii. There was a fence between the properties
a.iii. But the actual boundary line could not be determined because the descriptions in the deed are inadequate
b. Helms used Parcel 2
b.i. He used a tractor to clear brush off
b.ii. He maintained dog kennels
b.iii. He constructed a "skid road" and hauled timber across Parcel 2 because Manspile did not permit Helms to use Manspile’s land
b.iv. Manspile did not believe he could keep Helms off of Parcel 2
b.v. His predecessors kept livestock
c. Actual because the property was within their fence, Helms mowed the grass and maintained dog kennels, and his predecessors in title kept cattle, a milk cow, and a horse on the parcel
d. Adverse because of the fence and because Helms used Parcel 2 once Manspile declined permission to use his land
e. Parcel 2 was used exclusively by the Helms and their predecessors in title and such use was open and notorious and continuous well in excess of fifteen years
e.i. No mention of the minority-held good faith requirement

VII. Cahill v. Morrow
a. Justifications
a.i. better use of the land
a.ii. fixes mistake
a.iii. promotes certainty and finality
a.iv. helps purchaser's reliance
a.v. Addresses problems of:
a.v.1. the problem of lost evidence
a.v.2. the desirability of quiting titles
a.v.3. the interest in discouraging sleeping owners
a.v.4. the reliance interests of adverse possessors and interested third persons
b. Critiques
b.i. perverse intentions
b.ii. discourages sharing land (Jacques)
b.iii. easier to keep track of things today
b.iv. Fails to address
b.iv.1. outdated in a sophisticated, congested, peaceful society
b.iv.2. infringement of landowner's rights
b.iv.3. encourages exploitation and development of land
b.iv.4. generates animosity between neighbors
b.iv.5. creates uncertainty
b.iv.6. Discourages allowing others to use your land

IX. Adverse Possession of Goods & Vertical Limits (172-184, 202-215)

Adverse Possession – Personal Property
Same elements as for Real Property except that the statutory period is usually shorter.
Major Difference – Open and notorious problem. When should the statutory period start?
a.2. The original owner can prevent the statutory period from beginning (and therefore maintain ownership) if they diligently pursue their goods.
a.3. Once the owner stops looking, knows or should reasonable know who has the goods, the clock starts

Mistaken Improvers
General rule - if you mistakenly improve, you don't get the property. But if the value added is high enough, you'll probably get equitable compensated.

Vertical Limits
1. Ancient common law rule – Ad Coelum – rights extend to the edge of the universe and down to the middle of the earth, doesn’t really have a place in modern law (United States v. Causby )
a. Most of the time this is governed by statute and other doctrines such as the rule of capture
b. However, the rule is not completely dead: the cave case (Edward v. Sims)
2. Modern Rule - One does not own all of the airspace above their house, but some amount of it such that an interference with the enjoyment and use of the land constitutes a taking (United States v. Causby )

I. O’Keefe v. Snyder
a. Issue(s): Under NJ property law, does the statute of limitations for taking legal action on alleged stolen chattels begin when the original owner finds the current possessor and alleged owner by purchase?
b. Holding: No. The statute of limitations begins to run upon the discovery of the dispossession, not when the person finds the actual owner.
c. NJ Supreme court does not solve underlying issues of painting ownership
c.i. Sides with O’Keefe:
c.i.1. Dispels Snyder’s summary judgment; conflicting factual accounts
c.i.1.a. This was all the court NEEDED to do
c.i.2. Advises lower courts in addition to remanding
c.i.2.a. Statutes of Limitation are ubiquitous
c.i.2.a.i. Run from the time the cause of the action accrued
c.i.2.b. Georgia O’Keefe would normally have had to sue by 1952
c.i.2.c. Discovery Rule—
c.i.2.c.i. SOL runs from discovery (or date should have discovered) facts which form the basis of the cause of actions
c.i.2.c.i.1. Facts: knowledge of injury and party
c.i.2.c.ii. Here would be 1982; she knew Snyder had paintings in ‘76
c.i.2.c.iii. Argument over date of SOL—when should have known?
c.i.2.c.iii.1. Actual v. reasonable
c.i.2.c.iii.1.a. Due diligence, should she have been trying
d. What is going to happen on remand? Who would have won?
d.i. Whether they believe Snyder/Franks or
d.ii. Discovery—does patches of non-diligence render her unable to invoke
d.ii.1. Did she do what was reasonably required?
d.ii.2. Shifts actions from “possessor” (Adverse possession) to “owner” Discovery Rule
d.ii.2.a. NJ is no longer applying personal property to adverse possession
d.ii.2.b. Q: on remand, what should Snyder argue?
d.ii.2.b.i. didn't use due diligence
d.ii.2.b.ii. SOL should have run earlier
d.iii. Adverse possession—court analogizes to jewelry; “open and notorious”
e. Rule: To establish adverse possession to chattels, the rule of law has been that the possession must be hostile, actual, visible, exclusive, and continuous. Open and visible in this context will now be upon the discovery of the missing chattel:
e.i. (1) did the owner use due diligence to recover the chattel at the time of the alleged dispossession/theft?
e.ii. (2) whether at the time of the alleged dispossession/theft there was an effective method to put others on notice?
e.iii. (3) whether registering the chattel or reporting the chattel with an authoritative institution would put prospective buyers on notice of the possibility that they could be purchasing in stolen goods?

Application of the real property adverse possession standards to chattels is troublesome. Suppose that for six years X possesses a valuable antique vase owned by Z; X displays the vase prominently in his living room during this period. Is this conduct sufficiently? “open and notorious”? If the elements of adverse possession are intended to give adequate notice to the true owner of the chattel so as to start the statute of limitations running, one might argue that X’s acts are insufficient because Z is unlikely to receive notice. Cf. O’Keeffe v. Snyder

The New Jersey Supreme Court’s decision in O’Keefe v. Snyder illustrates the discovery approach. Three pictures painted and owned by plaintiff Georgia O’Keeffe disappeared from an art gallery in 1946; O’Keeffe learned in 1976 that defendant Snyder had acquired the paintings and brought a replevin action against him. Snyder claimed ownership by adverse possession, asserting that the applicable six-year limitations period had expired in 1952. Observing that the traditional adverse possession standard may not be sufficient or put the original owner on actual or constructive notice when art or other chattels are merely displayed in a private home, the court adopted the discovery rule in its stead. Thus, “if an artist diligently seeks the recovery of a lost or stolen painting, but cannot find it or discover the identity of the possessor, the statute of limitations will not begin to run.”

II. Museum of Fine Arts v. Seger-Thomschitz
a. Oskar Kokoschka painted Two Nudes (Lovers)
a.i. Self-portrait with his mistress
a.ii. Sold to Oskar Reichel in 1914
b. Reichel transferred to Kallir to avoid the Nazis around 1940
b.i. Kallir sold the painting in New York in 1945
b.ii. It was eventually bequeathed to the MFA in 1973 and has been on display there ever since
c. Claudia Seger-Thomschitz wants the painting back
c.i. She is Reichel’s sole surviving heir
c.ii. She learned in 2003 that the Nazis had confiscated Reichel’s artwork
d. The Court ruled for the MFA
d.i. Massachusetts law applies, with its three-year statute of limitations
d.ii. “There is no question that the MFA's possession of the Painting has long been discoverable with minimal diligence”

III. Vineberg v. Bissonnette
a. In 1937, Julius Stern, a Dusseldorf gallery owner, was forced by the Reich Chamber of the Fine Arts to auction off “Girl from the Sabiner Mountains, a nineteenth century painting by Franz Xaver Winterhalter
b. Karl Wilharm bought it at the auction
c. The court held that:
c.i. 1. The Stern Estate is the rightful owner of the Painting;
c.ii. 2. The Painting was taken unlawfully from Dr. Stern; and
c.iii. 3. Defendant is in wrongful possession of the Painting.

IV. United States v. Armstrong
a. The one-of-a-kind "Ice House Cover," an envelope franked with a rare 90-cent 1869 pictorial issue stamp, bearing the image of Abraham Lincoln. On December 9, 1967, the Ice House Cover, along with over two hundred other valuable philatelic articles, was stolen from the home of a prominent Indianapolis philatelist.
b. The Ice House Cover did not reappear until January 4, 2006, when William and Marigrace Stephens brought it to be appraised at a stamp shop in Chicago, Illinois. It is unclear when or how the Stephenses came into possession of the Ice House Cover, but, upon notification that it was stolen property, the Stephenses relinquished the stamp to the FBI, who has retained possession of it since then.
c. In light of the Seventh Circuit's recognition that "the due diligence determination is . . . highly 'fact-sensitive and must be decided on a case-by-case basis,'“ we are unable to decide this issue without the benefit of a trial as the resolution of the due diligence question will turn on the disentanglement of some confusing and murky fact issues as well as credibility determinations, none of which can be decided at the summary judgment stage
V. Mistaken Improvers

a. Wetherbee v. Green
a.i. Whether a landowner can recover property that was taken from his or her land and then improved in value depends upon the extent of the change made
a.ii. Example of Lockean labor theory on American property law

One branch of the doctrine (Accession) involves adding only labor to a chattel owned by another. Suppose that S uses O’s clay to create a valuable sculpture, mistakenly believing that O agreed to this use. Who owns the sculpture? As a general rule, one who in good faith applies labor to another’s property acquires title to the resulting product if this process either (1) transforms the original item into a fundamentally different article (e.g., seeds planted to produce a crop) or (2) greatly increases the value of the original item (e.g., timber made into barrel staves). Under this doctrine, S owns the sculpture; O is entitled to damages equal to the fair market value of the original clay. Compare Wetherbee v. Green (when standing trees worth $25 were converted into barrel hoops worth about $700, the innocent trespasser owned the hoops).

b. Isle Royale Mining Co. v. Hertin
b.i. A good faith improver cannot recover the value of his work when the disparity between the original property and the improved property is not substantial

See above - Compare Wetherbee v. Green (when standing trees worth $25 were converted into barrel hoops worth about $700, the innocent trespasser owned the hoops) with Isle Royale Mining Co. v. Hertin (when standing trees worth about $1 per cord were converted into firewood worth $2.87 per cord, no accession occurred).

c. Hardy v. Burroughs
c.i. One who mistakenly builds a house on the wrong land can recover in equity

Case law in some states entitles the good faith improver to either (a) remove the improvements or (b) receive compensation equal to the amount by which the improvements increase the market value of the owner’s land. See, e.g., Hardy v. Burroughs (good faith improver can recover compensation measured by enhanced value of land).

d. The Intermingled Cotton Cases
d.i. Divided the ownership of large quantities of cotton captured by the Union Army, commingled, and subsequently sold

e. Robert B v. Susan B.
e.i. A fertility clinic mistakenly implanted Susan with an embryo that should have been saved for Robert & Denise
e.ii. In Robert’s ensuring paternity action, the trial court awarded temporary custody to Susan and temporary visitation rights to Robert, but it denied Denise’s claim that she was the “intended” mother of the boy
e.iii. The court of appeals affirmed, noting that it “reject[ed] Denise’s comparison to a plot of land or the timber growing on it. Wetherbee v. Green (1871), 22 Mich. 311. This is a parentage action, not a replevin proceeding.”

VI. United States v. Causby
a. Respondents claim that their property was taken, within the meaning of the Fifth Amendment, by the regular army and navy aircraft flights over their house and chicken farm.
b. Eminent Domain: Can Causby receive compensation absent trespass and nuisance?
c. Holding: It’s not true that you have the right above the land limitlessly—however up to acceptable airspace you do have a right

Common law courts confidently proclaimed that each landowner owned “to the heavens.” Thus, in theory at least, each landowner held title to a column of air space that extended upward from the land surface for an infinite distance. Any intrusion that interfered with the owner’s exclusive possession of this air space—such as an overhanging tree branch from a neighbor’s yard—was deemed a trespass. This absolutist position collapsed with the invention of the airplane…

As the Supreme Court explained in United States v. Causby, the rule would subject the operator of every transcontinental flight to “countless trespass suits.” In turn, this would “clog these highways [and] seriously interfere with their control and development in the public interest.” It was accordingly necessary to formulate a new approach to ownership of air space. Modern courts uniformly agree that an airplane overflight within “navigable air space,” as defined by federal regulations, is not a trespass. But cf. United States v. Causby (finding that frequent airplane overflights 83 feet above plaintiffs’ land constituted a taking).

VII. Edwards v. Sims
a. Facts: π owns land that is directly above a sub-terrainian cave. ∆ is a judge who ordered the cave entered to determine the facts of another case (Edwards v. Lee), as to whether the cave travels under Lee's land as well, and therefore π would be trespassing on Lee's property while exploiting the cave. π seeks a writ of prohibition to prevent ∆ from enforcing his order.
b. Issue(s): Is the ∆ proceeding erroneously within its jurisdiction in entering and enforcing the order directing the survey of the cave under π's land in order to resolve the issues in Edwards v. Lee?
c. Holding(s): A court of equity has the transcendent power to invade the property of a private citizen for the purpose of ascertaining the facts of a separate matter before the court.
d. Reasoning: The right to enjoyment and possession of property is limited in so far as the state has a right to infringe upon those rights when it believes that those rights are being used to the detriment of other private citizens. Court cited a similar decision involving the determination of trespass in a sub-terrainian mine.
e. Dissent(s): You only have rights to underground property which you can exploit, and since the cave opening was on Edward's land, there was no way that Sims could exploit the cave, and so he should have no rights. This is based on the social utility theory.

Although most trespass cases involved entry onto the surface of land, the doctrine also applies to entries below the land surface (e.g., through tunnels or caves). Cf. Edwards v. Sims (suggesting entry into cave beneath owner’s property constituted a trespass).

Contemporary courts still protect the surface owner’s absolute right to possession when third parties intrude into the subsurface, whether by mining, installing a pipeline or otherwise. Perhaps the most famous decision is Edwards v. Sims, a dispute involving ownership of the Great Onyx Cave. Plaintiff claimed that part of the cave was below their land and, accordingly, that they owned that part. The defendants, who owned the only cave entrance, claimed ownership of the entire cave. The trial court ordered surveyors to enter the defendants’ property to survey the case and determine its location in relation to plaintiffs’’ land. When defendants petitioned for a writ of prohibition to prevent the survey, the court relied on the traditional rule: “[W]hatever is in a direct line between the surface of the land and the center of the earth belongs to the owner of the surface.” Therefore, the court reasoned, if plaintiffs could prove they owned the surface, they logically owned the cave beneath, and the trial court properly exercised its equitable power in ordering the survey. An eloquent dissent protested the absurdity of vesting property rights in surface owners who lacked access to the cave itself: “It should not be held that he owns that which he cannot use and which is of no benefit to him, and which may be of benefit to others.”

VIII. South West Sand & Gravel, Inc. v. Cent. Ariz. Water Conservation Dist.
a. The district diverted Central Arizona Project (CAP) water into the Agua Fria River. As a result, the aquifer underneath and adjacent to the river filled with water, thereby raising the water table beneath the company's property to a level that interfered with its sand and gravel mining business. The court concluded that, as a matter of law, the company had no cognizable takings claim.
b. Equally unavailing are the arguments South West derives from the doctrine of "cujus est solum ejus est usque ad coelum et ad inferos" (the "cujus doctrine"). The doctrine states: "To whomsoever the soil belongs, he owns also to the sky and to the depths. The owner of a piece of land owns everything above and below it to an indefinite extent." Black's Law Dictionary 341 (5th ed. 1979). In essence, South West argues that its ownership of overlying land gives it the power to preclude water recharge and increased groundwater levels while claiming damages for trespass, nuisance, and other claims based upon such activities. Time after time, Arizona courts have held that landowners do not own the groundwater below their property and the state is free to regulate its withdrawal and use

IX. Coast Oil & Gas Corp. v. Garza Energy Trust
a. The lessees drilled a well on adjoining land in close proximity to a well on the lessors' property. The lessors filed suit, alleging that the lessees were conducting hydraulic fracturing operations that damaged their property. The court held that the rule of capture precluded damages for drainage by hydraulic fracturing; hence, there was no actionable trespass.
b. Had Coastal caused something . . . to be deposited on the surface of Share 13, it would be liable for trespass, and from the ancient common law maxim that land ownership extends to the sky above and the earth's center below, one might extrapolate that the same rule should apply two miles below the surface. But that maxim -- cujus est solum ejus est usque ad coelum et ad inferos -- "has no place in the modern world. Wheeling an airplane across the surface of one's property without permission is a trespass; flying the plane through the airspace two miles above the property is not. Lord Coke, who pronounced the maxim, did not consider the possibility of airplanes. But neither did he imagine oil wells. The law of trespass need no more be the same two miles below the surface than two miles above.

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X. Intellectual Property

Types of IP-creature of statutory/positive law
1. Copyright - right to things you write
1. Patent - right to things you invent. Court must decide if a patent goes far enough beyond (includes commercial success) an original design if there are similar patented products.
a. Must be novel, utility, and nonobvious---must make timely application (now just first to file)
b. Can be business methods (amazon one-click), Can be Utility (design or process for an invention) or design (aesthetic elements of a design of a particular good)
1. Trademark - right to things that signify your business
1. Trade Secrets - right to keep valuable information form competitors
1. Right of Publicity - right to control the exploitation of your name and likeness
1. Misappropriation

Policy: If you have the rights to your inventions, you have the right to exclude and have incentive to spend $ on R&D and creative work, Natural Law - what you create is yours., Why limited times? The point is to encourage activities that are socially useful. The time limit gives you a chance to make money exclusively. Distinguish between laws that help promote people to be creative vs. people that have a creation and want to protect it. Why limited times? The point is to encourage activities that are socially useful. The time limit gives you a chance to make money exclusively. The Constitution and IP
…"by securing for limited times to authors and inventors the exclusive right to their respective writings and discoveries…"
This gives Congress the power to enact copyright and patent laws
Trademarks - S.Ct. read the commerce clause very broadly and so trademark laws are enacted. __________________________________________________________________________________________________________________________________________

Copyright (Article)
Copyright (life +70 years) (first to fix the work)
A copyright protects rights in original works of authorship fixed in any tangible medium of expression---books, articles, songs, paintings, sculptures, and related artistic creations
1. Original – must show some minimal creativity
a. Can’t just be a "slavish copy"
2. Fixed or tangible – protects an audio recording but not unrecorded speech
3. Doesn’t extend to the underlying fact or idea
4. Fair Use – the statutory exception that affords writers and other copyright holders a limited monopoly to their works. Recognizes the public’s interest in access to written works even when they are protected by copyright law and the concomitant need to limit the monopoly that the statute grants to copyright holders

Inducing others to violate copyrights can give rise to liability (MGM & Sony) – Need to actually intend to induce.

I. Eldred v. Ashcroft
a. Stretched the copyright length to Life + 70 in light of Mickey Mouse’s potential public domain.

II. Golan v. Holder
a. Upheld the Federal statute that granted copyright protection to foreign works previously in public domain

III. Schrock v. Learning Curve International
a. What can be copyrighted? Originality and modicum of conveyance
b. Here the court held that the lighting (its placement, implementation, so forth) was copyrightable
c. originality: photographs seem to have originality (how you portray something is critical)  they have rights

IV. MGM Studios, In. v. Grokster

To prevail in an infringement action, a copyright owner must prove: (a) he holds a valid copyright in the work; (b) the defendant copied the work; and (c) the copying was an “improper appropriation.” In addition, the distributor of a product capable of both lawful and unlawful use may be liable when third parties use the product to infringe a copyright. See MGM v. Grokster, Ltd.

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XI. Patents & Trademarks (229-242, 254-258, 262-269)
Trademark
You obtain trademark rights by usage. People have to recognize the trademark as your product.
1. Statutory and CL right
a. Protect the producer’s rights against replicas and protects consumers against mislabeled products
2. Can only lose the rights when you abandon them. Non-use isn’t abandonment
3. Same name can be used as long as consumes can tell the difference
a. Can be constrained to geographic region

Trademark Infringement (normally confusion)
(1) The degree of similarity in appearance, pronunciation of the words used, verbal translation of the pictures or designs involved, suggestion
(2) Intent of the actor in adopting the designation
(3) Relation in use and the manner of marketing between the goods or services marketed by the actor and those marketed by the others
(4) Degree of care likely to be exercised by purchasers

Anti-Dilution (1) injury to the value of the mark caused by actual or potential confusion
(2) diminution in the uniqueness and individuality of the mark, or
(3) injury resulting from use of the mark in a manner that tarnishes or appropriates the goodwill and reputation associated with plaintiff’s mark
Dilution laws look at commercial products, so something offensive does not violate it
For the most part, parodies are okay, even though it appropriates some goodwill
A mark does not have to be registered to be protected (LSU v. Smack Apparel)
Color schemes can be protected if it acquires secondary meaning,
The most DISTINCTIVE marks are given the greater protection (no other meaning or descriptiveness for the mark at all), Non-functional, and First use in trade (or registered)
Protect the producer’s rights against replicas and protects consumers against mislabeled products
Can only lose the rights when you abandon them. Non-use isn’t abandonment
Same name can be used as long as consumers can tell the difference
Any word, name, symbol or device, or any combination there of that is used with the bona fide intention to use in commerce and applies to register. Distinguishes goods.

Factors to determine if there is a secondary meaning
(1) length and manner of use of the mark or trade dress, (2) volume of sales, (3) amount and manner of advertising, (4) nature of use of the mark or trade dress in newspapers and magazines, (5) consumer-survey evidence, (6) direct consumer testimony, and (7) the defendant's intent in copying the trade dress.

Trademarks are like property because you have a right to exclude.

I. The Barbed Wire Patent
a. Glidden invented Garbed wire. Before Glidden there were crude models to keep cattle in.
b. Glidden is the plaintiff and suing a competitor. He wants to enforce his property right to this patent
c. Infringer argues it was not novel invention
c.i. overwhelming for patent office to have everything correct in the first place
c.ii. allow collateral attack on the patent on infringement action
d. Having the patent doesn't mean that you can prevent others from improve it
d.i. as long as non-obvious, novel improvement is made
d.ii. after the expiration of patent, exclusive right is terminated
II. Kellogg v. National Biscuit Co.

A generic mark—one that is frequently used to refer to a type of goods or services (e.g., “Jelly Beans”)—cannot qualify for any protection, because it cannot serve to distinguish their origin. See, e.g., Kellogg Co. v. National Biscuit Co. (“shredded wheat” was generic).

III. Hanover Star Milling Co. v. Metcalf

The mark must be actually used in trade—a bona fide use in marketing goods or services in the ordinary course of business. At common law, the first person to use a mark in trade in a particular geographic area secured protection for the mark within that region. This meant, of course, that another person was free to use the mark in a different region. See, e.g., Hanover Star Milling Co. v. Metcalf

IV. Jordache Enterprises, Inc. v. Hogg Wyld, Ltd.

In order to prevail in an infringement action under the Lanham Act, the plaintiff must prove: (a) he holds a valid mark; (b) the defendant has used “in commerce” a copy or imitation of the mark; and (c) the defendant’s use is “likely to cause confusion, or to cause mistake, or to deceive.”

The central issue in most infringement cases is the final element—likelihood of confusion. In other words, would an “appreciable number of ordinarily prudent consumers” be confused into thinking that the defendant’s goods or services are related to the plaintiff’s mark? In answering this question, courts consider a number of factors, including: (a) the similarity of the marks; (b) the strength of the plaintiff’s mark; (c) the similarity of the two parties’ goods or services; (d) any evidence of actual confusion; and (e) the defendant’s intent. See, e.g., Jordache Enterprises, Inc. v. Hogg Wyld, Ltd. (finding no likelihood of confusion).

Most states provide antidulution protection by statute. See, e.g., Jordache Enterprises, Inc. v. Hogg Wyld, Ltd. (discussing New Mexico’s antidilution statute).

V. Board of Supervisors for LSU v. Smack Apparel Co.

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XII. Animals (295-311)
Animals & Other Organisms Rule of Capture: A wild animal becomes property only when it has been deprived of its natural liberty
1. Natural liberty
a. Death, mortal wounding counts
b. Mere chasing, does not give pursuer right to possession against another who captures it by intervening
c. If an animal is mortally wounded, or caught in a trap so that its capture is certain, the hunter acquires a right to possession and title which may not be defeated by another's intervention
d. Title acquired by possession can be lost if the wild animal escapes and returns to its natural habitat
e. States now own all wild animals---cant even have a piece of endangered species
Possession of Animals
1. Typically domesticated animals are treated as personal property.
2. Property Rights can be statutorily limited
a. May require a permit to possess or else contraband (Belinda v. McCleod)
b. Allowed to exclude, destroy (in some ways), transfer, convey, etc
c. Not allowed to abuse, neglect, destroy (in other ways), etc.
3. Some jurisdictions are moving away from the traditional property view of domesticated animals and towards guardianship.

Opposite Policies: 1.) Rhode Island- Change ownership in chattels to guardianships, but that has lead to no substantive change 2.) public safety officials get more benefit then the property right of the owner. Unless the conduct by the official so egregious to have any public purpose.
Intellectual Property in Living Things
A living thing may be patented so long as it was created, not discovered. Must possess quality not found in nature.---unclear what effect Chakraharty had- it encouraged people to seek patents and discover new things, but the patent courts may not have really changed anything.

I. Pierson v. Post
a. Does hunting an animal on commons create property rights
b. In order to reduce wild animal to ownership it must be possessed
b.i. Should the court respect that community norm
c. There is a sense in which state government own wild animals; not in a property/liability sense; more in an exert force over sense—Really something of a legal fiction re: property right
d. What happens if you kill it and then someone gets to the carcass first
d.i. Whoever reaches the carcass first gets it
e. Held. No. Judgment reversed.
e.i. Merely finding and chasing a wild animal does not give a person possession.
e.ii. Even merely wounding the animal will not give right to possession.
e.iii. The animal must be captured or killed in order to constitute possession.
f. DISSENT: we should look for allocative efficiency
f.i. Giving to pursuit incentivizes that kind of practice
f.ii. More people in the game of hunting fox
f.iii. What is fair?
g. Today: neighboring landowners turning on these kinds of disputes
g.i. Lobsters, fishing  very specific social customs which govern
g.ii. Trapping: if legal, then anything in the trap becomes yours

II. Bilida v. McLeod
a. Orphaned raccoon adopted as a pet; protection; domestication; emotional bondSecurity
b. Police respond to security alarm; see raccoon; call to environmental management
b.i. Two officers came; Bilida said she had permit (did not); took Mia and because of procedure had to test for rabies; Bilida said officers said Mia would not be killed
b.i.1. Rhode Island had worst rabies epidemic in country
c. §1983—Congress enacted after civil war, designed to protect life, liberty, law
c.i. Statute adds to the Constitutional provision by adding civil recovery of damages
d. Wild animal is a category—has nothing to do with level of domesticity
d.i. Permit necessary to have property rights over wild animal
e. In the eyes of the law, Mia is per se contraband which cannot invoke in a §1983 suit
f. State laws govern what animals can be reduced to private property
g. Is there a way to keep raccoon and still weigh rabies concerns? Legal permits
h. Dogs—are the things you are allowed to own as pets sans legal exception
i. Q: what if the pet was dog: domesticated, allowed to possess as pets
i.i. P would have remedy: it would be property (if they exercise due process, government can take the pet)

III. Scheele v. Dustin
a. Unleashed dog wandered to adjacent property; shot and killed shadow with pellet gun
a.i. There is no right to shoot pet that wanders on property
b. Scheele’s lost their pet; conversion: exercising dominion (destruction) over someone else’s property
c. Measure of damages like other property: property value before v. property value after
c.i. Law cannot recognize emotional distress for loss of property
d. Is property the appropriate way to categorize pet ownership? As opposed to guardianship?
e. Whether property is a proper way to categorize pets -guardianship is one of the proposed
e.i. legal significance: focus on idea of alleviating public perception  doesn't change the rule that much

IV. Diamond v. Chakrabarty
a. Bacteria that breaks down oil; for the clean-up of oil spills
b. Chakrabarty has invented a new living thing; it did not exist prior to
b.i. Is a human-made micro-organism a patentable subject matter
b.i.1. Cannot patent a product of nature
c. Can a micro-organism constitute a “manufacture” or “composition of matter”
d. The Court of Customs and Patent Appeals reversed and awarded the patent. The USPTO appealed.The Supreme Court affirmed.
e. The US Supreme Court noted that laws of nature, physical phenomena and abstract ideas cannot be patented. That includes plants and minerals you find in the environment, as well as mathematical formulas.
f. However, the Court found that genetically-engineered organisms fall within the definition of manufactured."Chakrabarty's claim is not to a hitherto unknown natural phenomenon, but to a non-naturally occurring manufacture or composition of matter. His discovery is not nature's handiwork, but his own, accordingly it is patentable subject matter under 35 U.S.C. §101."
g. Basically, 'products of nature' are not patentable because the discoverer isn't really an 'inventor' they didn't do anything themselves, they just found something that preexisted. However, that argument doesn't apply to Chakrabarty because he did work to create the new bacteria.
h. The Court also found that bacteria could technically meet the definition of a composition of matter.
i. The Court felt that the patent system should be read broadly to encompass new fields that Congress didn't foresee when they wrote §101.
j. The Plant Protection Act and the Plant Variety Protection Act (see 25 U.S.C. §§161-164) were passed by Congress specifically to create a patent regime that would cover living things, implying that Congress felt that the general patent system wouldn't cover living things. If bacteria (and presumably plants) are covered by §101, then doesn't §§161-164 become superfluous? The Court considered this argument, but rejected it.

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XIII. Humans (311-335)
Human Beings
Humans are not able to be possessed, but human tissue, organs, blood, fetuses, glands, and dead bodies may be possessed through certain statutory regulations (Uniform Anatomical Gift Act-regulates selling organs). Replaceable human materials (hair, plasma, sperm, eggs) are normally allowed for sale. Dead bodies cannot be sold, mutilated or used, but can be properly disposed (buried) or excluded from others (through statutes normally).
Dred Scott
Majority: traditional CL principles, like the Law of Capture, apply to African-Americans.
Minority: slavery is against the natural law and can only exist where the positive law allows it.

Human Biological Materials
1. Human tissues, transplantable organs, blood, fetuses, pituitary glands, corneal tissue and dead bodies are treated as objects sui generis – regulated according to policy goals rather than CL principles.
a. Need to look at specialized statutes for guidance.
b. Removed Cells cannot give rise to patent claims because patents reward invention, not the discovery of natural materials
c. Right of Publicity is not an apt analogy for the harvesting of biological materials from human cells
Uniform Anatomical Gift Act
1. Prohibits anyone from selling organs for transplantation
2. Requires consent before organs can be used for transplantation
3. Recognizes that persons have at least a limited legal right to exclude others for using their excised organs
4. No valuable consideration can be received for human organs for use in human transplantation
5. Sales for other purposes such as research and education are not prohibited
Replaceable Human Materials
1. Typically the government permits persons to sell their replaceable body products (hair, plasma, sperm, and eggs)
a. There is no binding legal authority for the proposition that DNA codes may be copyrighted especially since individuals are not generally viewed as the author of their own DNA
2. Rule: cells removed from a body no longer constitute part of the body and instead constitute personal property whose destruction is not considered bodily injury
a. Statute recognizes the sperm removed as property, this does not mean that their damage is bodily injury for the purposes of insurance coverage
b. Generally courts honor a preexisting written contract governing the disposition of the frozen embryos, but that wither party can rescind the agreement if he or she has a change of mind and now desires to prevent implantation
Dead Bodies
1. At common law, dead bodies are quasi-property
a. Can't: Sell, mutilate, use
b. Can: properly dispose, exclude
c. More of a duty than a property right
2. Statutory Schemes:
a. CA: legal duty to bury
b. Right to Transfer
b.1. Cannot purchase or sell for valuable consideration
b.2. Next of kin has the right to transfer the parts of the bodies in their possession to others for medical or research purposes
3. Due Process
a. States may or may not confer property rights
b. But once it does, it may not constitutionally authorize a depravation of the interest without appropriate safeguards.

I. Dred Scott v. Sandford
a. Dred Scott was probably born in Virginia around 1800 as the slave of Peter Blow
b. Blow moved to St. Louis and died in 1832 leaving behind six slaves (including Scott)
c. Around 1833, Dr. John Emerson obtained Scott as his slave, whom he took on his various army postings (except to Florida) until he died in 1843
d. In 1838, they returned to Missouri where Emerson’s widow Irene and her brother John Sanford now took Scott, his wife, and two children
e. In 1846, Scott and his wife sued Emerson in Missouri state court for assault and false imprisonment, with their status as slaves the only defense
f. Multiple state court proceedings finally yielded a state supreme court ruling for Emerson in 1852, contra the previous decisions saying residence in a free state ended slave status
g. Scott sued in the federal circuit court in St. Louis for his freedom

II. In re African-American Slave Descendants Litigation
a. In re African-American Slave Descendants Litigation (Lehman brothers)
b. court to remedy this was far too late

III. Roe v. Bridgestone Corp.
a. Held that the plaintiffs stated a claim under the federal Alien Tort Statute against American companies operating in Liberia that allegedly were actively encouraging parents to require children as young as six, seven, and ten years old to work full-time at heavy and dangerous jobs
b. Tobias B. Wolff, Thirteenth Amendment and Slavery in the Global Economy, 102 Colum. L. Rev. 973 (2002), does not persuade this court . . . that the existing language of the Thirteenth Amendment itself can reasonably be stretched to reach slavery that exists in places other than "within the United States, or any place subject to their jurisdiction." The argument that slavery is a prohibited relationship that "exists" wherever the master might be found is clever but not persuasive. Specific legislation and international treaties and conventions are better suited to reach international dimensions of slavery, forced labor, and related practices.

IV. Moore v. Regents of the University of California
a. Plaintiff Moore was a cancer patient at U.C.L.A. Medical Center where his doctor, over a period of several years, removed blood and other bodily fluids from Plaintiff which eventually became a “cell line” and was patented for commercial use, which aggrieved Plaintiff.
b. Rule of Law—That no action based on a theory of conversion may be prosecuted where the subject matter of the allegation are excised cells taken from Plaintiff in the course of a medical treatment; however, that an action may be based on theories of breach of fiduciary duty or lack of informed consent.
c. Issue. Did the Plaintiff retain an ownership interest in the excised cells and matter such that he may prosecute the Defendants for conversion?
d. Held - No. Plaintiff did not state a cause of action based on conversion, but may prosecute the case based on theories of breach of fiduciary duty or lack of informed consent.
d.i. Unwilling to treat this as a property dispute, once it's out of body after being consented, then no possessory and ownership interests are gone.
e. The Court notes that historically the tort of conversion arose to settle disputes between losers and finders. The Court examined Plaintiff’s claim under the existing law and found that no judicial decision could be found to support the claim, that statutory law drastically limits the continuing interest of a patient in excised tissue, and finally that the subject matter of the patent cannot possibly belong to Plaintiff. The Court noted a California statute which ordered that any materials removed from patients be disposed of in a safe matter. The legislative intent was, according to the Court, to limit the patient’s ownership of any material excised in the course of medical treatment. The Court finds that the cell line is factually and legally distinct from any part of materials removed from Plaintiff’s body.

V. Kurchner v. State Farm Fire & Casualty Co.
a. Here insurance compensation in the wake of a fire hinges on whether the destruction of preserved sperm is a a bodily injury or a property damage.
b. Holding: When removed from body it is a property interest, if anything.
c. Barber sells Neil Armstrong’s Hair. Retention of property in cut hair? Leaving cut hair.
c.i. The law has found no way to accommodate the kind of interest: where you expect something is to be destroyed thought you do not take steps to ensure such destruction
c.i.1. The category of things I don’t want but want to excude others from
VI. Flynn v. Holder

VII. Estate of Kievernagel
a. Joseph & Iris were married for ten years
a.i. She wanted children; he didn’t
a.ii. He agreed to have his sperm stored at a fertility clinic, with the specific written agreement that it was his alone
a.iii. He died in a helicopter crash while on aerial patrol
a.iv. She wants to be inseminated by his sperm, but his parents object
b. The court held that Iris could not get Joseph’s sperm
b.i. Gametic material, with its potential to produce life, is a unique type of property and thus not governed by the general laws relating to gifts or personal property or transfer of personal property upon death.
b.ii. Joseph, as the person who provided the gametic material, had at his death an interest, in the nature of ownership, to the extent he had decisionmaking authority as to the use of the gametic material for reproduction
b.iii. Iris argues intent is difficult to determine because those undergoing IVF face great emotional and psychological turmoil, circumstances change, and their intent may change over time
b.iv. The probate court found Joseph intended that his frozen sperm be discarded upon his death

VIII. Newman v. Sathyavaglswaran
a. Court held that Π’s did have action when Δ took the corneas of Π’s deceased children, despite the statute. Court held that Δ needed to justify on public policy grounds its deprivation of parents’ interests in receiving consent. Found there must be consent.
a.i. No property in body until death—then given limited property rights.

IX. Seals v. H&F, Inc.
a. After Rodney Leon Boling, his fiancee/girlfriend and his 14-year-old son had the H & F funeral home and cremation service owned by Judd Sellars cremate the body
b. His parents sued in federal the funeral home for disposing of their son’s body without their permission
c. The Tennessee Supreme Court answered the certified questions
c.i. The Revised Uniform Anatomical Gift Act provides the following order for making decisions: your own wishes, spouse, adult children, parents, adult siblings, adult grandchildren, grandparents, an adult who exhibited special care and concern, and other person having authority
c.ii. A Tennessee cremation statute says to follow the order of “heirs,” which could include a minor child
c.iii. A funeral home may be reckless if it followed the wishes of a minor child, notwithstanding the statute

X. Bonnischsen v. United States
a. Two men found skeletal remains that are perhaps 9,000 years old while watching a hydroplane race near Kennewick, Washington
b. The Umatilla Tribe claimed them pursuant to the federal Native American Graves Protection and Repatriation Act (NAGPRA), which allows a Native American tribe to claim human remains of a tribe member found on federal land
c. Ninth Circuit held that held that NAGPRA does not apply because of there was insufficient evidence of the Kennewick Man’s connection to the tribe
d. So the remains are the property of the U.S. Army Corps of Engineers, who owns the land on which they were found
XIV. Fee Simple Absolute & Fee Simple Defeasible (337-352)

Present Estates
Estates further classify interests and refer to when and how ownership ends. All estates are interests in land. (you don't own real property you have an estate—bundle of rights).
Interests refer to when ownership begins- either present (possessory at the moment of creation), or anytime in the future (wait until some future time to obtain possession of property)
-Future gets no present enjoyment or economic benefit.
A Quitclaim deed is done when there is doubt to the validity of the grantor’s title or authority to covey the tract. Operates as a release that conveys the grantor’s entire title, interest, or claim in the property to the grantee, but without warranting that such title is valid.
A Warranty Deed is when a grantor promises to warrant and defend the grantee’s title and possession of the estate against all legal challenges under the deed.
Escheat is the lapsing or reverting to the state as the original and ultimate proprietor of real estate, by reason of a failure of persons legally entitled to hold the same. Escheating only occurs if you have no wills or heirs
Intestate is when you die without a will. In general every state a statute of intestate succession, which says that if you die without a will, your land will go to your lineal descendants. (trying to honor what we think people will want to do with their property).
Devisees are people who get your property when you have a will. Heirs are people who get you property without a will (determined at death).

Present Estates - Only 4 kinds
1. Freehold Estates - tenants are "seized" of the land
a. Fee Simple-Potential of enduring forever, absolute ownership
a.i. Fee Simple Absolute
a.i. Fee Simple subject to condition subsequent
a.i. Fee Simple Determinable
a.i. Fee Simple Subject to executory limitation
a. Fee Tail - Will necessarily cease if and when the first fee tail tenant has no lineal decedents
a. Life Estate- End necessarily at the death of the person
a.ii. Measured by the duration of life of the owner of the tenancy
a.ii. Measured by the life of a third party
1. Non-Freehold Estate - landlord has seisin (possession)
a. Leasehold
a.i. Term of years (limited by months or years)
a.i. Periodic tenancy (month to month or year to year)
a.i. Tenancy at will (can be terminated “at will”)
a.i. Tenancy at sufferance (tenants keep possession after the end of the lease)
2. Three Transfer Rules -By conveyance (alienation), using deed -By inheritance (heirs) -By Will 4. Words of Purchase and Words of Limitation:
a.i. Purchase: Identifies the person in whom the estate is created “To A,” “and her heirs”
a.ii. Limitation: Describes the type of estate “For life,” “so long as”
b. Indefeasible v. Defeasible
b.i. Estates can be either—can be taken away from present owner to a different person.
b.ii. Defeasance: possibility that a vested remainder would be diminished by subsequent event.
Fee Simple Estates
Fee Simple Absolute
Or just "Fee Simple"
1. A fee simple absolute is the maximum rights over the land for an unlimited amount of time and doesn't end for any event. The owner can devise (will), descend (intestacy-heirs), or alienate (sell your land) it.
a. Owner can keep, convey or devise by will.
b. If not devised, passes to heirs.
c. No conditions imposed on land use
2. Conventions - "O to A and his heirs"
a. "to A" - words of purchase indicating who is receiving the estate
b. "and his heirs" - words of limitation or words of inheritance
c. It is a fee simple absolute rather than a life estate
d. No rights except the right to inherit if A die instate
e. Their inclusion is a point of confusion - sometimes not appended
3. Rule for construction – “the mere expression that property is to be used for a particular purpose will not in and of itself suffice to turn a fee simple into a determinable fee."
4. Heirs have no present interest (only when you die)
5. Rights are still limited to nuisance law and states policing power
6. May be encumbered by easement, real covenant, equitable servitude, mortgage
7. Keywords to create a particular kind of FS estate
a. Only state a Preference = absolute
b. “As long as” – determinable
b.i. Creates an automatic reverter
c. “Provided,” “if” - condition subsequent
c.i. Creates a waivable right of re-entry
Fee Simple Defeasible
Defeasible fees are fee simple estates of potentially infinite duration that can be terminated by the happening of a specific event. This decreases the “sticks” in the new owners bundle and leaves some with the old owner.
-Law does not favor any limits or conditions on estates because they restrict present use and future development. To establish a defeasible estate, the deed must clearly express such intent – certain time honored language is preferred. Future interests in defeasible land are worthless unless the future interest is imminently possessory.
Fee Simple Subject to a Condition Subsequent
A Fee Simple Subject to Condition Subsequent is a fee simple that doesn't automatically terminate but may be cut short (divested) at the grantor’s election when a stated condition happens. The estate may still be transferred or inherited until the transferor exercises his Right of reentry, which must be expressed in a reasonable amount of time (no specific b/c we want grantors and grantees to work out the land dispute better). (Condition must happen first)
b.ii.1.a. to A, “but, if” or “upon condition that,” or “provided, however”…
b.ii.1.b. Favored over Fee simple determinable because the land doesn't automatically transfer
b.ii.1.c. Right of reentry/power of termination/right of entry must be expressed and can be waived if not exercised
b.ii.1.d. Statute of Limitations begins to run on the holder of the right to entry once they enforce it—rent and tax start once you enforce it---also laches and estoppel, and who as the property
Fee Simple Determinable
A Fee Simple Determinable is an absolute endless estate that automatically terminates on the happening of a stated event and goes back to the grantor. The estate may be transferred or inherited until the condition is broken.
b.ii.1.d.i.1.a. “as long as” or “until” or “while” “during” “so long as”
b.ii.1.d.i.1.b. Must use clear language and there is a timing element to the words
b.ii.1.d.i.1.c. Grantor retains a future interest: possibility of reverter
b.ii.1.d.i.1.d. SOL begins to run on the possibility of reverter once the condition is broken—rent and tax charges start right away—estoppel wavier and laches are often not applicable

Fee Simple Subject to an Executory limitation A Fee Simple Subject to an Executory Limitation is an estate that, upon the happening of a stated event, is automatically divested in favor of a 3rd person (not the grantor). It could last forever and is tied to the performance of a particular act or occurrence
a. ”But if the property is no longer used as X, to B and his heirs.” “Express condition” “in the event that”
b. Shifting Executory Interest. Is an executory interest that operates in defeasance of an interest created simultaneously in a third person.
c. Springing Executory Interest is an executory interest that operates in defeasance of an interest left in the transferor.
d. Can be a trust if they have intent, something being transferred to it, and charitable purpose—the trustee manages the property until the person with the legal title becomes old enough—charitable trusts are for the benefit of the people and the state appoints someone to manage it.

If there is ambiguity, a court will interpret the deed as creating a FS CS as opposed to FS D.

I. Questions About Land
a. Who owns the land?
a.i. Who has the right to possess it now? Present estates/concurrent ownership
a.ii. Who has the right to possess it in the future? Future estates/concurrent ownership
a.iii. How do you obtain land? Inheritance or devise/real estate transfers/eminent doman
b. How can you use land?
b.i. Which rights do you not have? Nuisances
b.ii. Which restrictions can you impose voluntarily? Easements/covenants & servitudes
b.iii. Which restrictions can the government impose? Zoning/growth controls/direct regulations

II. In re O’Connor’s Estate
a. Adams county, Nebraska, sued the state of Nebraska for payment of an inheritance tax when the state obtained lands by escheat because the previous owner died without leaving heirs. Adams county claimed that the statutes concerning inheritance taxes were meant to cover escheat as well as standard inheritance. The state of Nebraska refused to pay.
b. Is escheat of lands a form of inheritance that is subject to an inheritance tax?
c. No. Escheat of land by the state is not subject to taxes of inheritance.
c.i. The court stated that the inheritance tax only covered property that was transferred by proper inheritance, testamentary will, or transfer in contemplation of death (causa mortis).
d. Notes: In In Re Estate of O'Brine , the court held that personal property was subject to estate taxes under escheat.

III. Roberts v. Rhodes
a. The π seeks judgment for title to a portion of land which had been formally the subject of a grant for the purposes of a school. The land was used as a school for 60 years, then for something else. The grant deed to the land had the language that the grant was to the grantee's "heirs and assigns", and "it being understood that this grant is made for school and cemetery purposes only." There were no specific provisions made for disposition of the land upon a subsequent failure of use as intended.
b. Is the language in the grant deed specific enough to make it a defeasible fee?
c. Holding: No. 1. In the absence of an intent to limit the title to a defeasible, either expressly or by necessary implication, the grantors pass a fee simple absolute (all rights). 2. The mere expression that a land is to be used for a particular use is not of itself sufficient to turn a fee simple absolute into a determinable fee.
d. Fee simple determinable: automatically expires and reverts back to the owner (permanent possession until the occurrence of the event)
e. The legal significance of the language is absolutely zip
e.i. Conveying land to town for use as a school: language = different consequences
e.i.1. ...so long as  fee simple determinable (durational language)
e.i.1.a. “Until”, “During”, or other durational language
e.i.1.b. Even if it’s 202 years later it reverts
e.i.2. ...if  fee simple subject to a condition subsequent
e.i.2.a. Not automatic reversion; triggers right of entry no process
e.i.3. ...understanding  legally irrelevant, doesn’t form condition

Various judicial mechanisms are employed to limit the scope of defeasible estates. Most importantly, the granting language must indicate a clear intent to impose a condition on the estate. Words that merely recite the intent or purpose of the grantor do not limit the estate that is granted.

Similarly, words of covenant or promise (e.g., “and the grantee promises to use the land only for a hospital”) merely create a contract obligation in the grantee, not a defeasible estate. In addition, where ambiguous language could be construed as creating either an absolute or a defeasible estate, courts uniformly follow a constructional preference for an absolute estate. See also Roberts v. Rhodes

IV. Lawyers Trust Co. v. City of Houston
a. Lumber company gave land to city of Houston for basically a public park
b. If after 25 years it is not used as a park, shall vest in lumber company
c. Ambiguity between fee simple determinable and fee simple subsequent condition
c.i. Err towards the fee simple to a condition subsequent
c.i.1. “less onerous” and strict, not automatic but capacity for re-entry
d. Waiver issue: if owner waits too long or mislead the user of the land that you won't use the land, you waived the right
e. Fee simple subject to condition can last indefinitely: right to entry
e.i. fee simple determinable: estate ends automatically upon the triggering of the limitations
f. Adverse possession? Did it automatically revert or not? If so then hostility against whom?

V. Mayor & City Council of Ocean City v. Taber
a. Three conversions:
a.i. Tabor  Trustees (1876);
a.ii. Trustees  United States of America (1878)
a.ii.1. “fail to use the said Life Saving Station...revert to the said Trustees”
a.iii. United States of America  Mayor and City Council of Ocean City (1967) via Quitclaim deed
b. Mayor claims 1876 ineffective, thus United States had fee simple by adverse possession (has been occupying much longer if 1876 ineffective)
b.i. Only would work if Trustees did not have power to make conveyance, they did via the 1876 conveyance
b.ii. Fee simple determinable (clear duration language "when .. fails to .. reverts back to the grantor …"
c. Since a fee simple determinable was conveyed, the property reverted much later, thus adverse possession is estopped from being claimed by the Mayor (on behalf of the US) and thus the US quitclaim to the city only conveyed the fee simple determinable which then ended in 1968

It is sometimes difficult to distinguish between fee simple determinable and fee simple subject to a condition subsequent. In general, the hallmark of a fee simple determinable is language of time or duration. See, e.g., Mayor and City of Council Ocean City v. Taber (grant to federal government that provided “when the United States shall fail to use the said Life Saving Station, the land hereby conveyed for the purpose aforesaid, shall, without any legal proceedings, suit, or otherwise, revert to the said Trustees” held to create fee simple determinable).

VI. Green Tree Servicing, LLC v. Williams
a. Lueveania Garvin deeded .23 acres to her granddaughter Reniata Williams
a.i. “In the event . . . Williams shall fail to use said property for residential purposes for a consecutive period of 60 days or more, the aforementioned property shall revert back to Grantor or Grantor’s heirs and assigns, in fee simple”
b. Williams mortgaged the property through Green Tree, defaulted, and moved away
c. Green Tree sought to foreclose and take possession of the property
d. The court held that Williams owns the property
d.i. The deed created a fee simple determinable
d.ii. “When the determinable fee was terminated, Green Tree’s interest in the property terminated.”

VII. Metcalf v. Black Dog Realty, LLC
a. In 1901, George Pack gave the county land for a park and courthouse
a.i. Granting clause = Pack sells the land to the county
a.ii. Habendum clause (to clarify that the grantor has transferred absolute title or ownership rights on the property to the grantee) = the county can have the land forever
a.iii. Warranty clause = Pack promises that he owns the land in fee simple
a.iv. Final clause = the land will revert to Pack if it is ever used for a jail or if the land is ever sold or leased to someone else
b. Court held that “Pack conveyed his entire fee simple absolute interest to the County, and the additional language in the deed did not create any limitations or conditions upon the fee simple interest”

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XV. Fees Simple Defeasible & Life Estates (352-371)
Life Estate
A Life Estate is an estate that is not terminable at any fixed or computable period of time, but cannot last longer than the life or lives of one or more persons. Once the person dies it reverts back to the original grantor or shifts to a designated remainderman. They are free to transferable, only lasts until the grantor dies, but they are not devisable or descendible.
a. Most are created by gift, devise, or bequest and can be held in a trust where someone else manages it and they get the rents and profits.
b. If there are multiple tenants and one dies it can: 1) Transfer to the other tenants until the last one dies, 2) the share passes to the persons heirs, 3) the estate ends once the first person dies.

A Defeasible life estate is subject to a condition subsequent/executory limitation where the estate may end before the life tenant dies if the condition occurs. -“A, for life, so long as A remains unmarried” “but if A doesn't use land for certain purpose”

A Life Estate Per Autre Vie is when the state is measured by the life of someone other than the life tenant, it will end when the measuring life ends.—“To B for the life of A” or “A, life tenant, conveys her life estate to B”

RULES OF CONSTRUCTION---gives consistency and promote marketability of the land: 1) Law doesn't like limits or conditions, 2) FSSCS > FSD (if ambiguous), 3) ambiguous deeds are construed against the grantor, 4) if unclearly stated all of the testator’s property transfers in a will, 5) courts disfavor restraints on alienation (either partial/limits or absolute)

1. Grantee retains for life and then estate automatically reverts back to grantor or shifts to a second grantee
2. Therefore, every life estate is paired with a future interest
a. Reversion for the grantor
b. Remainder for second grantee
3. Life Estate pur autre vie
a. Created when a LE is conveyed to another
b. Can be created at the time of grant: “to A for the life of B”
4. Rules for construction
a. When construing ambiguous meaning, try to effectuate the intent of the testator
b. Presumed that a testator intends to devise (real property) or bequeath (personal property) all of his property
5. Restraints on Alienation – courts disfavor them
a. Disabling restraint: prevents a grantee from selling interest
a.i. This is an absolute restraint – will be voided
Waste (normally just for reversion interest or remainder interest…not ROE or POR)
Waste is conduct by the life tenant that permanently impairs the value of the land or the interest of the person holding title or having some subsequent estate in the land. What constitutes was is highly fact determinable, but a court my order an injunction, give monetary damages, or forfeiture for a remedy.
a. Life estates and waste – life tenant who causes waste on a property loses that part of the property to the person who holds the remainder or the reversion interest and may be liable for damages to that person
b. Applies to leasehold estates and defeasible fee simple (differently though), but not fee simple
Categories
1.) Affirmative or voluntary is when the life tenant actively changes the property’s use or condition, usually in a way that substantially decreases the property’s value. This will not apply when the tenant has the expressed right to exploit the land for resources or reasonable amounts of repair or maintenance.

2.)Permissive Waste is when a life tenant fails to prevent some harm to the property (not making normal repairs, pay interest, taxes, or premiums) --Required on both to pay damages to the remainderman (future holder)

3.)Ameliorating waste is when the principle use of the land is substantially changed, but the change increases the value of the land. It is actionable if the grantor intended to pass the land with the specific building on it to the holder of the remainder and the building can reasonably be used for the purposes built. -If the thing is undesirable they can demolish it if it enhances the property

Policy: Created to prevent life estate owners from destroying property because they have no interest in its future value beyond their own life expectancy. As a result, for example, a life tenant may have an economic incentive to strip forest land of its valuable timber without replanting it, or to allow buildings to deteriorate without performing normal maintenance. AND Also, where two or more persons own interests in land, fairness requires that one should not impose sever economic damage to the other.

Open Mines Doctrine
-A life tenant may mine and remove minerals (and keep profits) if the grantor had opened the mines or began the mining and removal before he granted the life estate. -This presumes that the grantor intended the life tenant to continue using the property how he had been.
-Unless the future interest holder is consented, then the life tenant can’t begin or conduct mining operations if none had taken place before.

Economic Waste
-Occurs when the income from property is insufficient to pay the expenses the life tenant has a duty to pay. (maintenance, taxes, interest, insurance)
-Only means that it doesn't pay for its open upkeep
-life tenant-and sometimes the remainderman- can bring action to sell the property if this occurs.

I. City of Palm Springs v. Living Desert Reserve
a. Deed left land to the City of Palm Springs, with the proviso they use the land for an Equestrian Center. Instead, PL wanted to build a golf course and sued to try and remove the proviso from the deed, claiming the power of termination was not compensable. City argued the possibility of not meeting the condition was too remote.
b. Under CA property law, may City of Palm Springs move to condemn the reverting party from holding its rightful claim to the land when the City wants to build a golf course on land which was earmarked for an equestrian center in the decedent's will?
c. When the condemnor owns the present possessory interest in the land, the action of condemnation itself makes violation of the condition imminent.
c.i. If the court allowed Palm Springs to do what they wanted they could simply make their land a fee simple unrestricted and have paid nothing for it. There is something about notions of degrees of fairness, justice and virtue that should characterize public entities. Living Desert was entitled to be compensated 100% of the value of the unrestricted fee in the land.
d. Before lawsuit, to finesse this problem: buy out Desert Reserve OR eminent domain
d.i. Government can only invoke eminent domain with just compensation
d.ii. This dispute becomes how much the city has to pay, if anything
e. End up settling for $1.4 million dollars to Desert Reserve but now has property to develop into a golf course
f. Pl announced that they would breach the condition, once the announced—
f.i. General rule: when government takes property that is split, the owner of future interest does not get any compensation (unless the reversion would occur in a reasonably short time)

The Restatement of Property embraces this rule, except in the rare situation where the event that would terminate the defeasible estate will probably occur within a short period of time. See also City of Palm Springs v. Living Desert Reserve (where city, holding defeasible estate in desert land, sought to condemn power of termination held by third party, the city’s action made a violation of the restriction imminent; third party was accordingly entitled to compensation).

II. White v. Brown
a. “I wish Evelyn White to have my home to live in and not to be sold. “
b. Plaintiff’s Argument: T’s will implies constructive fee simple because they lived together at the same home.
c. Defendant’s Argument: Estate was only given for life estate for P and remainder should go for D under law of intestate.
d. Courts Rules/Standards::
d.i. Ct generally prefer to dispose all of T’s estate if the construction is reasonable and consistent with general scope and provision of the will.
d.ii. The will should construct the fee simple unless the words and context of will clearly evidence J’s intention to convey only a life estate.
e. Life estate: she gets it for her life; “to live in” is not specific enough
e.i. Rather than forcing courts to guess, incentivize specificity
f. Restraint on alienation: effort to restrict future sale or transfer of property
f.i. The law does not like this, discourage or inhibits for policy reasons

Reversing the common law approach, modern American law presumes that every grant passes all of the grantor’s estate, unless the grantor’s contract intention is clearly indicated. As a result, ambiguous language in a conveyance by a grantor holding fee simple is judicially interpreted as transferring fee simple absolute.

An example is White v. Brown, where the Tennessee Supreme Court construed a holographic will that provided” “I wish Evelyn White to have my home to live in and not to be sold.” Concluding that this sentence did not clearly state the intent of the testatrix, the court held that it devised a fee simple estate. Thus, today the holder of a fee simple estate can create a life estate only by using language that clearly reflects this intention. (e.g., “to B for life” or “to Be for his lifetime”).

III. Williams v. Estate of Williams
a. PROCEDURAL POSTURE: Defendants, heirs of the decedent, sought review of a decision from the Court of Appeals (Tennessee), which affirmed the judgment of a chancery court in an action to construe the will of the decedent. The action was brought by plaintiff, the decedent's surviving daughter who was named as a beneficiary in decedent's will.
b. OVERVIEW: The decedent's will bequeathed his farm to three of his daughters, including the surviving daughter. The surviving daughter and the other daughters maintained possession of the farm during their lives, and the other daughters had predeceased her. The surviving daughter brought the action to construe the will, and the chancery court and the court of appeals ruled that the three daughter's had each received a one-third undivided interest in fee simple in the farm, instead of only receiving a life estate. The court reversed, finding that the predominant intention of the decedent was clear that the three daughters were to share the farm equally so long as they were living and unmarried. The court stated that the testator's statement that he was favoring the daughters above the other children because they had stayed at home and taken care of their mother implicitly recognized that each had foregone the opportunity to become self-supporting or be supported by a husband, and by the decedent's limiting the duration of the devise to such time as a daughter should marry, indicated that the devise was intended to be a substitute for support that might otherwise have been available.
c. OUTCOME: The court reversed the judgment of the court of appeals and remanded for further proceedings. The court held that the heirs-at-law of the decedent held a reversion in fee simple, subject to the determinable life estates and the executory interests in the named daughters, which reversion would vest in possession, at the latest, upon the death of the surviving daughter.

I. City of Huntington Woods v. City of Detroit
a. In 1924, Horace & Mary Rackham donated a golf course to the City of Detroit “provided always” that
a.i. The property “shall be perpetually maintained . . . exclusively as a public golf course”
a.ii. No alcoholic beverages are permitted on the premises
a.iii. “If any of the foregoing conditions are broken then the estate . . . Shall be forfeited and the said premises shall revert” to the Rackhams” who shall thereupon have the right to re-enter and re-possess the same”
b. Detroit wants to sell the property to a developer who wants to build houses there
c. The court held that the deed created a fee simple to a condition subsequent
d. So the City can only sell the property to the developer if it obtains the permission of the Rackham’s heirs

II. Garcia v. Celestron
a. Nicolaz Maqueira died with a will providing that he left his house:
a.i. To his widow, or if she died before him, to six named family members
a.ii. “I further leave a life estate in [his house] to my daughter Mercy Garcia, so that she may live in and enjoy this property. . . . Upon her death, the property shall be sold and the proceeds divided equally among those living at the time of my death so named herein. . . . If Mercy so desires, she may sell this property at any time and divide the proceeds as stated.”
b. Mercy rents out the house and has no plans to live in it
c. The court held that the deed gave Mercy a life estate determinable that ended when she decided not to live in the house

III. Woodrick v. Wood
a. Barn exists across parcel 105 and 106; because of will and gifts:
a.i. Parcel 105: C has life estate; C has 75% and P has 25% future interest
a.ii. Parcel 106: C and S have fee absolute
b. Doctrine of Waste: prevents abuse or destructive use of property by owner of present interests on behalf of those with future interest
c. Issue. Whether the holder of a remainder interest in a parcel of land may prohibit the life tenant of such property from destroying structures of value on the land even if such removal of those structures would increase the property value.
d. Held. Judgment affirmed. While at common law anything that altered leased premises in any way constituted waste, as long as there is no diminution of the value of the property destroying structures of value on land does not constitute waste.

The common law traditionally accorded greater protection to the holder of a vested remainder than to the owner of a contingent remainder or executor interest. Modern law still partially reflects this disparity as evidenced in two settings: remedies for waste and shares in eminent domain proceeds

Rights re Waste: Suppose O conveys Blueacre “to A for life, then to B and his heirs,” and A subsequently commits waste by starting a gold mining operation on Blueacre. As the holder of an indefeasibly vested remainder, B’s rights are adequate to protect his interest; he may recover compensatory damages for past waste and enjoin future waste. The law safeguards B’s vest remainder because it is certain to become a possessory estate, and it is accordingly logical to limit A’s conduct. See Woodrick v. Wood (Recognizing right of remainder holder to enjoin waste in theory, but finding no waste on facts.)

I. Matteson v. Walsh
a. Dorothy Walsh devised her house to her son Robert “for his life” with the remainder to be divided equally among the heirs of Robert, Elizabeth, and Catherine
b. Robert stopped paying property taxes and stopped maintaining the property
c. Elizabeth sued for waste
c.i. Waste has been defined as "an unreasonable or improper use, abuse, mismanagement, or omission of duty touching real estate by one rightfully in possession, which results in its substantial injury
c.ii. Permitting the real estate taxes assessed to the property to remain unpaid to the point that the taxing authority records a tax taking amounts to waste
c.iii. While there appears to be no evidence that Walsh affirmatively destroyed or removed anything from the property, the judge found a degree of neglect that amounted to severe and substantial deterioration against the right of the remainder interest that amounts to waste

XVI. Future Interest (371-387)
Future Interests
A Future Interest is property a presently existing right to the future possession that may or may not materialize. They are a legally enforceable right, presently existing. Can be created in the conveyer or in a third party

5 kinds of future interests
1. Reversion
1. Remainder
1. Possibility of Reverter
1. Right of entry
1. Executory interest

Present Estate
Future Interest in Grantor
Future Interest in 2nd Grantee
Fee Simple Absolute
-
-
Fee Simple subject to condition subsequent
Right of entry
-
Fee Simple determinable
Possibility of Reverter
-
Fee Simple subject to executory limitation
-
Executory interest
Fee Tail
Reversion
Remainder
Life Estate
Reversion
Remainder
Leasehold
Reversion
Remainder

In most States, the five types of future interests are freely transferable by sale, gift, will or inheritance

Reversion (held by the grantor)
1. Reversion is a future interest left over after the holder of a greater estate in real property transfers a lesser estate in property that is certain to end without specifying in the deed or will who is to receive that future interest.
-For a deed, reversion remains in the grantor
-For a will, it remains in the successor in interest of the testator
-Can be expressed or created in law
-Follows an estate that ends naturally
Possible Corresponding Present Interests
a.i.1. Life Estate
a.i.2. Estate for a Term of years
Characteristics:
a.i.3. Alienable- Transferable both inter vivos, testate, and intestate—only get interest not possession
a.i.4. Devisable- yes
a.i.5. Descendible- yes
a.i.6. Vested-All wont become possessory
a.i.7. The holder can sue for Waste
a.i.8. The holder may recover from Wrongdoers for Damages to the Property (to the extent of the injury to the reversion)
- “wait patiently” until present estate ends
a. Cannot disrupt a present estate
- Keep their names even if granted to another –i.e. an original grantor may sell his reversion interest but that doesn’t make it a remainder.
Remainders (created in transferee)
A Remainder is a future interest left over after the holder of a greater estate in real property transfers a lesser estate that is certain to end and specifies some second grantee that is to receive the leftover future interest, which will become possessory upon the natural termination of the preceding estate. -Has to be created at the same time as the estate (life, fee tail, or term of years) -Cant follow a fee simple and always “waits patiently” -If ambiguous the law favors vest over contingent
Vested remainder is created when property is granted to both an ascertained (presently existing, not subject to a condition precedent to the third party taking possession when the preceding estate expires. (“to a for life, then B”)
Contingent is held by an unascertained (not heirs) person or subject to a condition precedent other than the natural termination of the preceding estate
-It is subject to open (subject to open) it is subject to a class of persons, which includes additional members not yet ascertainable (“to A for life, then to B’s kids”---B’s kids are open until 38 weeks after B dies)
-B’s kids are fully vested as soon as they are born provided that A is alive…if A dies before B then only the kids alive when A died have an interest and it closes.
-It is subject to a condition precedent (subject to divestment) if the parties interest is contingent on a condition precedent.
-“to A for life then B if B is married to C (at the time A dies)”---B’s right vest if he is married to C when A dies.

Doctrine of Merger is a possessory or vested life estate merges into the next vested future interest in fee simple (either reversion or vested remainder) when both are held by the same person, unless created in the same document.

Doctrine of Destructibility of Contingent Remainders is when the prior estate terminated before the occurrence of the contingency, then the contingent remainders would be destroyed for the lack of a supporting freehold estate. ---Makes property more marketable at the expense of the grantor’s intent

Right of Entry- Fee simple subject to condition subsequent (held by the grantor)
ROE is a future interest created when the grantor creates a FSSCS and retains the power to cut short or terminate the present estate. The grantor must state explicitly her right to reenter. -Must be explicitly used it is not automatic and may be waived—doing nothing isn’t a waiver unless the fee holder detrimentally relies
Characteristics:
a.i.1. Alienable (transfer)- yes (used to be not inter vivos)
a.i.2. Devisable (will)- yes (used to be no)
a.i.3. Descendible (heirs, no will)- yes to heirs in most states
a.i.4. Vested
a.i.5. The Doctrine of Waste rarely applies.
a.i.6. If the State condemns a FSSCS, traditionally the holder of a ROE receives nothing.
-No time limit by statue
-Has a conditional intent (making sure it is being used for a specific purpose and not for duration), not temporal (using it for a duration of time for a purpose)
Possibility of Reverter- Fee simple determinable (held by the grantor)
A POR is a future interest in the grantor when a FSD is created. A POR is current, legally recognized property right, but it is considerably less extensive than a reversion or remainder. -If there is a FSD then it will be a POR unless the grant transfers to a 3rd party upon a specific event
Characteristics:
a.i.1. Alienable (transfer)- yes (used to be not inter vivos)
a.i.2. Devisable (will)- yes
a.i.3. Descendible (heirs, no will)- yes
a.i.4. Vested
a.i.5. The Doctrine of Waste rarely applies.
a.i.6. If the State condemns a FSD, traditionally the holder of a POR receives nothing.
-Transfers automatically upon the termination of the FSD.
-Normally has a time limit by a statute on the exercising of the right
-Has a temporal intent (using it for a duration of time for a purpose), not a conditional intent (making sure it is used for a specific purpose and not duration)

I. Abo Petroleum Corp. v. Amstutz
a. James & Amanda Turknett conveyed land to
a.i. their daughters Beulah and Ruby during her natural life
a.i.1. life estates for Beulah and Ruby
a.ii. and at death to revert, vest in, and become the property absolute of her heir or heirs, meaning her children if she have any at her death
a.ii.1. = contingent remainders in Beulah and Ruby’s children because it was impossible at the time of the original conveyance to know whether Beulah and Ruby would have any children or whether any of their children would survive them
a.iii. but if she die without heir or heirs, then and in that event this said property and real estate shall vest in and become the property of her estate to be distributed as provided by law
a.iii.1. = alternative, second contingent remainder to Beulah and Ruby’s estate in the event they did not have heirs
a.iv. James & Amanda kept a reversion because both remainders were contingent
b. So Beulah and Ruby could only transfer the life estate that they originally obtained, which means that Abo did not get a fee simple

The common law doctrine of the destructibility of contingent remainders was straightforward. A legal contingent remainder in real property was extinguished or “destroyed” if it failed to vest when the preceding freehold estate ended. See Abo Petroleum Corp. v. Amstutz (refusing to follow doctrine).

II. Swanson v. Swanson
a. In 1970, George Swanson died with a will creating two trusts
b. Item IV trust:
b.i. His wife Gertrude had a life estate with a power of appointment to dispose of the trust
b.i.1. = Gertrude has a life estate
b.ii. The remainder was left to his nine children, including Bennie
b.ii.1. = George’s nine children have vested remainders
b.iii. And if any of the children are not in life when Gertrude dies, then that child’s share shall go to his or her surviving children
b.iii.1. = The remainders held by George’s nine children are subject to divestment
b.iv. So Bennie’s interest passed under his will because neither divesting condition occurred
c. Item V trust was the same except the remaining assets were to be divided into nine equal shares, one each for George’s surviving children or the then surviving issue of each his deceased children
c.i. = The surviving children each held a vested remainder subject to divestment
c.ii. So Bennie’s vested remainder was not defeased upon Bennie’s death, and his interest instead flowed into his estate

The testamentary trust is created as part of a will, and takes effect only at the death of the settlor. See, e.g., Swanson v. Swanson

In order to create this trust, the settlor must execute a writing that: (1) expresses the intention to form a trust and identifies the trust property, beneficiaries, and purpose; and (2) complies with all the formalities required for a valid will.

III. Baker v. Weedon
a. John wrote his will in 1925 to give all of my property to
a.i. Anna during her natural life
a.i.1. = Anna has a life estate
a.ii. and upon her death to her children, if she has any
a.ii.1. = Anna’s children have a contingent remainder
a.iii. and in the event that she dies without issue then at the death of Anna, I give all of my property to my grandchildren, each grandchild sharing equally with the other
a.iii.1. = John’s grandchildren have a contingent remainder
b. Court held that Anna can only sell so much of her land as is necessary to satisfy her reasonable needs

The life tenant’s right to sell his or her interest is often illusory because its value is uncertain and speculative. T’s life estate in Greenacre, for example, may be virtually worthless (e.g., if T dies tomorrow) or quite valuable (e.g., if T lives for 50 more years). An interesting issue arises when the life tenant wishes to maximize the value of the interest by forcing a sale of the affected land over the objections of the remainderman. Baker v. Weedon illustrates the problem. There the 73-year-old plaintiff was a life tenant in a Mississippi farm; the farm produced income of only $1,000 per year, too little for her to live on. But fee simple absolute in the farm was value at $168,500. If the fee simple could be sold, and her life estate transferred to the sales proceeds, she would earn enough interest to support herself (e.g., over $8,000 per year assuming a 5% return). The remaindermen refused to join voluntarily in selling the fee simple because they expected that future construction of a nearby highway would double the land’s value in a few years. Plaintiff sought a judicial decree that would (a) order sale of the fee simple absolute over the remaindermen’s objections and (b) recognize her life estate in the proceeds. Prior Mississippi decisions had authorized such judicial sale only where necessary to preserve the estate, that is, if the property involved had deteriorated to the point that its income would not pay for required taxes and maintenance. But the Baker court embraced a new rule, holding that such a sale would be proper if “necessary for the best interest of all the parties.” The case was remanded to allow plaintiff the opportunity to prove that an immediate sale would serve the best interests of all.

Most states have enacted statutes in recent decades that expand judicial power to order the sale or other transfer of fee simple in this situation. There is quite a bit of state by state variation, but the most common approach echoes the Baker standard: sale will be decreed if it is “expedient.”

IV. Mahrenholz v. County Board of School Trustees
a. W.E. & Jennie Hutton conveyed land to the trustees of School District No. 1 with a deed stating that “this land to be used for school purpose only; otherwise to revert to Grantors herein”
a.i. = School District has a fee simple determinable
a.ii. = Huttons have a possibility of a reverter
b. Court remanded to decide if the property is still being used for school purposes

Although widely used in the past, defeasible estate are rarely created today. The defeasible estate was once commonly utilized in conveyances for charitable purposes such as parks, schools, hospitals, orphanages, and the like. See, e.g., Mahrenholz v. County Board of School Trustees (schools)

It is sometimes difficult to distinguish between fee simple determinable and fee simple subject to a condition subsequent. In general, the hallmark of a fee simple determinable is language of time or duration. This estate is created by granting language indicating that a fee simple estate will continue only for the duration of a specified state of affairs such as “so long as” (e.g., “to City for so long as the land is used as a park”), “while” (e.g., “to City while the land is used as a park”), and “during” (e.g., “to City during the time the land is used as a park”), and “during” (e.g., “to City during the time the land is used as a park”). For example, Mahrenholz v. County Board of School Trustees, the grant of land to a school district with the restriction “this land to be used for school purposes only; otherwise to revert to Grantors herein” was held to create fee simple determinable. The appellate court reasoned that the term “only” indicated an intent to “give the land . . . only as long as it was needed and no longer.”

Even where a defeasible estate clearly exists, courts tend to construe the conditional language narrowly, in order to avoid forfeiture. See, e.g., Mahrenholz v. County Board of School Trustees (storage of desks and other equipment on land subject to determinable fee held use for “school purpose”).

When future interests are found outside of the family setting, as was quite common in the nineteenth century, they typically serve either a charitable or economic motivation. Suppose that charitable O intends to donate Redacre to a local hospital group, and wants to ensure that it will be forever used as a hospital. To accomplish this goal, O might grant Redacre “only for so long as it is used as a hospital as a hospital,” retaining the future interest called a possibility of reverter. Or perhaps O has an economic goal—to ensure that the railroad runs by his farm, so that the wheat he grows can be easily sent to market. Under these circumstances, O might grant a strip of Redacre to the railroad “only for so long as it is used for railroad purposes.” In either even, the grantee is motivated to carry out O’s plan in order to avoid loss of title. Alternatively, the grantor might have both motivations. See, e.g., Mahrenholz v. County Board of School Trustees (owner conveyed 1.5 acre parcel to school board for school use, probably intending both to ensure nearby school for son and to benefit the school district).

When a transferor creates a fee simple determinable the future interest retained is a possibility of reverter. For example, if O conveys Blueacre “to L for so longa s the property is used as an orphanage, and then to me,” she has expressly reserved a possibility of reverter. See, e.g., Mahrenholz v. County Board of School Trustees

Some jurisdictions still cling to the restrictive common law approach, but allow these interests to be “released,” i.e., conveyed inter vivos to the holder of the defeasible estate. See, e.g., Mahrenholz v. County Board of School Trustees

V. Harrell v. Harrell
a. H.C. died in 1954 with a will devising his 152-acre farm to
a.i. His sons James and John so long as each shall live
a.i.1. James and John each have a life estate
a.ii. At the death of each son, his share shall become the property of his children
a.ii.1. The children of James and John each have contingent remainders
a.ii.1.a. Contingent because we don’t know if there will be any children
b. After James died in 2007 without any children, his share of the property goes to
b.i. H.C.’s heirs who held the possibility of reverter

VI. Review Questions:
a. O conveys to A for life, then to B and her heirs =
a.i. A has a life estate
a.ii. B has a vested remainder
a.iii. O has nothing because there is no reversion because after a vested remainder in fee simple
b. O conveys to A for life, then to B for life, then O dies devising all of his property to C, then A dies and B dies =
b.i. C owns the property because O devised his reversion to C
c. On March 1, 2003, O conveys “to A for life.” On March 2, O conveys her entire remaining interest to B and his heirs. =
c.i. A has a life estate
c.ii. B has a reversion
d. O conveys to A for life, then to A's children who shall reach 21, with B being A's oldest child & who is now 17 =
d.i. A’s children’s remainder is contingent because the “who shall reach 21” condition precedent is not satisfied
d.ii. When B reaches 21 =
d.ii.1. Remainder vests in B subject to partial divestment of any of B's siblings who reach 21
e. O conveys “to A for life, remainder to B,” then A sells her interest to C, and C dies intestate while A is still alive =
e.i. B has a vested remainder
e.ii. C's heirs have a life estate measured by A's life
e.ii.1. Remember that intestate means without a will, so property descends to your heirs
e.ii.2. Or if C has no heirs, then the property escheats to the state for the life of A
e.iii. A and O each have nothing
f. O devises “to A for life, then to the children of A for life, and upon the death of the last surviving child of A, to such of A's grandchildren as may then be living” =
f.i. O has a reversion
f.ii. A has a life estate
f.iii. A's children have a contingent remainder for life
f.iv. Contingent because not ascertained
f.v. A's grandchildren have a contingent remainder

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XVII. Executory Interests & the Rule Against Perpetuities (387-401)
Executory Interest
A future interest created in an alternative grantee that divests the present estate before its natural end - happens automatically
1. Springing - springs out from the grantor
a. From O to A when she marries
2. Shifting - shifts the estate from the original grantee to an alternative one
a. From O to A, but if the property is no longer used as a library, then to B Rule against Perpetuities
A future interest cannot possibly last longer than 21 years beyond the death of the last relevant person alive at the time of its creation (the life in being); the interest must certainly (not just a possibility) vest, close, become possessory, or fail within this period or it is void from the moment of its creations.
1.) Dealing with a future interests in a transferee?,
2) Any interest not vested at the time of creation?,
3) What is the first point at which the future interest must vest or fail?
4) Is the point at which the future interest must vest or fail more than 21 years after the end of some measuring life that was in being at the time of the creation of the interest?

Rules
1. A life being is someone who is 1) identifiable at the time of conveyance, 2) relevant to the grant, and 3) not a member of an open class (one member of a class not have their interest vest in that period)-----even in utro—conception)—wills start when they die
2. When an interest is void then the language that offends is crossed out
3. Does NOT apply to charitable organizations (both the holder of the present estate and the future interest are charitable for it to be valid)
4. Does not apply if it is between two charitable organization
5. For a devise, look at when someone actually dies, not when the will was signed
6. A child is a life in being from the time of conception
7. Any living person can have a child
8. Any living person can marry someone who has not yet been born
9. There was a fee simple determinable followed by a void executory interest, only the executory interest is stricken and not the determinability
10. Difference between fee simple determinable and a fee simple subject to an executory interest is that it goes to a third person

Special Rules
a.1. Charitable interests are excluded from Rule if both the possessory estate and the future interest are charitable organizations
a.2. A gift to a class violates the Rule if it might vest too remotely in even one member of the class
a.3. Wait-and-see doctrine provides that an interest is good if it actually vests within the allotted time
a.4. Reformation of invalid interests +Common law rule voids the interest from the time of its creation
+Several states now allow courts to carry out the intent as closely as possible consistent with the Rule
a.5. Many states are reforming the Rule

Under the Cy pres Approach intention is to carry out intentions of the parties as near as possible under the rule. Courts make some appropriate change to reform the invalid interest—most states don’t recognize this doctrine.

Under the Wait-and-see approach the validity of interests are judged by actual events as they happen, and not by possible events that might happen. (Only followed by some states.) The court may adopt a statutory approach that creates a 90 year wait-and-approach.

Fertile Octogenarian Rule—Facts indicating old life tenant---all people can have kids so they are still allowed to have the rule apply

Unborn Widow—facts w/ a grant with no name give (husband, spouse, wife, widow)

Option to purchase—gives its holder an enforceable right to buy a particular piece of property at an ascertained price for a specific length of time, and thus similar to future interest. (often involves commercial transactions between corporations)----often is exempted to the limits from the rule of perpetuities

Right of first refusal—gives its holder an enforceable right to buy a particular piece of property at the price offered by others.
a. Policy: designed to promote the marketability and development of present estates and limit the dead-hand control of grantors over future interests.

Create, Kill and Count
• Method used in applying RAP.
• Example: T  “to A for life, and on A’s death to A’s children for their lives, and upon the death of A and A’s children, to B if A has no grandchildren then living.” A and B survive T.
• CREATE a child of A who is not in existence at the time of the grant = C.
• KILL off A and any other of A’s children.
• COUNT 21 years. Say that C lives 25 or 26 years. We don’t know that we have all of the grandchildren at this point, so don’t know for certain if B vests or not – therefore is it INVALID

HOW TO DETERMINE WHAT AN INTEREST IS:
a.i.1. Look first to the intent of the grantor as expressed in the terms of the grant.
a.i.2. If it is ambiguous or against public policy:
a.i.2.a. Look to parol evidence, if admissible
a.i.2.b. Look to grantor’s purpose
a.i.2.c. Apply Rules of Construction:
a.i.2.c.i. Prefer FSSCS over FSD
a.i.2.c.ii. Prefer complete over partial grant
a.i.2.c.iii. Prefer devise of complete estate over partial intestacy
a.i.2.c.iv. Prefer vested interests (remainders) over contingent

I. Neilson v. Woods
a. Evinces a constructional preference towards fee simple condition subsequent over fee simple determinable
b. Court avoids ruling for forfeiture and saying that the pursuit was a penalty and a windfall
b.i. Mostly evinces preferences for subsequent condition v. determinacy
c. H: in spite of language of condition, if the prevailing purpose is to create a collateral limitation of this kind, and not to enforce a condition by threatened forfeiture, a fee on limitation results
d. Take away
d.i. 1) there are indeed some courts try to equity and not necessarily follow the rules  follow the rule if there isn't any indication that thinking outside of the box
d.ii. 2) different states tweak these things in different ways

II. Rodriguez v. Garza
a. Maria Lopez de Pena died in 1943 with a will devising her property
a.i. in fee simple title on my nephew, Santiago Rodriguez, Jr., son of my sister Eusebia Lopez de Rodriguez, to be owned and enjoyed by him with God's and my blessings forever. I make this gift and bequest because I helped to rear my said nephew from his birth and I look upon him as my own son, and I want to declare him to be my sole heir. But should he die without lawful issue of his body, then, and in that event, it is my will and wish that all of my aforesaid property shall pass to and be vested in fee simple in my sister, the said Eusebia Lopez de Rodriguez . . . to be enjoyed by her, or her said heirs together with God's and my blessings forever.” =
a.i.1. Santiago has a fee simple subject to an executory interest
a.i.2. Eusebia has an executory interest
b. Santiago died intestate in 1984 survived by his wife and an adopted son
c. Eusebia’s executory interest became possessory upon Santiago’s death because Texas law in 1943 did not recognize adopted children as “issue”

III. Armenian Assembly of America, Inc. V. Cafesjian
a. Cafesjian donated $10.3 to the Armenian Genocide Museum so that the museum could acquire a building
b. The donation contained a clause stating that the money shall be returned to Cafesjian if the building is not developed by 12/31/10
c. The court held that the building is not subject to a reversion
c.i. The donation agreement did involve the actual purchase of land
c.ii. If it had, then it would have established a springing executory interest

IV. Washington State Grange v. Brandt
a. In 1950, the Gorzes conveyed two acres to the Orchard Grange for $1 with the condition that “the land herein deeded reverts back to original plot in event it is no longer used for Grange purposes” =
a.i. The reversionary clause said that the land was to go back to “the original plot,” but land cannot own itself, so that must mean the “then owner” of the original plot – which means that the Orchard Grange acquired a fee simple subject to an executory interest
a.ii. The executory interest violates the Rule because of the possibility that the interest of the unidentified “then” owner or owners of the “original plot” would not vest within 21 years of the grant – indeed, the Orchard Grand could have continued to use the land for Grange purposes in perpetutity
a.iii. Where a fee simple determinable is followed by a void executor interest, only the executory interest is stricken and not the determinability
a.iv. So the deed is read to create a fee simple determinable for the Orchard Grange with a possibility of reverter in the Gorzes as the original grantors
b. The property is no longer used for Grange purpose
c. It is unclear whether the Brandts received the Gorzes’ reversionary interest in the estate’s 2005 quitclaim deed, so the case is remanded to decide that question

V. Warren v. Albrecht
a. McGaughey died with a will leaving his land
a.i. To John Warren for his life =
a.i.1. John has a life estate
a.ii. Then to John’s living children or their survivors =
a.ii.1. John’s children have a contingent remainder in fee simple
a.iii. But if no children or their descendants, then to John’s sisters subject to conditions =
a.iii.1. John’s children’s descendants had an alternative contingent remainder in fee simple
a.iv. To the other sister if the first sister dies without children or descendants =
a.iv.1. John’s sisters Emma and Goldy also have an alternative contingent remainder in fee simple
a.v. To James’ heirs if neither John nor his sisters have any descendants =
a.v.1. James’ heirs have yet another alternative contingent remainder in fee simple
b. The interests held by Emma and Goldy are valid under the Rule
b.i. John claimed that it violated the Rule because his children could be divested longer than 21 years after his death if his children were to die leaving no descendants
b.ii. When John dies, he will either have living children (so the Emma and Goldy’s interest will fail) or he will not have living children (so Emma and Goldy’s interest will vest)
b.iii. All of the various possibilities will either vest or fail when the life estate ends (with John as the life in being)

The central core of the Rule is simple to understand: it is a rule about time. The Rule essentially imposes a time deadline on how long certain contingent future interests can exist. To comply with the Rule, it must be contingent future interests can exist. To comply with the Rule, it must be logically provable that within a specified period (equal to the length of one life plus 21 years) a covered interest will either “vest” (that is, change from a contingent interest to a vested interest or possessory estate) or “forever” fail to vest (that is, never vest after the period ends). See, e.g., Warren v. Albrecht (devise using formula “to A for life, then to A’s children” or if none then to A’s two names sisters did not violate the Rule because the interests of the children and sisters would either vest or forever fail at A’s death).

VI. United Virginia Bank/Citizens v. Union Oil Co. of California
a. The Abbitts and Union Oil entered into an agreement that gave Union Oil an option to buy land in Newport News within 120 days after the city acquires the right of way for a new highway =
a.i. Union Oil has an option to buy the land
a.ii. But that option violates the Rule
a.ii.1. The Rule applies to an option agreement
a.ii.2. The agreement violates the Rule because “on the date the agreement was executed there existed the distinct possibility that the specified contingency might not occur until after expiration of a period of 21 years from the date of the agreement”
a.ii.3. Neither the cy pres doctrine nor the wait and see rule apply
b. So the option agreement is void, and the property is part of Abbitt’s estate

The common law Rule also applies to a variety of commercial transactions. These include options to purchase and, in most jurisdictions preemptive rights or rights of first refusal. See, e.g., United Virginia Bank/Citizens v. Union Oil Co. of California (option held void under Rule)

VII. REVIEW QUESTIONS:
a. O conveys “to A for life, then to B, but if B marries before A dies, then to C” =
a.i. A has a life estate
a.ii. B has a vested remainder subject to divestment
a.ii.1. Vested because B is ascertained and B gets the property immediately upon the expiration of the preceding estate
a.ii.2. Subject to divestment because C will take the interest if B marries before A dies
a.iii. C has a shifting executory interest
a.iii.1. Shifting because C divests a transferee, not the transferor
a.iii.2. C's interest is valid under the Rule
a.iii.2.a. Either A or B will work as the measuring life because we will know at the moment of A or B’s death whether or not B married
b. O conveys “to A so long as the public is allowed to hike on the property, then to B” =
b.i. O has a reversion
b.ii. A has a fee simple subject to an executory interest
b.ii.1. Ends automatically when the specified event occurs, not only if the transferor asserts her right to entry
b.iii. B has a shifting executory interest
b.iii.1. . . . But it is void under the Rule
b.iii.1.a. The refusal to hike could occur at any time in the future
b.iv. So A ends up with a fee simple
c. O devises “to A for life, then to such of the grandchildren of A who reach the age of 21" =
c.i. O has a reversion
c.ii. A has a life estate
c.iii. A's grandchildren who reach 21 have a contingent remainder
c.iii.1. . . . . But that contingent remainder is void under the Rule
c.iii.1.a. The remainder is not certain to vest or fail within 21 years after the death of A or all of the children of A living at the time of the devise
c.iii.1.b. A could have additional children after the devise (which occurs when O dies), and those children could produce more grandchildren for A who were not lives in being, and those grandchildren might not reach 21 until more than 21 years after the death of A or the children of A who were living at the time of the conveyance
c.iii.1.c. Remember that the remainder has to vest on time for all members of the class
d. O devises “to A, but if any gambling is permitted on the property within 21 years of the death of any child of A's born before O's death, then to B” =
d.i. A has a fee simple subject to an executory limitation
d.i.1. “But if” is conditional language, so A would have had a fee simple subject to a condition subsequent if the interest went back to O
d.ii. B has a shifting executory interest
d.ii.1. B's interest is good
d.ii.1.a. A's children born before O's death are the measuring lives
d.ii.1.a.i. The class of A's children born before O's death will be closed at the time that O dies
d.ii.1.a.ii. The interest will become vested within 21 years of the death of any of A's children – or else it will fail
e. O devises “to A for life, remainder to such of A's lineal descendants as are alive on January 1, 2020" =
e.i. O has a reversion
e.ii. A has a life estate
e.iii. A's lineal descendants alive in 2020 have a contingent remainder
e.iii.1. Contingent because not ascertainable
e.iii.2. A's lineal descendants' interest is good
e.iii.3. We will know in eight years which of A's lineal descendants are alive on 1/1/2020
e.iii.4. So you can use anyone alive today – literally – as a measuring life and just add 21 years
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XVIII. Cotenants (407-425)
Cotenancy
When more than one person owns an estate, it is a Cotenancy. This is a form of successive ownership. All cotenants have the right to posses the entire premises and have the right to transfer possessory rights, by lease or license, or others, no right to destroy without consent -A and B can be concurrent owners of a possessory fee simple, a life estate, or even a remainder.
Typical ways Property Becomes Concurrently Owned
a.1.1. Parent wants his kids to share something equally – vacation homes
a.1.2. Two or more persons may buy property jointly – husband and wife, same sex couples, unmarried friends
a.1.3. If someone dies intestate (no will), his heirs all have concurrent ownership over his estate.

I. Georgia v. Randolph
a. Cotenant reported to the police that the husband uses drugs. She gave permission to police to search without warrant. He objected to the warrantless search
b. 4th amendment: police cannot search or seize unless they have warrant or if there is an exception to the warrant (i.e., consent)
c. Rule: Generally, one joint occupant who is away from premises may not authorize police to enter and search premises over the objection of another joint occupant who is present at the time.
d. The cotenant acting on his own initiative may be able to deliver evidence to the police, and can tell the police what he knows, for use before a magistrate in getting a warrant. Lastly, the court drew a fine line between other similar cases Matlock and Rodriguez by stating if a potential defendant with self-interest in objecting is in fact at the door and objects, the co-tenant’s permission does not suffice for a reasonable search, whereas the potential objector, nearby but not invited to take part in the threshold colloquy, loses out
e. H: when one objects, guest cannot come in. (functional test)
f. R: why does his right to exclude trump her right to invite?
f.i. social norm?
f.ii. she invited the police to his room despite his express objection
f.iii. this case does not explain what would happen if the guest is invited to common area
f.iv. says that: cotenant's consent does not matter if the other objects

II. State v. Tarasuik
a. James and Rebecca lived together in a hotel room. Rebecca consented to random searches as a condition of her probation from a prior conviction. Two probation officers visited there hotel room. Both James & Rebecca gave non-verbal signals that they were displeased with the search. The officers found cocaine.
b. James argued that he did not consent to the search (he is on the hook for the cocaine search as well)
c. Functional test
d. H: upheld the search because "Randolph limits the general rule that consent provided by a co-tenant is valid against another co-tenant in cases in which a present co-tenant expressly refuses consent. However, in this case, as the D concedes, he did not expressly refuse consent

III. Barrow v. Barrow
a. Barrow v. Barrow– Husband owned title and built a residence before his marriage to wife. They lived on the property for 10 years, while married. They divorced and wife got ½ interest in the property as alimony. She moved to Idaho right after they separated. Husband continued to live on the property (maintained and improved it) and changed the locks, new telephone number, didn’t answer wife’s letters. Wife wants ½ the fair rental value for the period husband occupied the property after the separation, claiming he ousted her. Issue is whether, in partition actions, the rules regarding notice of ouster from a former marital home must be applied differently for cotenants who are former spouses than for other cotenants.
b. Held: No. There was no communication by the cotenant in possession (π) to the cotenant out of possession (∆) that he was holding the property exclusively and adversely to the latter, so no ousting. – see rules (1-3) BUT there is an existing applicable exception – (see rule 4) So, under this exception, ∆’s claim for the rental value is limited to $2,591, the amount of π’s claim, since the rental value exceeds his claim
c. Rules:
c.i. The possession of a tenant in common is presumed to be the possession of all tenants until the one in possession communicates to the other the knowledge that he or she claims exclusive right or title.
c.ii. There can be no holding adversely or ouster by the cotenant in possession unless the adverse holding is communicated to the other.
c.iii. Where one cotenant has exclusive possession of lands and uses the lands for his own benefit and does not receive rents or profits therefrom, such a cotenant is not liable or accountable to the cotenant out of possession unless he or she holds adversely or as a result of ouster or its equivalent. (Bird v. Bird) – MAJORITY RULE
d. When a cotenant in possession seeks contribution for amounts expended in the improvement or preservation of the property, that claim may be offset by cotenants out of possession by the reasonable rental value of the use of the property by the cotenant in possession to the extent it has exceeded his or her proportionate share of ownership. (A.L.R. 2d)

However, in most states, a special rule applies to the cotenant in sole possession of the property: the cotenant cannot recover for these payments unless they exceed the reasonable value of the property. See, e.g., Barrow v. Barrow

IV. White v. Smyth
a. White v. Smyth – The Smyth ranch was owned by 9 total owners. They signed an agreement to let White come in and mine asphalt. He did so for a number of years and everyone made good money. Ten years later, White acquired one of the 1/9th interests in the 200 acres where he was mining and announced that he was going to mine 1/9th of the remaining asphalt wherever he wants because he has the 1/9th undivided interest. Held: By mining and processing the rock himself, White was depriving the others of the opportunity to take the rock out and mine it for themselves, so he owes damages to the owner co-owners. Further, the court further rejected White’s argument that if he is responsible for accounting his profits at all, he should be held to account for costs of raw materials, not the net profits after his own manufacturing and labor. Because White’s labor in preparing the asphalt for sale was more processing than manufacturing a new product, Whit was required to account for the profits.
b. Rule – A co-tenant cannot select and take for himself part of the property jointly owned and thus make a partition.
b.i. Land can be partitioned in-kind if the value of natural resources is of a known quantity and relatively uniform location over the land.
b.ii. When land cannot be partitioned in-kind, the non-operating co-tenants do not give up title until the natural resources are disposed of by sale or until there is an established market value for them. Non-operating co-tenant's rights attach to the proceeds, not the value of the natural resource before it was removed.
c. Q: was he allowed to mine? Yes. Can a cotenant unilaterally mine? Yes, they just have to share the profit.
d. Q: what should have white done? Some kind of agreement/try to adversely possess (explicit exclusion required)/can request to partition (either in kind or by sale)

If a cotenant exploits natural resources on the co-tenancy property such as minerals or timber, each cotenant is entitled to a pro rata share of the resulting net profits. In White v. Smyth, a tenant in common holding a one-ninth interest mined and sold valuable rock asphalt from the property. When the other cotenants sued for compensation in an accounting action, the defendant asserted that he had removed less than one-ninth of the asphalt, and thus had only taken his fair share, just as he might have done through partition. The Texas Supreme Court ruled that the defendant could not effect a de facto partition through self-help and, accordingly, that each cotenant owned a share in the mined asphalt. The defendant was ordered to pay eight-ninths of his net profits to his cotenants.

In theory, a cotenant is liable for waste when he or she uses the common property in an unreasonable manner that causes permanent injury, under much the same standards that govern life tenants and other owners of present estates accompanies by future interests. Yet the weight of authority treats certain acts by a cotenant that would normally constitute waste—such as extraction of minerals or cutting timber—simply as sources of income (like rents from third parties) for which he must account to the other cotenants. See, e.g., White v. Smyth (cotenant who removed rock asphalt required to account to other cotenants for his net profits)

V. Johnson v. La Mesa Farms, Inc.
a. La Mesa Farms, Don Johnson, and others were cotenants of 162 acres in Yoakum County
b. La Mesa asked to partition the land because Johnson wanted to renegotiate the farm’s lease for more money
c. Should the court order the partition?
c.i. “A co-tenant has an absolute right to partition”
c.ii. “The law favors partition in kind over partition by sale”
c.iii. The factfinder must determine whether a fair partition can be made
c.iv. The court ordered a partition by sale
c.iv.1. Some parts of the land could be farmed while others could not
c.iv.2. Some parts of the land had mineral value while others did not
VI. N.C. Gen. Stat. § 46-22 (2007)
a. The court shall order a sale of the property described in the petition, or of any part, only if it finds, by a preponderance of the evidence, that an actual partition of the lands cannot be made without substantial injury to any of the interested parties.
b. 'Substantial injury' means the fair market value of each share in an in-kind partition would be materially less than the share of each cotenant in the money equivalent that would be obtained from the sale of the whole, and if an in-kind division would result in material impairment of the cotenant's rights.
c. The court shall specifically find the facts supporting an order of sale of the property.
d. The party seeking a sale of the property shall have the burden of proving substantial injury under the provisions of this section.

VII. In re McDowell’s Estate
a. The daughter of decedent claimed a rocking chair which had been removed from her father's living quarters and was in possession of her brother and was allegedly the property of the estate
b. The Surrogate's Court held that evidence failed to establish delivery as an essential element of decedent's gift of his rocking chair, which was moved from decedent's premises the day before his death
c. The court imposed a temporal partition
c.i. The daughter gets it for the first half of the year; her brother gets it for the second half of the year
c.ii. That rotation will continue until they agree otherwise or one of them dies
c.iii. The chair was to become the sole property of the survivor on the death of either party

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Types of Cotenancies (425-434)
Joint Tenancy
A joint tenancy is a concurrent ownership with a clearly expressed right to survivorship. This right provides the other tenants share will be spilt among the current tenants when they die. This requires the four unities of time, title, interest, and possession to be effective or can be analyzed by the grantors wishes -Time (acquired at the same time), Title (interests arise from the same instrument-will/deed), Interest (equal share), and possession (right to possess whole property).
-A joint tenant’s interest is neither inheritable nor devisable and all joint tenants must have an equal interest in the property.---the right of survivorship isn’t an inheritance or devise (slayer statute may not apply)
-Typically used with related parties or between unmarried partners as a land-ownership and estate planning device
- Able to convey (severance—any overt act intending to sever will do the same thing); the grantee become a tenant in common and JT ends with that share that is conveyed
-can exclude others but not co-owners (cant give cops permission to search other co-tenants stuff)
Policy – Why the law requires such strict language:
a.ii.1.a.i.1. The law favors alienability – Tenancy with the right of survivorship is less alienable
a.ii.1.a.i.2. The law disfavors forfeitures – The death of a joint tenant is seen as a forfeiture because his share simply disappears.
Tenancy in Common
A Tenancy in Common is a concurrent state with no right of survivorship (passes to heirs). Each person has a distinct, proportionate, undivided interest in the property, which is not necessarily equal. Even with this they are still possession the whole estate with the other tenants, which means there are is no automatic ouster (deny access to or get money from) the others from a portion of the property unless you expressly and clearly tell them that you are ousting them. - Each tenants interests is freely alienable, devisable and inheritable—each can mortgage their part
- Typically used between business partners and friends
- Able to convey; grantee is a tenant in common
- Shares can be divided into life estates or future interests
- Can exclude others, but not the other co-owners (cant give cop permission to search others stuff)
- If it is a married couple the divorce decree would state when the house has to be sold, who has the possession of it until then, etc.
Partitions
Any joint tenant or tenant in common may obtain a judicial partition (of their physical share (in kind) or the sell price of their share (in sale)) of the co-tenancy with each of the former cotenants receiving their appropriate share of the whole, but it cannot be done by a single person. -The law favors in kind because of the personal value placed in the property by people---goes to a jury if the asset can be partitioned “in kind” (a family home isn’t)—also can be separated temporally (each person gets it for 3 months etc.) -When a party takes part of the property that isn’t amenable to being partitioned in kind (natural resources and minerals are unevenly distributed) then the person cannot choose which part they want and take that for profits or to keep, the parties must split it equally.

Contribution
If one tenant pays for necessaries (nonpayment means loss of home) then they can get the others share. If he is just making reasonably necessary repairs he must notify/get permission from the other tenants to collect. -If a tenant in possession tries to collect from a tenant out of possession then that can be offset by fair rental value if they are exceeding their portion of ownership.
Tenancy by the Entirety
1. Recognized in only half the states and seldom used in many of them.
2. Save Hawaii, only married couples may hold property in tenancy by the entirety
3. No right of survivorship, no right to partition, conveyances by a single spouse are generally ineffective
Community Property
1. Comes from the Spanish civil code
2. Each item of real and personal property held by the married persons is assumed to be owned 50-50.
3. States which recognize community property do not permit tenancy by the entirety.
Rules from Cases
1. A physically present co-tenant’s refusal to permit entry prevails over another co-tenant’s consent.
a. Dissent: assume the risk
2. If only one of the co-tenant is in possession, he is not required to pay rent to the other as long as the other has not been ousted (excluded).
a. Since A doesn’t have to pay rent, A must bear the costs of upkeep. If outlays are more than fair rental value, A has a right of contribution.
3. Exploiting Natural Resources – a co-tenant is accountable for the profits derived from the land that permanently reduce its value
a. Not entitled to fair share of minerals or oil because of the difficulty in determining the amount and value of minerals. Must pay proportionate amount received to co-tenants
b. Lumber is different because you can see the stuff – can cut your share
4. Any Co-tenant has the right to bring suit to partition the property
a. Can’t unilaterally partition
5. If one joint tenant murders another, a court will typically convert the property to a tenancy in common to prevent the murderer from taking the victim’s share by a right of survivorship.

I. James v. Taylor
a. Mother granted his property to his three children “jointly and severally and unto their heirs, assigns, and successors forever.” Mother retained a life estate. Two of the children predeceased her. Surviving child wanted a declaration that the mother had intended to convey the property to her children as joint tenants, thus making her the sole owner of the entire property by virtue of her brothers’ deaths.
b. Held– No. Not a joint tenancy because the words “jointly and severally” are ambiguous and when a deed is unclear, the presumption is tenancy in common.
c. Note: The court did not allow extrinsic evidence demonstrating that the mother clearly intended to create a joint tenancy.

Predictably, states vary widely on the phrasing that manifests the requisite intent to create a joint tenancy. In most jurisdictions, language such as “to E and F as joint tenants” or “to E and F as joint tenants with right of survivorship” will suffice. On the other hand, phrases like “to E and F jointly” may be insufficient. See James v. Taylor (conveyance to A, B, and C “jointly and severally” created tenancy in common).

II. Jackson v. O’Connell
a. Jackson v. O’Connell– Brother willed his land to his three sisters N, A, & K, as joint tenants. A year before N died, she quitclaim her deeded interest to A. A died, willing whatever interest she had to her nieces. Issue was whether N’s deeding her interest to A, a co-joint tenant destroyed the entire joint tenancy (leaving A and K as co-tenants – nieces would inherit 2/3 share in the land).
b. Held– No. A became the owner of a 1/3 interest in common and a 1/3 joint interest, so the joint interest went to K upon her death. K and the Nieces therefore held the land as tenants in common, K owning a 2/3 share and the nieces owning a 1/3 share.
c. Rule: Conveyance by one of three joint tenants of real estate to another of such joint tenants does not destroy joint tenancy entirely but merely severs joint tenancy with respect to the undivided third interest so conveyed, leaving the joint tenancy in force and effect as to the remaining 2/3 interest.

What if A, B, and C are all joint tenants in Greenacre and C conveys her interest to D? D is a tenant in common because he does not share the unities of time and title with A and B. But C’s conveyance does not affect the unities between A and B; thus, as between themselves A and B are still joint tenants. Greenacre is now held in a hybrid form of ownership: D owns a one-third interest as tenants in common, while A and B each own a one-third interest as joint tenants. See Jackson v. O’Connell

III. Hayes v. Southern New Hampshire Medical Center
a. Karen Hayes owed SNHMC $85,000 for emergency treatment
b. SNHMC moved to attach the land that Karen & her husband Anthony owned as joint tenants
c. They divorced and Karen quitclaimed her interest in the land to Anthony
d. The court held that SNHMC could collect against the land that Karen had owned
d.i. Karen’s quitclaim deed destroyed the joint tenancy, so Anthony does not have a right of survivorship
d.ii. Anthony received Karen’s share of the property subject to SNHMC’s attachment

IV. Land America Commonwealth title Insurance Co. v. Kolozetski
a. Dorothy and John owned land as joint tenants
b. John forged his signature to get a mortgage on the property which he used to buy “a hot tub and two luxury vehicles”
c. After they divorced, the bank sought to recover the money that it loaned
d. The court held that the bank is entitled to ½ of the proceeds of the sale of the house
d.i. John could only mortgage his ½ interest in the property
d.ii. His application for the mortgage severed the joint tenancy and converted it into a tenancy in common
d.iii. So the proceeds of the sale of his ½ of the property go to the bank

V. Hedrick v. Mosser
a. Glendie Mosser and his sister Evangeline Phelps obtained 150 acres of land as joint tenants in 1961
b. Mosser wrote a will in 1972 which stated that “I give, devise, and bequeath unto my sister, Evangeline D. Phelps, my interest in real estate that we own jointly”
c. Phelps died in 1990, then Mosser died in 1994 without having updated his 1972 will
d. Mosser’s heirs insisted that they now owned the 150 acres because Mosser had obtained full title to the land by virtue of the right of survivorship when Phelps died, so when Mosser died there was no “real estate that we own jointly” with his already dead sister
e. Therefore, Mosser’s heirs argued that the land passed to them because there was no other provision for it in Mosser’s will
f. The West Virginia Supreme Court of Appeals ruled against Mosser’s heirs
f.i. Favored the intent of the parties instead of the formal understanding of a joint tenancy
f.ii. “By concluding, based upon strict legal terms, that there was no jointly owned property to pass in the will, the lower court essentially subordinated the intent of the testator and elevated the technical nature of joint tenancy with right of survivorship. The intent of the testator should not be defeated by application of a strict technical view of the words employed, and this Court should not permit the technical attributes of the legal construct of a joint tenancy with right of survivorship or the imprecise use of language in the will to result in obscuring the effectuation of the testator's intent . . .”
f.iii. The court thus reached the opposite conclusion of the court in James, which specifically held that the form of concurrent ownership prevails over the intent of the parties
f.iv. This means that Phelps’ heirs or devisees get the property, not Mosser’s heirs

VI. Duncan v. Vassaur
a. Betty killed Edgar. There was no direct law on point in OK, they had a slayer statute, which disallowed inheritance by a murderer, but it didn’t say anything about survivorship. Important to not that these aren’t the same thing – Joint tenants can not pass anything through inheritance. Upon his death, Edgar had nothing. Survivorship is conceptualized as an undivided share from the outset.
b. By the murder, the joint tenancy has separated and terminated and ½ of the property should go to the heirs of the deceased (murdered person) and the other ½ to the murderer, or his heirs, when deceased – turns property into a tenancy in common.

What if D murders C? As a matter of public policy, the murderer cannot profit from the crime; the murder severs the joint tenancy. D receives only a one-half interest as a tenant in common, and the remaining interest passes to C’s devisees or heirs other than D. See Duncan v. Vassaur

VII. United States v. Craft
a. Husband sold wife land for $1 to avoid IRS unpaid income tax liabilities after he received a notice of government filing lien on the property.
b. Property exempt from debt collection measures—liens, etc.
b.i. Most states: homestead laws exempt person’s principle residence, with similar exemptions on personal effects (clothing), and tools of a trade.
b.ii. Federal law: generally can’t garnish social security benefits or pension payments.
b.iii. Tenancy by the entirety functions as an exception to principle of collecting debt.

One interesting example is the problematic impact of this estate on the national battle against drug trafficking operations. Under federal law, property used to sell illegal drugs, or acquired with proceeds from such sales, is subject to civil forfeiture by government agencies; yet property owned by an “innocent” owner cannot be seized. If property is held in joint tenancy or tenancy in common, the concurrent interest of the guilty spouse can be readily seized; the innocent spouse becomes either a cotenant with the government or receives half of the sales proceeds. But what if the property is held in tenancy by the entirety? Most courts conclude that only the survivorship right of the guilty spouse—whose value is speculative and uncertain—can be forfeited. Accordingly, the innocent spouse is entitled to lifetime use of the property, together with a right of survivorship. This disparity may tend to encourage drug dealers to relocate to states that recognize the tenancy by the entirety. See also United States v. Craft (holding that federal tax lien attached to debtor/husband’s interest in land held in tenancy by the entirety, pursuant to Internal Revenue Code, even though state law would prevent private creditor from attaching husband’s interest).

VIII. RBS Citizens v. Ouhrabka
a. Jan Ouhrabka & his wife own land worth $250,000 as tenants by entirety
b. Jan was the sole owner of Providence Chain Co., which went bankrupt, and he personally owed the bank $500,000
c. The bank sought to attach the land
d. This Court has long held that "the estate of the wife and the husband's interest in her tenancy by the entirety, if validly created, is protected from the husband's sole creditors”
e. The bank argued that “because the original purpose of the estate of tenancy by entirety was to protect the survivorship rights of married women at a time when those were the only property rights which could be held by married women, such an estate is an anachronism with no place in our modern jurisprudence”
f. But the court held that tenancies by the entirety “never flowed from the married woman's common law disabilities; rather, it resulted from the common-law principle of marital unity”
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XIX. Divorce (441-450)
Marital Property
Tenancy by the Entirety (1/2 of States)
Tenancy by the entirety same as joint tenancy (time, title, interest, possession), but adds the requirement of marriage (except for Hawaii). Their still exists a right of survivorship and the tenancy cannot be severed or transferred (even their portion) without both parties consent. Each person can use, exclude, and remove an equal share of income produced by the property.
a. Most states have an elective share statute that gives a certain amount of the estate to the other spouse no matter what, even if the other spouse doesn't pass it to them in the will and they can choose to enact the statute or take the will, whatever is better (this will augment the other property outside of the will through gifts, joint tenancies, living trusts, etc. creating an augmented estate)
b. Most states assume this without clear language
c. Cannot be conveyed to unmarried people.
d. Divorce ends tenancy by the entirety, converts to tenancy in common
e. No partitions
f. States split on personal property (bank accounts)
g. One tenant has no interest separable from that of the other, each is vested with the entire title
h. Judgment proofing-structuring the property so the courts cannot get it (trust is the most common)---protects the stay at home spouse because she cant lose the house if the husband does risky business (some state law has it only applies to real property, but federal law can get it all)

Divorce
Divorce used to require “grounds” and separate the husband’s and the wife’s property in a divorce, but the court would award the wife alimony unless she had been unfaithful or forfeited her right to support. Today there is no requirement of “grounds” (irreconcilable differences) and the property is divided equally through Equitable Distribution, unless it is separate property (prior to marriage or gifts to a specific spouse). If it is martial property (acquired during the marriage) belongs to the spouse who earned it. In case of divorce, the property will be divided between the spouses in a fair and equitable manner. There is no set rule in determining who receives what or how much. This division factors in things such as length of marriage, necessity for either side, and desirability of property.
-Some states allow her to collect repair maintenance for her costs or investment if they supported through it.
-Maintenance (alimony) only applies until the spouse no longer needs it, basically gets married
Equitable Distribution
1. Equitable division of property. Classify everything as separate property or marital property
a. Separate – acquired before the marriage and gifts made specifically to one
b. Marital – all else. Lots of discretion in splitting this up. Can be 50-50 but sometimes other factors will be considered. See # 3
2. Spouses have an equitable claim to things of value arising out of the marital relationship and classify them as subject to distribution by focusing on the marital status of the parties at the time of the acquisition.
a. Professional license could be marital property
b. This is the minority view. Most do not consider an increased earnings potential marital property
b.1. Would either reimburse with interest or give maintenance
3. The division of property must fairly allocate the economic effect of divorce by being based on consideration of the following factors:
a. the length of the marriage and station in life of the parties during the marriage;
b. the age and health of the parties;
c. the earning capacity of the parties, including their educational backgrounds, training, employment skills, work experiences, length of absence from the job market, and custodial responsibilities for children during the marriage;
d. the financial condition of the parties, including the availability and cost of health insurance;
e. the conduct of the parties, including whether there has been unreasonable depletion of marital assets;
f. the desirability of awarding the family home, or the right to live in it for a reasonable period of time, to the party who has primary physical custody of children;
g. the circumstances and necessities of each party;
h. the time and manner of acquisition of the property in question; and
i. the income-producing capacity of the property and the value of the property at the time of division.

I. Young v. Lowery
a. Couple married for around 12 years. Her sons died. She developed alcohol and depression problems. Divorce.
b. Court divides 66% of the property to her and 33% to him. Equitable division (medical expenses).
c. Why equitable instead of equal?
c.i. To make them equal, they need different division
c.ii. State statutes: tells what the goals
c.ii.1. Historically, the way the divorce property distribution did not provide equal distribution
c.iii. Factors to consider:
c.iii.1. the length of the marriage and station in life of the parties during the marriage;
c.iii.2. the age and health of the parties;
c.iii.3. the earning capacity of the parties, including their educational backgrounds, training, em-ployment skills, work experiences, length of absence from the job market, and custodial responsi-bilities for children during the marriage;
c.iii.4. the financial condition of the parties, including the availability and cost of health insurance;
c.iii.5. the conduct of the parties, including whether there has been unreasonable depletion of marital assets;
c.iii.6. the desirability of awarding the family home, or the right to live in it for a reasonable period of time, to the party who has primary physical custody of children;
c.iii.7. the circumstances and necessities of each party;
c.iii.8. the time and manner of acquisition of the property in question; and
c.iii.9. the income-producing capacity of the property and the value of the property at the time of division.
d. Q: why does the TC think that you need this to divide unequally
d.i. how to apply the length of the marriage?
d.i.1.  long marriage: more economic impact and position of the life changed
d.i.2.  she is 44 he is ?
d.i.3. court looking at financial reasons

II. Howard S. v Lillians
a. P's claim: to get a bulk of property due to her egregious acts (extramarital affairs)
b. Court says her acts are not a factor to consider in NY
b.i. See marriage as economic partnership and does not want to get into how spouse treat each other
b.i.1. can you even engage in discovery to find out?
b.i.2. no, there is no set of facts in which these acts can shock the conscience
c. Three steps
c.i. can't get divorced without some cause (not no-fault state): adultery, abandonment
c.ii. in allocating the property, you need some more than what you claimed to get;
c.iii. ordinary adultery is not a basis for unequal distribution (not egregious)

I. Laqualia v. Laqualia
a. How do we divvy up the property once we consider that most of it is held as exempt under the marital property prenup
b. The wife had much more assets prior to the marriage.
c. The trial incorrectly court ordered Karen to pay $300,000 , much more than the property in question was worth
c.i. The trial court likely erroneously looked towards outside assets
d. REMAND: re-evaluate how much each party has to pay by only looking at marital property: have to cite factors related to the value of the property (not the broadest understanding of financial circumstances)

II. O’Brien v. O’Brien
a. Plaintiff and Defendant married. They moved to Mexico so Plaintiff could go to medical school full-time. Defendant taught school and contributed her earnings to their joint expenses. They moved back to America so Plaintiff could finish school. Two months after Plaintiff received is license, he filed this action for divorce.
b. Is a professional license of one party subject to equitable distribution in a divorce?
c. Yes. An interest in a professional or professional career potential is marital property, which may be represented by direct or indirect contributions of the non-title holding spouse.
d. The court reads a broad definition of property to include professional licenses acquired during the marriage. They believe that a professional license is obtained through a joint effort of spouses, not the work of one.
e. Issue: is medical license a marital property
e.i. she has contributed to his obtaining of medical license
e.ii. DCF to get the PV of the future potential income
a. she sacrificed and has forgone

One theme revolves around whether human abilities should be considered property subject to private ownership. The other theme is the practical difficulty of appraising the value of an education. Statistics may have little relevance in the individual case. Someone’s future income will be influenced by a wide range of factors other than their education (e.g., health, interpersonal skills, employer’s solvency). Some courts express concern that any such valuation attempt is largely speculative. See, e.g., O’Brien v. O’Brien (Meyer, J., concurring).

It is well-settled in New York that educational degrees, professional licenses, and other career-enhancements are marital property subject to equitable distribution. The New York statute establishing the equitable distribution criteria directs the court to consider, among other things, the contribution of a spouse to “the career or career potential of the other party.” It further requires consideration of the contributions made to the acquisition of marital property by the spouse not holding title to it, including the “expenditures and contributions and services as a spouse, parent, wage earner and homemaker.”

The leading decision interpreting this standard is O’Brien v. O’Brien, presenting facts strikingly similar to those in Marriage of Graham. The wife worked as a teacher for nine years, allowing her husband to finish his undergraduate degree, graduate from medical school, and complete internship training. Two months after receiving his medical license, the husband initiated divorce proceedings. The trial court awarded the wife $188,800, representing 40% of the value of her husband’s medical license.

The Court had little difficulty affirming this result. It rejected plaintiff’s plea—based on decisions like Marriage of Graham—that the license did not satisfy the traditional definition of property, reasoning that the applicable New York statute created a “new species of property” unknown at common law. The court observed that a working spouse often contributes substantial income and sacrifices personal educational, career, and childbearing opportunities, all to support the other spouse’s pursuit of a professional degree that will ultimately benefit both. Consistent with the premise of equitable distribution that marriage is an economic partnership, it held that the medical license was the product of the parties’ joint efforts, and thus marital property. As a secondary basis for its holding, the court noted that—even outside of the statute—a professional license is a “valuable property right” that, for example, cannot be revoked without due process of law.

III. Elkus v. Elkus

Six years later, Elkus v. Elkus extended O’Brien by holding that a plaintiff opera singer’s career and celebrity status were marital property. The defendant husband sacrificed his own potential career in order to serve as his wife’s voice coach and to care for their children, all of which increased the value of her career. Although plaintiff’s successful career was primarily based on an “innate talent,” the Elkus court reasoned that the appreciation in the value of her career due to the husband’s efforts was marital property.

XX. Community Property, Unmarried Couples & Gay Couples (450-475)
Community Property (Marriage in 9 States)
A Community Property is when the estate starts with the separate property they bring into the marriage, but all property/cash accumulated during the marriage is seen as community property. Both the husband and wife are deemed to equally own all money earned by either one of them during the marriage, even if only one spouse is employed. In addition, all property acquired during the marriage with "community" money is deemed to be owned equally by both the wife and husband, regardless of who purchased it. In a community property state, equal ownership also applies to debts. This means both spouses are equally liable for debts. In most cases, this includes unpaid balances on credit cards, home mortgages and car loan balances.
1. Starts from the premise that marriage is a unity or at least an economic partnership
2. Spouses may own separate property including all premarital property untainted by post-marital additions, gifts made solely to one spouse and inheritances of one spouse.
3. Strong presumption against this – have the burden of showing that its untainted
4. Differences between community property states (page 452)
a. Income generated by separate property
b. Upon divorce, is property divided equally or equitably?
c. Consent to convert separate property to community property. Some won’t allow.
d. Gifts of community property. Some will allow one spouse to act alone as long as its reasonable. Others will set aside any gift.
e. Community debts. Some recognize and others don’t.
f. In all states a spouse can devise one-half of the community property. For an intestate spouse, some have right of survivorship and others give to decedent’s children or descendants.
5. Any couple domiciled in a community property state is subject to the laws for the propery they acquired while there.
Income
1. If earned during marriage, its community property.
2. Retirement plans are treated as community property to the extend they represent income that was earned during the marriage.
a. Some post-employment benefits, disability pensions and workers’ comp, are not deemed to be community property
Fraud on the Community
1. Husband and wife have a fiduciary duty as to the community property
a. A breach of this legal or equitable duty is “fraud on the Community”
2. A third person who knowingly participates in the breach of fiduciary duty may also be liable for fraud
3. Aggrieved spouse has a right of first recourse against the property or estate of disposing spouse but may proceed against the party to whom the funds have been conveyed
4. Allowed to make moderate gifts as long as not capricious, excessive or arbitrary.
5. For sale of community property, most states will protect a BFP.
Property Rights of Unmarried Couples
Unmarried people are traditionally treated as unrelated individuals regardless of the nature of their cohabitation. The court says that there can be an express agreement or even an implied agreement that can be actionable if breached (how to split property).
-Most states will only enforce an express agreement
-If they can create a partnership (joint venture) the court may split property equally
-Can recover on unjust enrichment for services rendered during partnership (may get alimony in some states)
-The meretricious relationship doctrine is extended to same-sex couples, which treats them as married for all intents and purposes.

I. In re Marriage of Horn
a. Is a severance package deferred compensation or a voluntary payout?
a.i. Essentially is community property or separate property accordingly?
b. NFL severance payment
c. after a specified period of time, when the player decides to leave, get the money
d. Holding: since the player had the absolute right of payment it is therefore deferred compensation and goes into the pool of assets up for division

II. Osuna v. Quintana
a. Married man giving another womena and their children property
b. Trial court awards $460K to the real wife (property was within community property)
c. Common law has no redress, statutory here (varies by state)
d. Recognizing that this is community property, what is the justification for $460K?
d.i. Fraud of the community estate
d.ii. Community assets that are dispersed in a capricious, excessive, or arbitrary way may be set aside as constructive fraud against the other spouse
e. Because the mistress knew about the marriage, can’t claim innocence
e.i. What if she didn’t know and didn’t have good reason to know?
e.i.1. More difficult case for real wife
e.i.2. Joint and several liability is tougher if she did not know)
f. Community property is presuptively the property of both couples if attained during marriage

Some states allow either spouse to make reasonable gifts to third parties (e.g., small donations to charity) without consent of the other; other states prohibit all gifts unless both spouses consent. See, e.g., Osuna v. Quintana (gift of community property by one spouse without consent of other spouse was invalid).

III. Marvin v. Marvin

The modern movement toward extending property rights to unmarried couples was sparked by the California Supreme Court’s controversial “palimony” decision in Marvin v. Marvin. Plaintiff Michelle Marvin alleged she entered into an oral agreement with defendant Lee Marvin whereby (a) they would live together as husband and wife, (b) they would equally share their earnings and property, and (c) she would provide “serves as a companion, homemaker, housekeeper and cook.” Plaintiff further asserted that she fully performed the agreement for six years, until defendant expelled her from his house. She sued for half of the $3.8 million that he had accumulated during their relationship.

The court first held that plaintiff could maintain her express contract claim. It acknowledged that a contract between nonmarital partners would be unenforceable if it rested solely on the illegal consideration of sexual services; but it found other lawful consideration, e.g., the agreement to share earnings and property. As the court summarized: “[W]e base our opinion on the principle that adults who live together and engage in sexual relations are nonetheless as competent as any other persons to contract respecting their earnings and property rights.

The second strand of Marvin was more surprising: the court concluded that plaintiff might have enforceable property rights even without an express contract. It observed that unmarried cohabitants might have expectations that courts would “fairly apportion property accumulated through mutual effort,” which should be protected in equity. Citing changing societal mores, the court concluded that moral considerations should not block this result. It also rejected concern about the stability of marriage, suggesting that unmarried cohabitation sometimes served as a trial period before marriage. Accordingly, it remanded the case to the trial court to determine whether the conduct of the parties demonstrated an implied contract, an implied agreement of partnership or joint venture, or a similar “tacit understanding,” and whether principles of quantum meruit, constructive trust, or resulting trust might apply.

In the wake of Marvin, the majority rule is that property rights may exist between unmarried cohabitants. In over 30 states, these rights stem from Marvin theories, most commonly express contract.

IV. Hristek v. Massey
a. Louise and Daniel began to live together as they were each getting divorced in 1993
b. He paid for nearly all of their living expenses
c. They broke upon in 2003
d. She claimed that they had agreed that he would pay the living expenses, she would take care of the home, and they would split all of the property that they acquired
e. Connecticut does not recognize common law marriage
f. She “has utterly failed to prove that any phrases uttered by the defendant in the course of a romantic relationship were intended to form a binding and enforceable contract”
g. His generosity toward her “should not be used to visit upon him the adage ‘no good deed goes unpunished’”

V. Anderson v. DeWitt
a. In 1986, Alfred bought a house for $55,000
b. In 1993, Donna moved in with him
c. She paid $500 per month for housing until they broke up in 2005
d. The house was worth $575,000 in 2005
e. She claimed that they had an oral agreement to share the equity
f. The Minnesota anti-palimony statute provides that contracts between unwed cohabitants are enforceable only if in writing
g. But the Minnesota Supreme court has held that the statute does not apply to protecting your own property
h. So the court held that she was entitled to $162,500, which was half of the appreciation while she lived there

VI. Ontiveros v. Silva
a. Noel Ontiveros & Erica Silva lived together for eight years
a.i. Had children together, whom she cared for at home
a.ii. Filed joint tax returns
a.iii. Bought a house with his income in his name
b. New Mexico Supreme Court had already rejected the Marvin theory
c. Held that there was no joint venture or partnership because no express agreement “to combine their money, property, or time, and to share profits and losses”
VII. Quintana v. Figueroa
a. Angel Quintana & Teresa Figueroa lived together for 20 years
a.i. They were married in a religious ceremony in their native Mexico in 1989, but they never registered their marriage with the Mexican or U.S. government
a.ii. Had three children
a.iii. She handled the finances because his English was poor
a.iv. The house is in her name
b. Illinois Supreme Court “held it would not grant mutual property rights to unmarried cohabitants because to do so would reinstate common-law marriage, which had been abolished by the legislature and would violate the public policy of the state to support marriage”
c. The application of that rule is harsh here, but it is for the legislature to make any change in public policy regarding the property rights of unmarried cohabitants
VIII. Gormley v. Robertson
a. “Whether same-sex can legally marry is for the legislature to decide. But the rule that the courts must ‘examine the [meretricious] relationship and the property accumulations and make a just and equitable distribution of the property’ is a judicial, not a legislative, extension of the rights and protections of marriage to intimate, unmarried cohabitants. We hold that the meretricious relationship doctrine should be extended to same-sex couples.
IX. In re Meretricious Relationship of Long & Fregeau
a. In 1999, David Fregeau left his wife and family to date Jeremy Long
a.i. They shared living expenses and had a “loving and intimate relationship”
a.ii. Long added Fregeau to his bank account so Fregeau could conceal funds from his wife
a.iii. In February 2007, Fregeau divorced his wife
a.iv. They cheated on each other between 2001 and 2007, and they declined to register their same-sex partnership when that became possible in 2007, and split up by 2008
b. Long is entitled to an equitable property division because he had an “equity relationship” with Fredeau
b.i. Relevant factors establishing an equity relationship include continuous cohabitation, relationship duration, relationship purpose, pooling of resources and services for joint projects, and the parties' intent
b.ii. The fact that Fredeau was still married is not dispositive, but rather is only one factor to consider
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XXI. Public Lands (773-784 & Supp. 10-20)
Government Lands
1. Federal agencies regulate public lands (Mausolf v. Babbitt)
a. Expected by Congress to fill in details to laws as circumstances demand
b. Courts defer to what the agency says because they are experts
2. Court will only overturn a decision that is arbitrary and capricious
3. Federal agencies sometimes overstep boundaries (Wilderness Watch v. Mainella)
a. For public land management, often it is about someone objecting and litigating before something changes
What the point?
1. Much different way of make land management decisions.
2. The decisions are governed by the congressional statute and then by the regulatory agencies. Then other laws (Endangered species act) might come into effect.
3. Different than private property

I. Mausolf v. Babbitt
a. Ban of snowmobile in national park for protection of an endangered species (gray wolf)
b. Conflict bet/ snowmobile enthusiasts and thriving gray wolfs
c. Q: what would you expect in a national park? wolf? snowmobile? provided that snowmobiles don't damage the land
d. Q: suppose that there is no wolf. default rule is there shouldn't be snowmobiles
e. C: snowmobiles are the means of enjoying the park v. interest of preserving the park
f. Q: how did the park decide what's allowed and where?
f.i. opinion of official wild life service
f.ii. federal endangered species act
f.iii. concluded that this could be a problem under the endangered species act
f.iv. to limit the kinds of things that anyone could do
f.v. overlay of park service policy
g. Court is trying to figure out whether or not the park acted arbitrarily or capriciously
g.i. not deciding if snowmobiling is good or not
g.ii. defer the federal agencies the exercise of policy promulgation  just see if they followed the test
h. H: enough evidence in there to support park service conclusions and thus not arbitrary
i. Q: what if you are not happy about the decision - get the agency to change his mind - get Congress to change this

II. Wilderness Watch v. Mainella
a. Wilderness Act: designed to preserve those areas where the earth and its community of life are untrammeled by man, where man himself is a visitor who does not remain (Trammel: leaving marks that you've been there)
b. Management of wilderness areas
b.i. use and enjoyment
b.ii. preservation of wilderness character
b.iii. collect scientific information
b.iv. no motor vehicles
b.v. no commercial uses
c. Q: what does the Park Service want to do? increase the access, maintenance
d. Q: why does wilderness watch object?13 more people in the van
e. Q: what's illegal here? general prohibition of the motor vehicles
f. Q: what does the court decide? competing demand, agency tries to find balance and the use of van is not necessary to maintain  park service misinterpreted the wilderness act
g. After the court's decision- congress changed the boundaries of wilderness area

III. Olympic Park Assocs. Mainella

IV. The Ecology Center v. Casteneda
a. WildWest filed this action challenging the nine projects on numerous grounds.
b. Claim
b.i. improperly designated
b.ii. various ways to claim that the plan is flawed (not right counting, science)
b.iii. this group does not want timber cut down
b.iv. “We will reverse a decision as arbitrary and capricious only if the agency relied on factors Congress did not intend it to consider, 'entirely failed to consider an important aspect of the problem,' or offered an explanation 'that runs counter to the evidence before the agency or is so implausible that it could not be ascribed to a difference in view or the product of agency expertise”
V. Utah Shared Access Alliance v. Carpenter

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XII. Real Estate Transfers (553-571)

Real Estate Transfers
Four Phases
1. Pre-Contract
1. Executory Contract
1. Closing
1. Post-Closing
Statute of Frauds
1. Certain contracts are invalid unless they, or some note or memorandum thereof, are in writing and subscribed by the party to be charged
2. Must be sufficient to demonstrate with reasonable certainty the terms to which the parties agreed to be bound
a. Names of the parties
b. Description of the land
c. Intent to sell and buy the land
3. If ambiguous terms are disrupted, extrinsic evidence is admissible to resolve the ambiguity
a. Parole cannot supply the required terms
b. Cannot contradict the memorandum
4. Multiple writings may compromise the note or memorandum
5. Notwithstanding the statute, some oral contracts for the sale of land might be valid
a. Part-performance, equitable estoppel and promissory estoppel
Doctrine of Equitable Conversion
During the executory contract period:
1. Buyer is the equitable owner
2. Seller is the legal owner – has the right of possession
a. Is viewed as a sort of secured creditor
b. May not commit waste
3. Risk of Loss – majority puts on the buyer
a. Massachusetts rule – risk on seller until transfer of title
b. Obligation to maintain is usually one that follows possession and control rather than the legal right to force conveyance through specific performance
b.1. CO doesn’t use the doctrine for allocating loss to a vendee

I. Sterling v. Taylor
a. Writings which confirms sale of real estate satisfies the statute of frauds
b. California law—parties, item to be sold and price are essential terms
b.i. Exhaustive documents not necessary for statute of frauds; bare minimum
c. Essential terms were listed and reinforce price of Sterling

II. Brush Grocery Kart, Inc. v. Sure Fine Markets, Inc.
a. Hail storm damage—how ought this affect the purchase agreement?
b. Equitable conversion
b.i. Why does court allow for reduced value in setting price as opposed to keeping its value as the same from the outset
b.ii. Court refuses to apply here: buyer was not in possession,
c. IF something materially damages, place that burden upon the seller if they do not own possessory interests
d. Who bears the risk during the course of the sail

There is a clear trend away from equitable conversion. See, e.g., Brush Grocery Kart, Inc. v. Sure Fine Markets, Inc. (refusing to apply equitable conversion where buyer was not in possession when premises were damaged).

III. Donnelly v. Taylor
a. Taylors are not at fault, do the Donnelly’s have any other recourse?
a.i. Perhaps against the inspectors, depending on the nature of the contract
b. Taylor didn’t say there wasn’t a bat and contract included an “as is” clause
b.i. Affirmative duty to disclose come from statutes and not contracts

Can the parties expressly agree to relieve the seller of the common law disclosure obligations? A clear, specific wavier will be enforced in most jurisdictions. The law is less clear on the effect of the simple “as is” clause, yet some courts will find a waiver here as well. See, e.g., Donnelly v. Taylor (due to “as is” clause, sellers had no duty to disclose latent defect to buyers).

IV. Reed v. King
a. Murder at house, recent buyer wants remuneration for difference
b. Disclosure of price-altering data, insofar as such data is unavailable to a due diligence inquiry
b.i. Does the shifting landscape of due diligence (google search) affect the result of this case

Suppose a former resident contracted AIDS or a mass murder occurred in the home. See, e.g., Reed v. King (seller had duty to disclose that mass murder had occurred in house ten years earlier).
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XXIII. Property Quality & Recording Systems (571-590)
Property Quality
“As is” Clause
1. Latent defects – Caveat Emptor
a. Defects not discoverable by a reasonable inspection or opportunity to inspect is impeded by sellers – Caveat emptor doesn’t apply unless there is an “as is” clause.
b. Doctrine doesn’t apply when there is a fraudulent misrepresentation
2. “As is”
a. No duty to disclose but seller may not actively misrepresent or conceal
3. What about latent defects not discoverable by a reasonable inquiry
Duty to Disclose
In general, the seller of real property has the duty to disclose any fact that materially affects the value or desirability of the property.

Recording System
Only gives protection to those who give value for the deed
Statutes
1. First in time, first in right.
a. Must be deliver
1. Race Statute
a. Whoever registers first prevails, regardless of any notice to the later purchaser
a. Not super fair to prior parties
1. Notice Statutes
a. A subsequent purchaser who lacks notice of an earlier unrecorded conveyance prevails against that earlier unrecorded interest
a. If you have notice, regardless or whether or not you believe the its valid, you cannot prevail
1. Race-Notice
a. A subsequent purchaser who lacks notice of an earlier unrecorded conveyance and who records prevails against that earlier unrecorded interest
Notice
1. Actual
2. Constructive
3. Inquiry Notice
Bona Fide Purchaser
1. Takes conveyance of real estate in good faith
a. Not BFP if reasonable person should have known others have made claims hostile to his grantor’s claim
b. Exception when possession is consistent with the record title
2. Recording systems protect BFP against an off-the-record interest that is capable of being recorded

I. Stambovasky v. Ackley
a. Former owner tried to exploit (publicize) haunted nature of house
b. Non-local buyer never finds out about this
c. An “as is” clause does not extend to those thing peculiarly within the knowledge of the seller
d. What is the threshold of the burden due diligence imports?
e. Seller here both affirmatively created and sought to publicize
f. Failure to let buyer know is actually cause to get them out of the contract
f.i. What if the buyer wants to know if anyone here has ever had AIDS?
f.i.1. Irrational fear, stigma of non-disclosure statute
f.i.1.a. Can’t provide or ask for certain types of information
g. Many states have enacted non-disclosure statutes, does this cut against the presence of equitable “wiggle room”?
g.i. Can you pursue an equitable remedy in the face of a stigma statute?

The leading case on point is Stambovasky v. Ackley, where the buyer sought to rescind the contract for the purchase of a New York house due to the seller’s failure to disclose that the house had a reputation for being haunted by ghosts. The plaintiff-buyer alleged that the seller had created the reputation by publicizing her sightings of “spectral apparitions” to Reader’s Digest and local newspapers, and that this stigma greatly reduced the market value of the property. Because New York still followed caveat emptor, however, the trial court dismissed the complaint. In an amusing, tongue-in-cheek decision, the New York appellate court reversed, holding that on these facts the seller was obligated to disclose.

The Stambovasky court’s apparent rationale is somewhat strained. At least superficially, it reached its result by distinguishing prior New York caveat emptor cases on the basis that the buyers’ prudent inspection might have revealed the defects, whereas in Stambovasky “the most meticulous inspection and search would not reveal the presence of poltergeists at the premises or unearth the property’s ghoulish reputation in the community.” Yet this is an obvious understatement. Although the court humorously muddled the issue, the plaintiff was seeking to rescind based on the house’s reputation for being haunted, not because the house was actually haunted. This “ghoulish reputation” was in fact easily discoverable by the simple expedient of asking any neighbor about the house in general terms, e.g. “Is there anything special I should know about that house?” More fundamentally, the result in Stambovasky stems from the same policy factors that have fueled the national movement away from caveat emptor. The court refers to these policies only obliquely, noting that “fairness and common sense” compel an exception to caveat emptor.

At bottom, Stambovasky is a transitional case, a stepping stone for future New York courts between caveat emptor and the modern disclosure standard. Consider the new test that the case offers: “Where a condition which has been created by the seller materially impairs the value of the contract and is peculiarly within the knowledge of the seller or unlikely to be discovered by a prudent purchaser exercising due care with respect to the subject transaction,” the seller’s nondisclosure allows the buyer to rescind. This reasonably close to the national standard except for the odd requirement (clearly linked to the facts of Stambovasky) that the seller must have created the condition.

Decisions that allow rescission based on nondisclosure of an intangible defect threaten one of the enduring policy themes underlying American property law: protecting the stability of land title. As Stambovasky illustrates, courts often attempt to mitigate the impact of rescission in such instances by requiring proof that the stigmatizing defect in fact reduces the property’s market value. In a broad sense, a reduction in market value can reflect a public consensus that the particular defect is material.

II. Caruso v. Parkos
a. Susan bought out Carol; dysfunctional family issue
b. Virginia signed and conveyed; at that point Virginia’s interest ceasesd
c. Fact-finding that James had notice as early as may
d. The difference between the race-notice and the notice?
e. Notice is relevant only insofar as second person has notice of first person
e.i. James would win if this were a purely race statute

In order to deliver a deed, the grantor must manifest by words or actions an intent that the deed be immediately effective to transfer an interest in land to the grantee. See, e.g., Caruso v. Parkos (“The vital inquiry is whether the grantor intended a complete transfer—whether the grantor parted with dominion over the instrument with the intention of relinquishing all dominion over it and making it presently operative as a conveyance of title to the land).

In many real property sales transactions, the deed is conditionally delivered to an escrow agent with instructions that it be delivered to the grantee when the contract conditions are met. Although a deed cannot be conditionally delivered directly to a grantee, it may be conditionally delivered to a third party. The escrow agent is essentially a neutral third party who is retained to facilitate the transaction, usually an attorney, title insurance company, escrow company, or financial company. An unconditional delivery to the grantee’s agent is deemed a valid delivery to the grantee. For example in, Caruso v. Parkos, the grantor gave the deed to her attorney so that it could be recorded; the attorney later testified that he considered himself to be acting as an agent of the grantees for the “limited purpose of filing the deed,” and the court found this to be a valid delivery.

It is well-settled that a deed induced by the grantee’s fraud is voidable in an action brought by the true owner against the grantee. A deed is voidable if it is procured through undue influence. See Caruso v. Parkos

Actual notice simply means knowledge of the prior interest. A person who knows that a prior interest exists has actual notice. See, e.g., Caruso v. Parkos

III. Raub v. General Income Sponsors of Iowa
a. What the banks knew or didn’t know speaks to their status as bona fide purchasers
a.i. Because the nature of the title would be voidable
a.i.1. You can convey voidable title, not a void title
b. Raub and bank are both innocents (realtively innocent)
c. That they are both innocent, we can’t place burden onto the banks because they can bear the burden more adequately

Some courts hold—quote appropriately—that if the tenant’s possession is consistent with a recorded lease, the purchaser has no duty to inquire further. See also Raub v. General Income Sponsors (where grantor delivered deed, which was recorded, but retained possession of property, his possession did not impart notice).
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XXIV. Intro. to Land Use & Express Easements(591-599;605-611 & Supp. 21-25)

Land Use & Easements
How to Control Land Use
Private
1. Fee Simple Ownership
1. Easement
1. Covenant that runs with the land
1. Nuisance law
Government
1. Ownership of land
1. Regulation
a. Zoning law
a. Direct regulation
Easements(the right for using another’s property—not possession, just one stick in the bundle (1) Express/Implied; (2) Reserved/granted; (3) affirmative/negative; (4) Appurtenant/in gross; (5) dominant/servient; (6) exclusive/non-exclusive
Distinctions
Affirmative is when the owner of the easement has a right to go onto the land of another and do some act.

Negative is when the owner of the easement can prevent the owner of the servient land from doing some otherwise legal act on the servient land. This is limited to easements for light, air, lateral support, or flow of artificial stream and includes the limiting of granting other easements.
-Conservation easement – a particular kind of negative easement which is designed to preserve servient land in undeveloped or natural state (benefiting non-profits or governmental entities)---difficult to enforce it, unless a governmental entity owns it
-Negative easements are frowned upon, don’t want to restrict what people can do with land
Appurtenant is an easement is attached to land that passes with the possession of the dominant tenement and doesn't need to be expressly mentioned in the deed.
-May not be used for the benefit of property other than the dominant estate unless otherwise stated
In Gross is an easement that is a personal right, not attached to land (keeps it if the land is passed).
-Traditionally, could not convey a right in gross because don’t like restrictions to use of property, but nowadays, courts are more willing to do it
-Most jurisdictions today allow the easement in gross to pass along -Hard to determine and not a uniform approach, which type the easement is through the language— they will ask the kind of right that is trying to be passed normally be given to the land or the person?—also grantors intent and interference of someone’s rights with another’s right

Private Servitudes
1. Easements – right to make a specific limited use of land possessed by someone else
2. Profit – right to remove something of value from someone’s land
3. Covenant – restricts a person’s use of the land
4. License

Vocab & Rules
1. Appurtenant – easement is attached to land
a. May not be used for the benefit of property other than the dominant estate unless otherwise stated (Christensen v. City of Pocatello)
2. In Gross – easement is a personal right, not attached to land, if land is sold, you still have easement
a. Traditionally, could not convey a right in gross because don’t like restrictions to use of property, but nowadays, courts are more willing to do it (Hagan v. Delaware Anglers’ & Gunners’ Club)
b. Most jurisdictions today allow the easement in gross to pass along
3. Negative - negative easement conveys rights to demand the servient owner reform from certain otherwise permissible uses of his own land (like a Conservation Easement)
a. Under CL, servient owner may make any use of the land which does not unreasonably interfere with the use and enjoyment of the easement, including granting additional easements
b. Conservation easement – a particular kind of negative easement which is designed to preserve servient land in undeveloped or natural state
c. Negative easements are frowned upon, don’t want to restrict what people can do with land

Reserved or granted
Reserved is when you hold back an easement out of the property you are giving, while granting is giving the person you are transferring the property to an easement.
-Traditional common law rule says that you cannot reserve an easement in favor of a party that isn’t a party in the transaction (Stranger of the deed) as certainty in title is favored (15 states follow this), but the modern rule is that you can (23 states)

Expressed Easements
An Expressed easement must be in writing and signed by the grantor (passing SOF) or if it is oral then the grantee has a license to use the land (revocable at anytime, except for estoppel claim). -Conveyed by grant (direct right of way) or reservation (reserves a right of way)

I. Hagan v. Delaware Anglers & Gunners Club (1995)

II. Leabo v. Lininski (1981)

III. Estate of Thomson v. Wade (1987)

IV. M.P.M. Builders, LLC v. Dwyer (2004)

V. Christensen v. City of Pocatello (2005)
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XXV. Implied Easements & Termination of Easements (611-633)
Non-Express Easements
1. Prescriptive Easement – occurs from a use of another’s land adverse to the owner of the land or the owner’s interest in the land against which a servitude is sought
a. One has to show an open, continued, and unmolested use of the land in the possession of another for a statutory period, it must be hostile or adverse, and permissive use can never become an easement
2. Implied Easement from prior use – 4 requirements
a. common ownership of both properties at one time,
b. Followed by a severance,
c. use occurs before the severance and afterward,
d. Notice (use was so long continued and so obvious as to show that it was meant to be permanent),
e. Necessary and beneficial (reasonable, not “strict necessity”)
3. Necessity – giving an easement to landlocked land or vice versa
a. Have to show that the land all used to be owned by one person, and at the time, it had been used and was necessary to use this part of the land to get to the newly sold part of the land
b. High degree of necessity has to be shown, not just convenience
c. Law doesn’t like to sanction hidden easements, if you want one, bargain for one (Schwab v. Timmons)
d. Ends when the necessity that created it ends
e. Weighs the burden of not having it with the burden on the owner of the land if they do
f. Some courts don't let the grantor in a deed have an implied necessity over property they convey
g. Statutes are used as well
4. Easement by estoppel - when an owner of property misleads or causes another in any way to change the other’s position to his or her prejudice (Kienzle v. Myers)
a. Requirements
a.1. Has to rely upon it to prejudice or detriment, and rely upon it changed his position
a.2. Party has to suffer injury
a.3. First party must engage in misleading conduct
a.3.1. However, we’re not sure if this misleading requirement is held that strongly anymore in different jurisdictions
b. Easement by estoppels are very rare, courts normally won’t bail you out when you get stuff
c. Ends when fairness no longer requires that easement to continue
d. Courts don't want to enforce them because: 1) penalize neighborly cooperation; 2) undermine recording schemes;
e. Courts take a hard approach to implied easements because express easements are easy to make and “hidden easements” aren’t good policy.
5. Implied Reciprocal Easement (See implied covenants)
Scope of easement
The scope is limited by what it says, if nothing: limited by reasonableness
(Leabo v. Leninski – where easement was for plaintiff to get to beach, not everyone else)
The serviant estate can use the easement in any way that does not overburden or destroy the easement (restatement)
Cannot benefit the serviant estate

Transferring Easements
If the easement is non-commercial it is normally not transferable, but if it is commercial then it is transferable----this is the default rule that can be overcome with strict language or if you go and buy your easement.
Reserving Easements for Third Parties
Traditional common law rule says that you cannot reserve an easement in favor of a party which is not a party in the transaction as certainty in title is favored (Estate of Thomson v. Wade)
This rule has become the minority rule, 15 states follow it
Majority rule – 23 states now allow this
Relocating or Changing an Easement
1. Majority Rule - can’t do it without both parties consent
2. Minority Rule(Restatement approach) - Owner of the servient estate is entitled to make reasonable changes to the location or dimensions of an easement, at the servient owner’s expense, to permit normal use of development of the servient estate, but only if the changes do not
a. significantly lessen the utility of the easement
b. increase the burdens on the owner of the easement in its use and enjoyment, or
c. frustrate the purpose for which the easement was created
Terminating an Easement
Scope of an Easement
The scope of the easement is determined by what the easement was created to do, if what the change is departs from the original purpose, you can get an injunction to stop that change (Preseault v. United States)
1. If underlying purpose of easement no longer exists, easement terminates
Ways to terminate an Easement
1. Abandonment – once you abandon the easement, terminates (Preseault v. United States)
a. Simple non-use does not count as abandonment
b. Requires act by the owner of the dominant tenement conclusively and unequivocally manifesting either a present intent to relinquish the easement or a purpose inconsistent with its future existence
2. Expiration – at the end of a specified duration
3. Consent to Release – Both parties
4. Merger – same person owns both dominant and servient tenement
5. Prescription – servient owner uses land adversely to the owner for a sufficient period – goes both ways
6. Forfeiture – dominant owner abuses easement in a way that cannot be resolved by injunction or upon a failed attempt to convert an easement appurtenant into an easement in gross.
7. Estoppel – servient tenement relies upon the statements of the easement owner
8. Condemnation – government exercises eminent domain powers
9. Easement by Estoppel ends if due to changes circumstances, fairness no longer requires the easement to continue
10. Easement by necessity ends once the necessity ends

I. Thompson v. E.I.G. Palace Mall, LLC (2003)

As a general rule, proof of the other elements—open, notorious, continuous, and uninterrupted use—creates a presumption that the use was adverse and under a claim of right. But see Thompson v. E.I.G. Palace Mall LLC (use deemed permissive).

II. Schwab v. Timmons (1999)
a. Issue: Whether the Schwabs have an easement by necessity to the private road. (in this case, the Scwabs had two properties. They conferred the northernmost property to someone else, and in their other property, they cannot get to the public road, so they are asking that they can extend the private road and they say that they have an easement by necessity to it.)
b. The court decides that there is not an easement by implication, because the situation is more like an easement by necessity. The court says that they do not have an easement by necessity, because for an easement by necessity, you have to show:
b.i. 1) common ownership of the two parcels prior to severance of the landlocked parcel: this cannot be shown because the US never severed a landlocked parcel of its property; they would have not been landlocked had they not sold their other property
b.ii. 2) that the owner of the now landlocked parcel cannot access a public roadway from his or her own property: they were not conveyed landlocked property, and when they had the two parcels, even though it would have been difficult to get to the public road, it was not impossible
c. A person who bought a ticket was denied in access of race horse - he sues and claim that buying the ticket gives them property right to access
d. Ct: it's a breach of contract, it does not give the right of entry (property right)
e. What right do movie ticket, museum ticket give you?
f. R: no property right: rather what you get is contractual right (license to be on the property) - license can be revoked unitarily by the giver

Most courts still recite the traditional rule that strict necessity is required. In order to establish an access easement under this approach, an owner must prove that the severance of title caused the property to be absolutely “landlocked.” In other words: (a) the parcel must be entirely surrounded by privately-owned land, without touching any public road; and (b) the owner must not hold an easement or other legal right of access to cross the adjoining land to reach a public road.

Under this view, if the owner has any legal means of reaching the land—regardless of how inconvenient, expensive, or impractical it may be—no strict necessity exists. See, e.g., Schwab v. Timmons (cliff and rocky terrain).

III. Marrone v. Washington Jockey Club (1913)***
a. A person who bought a ticket was denied in access of race horse - he sues and claim that buying the ticket gives them property right to access
b. Ct: it's a breach of contract, it does not give the right of entry (property right)
c. What right do movie ticket, museum ticket give you?
d. R: no property right: rather what you get is contractual right (license to be on the property) - license can be revoked unitarily by the giver

A license is informal permission that allows the licensee to use the land of another for a narrow purpose. The license is routinely encountered in everyday life. The spectator at a football game, the guest at a New Year’s Eve party, and the customer at a grocery store all hold licenses. Cf. Marrone v Washington Jockey Club (holding ticket to race track was a license)

IV. Kienzle v. Myers (2006)
a. Sewage line—What is it that gives rise to the easement
b. What happened: detrimental reliance:
c. Most courts agree with trial court - only estoppel: not only reliance and misterpresentation of the party  easement
d. But appeals (minority) - mislead or cause another (they caused another to rely even if they didn't mislead  easement by estoppel)
e. Q: why didn't this work in race track case? - reliance was different - most jurisdictions in these facts, there is no easement - easement by estoppel is by far least common

V. Jones v. Sparks (2009)
a. Jones and Stamper owned neighboring land along Highway 89
b. In 1992, Stamper agreed to allow Jones to build a road across his land in order to better access the highway
c. Jones paid Stamper $500, built the road, and maintained it over the years
d. When Stamper dies, his heirs denied that Jones had an easement
e. The court held
e.i. No express easement because no writing as required by the statute of frauds
e.ii. No easement by estoppel because Stamper did not mislead Jones or believe that Jones would rely on his conduct
e.iii. No easement by implication because no original common ownership
e.iv. No easement by necessity because Jones could access his land in another, though less convenient, way

VI. Preseault v. United States (1996)

On the other hand, the easement holder cannot change the scope of the easement so as to impose an unreasonable burden on the servient land. See e.g., Preseault v. United States (use of railroad easement for public hiking and biking trail was imposed unreasonable burden on servient tenement)

Abandonment hinges on the easement holder’s intent: he must affirmatively intend to relinquish his rights. Courts generally use an objective standard to determine this intent, based on the circumstances of each case. Abandonment will be found if the holder both (a) stops using the easement for a long period and (b) takes other actions that clearly manifest intent to relinquish the easement. For example, in Preseault v. United States, the court found abandonment of a railroad easement where the holder: (a) failed to use the easement for 26 years; and (b) remove the rails, switches, and all the other railroad equipment from the servient land, thus making future railroad use impossible. Courts tend to be hostile toward the abandonment doctrine—because it may have a disastrous impact on the dominant owner—and hence it is usually difficult to terminate an easement on this basis.

VII. Matoush v. Lovingood (2008)
a. Carol Matoush owns a lot benefited by an easement on David & Debra’s Lovingood’s property
a.i. The easement is a 10-foot wide, 90-foot long strip of land that connects Matoush’s property to an alley
a.ii. It was established in a 1977 deed, but it was never used by Matoush, though the land is used by the Lovingoods
a.iii. Matoush wants to sell her lot to a buyer who would replace the old driveway with a new driveway across the easement
b. Has Matoush abandoned her easement?
b.i. No, because “the use of the easement area, even in a way that prevents use of the easement, is not adverse and will not trigger the statutorily-mandated period of time for adverse possession until the easement holder needs to use the easement, demands to use it, and is refused the right to use it”
b.ii. Yes, according to dissenting Justice Coats, who would have held that the time begins to run “upon open, notorious, and incompatible usage by the servient estate,” instead of “only upon need, demand, and refusal”
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XXVI. Conservation Easements & Covenants (633-641, Supp. 26-31, article 753-769, Nature Conservancy website)
Covenants (Promise by a single party to do/or not do something ot the land)
A Covenant is a promise to do or not do something regarding the use of land. Can be Affirmative Covenants (promise to do something: cut lawn, maintain fence, etc) or Restrictive Covenants (promise to not do something: build detached garage, etc). -----normally affects the nature, quality, use enjoyment, or value
-MUST BE CREATED IN WRITING
-Policy on both sides to enforce them either you give people what they bargain for, but by keeping them then adequate marketability of land is decreased, public policy changes, windfall created

The Benefit and Burden of Covenants fall into two categories
1. Appurtenant - benefits the dominant tenement (running with the land)
2. In gross – personally benefits the holder (personal)
Further Classification
1. Running with the Land - Benefit or Burden passes automatically
2. Personal - not transferable, doesn't run with the land

They require that the real covenant relate to the covenanter’s use of his land. They were originally very restrictive to actual uses/non-uses, but now include not to engage in business that competes, pay rent held to concern the land, granting option to purchase property, agreeing to enter into arbitration over land, and pay homeowner’s association dues.
Run with Land? (determine the benefit and burden running separately)
1. Contracting parties must intend that successors are bound
a. If unclear, look at the purpose
b. For something that isn’t in being (a wall to be built), assigns aren’t bound unless specifically mentioned
2. Covenant must “touch” and “concern” the land
a. Negative covenants almost always satisfy b/c they affect how the land can be used
b. Positive covenants are more difficult
3. Privity of Estate
a. Horizontal Privity – the transaction of which the promise is a part includes a transfer of an interest either in the land benefitted by or in the land burdened by the performance of the promise.
a.i. Examples: Conveyance of Land, Leases, Co-ownership interests, Easements.
a.ii. A mere agreement won’t do
a.iii. Other Considerations: Three different views of when HP is required
a.iii.1. Benefit and burden to run with the land
a.iii.2. Only for the burden to run, not for benefit (majority view)
a.iii.3. For neither to run.
b. Vertical Privity – must convey the whole estate. Fee simple to fee simple. Can’t convey a life estate. is found when the successor must hold the entire estate in land held by the original party.---lessee couldn't have a burden enforced against them. However, a benefited party could sue the owner of the reversion and possibly the lessee for waste.
Equitable Servitude
1. A covenants that will be enforced in equity, not law. Typically injunctive relief.
2. Requirements
a. Original parties must have intended that the covenant bind and benefit successors
b. Horizontal Privity is not required, VP is but the definition is loosened
c. Still must touch or concern
Covenants in Gross
Recognition for Covenants in Gross has been slow. Many states still do not accept them. The RS does.
Rules for Enforcement
Majority Rule - you property must receive the benefit of the covenant in order to enforce it
Restatement Third - establish a legitimate interest in enforcing it
Only changes for covenant in gross
Rule of Construction - favors appurtenant over gross
Implied Covenants
Real covenants may not be implied, they must be in writing, but equitable servitudes may be implied.
1. Reciprocal negative easement or implied equitable servitude
a. Arises when an owner of two or more related lots sells one with restrictions to benefit the retained lot, so the servitude becomes mutual
b. Must apply to the entire subdivision
2. Common Scheme or Plan – requires that most of the houses have the restriction
Common Interests Developments
If there is evidence of a common scheme (still required to have the same covenant requirements, but have all the plots of a subdivision have the same or a uniform (maybe certain areas with other requirements)) then any person in the subdivision can enforce the covenant.---can enforce an implied reciprocal negative easement
Two categories of restrictions
1. Set forth in master deed or in the declaration
a. Should be clothed in a strong presumption of validity – only over turn if in violation of public policy or some fundamental constitutional right
2. Promulgated by the HOA or based on HOA’s interpretation
a. Subject to a reasonable test – balance the benefits of the restriction against the burden. Can’t be arbitrary. ----jurisdictional spilt if post purchase restrictions apply
b. People must adhere to both covenants and zoning laws, and must meet the more restrictive one of the two.
Doctrine of Changed Conditions
1. If the circumstances have changed so significantly so as to render the covenant worthless, they won't enforce it. Must be really radical changes.
a. Destroy the essential objects and purposes of the agreement
b. Consider the subdivision and the surrounding area

They terminate through expiration (expressed/statutory time), merger (own both burdened and benefited), release (written), unclean hands (enforce against owner), abandonment, eminent domain, public policy. Racially restrictive covenants were enforceable, but the SC deemed that state court enforcement is deemed state action and thus unconstitutional.

The 14th Amendment has been used to throw out discriminatory covenants –doesn’t get applied to the agreement but rather to the courts enforcing them

I. Windham Land Trust v. Jeffords (2009)
a. Conservation easement placed on land: residential and recreation purposes only, while mindful of enviornmnetal practices
a.i. Windham Land Trust owns, private environmental organization, they hold the conservation easement
a.ii. Easement ensures right to restrict what happens on the farm
a.iii. Easement is a misnomer here, usually easement specify allowable conduct
a.iv. Covenants are what is typically referred to
a.v. Conservation easement are good navigable ground between normal easement and covenant
a.v.1. Here the Jeffords can get a tax break; lower value on property taxes (can’t build subdivisions); lower estate tax; charitable bonus
b. Why would Jeffords buy property subject to conservation easement
c. Jeffords say their intended use is recreational
d. Court disagrees—what the problem is here is residential; they are charging people
d.i. An annual party of comparable size would probably be allowed
d.ii. You don’t look to an easement regarding simply its general intent and purpose (here this did not interfere with ecological purposes) but rather to its specific terms
e. Government and Windham trust can have interest in enforcing this easement
e.i. Heirs to property might have interest, others with easements
f. How have they been able to annually hold this concert?
g. Renegotiation or being able to cabin, restrict concern impact

II. Neponsit Property Owners’ Association, Inc. v. Emigrant Industrial Savings Bank (1938)

Probably the most influential is a standard pioneered by Dean Harry Bigelow that focuses on how the covenant affects the fair market value of the respective parties’ interests in land. See e.g., Neponsit Property Owners’ Ass’n, Inc. v. Emigrant Indus. Sav. Bank (endorsing Bigelow standard).

There is a clear trend toward holding that monetary payments related to the land do “touch and concern.” Probably the clearest example of this trend involves covenants to pay homeowners association dues. See e.g., Neponsit Property Owners’ Ass’n, Inc. v. Emigrant Indus. Sav. Bank

Most courts allow suit on the theory that the homeowners association is acting as an agent for the benefited lot owners. See e.g., Neponsit Property Owners’ Ass’n, Inc. v. Emigrant Indus. Sav. Bank

If the obligation remains unpaid, the plaintiff may collect by foreclosing on the lien. Cf. Neponsit Property Owners’ Ass’n, Inc. v. Emigrant Indus. Sav. Bank (action to foreclose lien).

III. PCS Phosphate Co., Inc. v. Norfolk Southern Corp. (2009)
a. In 1965, Norfolk built a rail line to serve the phosphate mine
a.i. Norfolk acquired easements across five miles of land
a.ii. The easement deeds provided that Norfolk “at its expense shall relocate the . . . track” if the mine needed to relocate it after 10 years
a.iii. In 2004, the mine’s new owner wanted to relocate the track, but the railroad’s new owner refused to pay for it
b. Can the mine force Norfolk to pay for the relocation?
b.i. Must touch and concern the land
b.i.1. Yes, it “protects the physical value of the land”
b.ii. Must be privity of estate
b.ii.1. Yes, the litigating parties are related to the original parties
b.iii. Must have intended the benefits and burdens to run with the land
b.iii.1. Yes, because the deed applied to Norfolk’s “successors and assigns” and because the purpose of the covenant was to last as long as the easement was needed

IV. Tulk v. Moxhay (1848)

The American law governing real covenants is so confusing that one text describes it as an “unspeakable quagmire.” In contrast, the equitable servitude developed during the nineteenth century in the English equity courts; these courts were more willing to tolerate private land use restrictions in order to avoid unfairness and inequity. See Tulk v. Moxhay

The equitable servitude was born in Tulk v. Moxhay, a landmark 1848 decision of England’s chancery court that vividly demonstrated the short-comings of the real covenant. Tulk conveyed Leicester Square, a privately-owned park in London, to one Elms. Elms promised in the deed to maintain the property “in an open state, uncovered with any buildings.” Apparently Tulk wanted this promise in order to benefit several houses he owned that fronted the square; it ensured that Tulk’s tenants could both use the park as a private, fenced garden and enjoy the view from their houses.

Moxhay eventually acquired title to the square with actual notice of the promise, but claimed that it did not bind him. This conclusion was quite correct under existing English law. The promise could not be enforced in the law courts as a real covenant against Moxhay, a successor, because no horizontal privity existed between Tulk and Elms, the original parties; in England, only a landlord-tenant relationship created horizontal privity.

Undaunted, Tulk sued in chancery court for an injunction and prevailed. The key to the ruling was that Moxhay had notice of the promise before his purchase. Given this advance notice, the court reasoned, it would be inequitable to permit Moxhay to violate the restriction. “[F]or if an equity is attached to the property by the owner, no one purchasing with notice of that equity can stand in a different situation from the party from whom he purchased.” Otherwise, the court suggested, an original purchase (like Elms) could buy land at a price that was reduced due to a restrictive promise and then resell the land for a greater price to a successor (like Moxhay) who could freely ignore the promise.

Yet another theme may lurk below the surface of the opinion. Nineteenth-century London was already an urban metropolis where open parkland was rare. Allowing Moxhay to build on the square might be inefficient; it could potentially case more damage to the value of Tulk’s houses than it would increase the value of the square. In this situation, enforcement of Elms’ promise against his successor Moxhay promoted productive land use. The traditional concern of the law courts that restrictions would impair productivity was inapplicable.

In general, the successor must have notice of the promise before acquiring his interest. The celebrated English decision of Tulk v. Moxhay expressly requires notice as an element of the equitable servitude, apparently in all cases. Under the prevailing American view, however, the notice requirement arises indirectly from the state recording statutes, not as a direct element of the equitable servitude.

The only potential different between the English and American rules involves the owner who acquires title by gift. A devisee, heir or other done cannot qualify for protection as a bona fide purchaser; under the American rule, a done is bound by a prior promise even without notice. In contracts, Tulk v. Moxhay suggests that in England a promise is unenforceable against any successor who lacks notice, whether purchaser or done.

The notice requirement can be satisfied by: (1) actual notice; (2) record notice; (3) imputed notice, or; (4) inquiry notice

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XXVII. Covenants (641-661 & Supp. 52-54)
Intent
Some advocate only asking whether the parties intend for the covenant to run
Touch & concern
Restatement would abolish, but few jurisdictions have adopted that approach
Vertical privity
Most jurisdictions require
Some jurisdictions require for the benefit to run, but not for the burden to run
Horizontal privity
Three approaches for real covenants
Required for the benefit to run and for the burden to run (traditional rule)
Required for the burden to run, but not for the benefit to run (Restatement)
Not required for either the benefit or the burden to run
Not required for equitable servitudes

I. Shaff v. Leyland (2006)
a. Respondent property seller appealed a judgment of the Hillsborough-northern Superior Court (New Hampshire), which granted petitioner property buyer summary judgment in the buyer's action seeking a declaratory judgment that a restrictive covenant did not limit the number of homes to be built on the buyer's property. The trial court found that the seller lacked standing.
b. The seller conveyed approximately twenty-three acres to the buyer by a warranty deed that contained a restrictive covenant that limited construction to a colonial-type residence of a specified value. The seller no longer owned other land in the area. On appeal, the court concluded that the restrictive covenant was created to personally benefit the seller as the owner of land that benefited from enforcement of the restriction. Thus, the restrictive covenant was appurtenant, and the seller held the benefit personally. Accordingly, the seller did not have standing to enforce the covenant because she no longer owned land that benefited from the covenant. The restrictive covenant contained in the deed to the buyer expressly stated that the burden would run with the land but expressed no intent regarding the benefit of the covenant or the type of covenant conveyed.
c. OUTCOME: The court affirmed the judgment
d. Why does it matter whether or not she owns any land?
d.i. covenant said "burden will run with the land" –the burden passes automatically to successors
d.ii. Q: What should she have said?
d.ii.1. she needs the language "pertinent (promise belongs to the land) or in gross"
II. Fong v. Hashimoto (2000)

In general, the running of the burden and benefit are analyzed separately. Yet most states recognize an important exception to this rule: the burden does not run if the benefit is in gross that is if it fails to “touch and concern” land.

For example, in Caullet v. Stanley, Stilwell & Sons, plaintiff purchased a building lot from the defendant-develop; the deed contained a covenant that gave defendant the right to “build or construct the original dwelling or building” on the land. Plaintiff used to quiet title, arguing that that restriction was not an enforceable covenant. The court agreed because, among other reasons, the benefit of the covenant was in gross. It did not “touch and concern” any property retained by the defendant; rather, it gave the defendant “a mere commercial advantage in the operation of his business.” See also Fong v. Hashimoto (covenant did not run because promise did not own benefited land).

What evidence proves the existence of a common plan? One key factor is the percentage of the deeds that contain the restriction. For example, if the restriction is presented in only 20% of the subdivision deeds, a common plan is far less likely to be found than if it appears in 95% of the deeds. See, e.g., Fong v. Hashimoto (no common plan where restrictions burdened only 3 of 15 lots in subdivisions).

III. Mack v. Armstrong (2008)
a. Two covenants in the Vista Ridge Subdivision
a.i. No structure may be more than 30 feet in height
a.ii. No structure may be built without the approval of the Architectural Control Committee
b. The Armstrongs objected that the Macks’ new home would block their view, and the committee did not approve the Macks’ home even though it was below 30 feet
c. The court allowed the home because the specific 30-foot provision controls over the general review provision

IV. Skyline Woods Homeowners Ass’n v. Broekemeier (2008)
a. In 1977, Dennis Circo developed the Skyline Woods subdivision next to an Omaha golf course with occasional mention of the golf course in the covenants for the residential lots
b. In 2005, David Boekemeier bought the golf course at a bankruptcy sale and said that he did not intend to reopen the deteriorated golf course
c. The court held that Broekemeir was obligated to maintain the golf course
c.i. “It is possible for a restrictive covenant to arise by implication from the conduct of the parties or from the language used in deeds, plats, maps, or general building development plans” if there was a common grantor who had a common development plan
c.ii. Courts should be cautious to find implied restrictive covenants because of the relaxation of the writing requirement
c.iii. There are not maps or plats here
c.iv. But “the record is replete with testimony supporting the existence of a common scheme of development establishing implied restrictive covenants”

V. Southwind Homeowners Association v. Burden (2012)

VI. Nahrstedt v. Lakeside Village Condominium Association, Inc. (1994)

In Nahrstedt v. Lakeside Village Condominium Association, the California Supreme Court struck a similar theme, holding that a restriction would be enforced unless it “is arbitrary, imposes burdens on the use of lands it affects that substantially outweigh the restriction’s benefits … or violates a fundamental public policy.”

An intriguing example is the restriction that bans pets. Perhaps the most famous decision on this point is Nahrstedt v. Lakeside Village Condominium Association, where a cat-loving condominium owner challenged a restriction that prohibited all animals other than small fish and birds. Applying a state statute that provided all CIC covenants were enforceable unless “unreasonable,” the California Supreme Court found that the pet ban was reasonable. The court interpreted the statute as meaning that such covenants are valid unless they are wholly arbitrary, violate a fundamental public policy, or impose a burden on the use of affected land that far outweighs any benefit. In evaluating the pet ban, the court considered its impact on the CIC as a whole, not the facts specific to plaintiff’s individual case. Plaintiff’s pleas that her particular cats were always silent, kept indoors, and were not a nuisance—and thus in fact did not affect other unit owners at all—were irrelevant. Under this framework, the court had no difficulty in concluding that—as a general matter—the pet restriction was rationally related to health, safety, and noise concerns, and hence not arbitrary. Nor did any fundamental public policy justify keeping cats in a condominium unit. Finally, despite an eloquent dissent about the social value of cats, the majority found no facts suggesting that the restriction imposed an undue burden.

VII. Round Rock Ranch

VIII. River Heights Associates Limited Partnership v. Batten (2004)

IX. Sunny Brook of Burlington – Assisted Living Facility
a. Restrictions on who may live in a neighborhood
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XXVIII. Nuisance Law (661-683)
Nuisance
Nuisance is a non-trespassory invasion of another’s present interest in the use and enjoyment of his property (can be a future enjoyment). A land owner may not use his land so as to unreasonably annoy, inconvenience, or harm others. Invasion must be 1) Intentional, unreasonable, and substantial interference with the use and enjoyment of land (scope of substantial will vary by jurisdiction)---Also can be unintentional, but negligent and reckless
a. If an entity is acting with a municipal rule that deals with the issue at hand then the court will be more likely to allow the action to happen, but courts differ over this. They will often try to balance the competing uses in the district.
b. Remedies can be either monetary or injunctions----courts given broad discretion
c. Monetary can be either periodic (only for a certain amount of time, but can bring another action for more damages) or permanent
d. Private Nuisance: bother one person---viewed through the factual disputes on an individual basis
e. Public Nuisance: bother public at large---viewed as a violation of law---private people only can bring action if they are affected in an unique way (not normal)
e.i. Presumes public authorities will bring the action if the public finds it a nuisance because they don't want any unfair windfalls for individuals or “upsetting the majority”
e.ii. Can apply to businesses
Nuisance per se
Nuisance at law – can never be conducted or maintained so as to be lawful or permitted
Summary Judgment is a good solution
Nuisance per accidens
1. Nuisance in fact – become a nuisance by virtue of the circumstances
2. Very rare that SJ will be appropriate
3. Doctrine of Aesthetic Nuisance
a. Unsightliness or lack of aesthetic appeal doesn’t work – inherently subjective
a.i. Graffiti isn’t a nuisance either
b. Some courts have rejected
4. Spite Fence statutes – trees can be a fence (Dowdell v. Bloomquist)
a. Not allowed if there is hostile motives and no utility
5. Liability for Third Party Nuisance
a. Know the activity is being carried on and will involve an unreasonable risk of causing the nuisance
b. Consent to the activity or failure to exercise reasonable care to prevent it.
Doctrine of Coming to Nuisance
The doctrine of coming to nuisance limits your ability to sue (has to be reasonable) when you come into an area that you know has a nuisance. Also if you bring others into an area of a nuisance, you may have to compensate them.-----“Right to farm statutes” (allowed to farm as long as its not negligent or significant change in operation)
Property & Liability Rules
1. An entitlement is protected by a property rule to the extent that someone who wishes to remove the entitlement from its holder must buy it from him in a voluntary transaction
2. An entitlement is protected by a liability rule when someone may destroy it if he is willing to pay an objectively determined value

I. Biglane v. Under the Hill Corporation (2007)
a. Biglane’ don’t go straight to court; tried to insulate windows and dropped band
b. This suit still ensues (Other options: noise control ordinance
c. Nuisnace: church bell cases, dog barking, the nature of the suits blends into where it is happening
c.i. Such a fact sensitive decision—court exhibits deference to the fact that trial court
c.ii. Nuisance has to stumble its way through on a case by case “given the circumstances”
d. H: this interference is nuisance
d.i. Q: why? what makes this Nuisance?
d.i.1. invades the private enjoyment
d.i.2. the fact that they can't sleep at night
d.ii. Reasonable?
d.ii.1. harm that someone suffers and the judgment of the activity and where it occurs
d.ii.2. Will defer to TC.
d.ii.2.a. this is a different approach from zoning law (zoning law is more clear)
II. Wernek v. Halas (1992)
a. Vulgar fence and toilet seat Why not have a brightline rule—no toilet seats
b. Do we get into the intentions of the acts? Nuisance laws are to protect mutual utilitarian use of the land. (spite-fence statute). Does reasonableness speak to relative intent of the laws?
c. Graffitti not nuisance; toilet merely aesthetic annoyance; fence is not nuisance because it is less than 6 feet tall
d. H: no nuisance
d.i. the common law  fence over 6 ft is nuisance. But, the fence was under 6th.
d.i.1. although it's not the prettiest fence, but the court will not get into it
d.ii. couldn't they have a rule bout the toilet up, it's nuisance?
d.ii.1. first amendment protects the vulgar language. Here too, writing was small.
e. Majority rule: aesthetics can serve as a basis for nuisance (sufficiently out of place, ugly, wrecking the aesthetics level)
f. Indiana Minority rule: aesthetics cannot serve as a basis for nuisance
f.i. not getting in to intention (focusing harm rather than absence of utility)
III. Dowdell v. Bloomquist (2004)
a. Building a big tree—zoning; can't build second story.. and the tree was planted to spite her and to bock her view.
b. Q: does the trees fall under spite statute? Reaches the height. But, is it a fence?
c. H: trees are fence too
d. Hypo: if there wasn't any dispute before them, and thus not under the spiteful statute, would it still be nuisance?
d.i. If they find that it wasn't spiteful, and it had a different motive (bird watching) it may not be nuisance
e. If you are buying the property for the view, should the law say you need to buy the covenants from adjacent properties?
e.i. Yes. (it's not unreasonable to plant trees except for spiteful)  majority
I. Mark v. Oregon (1999)
a. What exactly is the nuisance: exposure to nudity, harassment by nudes
b. How do you respond to the claims of those who want the nude lifestyle?
c. The state can be liable for permitting a nuisance especially if it is land the state holds
d. What if state had designated/Collins Beach Clothing Optional Area
e. The beach is quite inaccessible: if Nuisance is about doing things reasonably in a certain time and a certain place, we weigh in how inaccessible it is.
f. Q: why are they told that they can't do this anymore: it's about being told you can't use a public property in a certain way.
g. Q: what if it's a private property: is that nuisance? No.

The typical plaintiff in a public nuisance action is a city or other governmental entity that brings suit on behalf of the general public and seeks damages, an injunction, or an abatement order. A private party may sue on this theory only if “special injury” can be demonstrated. See, e.g., Mark v. Oregon (residents near state-owned beach area where public nudity occurred could sue on both private and public nuisance theories).

II. Spur Industries, Inc. v. Del E. Webb Development Co. (1972)
a. Farming started in the area at issue as early as 1911. Later, the area developed into an urban area with several retirement communities being built. The Defendant, Spur Industries (Defendant), developed cattle feedlots in the area in 1956. The Plaintiff, Del E. Webb Development Co. (Plaintiff), began development of an urban area near the feedlots. Plaintiff filed a complaint in 1967 stating that the approximately 1,300 lots were unfit for residential development because of the feedlots proximity to the lots, therefore the feedlots constituted a public nuisance. The trial court permanently enjoined the defendant from operating the feedlots.
b. Two issues were examined on appeal:
b.i. Where a business is being operated in a lawful manner, may the operation be enjoined as a nuisance?
b.ii. If the operation is enjoined as a nuisance, may the developer who requested the enjoinment be required to indemnify the business owner.
b.iii. Affirmed. The feedlots are both a private and public nuisance to the residents of the development. Reversed as to damages awarded to Defendant, Plaintiff must indemnify Defendant for a reasonable amount of the cost of moving or shutting down.
b.iv. To be a public nuisance, the activity has to be one that must affect a considerable number of people or an entire community or neighborhood. To be a private nuisance, it must affect a single individual or a definite small number of persons in the enjoyment of private rights not common to the public.
b.iv.1. By statute, Defendant’s feedlots could be deemed a public nuisance because of its potential to be dangerous to public health.
b.iv.2. With respect to indemnity, if a residential owner knowingly came into an area reserved for industrial or agricultural endeavors, he may not be entitled to relief

A nuisance involves conduct other than physical entry—such as producing dust, gases, light, noise, odors, shadow, smoke, or vibration—that interferes with the use or enjoyment of land. See, e.g., Spur Indus., Inc. v. Del W. Webb Dev. Co. (odors and flies from cattle feedlot).

The existence of a private nuisance is a question of fact that turns on the unique circumstances of each case. For instance, a halfway house for parolees might be deemed a nuisance under some circumstances, but not under others. Examples of land uses found to be nuisances on the facts of the particular case include: airports, bakeries, cement plants, cemeteries, dairies, dog kennels, feed lots, funeral parlors, gas stations, halfway houses, hog farms, hospitals, laundries, lumber mills, music stores, rifle range, roosters, slaughter houses, smelters, soup kitchens, stables, trees, and windmills. Spur Indus., Inc. v. Del W. Webb Dev. Co.

At one time, many courts recognized a defense known as “coming to the nuisance.” Today, however, almost all courts reject this defense because it effectively allows first-in-time residents to stifle new development in the community. Instead, a number of courts consider the plaintiff’s “coming to the nuisance” as one factor in determining reasonableness. But cf. Spur Indus., Inc. v. Del W. Webb Dev. Co. (suggesting that the defense would have barred recovery by developer who constructed new residential subdivision near existing cattle feedlot).

Another remedial option is to issue an injunction against the nuisance, but require the plaintiff to compensate the defendant for costs of compliance. The pioneer decision adopting this alternative is Spur Indus., Inc. v. Del W. Webb Dev. Co. Defendant Spur operated a commercial feedlot for up to 30,000 cattle in an agricultural area. Plaintiff later developed a residential community on nearby land, and sued to enjoin the feedlot as a nuisance because of the flies and odor that it produced. The Arizona Supreme Court agreed that the public interest justified an injunction closing the feedlot. Yet, because plaintiff was the direct cause of the problem, the court exercised its equitable powers to require plaintiff to indemnify the defendant for the costs of moving or shutting down. “It does not seem harsh to require a developer, who has taken advantage of the lesser land values in a rural area as well as the availability of large tracts of land on which to build and develop a new town or city in the area, to indemnify those who are forced to leave as a result.” Spur is a controversial decision that has attracted much scholarly interest, but has not been followed by other courts.

Under some circumstances, the same conduct may create both a public nuisance and a private nuisance. See, e.g., Spur Indus., Inc. v. Del W. Webb Dev. Co. (finding that cattle feedlot was both a public nuisance and a private nuisance).

III. Lindsey v. DeGroot (2009)
a. In 1998, the Lindseys built a 4,000 square foot home in rural Huntington County
b. In 2001, Johannes DeGroot emigrated from the Netherlands and converted an old hog farm into a dairy with 1,600 cows
c. The Lindseys filed a nuisance action against DeGroot
d. The DeGroot sought the protection of the Indiana Right to Farm Act
d.i. Goal of preserving agricultural land
e. Farming is not a nuisance so long as:
e.i. Not negligent
e.ii. Not a significant change in operation
f. The court ruled for DeGroot
f.i. Within the scope of the Act
f.ii. The Act does not result in a taking of the Lindseys’ property
IV. Calabresi & Melamed:

Plaintiff wins
Defendant wins
Property rule
Boomer dissent
Not a nuisance
Liability rule
Boomer majority
Spur

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XXIX. Introduction to Zoning (685-701)
Zoning
Zoning is the governmental restriction of areas based on things like number of people, types of buildings, agriculture, and industrial use. The restrictions must have a rational basis for a legitimate state interest (health, safety, height of buildings, etc.)
e.i.1.a. It is ok for cities to limit the amount of residential building that can be built per year, as long as they are not excluding low-income neighborhoods for wealthy ones
e.i.1.b. Has to provide a place for a porn shop or church or else it could be unconstitutional
e.i.1.c. Done for litigation efficiency, health/environmental, safety, land use efficiency, plan for things the market may not consider (inclusiveness, ease for UPS), protecting peoples investments in the community
e.i.1.d. Compared to nuisance and private land use arrangements, zoning looks forward before a breach occurs (save time and money from a lawyer because the state takes care of everything), while they look backwards after the breach has occurred.
The process starts with enabling legislation, which is state legislation that grants power to the state governments to creating zoning laws. Next comprehensive planning are created, it is the process that determines community goals and aspirations in terms of community development. These plans are developed, which are then executed by various zoning laws. Courts take different views on if someone can sue based on the plan. The courts normally don't impede with zoning boards because they normally have the greater expertise. The final part of the process is the zoning ordinance which is the legislation carrying out the plan by the specific city municipality. This is when they decide if a building permit or granting certificate, and at that point is when the challenges will arise. The ordinances must be reasonable and impartial to a particular group. -If the zoning ordinance doesn't agree with the comprehensive plan then it can be actionable
Comprehensive Plans
Set out before zoning laws are made to comply with plan (Watergate West, Inc. v. District of Columbia Board of Zoning Adjustment)
a. Not self executing – can’t challenge an individual decision about a single piece of plan as contrary to Comprehensive plan
b. Court usually defers to zoning board decisions because they know best (with regard to decision being contrary to plan), unless they are not reasonable
b.1. Hence, not much litigation about comprehensive plans
c. Conditional Zoning – gives approval to zoning changes subject to certain conditions
c.1. Typically sustained, even statutorily permitted despite fears of undue influence and undermining the comprehensive plan
Euclidean Zoning
Euclidean zoning are characterized by the segregation of land uses into specific geographic districts and dimensional standards stipulating limitations on development activity within each type of district.
1. Rational basis, very easy to satisfy (Village of Euclid v. Ambler Realty Company)
a. Very difficult to mount a constitutional argument against zoning code
b. Social policy – want to separate uses, having subdivision

Non-Euclidean Zoning
These things allow large developers to determine how to determined mixed uses will be provided (market forces), instead of the state doing this in the beginning.---put the municipalities in negotiations with the developers to keep the interest of the municipalities
1. Cluster Zoning – limits a subdivision’s overall density of residential units instead of limiting individual’s residential lot or parcel—Preserve natural attractive features, more affordable or desirable housing
a. Floating Zone – zone defined with particular use and later applied to particular land, not specified where it will be located
a.1. Effective mean to control location and impact of large-scale developments
a.2. Widely used in all states
b. Spot Zoning – treatment of an island of land differently than adjacent properties
b.1. looked upon with disfavor and commonly struck down when spot zoning benefits landowner rather than public generally or nit in accord with the comprehensive plan due to concerns of bribes or political pressure
b.2. Anyone who meets criteria can get this so it’s different than variance
c. Contract zoning occurs when a particular area which is zoned for one type of development is rezoned to another classification based on an agreement between the government and the party that will be using the land.
c.1. If an area's zoning code is for residential use but a business wants to make use of it as commercial land, it would be considered contract zoning if the government rezoned the area as commercial based on an agreement by the business to restrict their use to avoid some use that is objectionable to the public.
d. Conditional Zoning means a zoning in which, the governmental body allows a change in zoning activities subject to certain conditions that are designed to protect adjacent land from the loss of use value which might occur, if the new zoning activities are allowed without any sort of restrictions. The restrictions that are imposed for conditional zoning are not usually on similar zoned property.
2. Planned Unit Development – tries to create entire mini-community at once
a. Allows a bit of everything in one area, accommodate every use in one area
Ways To Get Around Zoning Laws
1. Try to get law struck down—must promote a substantial state interest
a. Facial challenges—entire scheme is unconstitutional---substantive due process-lacks rational basis (no longer used really)
b. Takings (As Applied)-Must regulate the land use so much that it constitutes a taking
c. Equal Protection (As Applied)- Not applied evenly or violate free speech (cant be on content)
d. Religious Exercise (As Applied)- Substantially burden a persons exercise of religion
Free Speech—Porn shop or advertising---first amendment
2. Non-conforming use (Snake River Brewing Company v. Town of Jackson)
a. If you have property which is serving a purpose which is not allowed by the new zoning, you get grandfathered in.
b. Interpreted narrowly because they thwart public policy behind comprehensive plan
c. Vested property right which is protected by statue, constitution, and doctrine of equitable estoppel
d. Termination methods –
d.1. Abandonment
d.2. Discontinuance or non-use of a prescribed period;
d.3. Amortization; and
d.4. Voluntary or involuntary destruction.
e. Rights of non-conforming uses
e.1. Non-conforming use runs with the land
e.2. Does not have the right to expand or different use
e.3. Not clear if there is a right to repair
e.4. Can be abandoned and cannot be revived later
3. Variances - (Cochran v. Fairfax County Board of Zoning Appeals)
a. Variances are orders that state the application of a zoning law doesn't applied to you. Some states allow them only if it is unconstitutional when applied to you, while others allow the state to choose its standard to be stricter than the constitution (can be set out in there enabling act).
b. The constitutional requirement normally requires that the zoning deny all reasonably beneficial uses to the owner (takings). While the states may require a less stringent test, but don't have to, that look at things like 1) landowner suffers a unique undue hardship in the use of the land; 2) land owner would suffer a unnecessary harm (or practical difficulties—for area exception) if the variance is denied; or 3) grant of the variance will not be detrimental to the public welfare (not often used).
b.1. Denied if there are other ways to achieve the goal or it is self-inflicted
b.2. Stricter hardship requirement for USE variance and cannot be self-created
b.3. Public welfare normally is the use and enjoyment of neighbors or the neighborhood
b.4. No reason (constitutionally or otherwise) a zoning board cant grant variances more liberally
c. Two types of variances:
c.1. Use exception is given to permit a use otherwise prohibited in the district—Very strict, if given at all
c.2. Area Exception is when a builder or landowner requests a relaxation of the applicable regulations to avoid denying them the same rights and uses of neighbors because their property is oddly configured—Normally deals with deviations from area, bulk, setback, street frontage, floor space, and height
4. Special Exceptions – allowed if certain conditions in the ordinance are met
a. Certain uses can peacefully coexist when specified conditions occur
5. Zoning Amendment (H.H.B., LLC v. D & F, L.L.C.)
a. A change or revise the zoning ordinance or map and must provide notice to the public and be 1) in accordance with the “comprehensive plan” (the plans general interest); 2) not arbitrary, capricious, or discriminatory; 3) not violate the federal or state constitution or statutes.
b. Cannot benefit one person over the rest of the community (spot zoning)
c. Typically, try to get variance first and deference is given to city council and district court first on whether to pass the amendment because they have a better sense of what is appropriate for the community.-----review can either be rational basis (lenient) or a stricter standard, depending on if it is a legislative (lenient) or administrative act (stricter)
d. Zoning decisions are sometimes seen as “quasi-judicial”—will review even stricter
Adult Bookstores and Theaters
Can either be spread out by 1000 feet or constrained to a small part of city

I. Village of Euclid v. Ambler Realty Company
a. The ordinance must be for the benefit of the public welfare. This is to be determined not by an abstract consideration of the building considered apart but considered in connection with the circumstances and the locality.
b. The line which separates legitimate from illegitimate assumption of power depends on the circumstances and conditions. These ordinances are made for the public welfare and rely on some aspect of police power.
c. One way to a constitutional attack is that the gov't approach is unconstitutional as it applies to that particular person. Here, they attacked it not as it applied to them, but on its face as it applied to everybody.
d. In this case, we are dealing with a low level of scrutiny (rational basis). If someone claims that another has violated due process and equal protection he has to show there is not a rational basis for the law.
e. Due Process involves a fundamental interest; if we are talking about equal protection, what would raise the level of scrutiny would be a law that inherently discriminates. You as the challenger, have to show there is no rational basis or governmental interest at stake.
a. It cannot be said that the ordinance passes the bounds of reason and assumes the character of merely arbitrary fiat. Thus, ordinance cannot be declared unconstitutional.

Factual Setting
Plaintiff purchased a 68-acre tract of undeveloped land in the Village of Euclid, near Cleveland, Ohio. The southern edge of the land bordered Euclid Avenue, a major street, and was suitable for retail store uses. The balance of the land, which adjoined a railroad to the north, seemed destined to accommodate the growing regional demand for industrial property.

In 1922, the village adopted its first comprehensive zoning ordinance. The ordinance divided the village into six districts and restricted the uses permitted in each, in cumulative fashion. The only major use permitted in the U-1 district was single-family residences; the U-2 district was extended to include duplexes; the U-3 district allowed the U-1 and U-2 uses, together with apartments, public buildings and the like. The 4-4 district was further extended to include retail uses; the U-5 district added light industrial uses; and every use, including heavy industry, was permitted in the U-6 district. The ordinance also regulated building height and lot size.

The new ordinance substantially restricted the uses allowed on plaintiff’s land, and thereby reduced its value. The southern one-third of the tract bordering Euclid Avenue was zoned U-2, while the northern half adjoining the railroad was zoned U-6l a thin strip in the middle was zoned U-3. According to plaintiff, the land was worth $10,000 per acre as industrial property, but only $2,500 per acre as residential property.

Plaintiff argued that the zoning ordinance violated its right to substantive due process and equal protection. The federal district court struck down the ordinance, holding that police power did not permit a municipality to “classify the population and segregate them according to their income or situation in life.”
The Decision
In upholding the constitutionality of the Euclid ordinance, the Supreme Court established principles that still dominate American zoning law. Writing for the majority, Justice Sutherland focused on the new problems created by population growth and urbanization. Modern conditions justified regulations that would have been rejected as arbitrary and oppressive in the past. The source of local zoning authority was the police power—the power to protect the public health, safety, welfare, and morals. But how far did the police power extend? Sutherland answered this question by analogizing to nuisance law; after all, he observed: “A nuisance may be merely a right thing in the wrong place—like a pig in the parlor instead of the barnyard. Sutherland accordingly found that the Euclid ordinance was facially constitutional because it essentially regulated nuisance-like impacts. For example, the provisions of the ordinance that separated industrial uses from residential uses protected homes from noise, smoke, fumes, and similar intrusions. This nuisance-control rationale had little impact on later cases, but the rules it initially justified still endure.
Three interrelated principles emerge from the majority opinion. First, a zoning ordinance is presumed to be constitutional. Second, the ordinance will be upheld against substantive due process and equal protection attacks unless it is arbitrary and unreasonable, having no substantial relation to the public health, safety, welfare, or morals. Finally, a court may not conduct an independent review of the wisdom or policy of a zoning ordinance; if the validity of the legislative classification is “fairly debatable, the legislative judgment must be allowed to control.”

Euclid is easily the most important decision in the evolution of American zoning law. With the Supreme Court’s stamp of approval firmly in place, Euclidean zoning swept across the nation. Municipal officials and planners promoted Euclid-like ordinances, confident that they would withstand constitutional attack.
Reflections on Euclid
Yet from the perspective of the twenty-first century, the judicial reasoning underlying Euclid seems somewhat antique. The Court defends comprehensive zoning—in essence—as a method to prevent nuisance-like impacts. This analysis makes sense to a point. Certain types of industrial uses—for example, refineries, smelters, and tanneries—are likely to be nuisances if located in a residential district. Thus, the exclusion of industrial uses from the U-1, U-2, and U-3 zones is easily explained.

But the nuisance-control rationale collapses when the Court tries to explain why apartment houses are barred from the single-family residential zone. The Court’s suggestion that an apartment house is “a mere parasite” whose coming destroys the “residential character of the neighborhood and its desirability as a place of detached residences” implies reasons for zoning that go far beyond the nuisance doctrine. Zoning suddenly seems more like social engineering, which serves broad “quality of lie” goals by shielding single-family residential neighborhoods from change. And the Court ignores the toughest question: why exclude duplexes from the single-family residential zone? Could anyone seriously argue that a duple is a nuisance?
Post-Euclid Developments
As the leading Supreme Court decision on the constitutionality of zoning, Euclid became the foundation for American zoning law. In the wake of Euclid, federal and state courts routinely followed its mandate that comprehensive zoning in general was constitutional unless arbitrary and unreasonable, having no substantial relation to the public health, safety, morals, or general welfare. Under this deferential standard of review, courts did not question the wisdom or necessity of zoning ordinances. These broad standards, of course, went far beyond the logic of nuisance-control. And later courts utilized them to uphold zoning ordinances that served quite different purposes, including protection of property values, preservation of neighborhood character, and controls on growth.

One reason for the extraordinary influence of Euclid is its isolation. The Supreme Court decided only two significant zoning cases before 1974: Euclid in 1926, and then Nectow v. City of Cambridge in 1928. Euclid stands alone as the leading case establishing the constitutionality of zoning in general. Nectow established the important principle that a zoning ordinance might be unconstitutional as applied to a particular parcel. There, part of plaintiff’s land was restricted to residential use, even though adjacent industrial and railroad uses made the land highly undesirable for housing. At the trial level, a special master concluded “no practical use can be made of the land in question for residential purposes.” Based on this record, the Court had no difficult in holding that the application of the ordinance to plaintiff’s land failed to promote the public health, safety or welfare, and accordingly was unconstitutional.
***
As the Supreme Court observed in Village of Euclid v. Amber Realty Co., a zoning ordinance is valid unless “clearly arbitrary and unreasonable, having no substantial relation to the public health, safety, morals or general welfare.”
***
In its classic 1926 decision of Village of Euclid v. Amber Realty Co., the Supreme Court justified a typical zoning ordinance as little more than a nuisance control measure; the ordinance minimized the adverse effects of smoke, fumes, noise, and other problems.

II. Snake River Brewing Company v. Town of Jackson (2002)
a. When Brewing company opened had three parking options: on site, off site and in lieu
a.i. later, city changed the zoning for parking
a.ii. brewing invested more money
a.iii. city argues that in lieu abandoned zoning and can't go back to the type of parking
b. The Brewing asserts nonconforming use of off-site parking is granfathered
b.i. before the zoning law was passed, the use was there first
b.ii. in this case, Brewing company had a right to use in nonconforming use.
c. Ct said they had the right before the zoning and they didn't abandon the right there was also an estoppel claim that they could rely on (detrimental reliance)
d. H: when zoning law was in effect, it can't unilaterally change other's use
e. Note that you can't change one nonconforming use to another after the zoning is introduced
f. When a zoning ordinance is enacted, it cannot outlaw previously existing nonconforming uses—four principal methods of termination of a nonconforming use have been recognized
f.i. Abandonment
f.ii. discontinuance or non-use for a prescribed period
f.iii. amortization
f.iv. voluntary or involuntary destruction

In general, zoning regulated only future development. Thus, from the 1920s onward, virtually all zoning ordinances allowed the prior nonconforming use to continue. A nonconforming use is a use of land that lawfully existed before the zoning ordinance was enacted, but that does not comply with the ordinane. It might be a type of land use that violates the use restriction in the zone. Or it might be a building that failes to comply with the ordinance restrictions on height, lot coverage, set back, lot size, frontage, parking, or other similar items. See, e.g., Snake River Brewing Co., Inc. v. Town of Jackson (parking requirement).
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Zoning Procedures (701-721)

I. Watergate West, Inc. v. District of Columbia Board of Zoning Adjustment (2003)
a. Hotel to be repurposed as a GW dorm exists in a R-5-E (high density) residential zoning district
b. Nothing illegal as matter of zoning ordinance to prevent this conversion
c. Plaintiffs allege this is contrary to the comprehensive plan
d. Following courts of appeals precedent: the BZA gave proper great weight and we as a court are going to defer to the board in terms of plan interpretation
d.i. The cities plan is also no self-executing; this is not a law; this cannot generate standing for suit
d.ii. Generally comprehensive plans do not have the legal command nature which laws hold
e. What is the point of the plan? If it can be departed from
f. Zoning ordinance has the legal power; the comprehensive plan does not
f.i. Legal order is binding save variance
f.ii. The Comprehensive plan only attains legal relevance if it is bolstered by ordinance

The typical state zoning enabling act empowers a city council or other local legislative body to:

1. adopt a “comprehensive plan,”
2. enact a zoning ordinance, and
3. delegate administrative authority to an appointed board.

The adoption of a zoning ordinance is a legislative act. The ordinance is enacted by the city council or similar body in the usual course of business, just like any other law or ordinance. It reflects a legislative judgment that its particular mix of land use restrictions will best serve the health, safety, welfare, and morals of local residents.

The Standard Stat Zoning Enabling Act required that zoning be “in accordance with a comprehensive plan,” and this requirement led to a certain amount of confusion. The drafters of the Act apparently intended that the local legislative body would first prepare a comprehensive, long-term plan for its community, and then, in a second step, adopt a zoning ordinance that implemented the plan. See, e.g., Watergate West, Inc. v. District of Columbia Board of Zoning Adjustment (holding that zoning decision was consistent with comprehensive plan).

II. Cochran v. Fairfax County Board of Zoning Appeals (2004)
a. Consolidated cases:
a.i. Fairfax: re-build house in breach of zoning laws re: proximity to street
a.ii. Pulaski: wanted to build unsightly side garage; allowed with aesthetic caveat
a.iii. Virginia Beach: build storage unit in excess of permissible limits (500 sq feet)
b. These variances ALL should not have been allowed
c. If zoning law inhibited all reasonable use of land; this would be a takings without due process in constitutional violation
d. Euclid anticipates variances as constitutionally required; zoning which requires undue hardship and interfere with all reasonable uses of property taken as a whole because it violates due process, especially 14th amendment property rights
e. Virginia is about as stringent as they come for variance allowances; other states hinge more on preference
e.i. Excessive use of variance does not implicate constitution (only stringent), however this does undercut the general purpose of zoning

What type of hardship is required for a variance? Most courts define hardship to mean the the owner cannot obtain a reasonable return under the existing zoning due to some special characteristic of the property itself that is not generally shared by other parcels in the district. Cf. Cochran v. Fairfax County Board of Zoning Appeals (hardship found only if ordinances interferes with “all reasonable beneficial uses of the property”).

III. Rousseau v. Zoning Board of Appeals (2009)
a. Elena Kerwin bought a lot in Omaha and wanted to build a four-story Federal-style condo building
b. She admitted that she could build other residences on the lot, but not the kind she wanted
c. The board granted her variances from the setback, side yard, and parking zoning
d. The court upheld the variances
d.i. Need not show a violation of a fundamental right
d.ii. Judicial deference to zoning boards

IV. Township of Northhampton v. Zoning Hearing Board (2009)
a. Rite Aid wanted to build a pharmacy with 67 parking spaces instead of the required 112 spaces
b. The zoning board granted a variance
b.i. The store needed fewer spaces
b.ii. Could add more spaces only with major modification and adverse economic impact
b.iii. Less impervious surface coverage
c. The court overturned the variance
c.i. Rite Aid “alleged no specific financial burden that compliance would impose – it simply wanted to use the Property as it wished”
c.ii. More parking could be provided by eliminating the drive-through window
c.iii. The need to follow the corporate prototype does not justify a variance

V. Rodgers v. Village of Tarrytown (1951)
a. Creation of the B-B (a new subclass) by way of amendment
b. Zoning laws are not static; they can change via amendment
b.i. Here the amendment considered the compatibility, expansive notion of land use, and comprehensive city goals and ideals when enacting the second amendment (which allowed Rubin’s land to be classed as BB)
b.ii. The decision only evinced deference for communal, zoning, goals; that in coincided with the desires of one citizen is not dispositive
c. Spot-zoning—small parcel of land within zone to be used contrary to zone for the benefit of the owner
d. Held: while the stability and regularity are essential to the operation of zoning plans, zoning is not static
d.i. changed or changing conditions
d.ii. Board's discretion to amend the zoning
d.iii. burden of establishing arbitrariness is imposed upon him who asserts it
d.iv. as long as the decision was neither arbitrary nor unreasonable  permitted
VI. Geneva New York’s PUD District
a. Different uses combined in such a way as they are compatible with eachother
b. Progressive iteration of the evolving standards of zoning law: here there is a recognition of compatibility and interwoven interests
b.i. Planned development: instead of separating them all the Idea is that we want to plan the entire community in a harmonious matter (commercial, residential, park, offices, churches integrated and planned ahead of time)
b.i.1. Less worried about mixing uses
c. To further enhancement of zoning authority, many cities have enacted subdivision controls: ordinances that seek to assure adequate services, streets, and other infrastructure by establishing standards and procedures for subdividing land for residential development
VII.
Zoning Changes, Growth Controls & Government Regulations (721-740)
Federal Limits on Zoning
1. Federal government can limit local government’s zoning rights (Prime Co Personal Communications, Limited Partnership v. City of Mequon)
a. TCA balances national interest in expanding cell phone coverage with local interests in controlling zoning
a.1. TCA requires specific evidence to show that there should be no cell phone tower there generalized evidence is not enough
b. RLUIPA (The Lighthouse Institute for Evangelism, Inc. v. City of Long Branch)
b.1. Government has interest in protecting churches because many cities don’t want them and discriminate against them, they don’t general money
b.2. Can’t unequally burden churches unless there is a compelling state interest and is the least restrictive way to achieve the interest
2. Supremacy Clause – can’t forcefully interfere with Federal Rights (i.e. trademarks) through zoning laws
a. Not many cases where Fed. Government has stepped in to limit local government’s zoning rights
3. National Historic Preservation Act (NHPA) – only works against government actors, not private actors
Growth Control
1. Cities often limit the amount of residential building that can be built per year
a. Growth control laws are okay if there is not exclusionary zoning
a.1. Can’t have wealth neighborhoods exclude low income housing (14th amendment)
(a.1.a) Home values will go up exponentially higher if they limit to only houses to certain size minimums or land minimums and houses in general (NOT IN MY BACKYARD), but may incentives builders quality to go down because of disincentive, also a decline in liquidity, moveabliity, and available to low income earners
a.2. Substantive due process ground
b. Look at the reasonableness of the relation to a legitimate state interest to determine if unconstitutional
c. These can also be done through legislation as well
Government Land Regulation

Preservation of historic buildings, places, districts (City of New Orleans v. Pergament)
Municipalities do have the authority to regulate to preserve historic buildings, places, district
Can do it be limiting what you put up, not just what you tear down
Aesthetics alone is a legitimate purpose for governmental regulation
Sometimes, commission’s decision needs to be supported by substantial evidence to prove the test in the statute
Some courts also say that the standard for designating something as being protected can’t be unconstitutionally vague
Cleaning up noxious substances (Carson Harbor Village, LTD v. Unocal Corporation)
CERLA – Law says if you own the land now, or if you owned the land when the stuff was disposed there, you have to pay for the cleanup
If you actually dumped the stuff on the site, or if you arranged for it to go there, or transported it there, you also have to clean it up
Only if you actively did something to dispose of the waste can you be held liable to pay for cleanup (this is the majority rule where you can’t be liable for passive disposal)
Policy – why should the current owner be held liable
Incentive for buyers to check into property
Innocent landowner defense that is hard to satisfy
-Clean Water Act (Federal environmental law)---Deals with wetlands (one of its provisions)-defined broadly—you need a permit to tamper or fill in a wetland…very hard to get
-Endangered Species Act (Federal environmental law)—once a species gets listed then a party cant “take” (destruction of critical habitat for those animals) the animal…the feds may grant incidental take land permits, which allows landowners to build and happen to destroy a habitat
People more likely to litigate for clean water then endangered species because it is a very powerful federal law and know if they were tight with permits that Congress would repeal it as well as it being run directly by the feds.
The clean water act is run by the feds, but administered by the states, so the states are in fear of the feds over watch---and it has been tested through litigation

I. H.H.B., L.L.C. v. D&F, L.L.C. (2002)
a. HHB likes things the way they are, doesn’t want the CVS
b. D&F has to make application to recast zoning district
c. Third application4-3 vote, requires supermajority (5)
d. D&F still not satisfied, brings it to court
e. Some jurisdictions treat these municipal functions as purely administrative (even though they’re fundamentally not—laws are passed, etc.)
f. What constitutes arbitrary and capricious?
f.i. If it is fairly debate-able then the courts exhibit deference to city council
g. Here there is a predicable reasonnot arbitrary and capriciosdeference
h. Dissent—to whom should we defer?
h.i. Majority defers to municipal council
h.ii. Dissent says deference should be given to trial judge’s finding of fact

Absent proof that the rezoning decision was arbitrary or unreasonable, courts will uphold the amendment against constitutional attack under the Due Process and Equal Protection Clauses. See, e.g., H.H.B., LLC v. D & F, LLC (upholding amendment on basis that decision was “fairly debatable,” such that court should defer to legislative judgment).

II. Construction Industry of Sonoma County v. City of Petaluma (1975)
a. Restriction of growth without infrastructure;
b. They really care about small town character and keeping people out
c. Claim: is their a substantive deprivation?
d. Exclusionary Zoning
d.i. The law does not provide much of a check on prohibiting municipalities from engaging in exclusionary zoning
d.ii. Portland’s growth controls—property within the urban growth zone—supply of land become artificially limited
d.iii. Smart growth—limit the number of uses as an absolute number
d.iv. Growth control is different from zoning; absolute number emphasis

The Ninth Circuit went even farther in Construction Industry Association of Sonoma County v. City of Petaluma. The court rejected a substantive due process attack on an ordinance that limited growth in order to “preserve [the city’s] small town character, its open spaces and low density of population, and to grow at an orderly and deliberate pace.” The Petaluma court relied in part on the Supreme Court’s decision in Belle Terre, concluding that the ordinance served the legitimate governmental interest of preserving quiet residential neighborhoods.

III. City of New Orlean v. Pergament (1941)
a. The gas station wants to post a big sign— he needs to get a permission from Vieux Carre Commission—he says that the whole enterprise of regulating my own enjoyment of the land to preserve the historic feel is not allowed
a.i. this is not issue at all these days
a.ii. this was common for municipal-city regulation (not federal law: federal law lists sites as natural preserve site; they only regulate if it's federal land)

The Constitution is the ultimate constraint on the zoning power. A short (and admittedly simplistic) overview of the relevant provisions will help the reader to understand the balance of the chapter. Zoning challenges most frequently involved the Equal Protection, Due Process, and Takings Clauses and the First Amendment protection for freedom of speech.

The Equal Protection Clause of the Fourteenth Amendment provides that no state shall “deny to any person within its jurisdiction the equal protection of the laws.” Equal protection challenges to land use regulations are usually reviewed under either the “strict scrutiny” or “rational basis” standard. The more searching standard—strict scrutiny—applies when an ordinance or other regulations discriminates against a “suspect class” (e.g., a class based on race, alienage, or national origin) or infringes a “fundamental right” (e.g., freedom of speech or religion). Under this standard, the ordinance is valid only if it is supported by a compelling state interest; the party seeking to uphold the ordinance has the burden of proof.

Otherwise, the regulation is presumed to be valid and is reviewed under the deferential rational basis test. “When social or economic legislation is at issue, the Equal Protection Clause allows the State wide latitude, … and the Constitution presumes that even improvident decisions will eventually be rectified by the democratic processes.” Under this standard a regulation will be upheld if it is rationally related to a legitimate state interest—usually the public health, safety, or welfare. See, e.g., City of New Orleans v. Pergament (historic preservation ordinance did not violate equal protection).

IV. City of Deadwood v. M.R. Gustafon Family Trust
a. The trust owned an old Sinclair station that had been unoccupied for years
b. It was on the national and state lists of historic places, but not the local list
c. The court held that state law requires a permit from the local historic preservation commission before the building can be demolished

V. Felician Sisters of St. Francis of Conn., Inc. v. Historic Dist. Comm.(2008)
a. The town’s historic district commission refused to allow a school to pave a parking lot
b. The court overturned the commission’s decision because it was not supported by substantial evidence
b.i. The parking area would decrease
b.ii. Vehicles would be farther from the historic street
b.iii. New trees would compensate for the removal of some vegetation
b.iv. “Neighborly animosity and outcry” are not sufficient reasons
VI. Friends of the Bethany Place, Inc. v. City of Topeka (2010)
a. The Sisters of Bethany Episcopal School for Girls was built in Topeka in 1874
b. In 2007, the church wanted to add 40 parking spots to the property
c. The State Historic Preservation Officer opposed the project
d. The city council approved the project because there were no feasible and prudent alternatives
e. The court of appeals affirmed 2-1
VII. Hanna v. City of Chicago (2009)
a. Two homeowners objected to the inclusion of their property in a new city landmark district
b. The court of appeals held that the criteria for placing a property in the district are unconstitutionally vague
b.i. Historic “value”
b.ii. “Significant” historic event
b.iii. “Unique” architectural style
VIII. Wetlands Presevation
a. Protected for ecological values
b. Sources of law
b.i. Local zoning
b.ii. State statutes
b.iii. Federal Clean Water Act § 404
b.iii.1. Need a permit to discharge any material into waters of the United States
b.iii.2. Army Corps of Engineers must find that four conditions are satisfied
b.iii.2.a. No practicable alternative that will have a less adverse impact on the aquatic ecosystem
b.iii.2.b. No statutory violations will occur
b.iii.2.c. No significant adverse impacts
b.iii.2.d. All reasonable mitigation measures are employed
b.iv. EPA can veto if the discharge will have an unacceptable adverse effect on aquatic resources, wildlife, drinking water, or recreation
IX. The Lighthouse Institute for Evangelism, Inc. v. City of Long Branch (2007)
a. Federal law: RLUIPA: regulating land use and people in jail
b. Limits the zoning authority of local zoning committee to regulate religious zoning
c. R: becoming too difficult to be located in certain places
d. This case: city trying to revitalize downtown area
d.i. the church wants to build a building there
d.ii. State of NJ says you can't have any sale of liquor around the church
e. City excludes the church
f. RLUIOA
f.i. can't discriminate religious institutions
f.ii. can't impose substantial burden on religious institutions
f.ii.1. argument
g. City had a reason (revitalizing downtown) legitimate interest  okay
h. Dissent: secular gathering places: discriminating church
X. Mount Elliott Cemetery Ass’n v. City of Troy (6th Cir. 1999)

XI. Sexually explicit businesses
a. Are they more or less desirable than churches?
b. Where should they be located?
c. Who should decide where they are located?
d. Cases :
d.i. City of Renton v. Playtime Theatres, Inc. (U.S. 1986) (Rehnquist, J.), held that a city ordinance prohibiting adult theaters except in a specified zone does not violate the first amendment

Government regulation of forms of speech—such as signs and sexually-oriented businesses—may invoke review under the First Amendment. See, e.g., City of Renton v. Playtime Theatres, Inc.

d.ii. Young v. American Mini Theatres, Inc. (U.S. 1976), upheld a Detroit zoning ordinance that prohibited an adult theater within 1,000 feet of certain uses or 500 feet of a residential zone
XII. Prime Co Personal Communications, Ltd. Partnership v. City of Mequon (7th Cir. 2003)
a. Verizon wants to build the tower. City objects for ugly/health problems.
b. Here Federal Law limits the capacity of the city to zone:
b.i. It became so difficult to enact cell phone tower that Congress intervened with a Federal law which says:
b.i.1. city has to have "substantial evidence that this cell phone tower in this place is especially ugly"
b.i.2. what kind of evidence?
b.i.3. schematic drawing, who can see from different places, something more than "we don't like it"
b.i.4. if you can't show that the municipalities lack to power to exclude cell phone tower
c. H: city did not satisfy the burden  permit
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XXX. Eminent Domain (785-800)

Why should the government have the power to take someone’s property? Why should the government have to pay for it? How much should the government have to pay for it? What constitutes the government’s taking of someone’s property?

Public Purpose
1. Condemnation is allowed if land is used for a public purpose
2. Used to only be for public use (gov’t facility or infrastructure) but soon was enlarged to include more
a. Limited by the extent of the police power
3. Is economic Development a public purpose
a. Kelo & Poletown---permissive and broad standard---The government taking of property from one private owner to give to another in furtherance of economic development constitutes a “public use” under the 5th Amendment.
a.1. Kelo had a great reform at the state level (see below)
b. County of Wayne v. Hathcock---If the idea of a public use captures a private land use like this then it gets around the real purpose of it because there are no private land use that doesn't have some public purpose
c. Rejects a bright-line rule that economic development doesn't count as PP
d. Can't make a principled distinction between ED and other public purposes
State Restrictions
Some states require stricter rules than the constitutions such as limiting it only to extreme necessity, remains in public control after transfer, and the reason for choosing the particular property is based on independent significance that it would serve the public good (Hathcock).
When land is taken the constitution requires just compensation or FMV to be paid, which doesn't include replacement costs for the land or unique non-transferable values the owner had.

I. Kelo v. City of New London (2004)
a. Life could go on without eminent domain power, but it's cheaper to have one
b.  public use limitation  ultimately here, the city wants to acquire property in order to resell it to a private party on the belief that it will be best for the overall utility of the property
c. government cannot take a private party's property to give it to another BUT can do that to facilitate public use (we are dealing with in the middle)
c.i. SC has long interpreted the term of public use broadly (e.g. public cannot use public use property: military base, white house)
d. New London takes from Kelo and transfers to Pfizer—public use (5-4)
e. Ct saying that one factor that helps here is that: there is a larger redevelopment plan which is comprehensive, promoting economic development
f. Definition of public use:
f.i. Broad view: focusing on ends: if there is a benefit to the public from the taking (current SC)
f.ii. narrow view: focusing on means; requiring an actual use by the public or a public right to use the property that has been taken

Can a city condemn an owner-occupied home and then convey it to a private company as part of an economic development project? In Kelo v. City of New London, the Supreme Court answered “yes” to this question, sparking widespread controversy.

New London, Connecticut was an economically-depressed area with a high unemployment rate. The city adopted a comprehensive redevelopment plan for 90 acres in the downtown district, which provided for the construction of new homes, shops, restaurants, marinas, a hotel, and other uses. The project was anticipated to create over 1,000 jobs, increase tax revenue, provide recreational opportunities, and generally revitalize the city. However, the city had to acquire title to all 115 private-owned parcels in the redevelopment area in order for the new project to proceed. While most owners sold voluntarily, Kelo and a few other homeowners objected, stressing that their properties were in good condition and not “blighted.”

When the city began condemnation proceedings, Kelo and others sued the city, asserting that taking their properties would not serve a public use. Before the Supreme Court, their principal argument was that economic development should not be considered a “public use.”

Writing for the majority, Justice Stevens relied on Berman and Midkiff in finding that the redevelopment plan “unquestionably serves a public purpose.” The downtown area was economically depressed; the city believed that its plan would provide new jobs, increased tax revenue, and other benefits to the public; and it would be improper for the Court to “second-guess the City’s considered judgments about the efficacy of its development plan.” Thus, the majority viewed its decision as a fairly straightforward application of the Court’s prior “public use” jurisprudence. Still, Justice Stevens noted that nothing in the opinion precluded states from further restricting the eminent domain power.

At the same time, the Court suggested a limit on the extent of its deference to local government. Thus, if a city transferred the property of citizen A to citizen B “for the sole reason that citizen B will put the property to a more productive use and thus pay more taxes,” such a one-on-one transfer would “certainly raise a suspicion that a private purpose was afoot.” But two factors distinguished Kelo from this hypothetical. The Court emphasized the comprehensive nature of the plan, involving many parcels and a wide variety of uses; it also applauded the careful deliberation that preceded adoption of the plan, a process that minimized the risk of abuse.

In her dissent, Justice O’Connor asserted that the decision “significantly expands the meaning of public use,” effectively allowing a government entity to “take private property currently put to ordinary private use, and give it over for new, ordinary private use, so long as the new use is predicted to generate some secondary benefit for the public—such as increased tax revenue, more jobs, maybe even aesthetic pleasure.” She viewed the outcome as a serious threat to private property rights, because “nearly all real property is susceptible to condemnation on the Court’s theory.”

Kelo ignited a national debate about eminent domain. The family home has always occupied a special place in our legal culture, and many citizens worried that their own homes might be condemned. As a result, most state legislatures adopted legislation that imposed new constraints on the use of the eminent domain power by local governments.

II. County of Wayne v. Hathcock (2004)
a. Michigan interprets their own Constitutions
a.i. Implication being that with regards to takings, the Constitution is the floor

In effect, Douglas (in Berman v. Parker) suggested that the scope of the government’s eminent domain power was coextensive with the police power.

Two significant state court decisions further illustrate the evolution of the public purpose test after Berman. Poletown Neighborhood Council v. City of Detroit (Mich. 1981), held that Detroit could condemn homes in a non-blighted residential neighborhood, and then transfer the land to General Motors to build a Cadillac assembly plant; the Michigan Supreme Court found that the taking served a public purpose because it would provide employment and help revitalize the economic base of the community. But see County of Wayne v. Hathcock (Mich. 2004) (overruling Poletown).

Can a city condemn an owner-occupied home and then convey it to a private company as part of an economic development project? Most state courts would answer “no” to this question. See, e.g., County of Wayne v. Hathcock (Mich. 2004) (private business and technology park was not a public use under Michigan Constitution).

III. County of Hawai’i v. C&J Coupe Family Ltd. Partnership (2010)
a. The county entered into an agreement with a developer
a.i. The developer agreed to build a bypass highway
a.ii. The county agreed to rezone the area
b. The county authorized the use of eminent domain to acquire Coupe’s land for the highway
c. The court held that the use of eminent domain was not pretextual
c.i. A contract that delegates a county's eminent domain powers, raises well founded concerns that a private purpose is afoot. However, a per se rule of pretext would threaten the established rule of deference given to the findings and declarations of the government in these cases.
c.ii. The county was not only concerned about violating its agreement
c.iii. The bypass will benefit the public by reducing traffic on the main highway

IV. United States v. 564.54 Acres of Land, More or Less, Situated in Monroe and Pike Counties, Pennsylvania (1979)
a. Government is suing the property
b. Government wants to pay $500K; Synod wants $5.8 million
c. To replace the camp is much more expensive than worth of land; many facets of the camp are grandfathered in and exempt from laws
d. 5th Amendment only requires just compensation—just does not invoke fairness, sentimental value, anything beyond market value
d.i. As long as there isn’t some gross deviation which so inadequately indemnifies the person the court draws just compensation solely along the lines of fair market value

An unbroken line of Supreme Court decisions defines “just compensation” as the fair market value of the property when the taking occurs. “Fair market value.” In turn, means the amount that a willing buyer would pay in cash to a willing seller. The goal is to put the owner in as good a monetary position as if the property had not been taken, but rather voluntarily sold on the open market. Fair market value is usually established by evidence on the open market. Fair market value is usually established by evidence concerning recent sales of the property at issue or sales of comparable properties. If the type of property involved is so rarely sold that fair market value is difficult to ascertain, the court may apply other just and equitable standards (e.g., the cost to acquire substitute facilities). See Generally United States v. 564.54 Acres of Land (concluding alternate standard was not appropriate on facts of case).
Similarly, fair market value does not necessarily compensate the owner for the full economic value of the land. For example, in one case, the federal government condemned three church-owned summer camps with a fair market value just under $500,000. The cost to develop replacement camps, however, was almost $6 million, because the new campus would have to comply with expensive regulatory requirements from which the existing camps were exempt. The Supreme Court held that fair market value does not include the special value of property to the owner arising from its adaptability to a particular need. United States v. 564.54 Acres of Land

V. Michigan Dep’t of Transportation v. Tomkins (2008)
a. MDOT took a small strip of Tomkins’ land in order to build an over pass for M-6 in Kent County
b. The strip had a fair market value of $3,800, but Tomkins also sought to recover $48,200 for damages associated with the dust, dirt, noise, vibration, and smell of the highway
c. Four justices in the majority denied recovery of those damages
c.i. The state statute excluding recovery of general damages is constitutional
c.ii. “Just compensation” is a specialized legal term of art
c.iii. There is no convincing evidence that just compensation included such damages before the new state constitution was approved in 1963
c.iv. So the court will accept the legislature’s understanding
d. Three dissenting judges would have allowed recovery because just compensation was traditionally decided by juries
__________________________________________________________________________________________________________________________________________

XXXI. Meaning of Takings & Regulatory Takings (800-806, 810-25)

Types of government interferences with your property rights
1. Government takes title to your property
2. Government uses your property
3. Government regulates your use of your property

Types of regulations
1. The government prohibits you from using your property in any way
2. The government prohibits you from using it in a certain way
3. The government does something that makes your property less valuable
Public Purpose
4. Condemnation is allowed if land is used for a public purpose
5. Used to only be for public use but soon was enlarged to include more
a. Limited by the extent of the police power
6. Is economic Development a public purpose (Kelo)
a. Rejects a bright-line rule that economic development doesn't count as PP
b. Can't make a principled distinction between ED and other public purposes
State Restrictions
States may require stricter rules than the Constitution.
1. Michigan's test for a proper taking and transfer to private party
a. Public necessity of the extreme sort otherwise impracticable
a. Private entity remains accountable to the public in its use of the property
a. Selection of the land to be condemned is itself based on public concern
Just Compensation
1. Constitution only requires that fair market value be paid.
2. Non-transferable values based on the owner’s unique need may not be compensated
3. Replacement costs are not awarded
What Constitutes a Taking?
Physical Takings
1. Government takes title, uses your property or makes a permanent physical occupation
2. Cannot disturb the right to exclude
3. Doesn't depend on the physical size of the area permanently occupied.
a. Extent of occupation is relevant in determining the amount of compensation due
4. Exceptions – No compensation for:
a. destruction of property during war-making
b. property that is a health and safety hazard
c. evidence seized – inherent duty of citizenship to give evidence
5. Can be when the government doesn't allow an original owners land to revert back after an easement or defeasible condition is broken
6. IP is a physical taking – if government uses a person’s IP, they must compensate. There is no difference between personal and IP because it still violates someone’s right to exclude. --No balancing test required.
7. No compensation for diminution in value due to governmental regulations
8. Was suppose to be originally for just physical takings, not regulation
Regulatory Takings
Regulatory Takings (inverse condemnations) are when the government regulates a property to such a degree that the regulation effectively amounts to an exercise of the government’s eminent domain power without actually divesting the property’s owner of title to the property.
a. Normally are categorical: 1) physical invasions, 2) No economically viable use; OR through using 3) Ad hoc factors
b. Can apply to surface, air, and subsurface (mineral) rights as separate interests in the taking
c. The denominator problem (have you taken 100%, a tiny 20% of a larger right, or the entire thing we own)

Physical invasion
The Loretto court ruled that regulation is generally considered per se taking when it forces land owners to endure a permanent physical occupation on their land, such as the permanent physical presence of cable lines on a residential building. -Can be by the government or 3rd party authorized by the government -No balancing private and public interests or degrees -Draws a line between temporary and permanent physical invasion (dissent doesn't like that)

Penn Central Rul (AD HOC---balancing the impact on the private person and the state interest)
Most cases fall here. The Penn Central Rule looks at the 1) economic impact of regulation, 2) interferes with investment backed expectations, and 3) the character of the governmental action (physical invasion?, if so it is an invasion that must be compensated.)
a. Action can be a taking if it 1) noticeably effects one or more lots for the benefit of the state as a whole (“fairness rationale”—balancing test); OR 2) Misuses the regulatory process to benefit the government’s later use or acquisition of the land (decreasing its FMV in advance of paying just comp, restricts owners land use rights so it doesn't have to condemn to get what it wants, or use “on-again off again” regulation creating uncertainty in use and inability to sell.)
b. Impact is in the loss of “use or value”
c. Investment backed expectations are reasonable improvements before regulations that the party must have the opportunity to recoup
Lucas Rule
The court in Lucas ruled that a state regulation that deprives a property owner of all economically beneficial use could be a taking, unless the proscribed use interests weren’t part of the title to begin with. In other words, a law or decree with the effect of depriving all economically beneficial use must do no more than duplicate the result that could have been achieved in the courts under the law of nuisance. As a result, "total takings" analysis requires a consideration of (1) the degree of harm to public lands or adjacent property posed by the regulated activities, (2) the social value of such activities, and (3) the relative ease with which the alleged harms can be avoided through measures taken by either the claimant or the government.----problem with using nuisance law is that the legislature can amend nuisance law (cant use the state action as the base line to measure the state taking action against)---also privileges judicial legal change, but not legislature
a. The goal is to get into this category – difficult to do
a.1. Regulation denies all economically beneficial use of land is taking per se
(a.1.a) Except when a countervailing government interest exists
Temporary Deprivation of Economic Utility
Even if the deprivation of economic utility is only temporary, it still follows the Penn Central rule because creating a categorical rule for deprivation regardless of time period is bad policy because 1) it would make things prohibitively more expensive and 2) its better to allow the legislature to decide this question.
1. Don't want to create a great categorical rule for deprivation of economic use regardless of time period because it it's bad policy (Lake Tahoe)
a. Stifles government
a.i. Would make things prohibitively expensive
a.i. Better to leave this question to the legislature
2. Use Penn Central instead
Intellectual Property
Physical Takings – if government uses a person’s IP, they must compensate. No balancing test required.
Regulatory Takings
1. Applied the PC test in Phillip Morris.
2. Concurrence would have used Loretto. Didn’t see the need to differentiate between personal property and IP. Still interfering with the right to exclude.

I. Loretto v. Teleprompter Manhattan CATV Corp. (1982)
a. NY city ordinance requiring allowance of cable wire—denying the right to exclude
b. Sues teleprompter as government agency, takings not a trespass
c. Bright line rule—permanent physical occupancy of land is a taking
c.i. Right to exclude is the heart of property
d. Why hinge the decision on permanent and temporary (which would evoke a balancing etst)
e. Physical instrusion—especially profound about physical occupancy that preemptory occupancy (via regulation) does not evoke
f. Ended up getting damages of $1—this was a taking

In the standard eminent domain case, a state or other government entity takes permanent physical possession of a particular parcel of land. For example, State A might condemn 10 acres of O’s land in order to build a new state prison; when the process is complete, O’ possessory rights will be extinguished. As the Supreme Court explained in Loretto v. Telepromter Manhattan CATV Corp., any permanent physical occupation of property authorized by government is deemed a compensable taking.

What “property” do these standards apply to? Suppose O buys an undeveloped parcel of land that contains 100 acres, and later government action adversely affects five acres of the parcel. Do we apply the takings tests to the 100-acre parcel or the five-acre parcel? First discussed in Pennsylvania Coal, this question is called the “denominator” or “conceptual severance” issue.

The law is clear when the government action is a physical occupation. Under Loretto, any permanent physical occupation of land authorized by the government is a taking. For example, if the county constructs a public school on five acres of O’s property, this is clearly a taking of the five acres even though O retains possession of the remaining 95 acres.

In Loretto, the Supreme Court established a special exception to ad hoc Penn Central approach. For the first time, the Court recognized a bright line rule: any “permanent physical occupation authorized by government is a taking without regard to the public interest that it may serve.”

Loretto only applies to physical takings. It can be classified as a regulatory takings case only in the narrow sense that government had authorized the permanent physical occupation of land by a third party. Yet Loretto is crucial to understanding the development of regulatory takings jurisprudence.
Facts of Loretto
Loretto revolves around the installation of cable television equipment at a New York City apartment building In 1970, the building owner permitted the local cable television company to install and maintain a “crossover” line on the building rook. This crossover line had three parts: (1) a thin cable about 36 feet long; (2) two “directional taps” each on a 4-inch cub; and (3) two metal boxes, each approximately 18” by 12” by 6” in size. The crossover line was part of a cable “highway,” which served other buildings on the block, not this particular building. Loretto purchased the building in 1971, unaware that the crossover line existed.

In 1973, New York enacted a statute that (a) authorized cable television companies to install cables and related facilities on residential rental property without the landlord’s consent and (b) provided that the landlord would receive a “reasonable” payment in return, as determined by a state commission; the commission later found that a one-time payment of $1.00 was reasonable. Shortly thereafter, the local cable television company installed a “noncrossover” cable line at Loretto’s building; this line provided cable television service to Loretto tenants. Loretto sued, claiming that the state law was a taking of property without just compensation.
The Loretto Test
The Court held that any “permanent physical occupation” of land is a taking, regardless of “whether the action achieves an important public benefit or has only minimal economic impact on the owner.” It made no difference whether government occupied the property itself, or merely—as here—authorized a third party to do so. The Court reasoned that such an occupation effectively destroys all of the owner’s basic property rights: the right to possess, use and dispose of property. “[T]he government does not simply take a single ‘strand’ from the ‘bundle’ of property rights: it chops through the bundle, taking a slice of every strand.” Moreover, the Court observed, in such an extreme case “the property owner entertains a historically rooted expectation of compensation.” After reviewing more than a century of precedent, the Court concluded that its decision had uniformly found a taking in such circumstances.

Under this standard, the cable installation on Lorretto’s building was a taking. The cables and related facilities were attached to the building with bolts and screws and thus were permanent; this equipment constituted a physical occupation because it occupied space on and above the roof, and along the exterior wall of the building. Although the extent of the occupation was admittedly small, this was relevant only in assessing the amount of compensation due for the taking.

The Court stressed that not all physical intrusions were takings un dre this standard. It distinguished sharply between a “permanent physical occupation” and a mere “temporary invasion.” A temporary invasion—such as an occasional demonstration at a shopping center or intermittent flooding of agricultural land—is a much smaller interference with an owner’s propery rights. It does not wholly eliminate the owner’s right ot use, or exclude others from, the land. Thus, the Penn Central balancing test applies to “cases of physical invasion short of permanent appropriation.”
Reflections on Loretto
The core of Loretto is uncontroversial. The concept that government seizure or occupation of privately-owned land constitutes a taking is the historic foundation of the Takings Clause. And, logically, it should make no different whether the occupation is performed or merely authorized, by government.

But should this rule extend to trivial and insignificant occupations? For example, as the dissent noted, New York law requires landlords to supply mailboxes for their tenants; in effect, a landlord is compelled to purchase and install mailboxes at his or her own expense. Yet, under the Loretto standard, if the state purchases mailboxes and installs them at its own expense in a landlord’s building, this is a permanent physical occupation and hence a taking. Is this distinction of constitutional significance? The dissent argues that an “intelligible takings inquiry must also asking whether the extent of the State’s interference is so sever as to constitute a compensable taking.” Indeed, it seems doubtful that the framers originally intended the Takings Clause to apply to trivial intrusions. However, these concerns may be more theoretical than real. Cases involving de minimis occupations are unlikely to be brought because the small amount of damages at stake will not warrant the expense of litigation.

Suppose M illegally dumps hazardous wastes on her rural property, creating a toxic nightmare that will endangers human life for years to come. In order to protect the public, the state installs a brick fence around the contaminated area and erects large warning signs on steel posts. Is this a taking, such that the state must pay M for the land occupied by the fence and signs? Seemingly, yes. The fence and signs are as permanent as the cable equipment in Loretto; and they physically occupy space on M’s land. The Loretto rule is apparently applies regardless of the nature of the public interest at stake—or the culpability of the landowner—so the strong public interest in protecting human healthy and safety here is irrelevant. Of course, if the occupied land has little or no value—as seems likely—a token payment to M may satisfy the just compensation requirement.

II. Pennsylvania Coal Co. v. Mahon (1922)
a. Are their iterations where restrictions of land use constitute takings?
b. Statute which prohibits mining that causes damages which constitute subsidence
c. Whether or not this kind of regulation goes too far? Doesn’t really lend itself to a judicial application
d. Courts talk about misfortune on individual not enough
d.i. How many people affected? General public?
d.ii. Issue of safety, no there’s notice
d.ii.1. Indeed, even earlier notice of intention to mine predicates this situation
e. Broad public interest in coal mine v. protecting homeowner who did not look after themselves
f. Blowing up a house to avoid a fire—not a taking
f.i. There are countervailing considerations
g. “While property may be regulated to a certain extent, if regulation goes too far it will be recognized as a taking”
h. This is the first holding that a regulation can constitute a taking for which the government must recompense—but it isn’t the holding, just the acknowledgment
i. Brandeis dissent—this is a broad application of the principle that the government can act to prevent harms

Birth of Regulatory Takings Doctrine
The Supreme Court’s 1922 decision in Pennsylvania Coal Co. v. Mahon is generally recognized as the birthplace of the regulatory takings doctrine. The Court struck down a sate statute as unconstitutional under the Takings Clause—thus establishing the rule that mere regulation could be a taking—but offered little guidance about what constitutes a taking.
Facts of Pennsylvania Coal
The case arose in the coal country of northeastern Pennsylvania, a region long troubled by surface subsidence. Subsurface mining removed the coal supporting the surface; the land surface then collapsed, sometimes causing personally injury and property damage. The Pennsylvania Coal Company conveyed a parcel of land to plaintiffs’ predecessor in title, but reserved in the deed the right to remove all the cola under the land surface. The plaintiff Mahons later purchased the property (apparently with notice of this restriction) and moved into the house built on the land.

In the interim, the state adopted a statute that prohibited mining of coal under residential areas in a manner that caused the subsidence of any dwelling. In effect, the statute required that pillars of coal be left in place underground to support the land surface. When the coal company warned the Mahons that its future mining operations would soon cause their home to subside, they sought an injunction pursuant to this statute. In reply, the coal company argued that the statute was an unconstitutional taking of its mineral rights.
Holmes’ Majority Opinion
Writing for the majority, Justice Holmes concluded that the statute was taking of the coal company’s property rights. He conceded that “[g]overnment could hardly go on if to some extent values incidence to property could not be diminished without paying for every such change in the general law.” On the other hand, “if regulation goes too fair it will be recognized as a taking.” Holmes found that the Pennsylvania statute indeed went “too far.” But the test he used to reach this result was far from clear.

Holmes emphasized that “[o]ne fact’ for consideration was the “extent of the diminution,” that is, the extent to which the regulation diminished the fair market value of the property. At the time, Pennsylvania law divided subsurface mineral rights into two separate estates in land: (a) the mineral estate (ownership of mineral that can be removed without disturbing the land surface) and (b) the support estate (ownership of minerals that remain in place to support the land surface). Holmes found that the extent of the taking was “great,” because the statute took the coal company’s entire support estate; “[i]t purports to abolish what is recognized in Pennsylvania as an estate in land—a very valuable estate.”

In addition, Holmes considered the extent of the public interest served by the statute. He stressed that the case involved damage only to a single private house, which could not be viewed as a public nuisance or as damage to the public in general. Implicit in this analysis was the assumption that plaintiffs knowingly purchased the surface rights only, aware that they had no right to support of heir house or the land surface itself. Moreover, the statute was not necessary to protect the plaintiffs’ personal safety because the mining company could provide advance notice of its intention to mine, as indeed had happened here. Based on this analysis, Holmes found that the “plaintiffs’ position” did not create “a public interest sufficient to warrant so extensive a destruction for the defendant’s constitutionally protected rights.”

In the balance of the opinion, Holmes proceeded to discuss the general validity of the statute regardless of “plaintiffs’ position.” He failed to explore the possible public interest in favor of preventing personal injury or property damage caused by surface subsidence generally, nor did he discuss the Mugler-Hadacheck rule. Rather, he focused only on diminution in value. Because the statute made it illegal to mine the pillars of cola that supported the surface, this had “very nearly the same effect for constitutional purposes as appropriating” the coal.
Brandeis’ Dissenting Opinion
Dissenting, Justice Brandeis argued that the case was clearly controlled by the Mugler-Hadacheck rule: a “restriction imposed to protect the public health, safety or morals from dangers threatened is not a taking.” The statute merely prohibited a “noxious use”—subsurface mining that endangered the public.

Brandeis then opened a debate the remained alive today. Assuming that the “diminution in value” of property is relevant, to what “property” does this standard apply? Holmes had viewed the “property” as only the pillars of coal left in place to support the surface. Brandeis argued, however, that the relevant “property” was the whole property owned by the coal company; thus, the extent of diminution in value could be determined only be company (a) the “value of the coal kept in place” with (b) the “value of the whole property.”

For example, suppose the coal company could comply with the statue by removing 98% of the underground coal (the mineral estate) and leaving only 2& of the coal (the support estate) in pillars to support the surface. On these facts, Brandeis would argue that the statute diminished the value of the “whole property” by only 2%, which would be a minor impact. Holmes, in contrast, would argue that the staute eliminated all value from the support estate (the 2% of coal left in place), causing “total taking”: a 100% diminution in the value of the “property.” The Brandeis approach to this issue has prevailed in later decisions.
Aftermath of Pennsylvania Coal
The Pennsylvania Coal decision left the law of regulatory takings in confusion. A regulation could indeed be a taking if it went “too far,” but exactly what did this mean? Legal scholars even failed to agree on what test Holmes had applied. Many interpreted the decision as creating a diminution in value test, in which the only relevant factor was the extent to which the regulation diminished the value of the property; these scholars focused on Holmes’ observation that when diminution “reaches a certain magnitude, in most if not all cases there must be … compensation.” Other scholars argued that Holmes had actually used a balancing test, comparing the extent of the public interest with the extent of diminution; this approach placed great weight on Holmes’ conclusion that the statute did not manifest a public interest “sufficient to warrant so extensive a destruction.” So, what was the test? And how much diminution in value was too much? Equally troublesome was the relationship between the new Pennsylvania Coal test (whatever it was) and the historic “nuisance” or “noxious use” standard. Had the Court superseded the historic standard or merely created an additional test?

Over 50 years elapsed before the Supreme Court revisited the takings issue in its 1978 decision of Penn Central Transportation Co. v. New York City. During this period, the meaning of Pennsylvania Coal remained unclear. The Court failed to even cite to the decision in its next two important zoning cases—Village of Euclid v. Ambler Realty Co. in 1926 and Nectow v City of Cambridge in 1928—although it later characterized both as “takings” cases. Over the ensuring decades, Pennsylvania Coal was rarely cited by any court, and the law of regulatory takings became dormant. Takings claims were infrequent, and almost always dismissed under the “nuisance” or “noxious use” test. Regulations enacted to prevent harm to the public were deemed valid under the police power, while—as a matter of logic—regulations enacted to benefit the public mist presumably require compensation under the Takings Clause. But the weakness of this approach, often called the harm-benefit test, was apparent; almost any regulation could be seen as either harm-preventing or benefit-conferring, depending on one’s perspective.

III. Penn Central Transportation Co. v. New York City (1978)
a. Three factors balancing test:
a.i. Economic impact of the regulation on the claimant
a.ii. Extent to which regulation has interfered with distinct investment-backed investments
a.iii. The character of the government action
a.iii.1. Taking more readily found in physical government invasion than in a public program which, adjusting the benefits and burdens of economic life, promotes the common good
b. Simultaneously the default test and thought to apply
b.i. If you get to the Penn Test—its probably not going to be a taking

The single most important modern decision about regulatory takings is Penn Central Transportation Co. v. New York City. The takings test it established brought much-needed coherence to the law and signaled renewed judicial interest in the topic. The Penn Central test is admittedly vague and imprecise, sometimes leading to unpredictable results; but it is an improvement over the mystifying Pennsylvania Coal approach. Although the three “bright line” rules later careted by the Court have somewhat reduced the role of the Penn Central test, it remains the basic standard used to resolve most regulatory takings cases today.

One of the most famous buildings in New York City—Grand Central Terminal—was designated a “landmark” under the city’s Landmarks Preservation Law. Constructed in 1913, the eight-story terminal was considered a “magnificent example of the French beaux-arts style.” Under the landmarks law, any change in the exterior architectural features of a landmark, or construction of any exterior improvement on its site, required advanced approval from a city commission. However, city ordinances also allowed the owner of a landmark to transfer unused development rights from the landmark parcel to other nearby parcels.

The owners of the terminal property—Penn Central Transportation Co. and affiliated companies (“Penn Central”)—leased the airspace above the terminals to UGP Properties, Inc. (“UGP”) for a 50-year term. Even without the lease, the existing terminal use provided Penn Central with a reasonable return on its investment; the lease would provide millions of dollars in additional income each year. UGP’s plan to construct a 55-story office building in the airspace over the terminal required approval from the landmarks commission. The commission rejected both the initial design proposal and 53-story alternative proposal, based mainly on aesthetic considerations. For example, the commission stated: “To balance a 55-story office tower above a flamboyant Beaux-Arts façade seems nothing more than an aesthetic joke. Quite simply, the tower would overwhelm the Terminal by its sheer mass.”

At this point—without submitting a proposal for a smaller office building or trying to transfer development rights to another parcel—Penn Central and UGP filed suit, alleging that the application of the landmarks law to the property was a taking. Plaintiffs made two main arguments. First, the law constituted a total taking of their property rights in the airspace, just as the statute in Pennsylvania Coal took the coal company’s entire support estate. Second, in the alternative, considering the property as a whole, the law substantially diminished the value of the land in order to confer the benefits of landmark preservation on the public; the Mugler-Hadacheck rule was inapplicable because the law was not intended to prevent public harm.

In a 6-3 decision, the Supreme Court held that no taking had occurred. Writing for the majority, Justice Brennan quickly dismissed the plaintiffs’ first argument that the law was a total taking of their airspace rights. “Taking’ jurisprudence does not divide a single parcel into discrete segments and attempt to determine whether rights in a particular segment have been entirely abrogated.” The Court would consider the impact of the law on “rights in the parcel as a whole—here, the city tax block designated as the ‘landmark site,’ “ not merely its impact on the airspace rights. This language clearly repudiated the Court’s contrary suggestion in Pennsylvania Coal.

Brennan characterized the Court’s past takings decisions as “essentially ad hoc, factual inquiries” based on several factors, without any “set formula.” He then proceeded to create a new multi-factor balancing test for determining when a regulation constituted a taking. The factors were:
(1) “[t]he economic impact of the regulation on the claimant”;
(2) “particularly, the extent to which the regulation has interfered with distinct investment-backed expectations”; and
(3) “the character of the governmental action.”

Applying this test to plaintiffs’ second argument, Brennan found that all three factors supported the conclusion that no taking existed. First, the economic impact of the law on plaintiffs was not severe. Even without the office building, Penn Central could derive a reasonable return on its investment by operating the terminal. Moreover, plaintiffs could still seek to construct a smaller office building in the air space or transfer the valuable development rights to another parcel. Nor did the law interfere with Penn Central’s primary investment-backed expectation concerning use of the parcel: operating the terminal as it had been used for the last 65 years. Finally, turning to the character of the government action, the landmarks law was found to be a regulation reasonably related to the promotion of the general welfare, not a physical invasion by government.

IV. Lucas v. South Carolina Coastal Council (1992)
a. You never have right to use your property in a way that constitutes a nuisance
b. For a taking It doesn’t have to literally be a 100% total taking of value, but close to it
b.i. Beach front property is still valuable, but markedly less without building right
c. Even this “markedly less” disposition is insufficient to constitutes a takings justifying compensation

In Lucas v. South Carolina Coastal Council, the Supreme Court adopted a “categorical” takings rule: a taking will always be found if regulation eliminates “all economically beneficial or productive use of land,” unless the regulation is justified under background principles of property or nuisance law.

Lucas, a real estate developer, paid $975,000 for two beachfront lots in a residential development located on a barrier island off the coast of South Carolina. At the time, a state statute required that owners of certain coastal lands—including beaches and areas adjacent to sand dunes—obtain a permit before developing their property. Because Lucas’s lots were 300 feet away from the beach when he purchased, they were not covered by this statute. However, for many years in the recent past, the lots had been either part of the beach or flooded regularly by the ebb and flow of the tide.

Two years after Lucas’s purchase, South Carolina adopted a more comprehensive statute to preserve its shoreline and beaches. The state legislature explained, among other things, that by preserving the beach/dune system as a barrier to hurricanes and other storms, the statute would protect life and property from serious injury. Accordingly, the statute prohibited all construction along a long stretch of shoreline, including both of Lucas’s lots. Concluding that the statute reduced the value of Lucas’s lots to zero, the trial court found a regulatory taking had occurred and awarded over $1,200,000 in compensatory damages. The South Carolina Supreme Court reversed, finding that the statute was a valid exercise of the police power to prevent nuisance-like activities under the Mugler-Hadacheck standard.

Writing for the Court, Justice Scalia carved out a special exception to the Penn Central standard. Acknowledging that the Court generally preferred to resolve taking cases on an ad hoc basis—as in Penn Central—he nonetheless identified two “categories” where a taking could be found without a fact-specific inquiry: (a) “regulations that compel the property owner to suffer a physical ‘invasion’ of his property” (as in Loretto) and (b) regulations that deny “all economically beneficial or productive use of land.”

This second standard—which governed the outcome in Lucas—is clearly linked to the Court’s early Pennsylvania Coal approach and to the Agins standard. Under the Lucas test, a regulation that denies the landowner all economically beneficial or productive use of his land is taking, unless the regulation is justified by “background principles of the State’s law of property and nuisance.” Applying its new test, the Court held that the statute clearly eliminated all economically beneficial or productive use of Lucas’ land. But it remanded the case to determine if the statute could be justified under background principles of South Carolina law, which it appeared to doubt. “It seems unlikely that common-law principles would have prevented the erection of any habitable or productive improvements on petitioner’s land; they rarely support prohibition of the ‘essential use’ of land.”

Although Lucas ignited scholarly controversy, its practical effect has been quite limited. State courts and lower federal courts tend to interpret Lucas narrowly, stressing that it applies only to the unusual situation where regulation eliminates all economically beneficial or productive use. Thus, one study of state court opinions concluded that Lucas “has not resulted in more than a trivial number of constitutional invalidations of state and local regulations.” However, the Lucas saga is far from over. As the case law continues to evolve, the Lucas standard may be applied to wetland preservation laws or similar regulations that seek to protect environmentally-sensitive lands.

The Lucas majority also signaled interest in reopening the “conceptual severance” debate, which Penn Central had seemingly resolved. If a regulation forces a developer to leave 90% of a rural parcel in its natural condition, for example, the Court opined that “it is unclear whether we would analyze the situation as one in which the owner has been deprived of all economically beneficial use of the burdened portion of the tract, or as one in which the owner has suffered a mere diminution in value of the tract as a whole.”

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Regulatory Takings & Exactions (825-844)
Exactions
1. Two part test for Exaction
a. Is there an essential nexus between the legitimate state interest and the permit conditions exacted by the city
a. If yes, then decide if the required dedication is related both in nature and extend to the impact of the proposed development. "Rough Proportionality"
a.i. Conditions imposed must be proportional to the development
1. The exaction test is much more 50-50 than the Penn Central test

I. Tahoe-Sierra Preservation Council, Inc. v. Tahoe Regional Planning Authority (2002)
a. Moratorium—owner cannot do anything in terms of development (same situation as David Lucas); natural resources without ability to build
a.i. Here though the infringement is designed to be temporary, until comprehensive plan comes along to determine relevant restrictions which will presumably allow development
b. To get into Lucas, you have to show that you have virtually valueless property. This is not true here.
c. Is this a taking under Penn central?
c.i. Fairness & justice—burdens borne by public as a whole are allocated there
c.i.1. Does this mean that a temporary restriction is one to be suffered alone, or should there be compensation (burdened shared by public)
c.i.2. Per se rule would impose too much costs on government decision making
c.i.3. Even if this were fair, it wouldn’t be market value of property—lost wages from property development for three years
c.i.4. Are the burdens and public benefits reciprocal?
c.i.4.a. Clean lake
c.i.5. Sheer number of people push this inquiry towards public benefit; insulated
d. “Land use regulations are ubiquitous and most of them impact property values in some tangential way … Treating them all as per se takings would transform government regulations into a luxury that few governments could afford.”
e. Refusing to adopt new per se rule governing temporary takings and relying instead on Penn Central test.
f. As Penn Central makes clear, we would apply its takings criteria to “the parcel as a whole.” See also Tahoe-Sierra Preservation Council, Inc. v. Tahoe Regional Planning Authority (refusing to “sever a 32-month segment from the remainder of each landowner’s fee simple estate”).
g. The first prong of the Lucas test is quite rigorous: the regulation must deprive the owner of all economically beneficial or productive use of land.
g.i. Does temporary elimination of all economically beneficial or productive use of land meet this standard?
g.ii. The Supreme Court answered “no” to this question in Tahoe-Sierra Preservation Council, Inc. v. Tahoe Regional Planning Authority

II. Seiber v. United States (2004)
a. 40 of 200 acres—to clear the trees
a. 2000 Federal Fish & Wildlife denied logging permit because of northern spotted owl concerns
b. 2002 Fish ad Wildlife—allows, owls seem to have gone somewhere else
c. Plaintiffs sue for taking, denying right to log for two years
c.i. Not like Tahoe, insofar as the limit is not controlled by government
d. The Sieber’s were unable to actually prove that the property’s value was reduced
d.i. Economic injury they suffered is modestfine under Penn Central
e. Siebers tried to argue that each tree was a separate piece of property; and thus totally lost value
e.i. How do you aggregate what counts as property? What is the scope?
e.ii. Still no takings under Lucas
e.iii. Loretta claim—they were denied the right to exclude others: the owls; nice try but NO

III. Philip Morris, Inc. v. Reilly (2002)
a. Taking of trade secrets by demanding public disclosure of ingredients
e.iv. Trade Secrets value hinges on them being secret
e.v. Government buys tons of things; constantly buying intellectual proeprty
b. Three different views
e.vi. Taking under Penn Central
e.vii. Taking under Loretto (functionally)
f. Not a taking at all

Massachusetts statute requiring disclosure of ingredients in tobacco products was a taking of manufacturers’ trade secrets under Penn Central test.

IV. Dolan v. City of Tigard (1994)
a. Need a permit to build; attached with condition (permit to build provided that you then dedicate 100 yards for drainage plain and other for bike path)
b. Why is this a taking?
b.i. Relationship between impact of expanded building and the conditions they’re attaching aren’t sufficiently tied
b.ii. Relationship between building on flood plain and inhibiting further; yes.
b.iii. How they went about encouraging—disproportionate
b.iii.1. Asked too much of Dolan to solve these broader issues
b.iii.2. Duties imposed upon the permit is a taking
b.iii.2.a. City has to pay for bike path and Greenway
b.iv. Two-part test:
b.iv.1. Essential nexus question
b.iv.2. Whether the degree of the exactions demanded by the city’s permit conditions bears the required relationship to the projected impact of petitioner’s proposed development