938

PROPERTY

INTRODUCTION:
THE MEANING OF PROPERTY
The concept of property occupies an important place in human life, because it is virtually
impossible to live without the use of material objects which constitute the subject-matter
of property.

In its widest sense, all animate or inanimate things belonging to a person are included in
the term property; for instance, a person’s life, liberty and estate may also be considered
his property. However, it has now become obsolete to interpret the term "property“ in
this comprehensive sense.

In a limited sense, property covers only a person’s proprietary rights as opposed to his
personal rights. Thus land, chattels, shares and debts due to him constitute his property.
Thus in the most usual sense in which the term is used in modern times.

In modem times, apart from its common use, “property" is used in a wider sense also. In
its widest sense it includes all the rights which a person has. Thus, a person’s life,
liberty, reputation and all other claims which he might have against other persons is his
property.

The term “property" is used also to denote the proprietary right of a man as opposed to
his personal rights. In this sense, it means a person’s land, house, his shares in a business
concern, etc. It is used in a third sense also, that is, to mean proprietary right "in rent".
SALMOND takes the term in this sense. He says: “the law of property is the law of
proprietary rights 'in rent he law ofproprietary rights 'in pesonam ’ being distinguished
from it as the law of obligations. According to this usage, a freehold or leasehold estate
in land, or patent or copyright is property but a debt or the benefit of a contract is not”1.
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There is also a fourth and the narrowest sense in which the term “property” is used. In
this sense it includes corporeal property only. It denotes the right of ownership in a
material object or the object itself. It is submitted that in modem times, the general use
of the term is not made in the sense in which it includes all the legal rights, nor the term
has remained confined to the sense in which it includes corporeal property only. The use
of the term in this sense will not give the idea of the practical application of it. In most of
the legal systems of the world the term is used either in the second or in the third sense.
The sense in which SALMOND takes the term “property” is also narrow. Now, things
or rights which were not called property previously have come to be included in it.

SALMOND observes that the term property may have a variety of applications but in
legal terms, it refers to the following:-

H All Legal Rights

It includes a person’s legal rights of whatever description. A man’s property is

all that is his in law. This ordinarily implies complete ownership of all things -
material as well as incorporeal.

HOBBES12 and BLACKSTONE have supported the use of the term property in
this sense.

21 Proprietary Rights

It includes not all rights, but only a man’s proprietary rights as opposed to his
personal rights. Thus if I sell my land to you, the property in it shall pass to you
on your paying me the purchase money.

3Jl Corporeal Property

In this sense, property includes nothing more than corporeal things, that is, right
of ownership in a material object such as a watch, land, horse, etc.

1 SALMOND: Jurisprudence
2 HOBBES : Legislation Chap.XXX P.329
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BENTHAM has preferred to interpret the term property in his narrowest sense1.

AUSITN looks at property in its widest sense and suggests that property denotes the
greatest right of enjoyment known to the law excluding servitudes. Sometimes even
servitudes are described as property in the sense that there is a legal title to them.
Sometimes property means the whole of the assets of a man including both his
proprietary as well as personal rights.

MEANING EXPANDED
In the beginning, “property" included only the corporeal objects. But gradually the
meaning went on expanding.

This expansion took place due to many reasons and in course of time.

First, the jurists who propounded the contract theory of the origin of the state attempted
to give a wide meaning to the term “property". They said that the state and law came
into existence only for the protection of the property. In property they included all the
things which are necessary for he development of the individual.

LOCKE said that “every man has a property in his own person ”, and at another place he
said that “the man has the right to preserve his property, life, liberty and estate’’2.

Though its wider meaning seems never to have received legal recognition, it helped in
expanding the meaning of the term.

The second factor which helped in extending the meaning of the term was the equity
jurisdiction of English courts. There Was a maxim to define equity jurisdiction which

said that the equity will protect only the rights of property. In equity courts there were
lesser formalities and the relief that the equity courts granted was not available in any
other courts. Therefore, an attempt was made to bring more and more cases under equity

1 BENTHAM : Principles of Legislation, P.231

2 Treaties on Civil Government
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jurisdiction. Thus, meaning of "property” was stretched and sometimes, personal rights
were also included in it.

Another development which caused expansion in the meaning of the term “property” is
the constitutional protection given to property in many legal systems in modem times.
The states is restrained form arbitrary interference in the individual’s enjoyment of his
property, or taking it without payment of compensation1. To obtain this constitutional
protection attempts have been made to extend the meaning of “property". In some cases
in order to give the protection it became necessary to defined “property”2

THE SUPREME COURT’S VIEW

“The right of property guaranteed by Article 19(1) (f) means that rights which by
themselves and taken independently, are capable of being acquired, held or disposed of
as property".

In another case3 it was observed “there is no reason why the word 'property' as used in

article 19(1) (f) of the constitution should not given a liberal and wide connotation, and
should not be extended to those well recognized types of interests iwhich have the insignia
and characteristic ofproprietary right".

In a third case4 it was said that “property” in article 31 “must be understood both in
corporeal sense as having reference to all those specific things that are susceptible to
private appropriation and enjoyment as well as in its judicial or legal sense of a bundle
of rights which the owner can exercise under the municipal law M>ith respect to the user
and enjoyment of those things to the exclusion ofall others ”.

1 See, Indian Constitution, 1950, Articles (i) (f) and 31(2)

l■’ Conner,
Chiranjitlal V. Union Of India, (1950) SCR 869
HRE V. Lakshmindira, AIR 1954, SC 282
4 State of West Bengal V Subodh Gopal (1954) SCR 587
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It was due to the reason of giving such a wide meaning to property that in one case1, it
was held that a bare contractual right unattended with any interest in property is property.

In a recent case2 the following definition of property has been quoted "property means
the highest right a man can have to anything being that right which one has to lands or
tenements, goods or chattels which does not depend on another’s courtesy. It includes
ownership, estates and interests in corporeal things, and also rights such as trade-marks,
copyrights, patents and even right 'in personam’ capable of transfer or transmission,
such as debts, and signifies a beneficial right to or a thing considered as having a money
value, especially with reference to transfer or succession, and of their capacity of being
injured”.

A fourth reason of the extension of the meaning of the term “property ” is the growth of
new forms of wealth in modem times.

As in England, the hierarchy of interest was created on land, it is now being created on
funds. Now, much of the wealth consists of documents "deed, instruments, etc. ” which
represent, in one or the other way, a claim of a right. A form of property called
"intellectual property” has come into existence and its importance is growing. Now,
there is generally a separation between ownership and possession. Both of them in their
various shapes and forms are property. Thus, in modern times "property ” has been given
a very wide meaning.

NEW DEVELOPMENTS
At one time private property was held in high esteem. A number of legal theories were
propounded3 which said that the man function of the state and law is the protection of

property

1 Shantabai V State of Bombay, AIR 1958, SC 532

; R.C.Cooper V. Union of India, AIR 1970, SC 564
J See, Chapter IX, "Natural Law”
 943

The theory of “laissez faire” also pleaded for the protection of individual’s property
rights. But, after the industrial revolution, there came a change. The state started
interfering with the private property of individuals. The new developments and changes
in political and economic thought helped in increasing the state interference. Now, in all
the developed societies there are a number of rules and regulations which impress various
restrictions on private property. There are theories which say that private property should
be abolished and they emphasis the social character of the property.

In USSR the state has taken over the ownership of land and industries and in many other
communist countries the same thing has happened. In democratic countries also there is
a move towards nationalization of the means of production.

THEORIES OF PROPERTY
Various theories have been given form time to time both in support and against private
property. These theories are called the theories of property. These theories are of two
kinds.

1) The theories about the origin of property. These theories attempt to explain how
property came to be.
2) The theories about the tenability of the institution of property. These theories can
be divided into two classes.
One class of theories justifies the institution of property and the second class
condemns it and argues for its abolition.

Following are some important theories of property.

11 The Natural Law Theory

This theory is based on the principle of natural reason derived from the nature of
things. According to this theory property was the firsts acquired by occupation of
an ownerless object1 as a result of individual labour. Natural theory says that

1 In legal terminology ownerless objects are called rus nullius

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property arose by “occupatio", that is, by taking control of “res nullius". He

who first takes the possession of an object has the right to retain it.

The view is supported by GROTIUS, BLACKSTONE, PUFENDROF and

LOCKE and many others. MAINE is opposed to this view. MAINE says that the
doctrine that the “occupatio " gives title is probably the result of later thought. “It
is only when the rights of property have gained a sanction from long practical
inviolability, and when the vast majority of the objects of employment have been
subject to private ownership, that mere possession is allowed to invest the
possessor with dominum over commodities in which non proprietorship has been
asserted”. It is submitted that the “natural theory" neither gives a convincing
account of the origin of property nor it gives any justification for it. In modern
times, this theory is of little practical value.

According to GROTIUS, all things originally were without an owner and

whosoever captured them or occupied them, became their owners.

According to PUFENDROF, originally, all things belonged to the people as a

whole. There was no individual ownership. By means of an agreement or a pact,
private ownership was established.

According to BLACKSTONE, “by the law of nature and reason, he who first
began to use a thing acquired therein a kind of transient property that lasted so
long as he was using it and no longer; or to speak with greater precision, the
right of possession continued of the same time only that the act of possession
lasted But when mankind increased in number, craft and ambition, it became
necessary to entertain conceptions of more permanent dominion and to
individuals, not the immediate use only but the very substance of the thing to be
used. The theory of occupancy is the ground andfoundation of all property or of
holding those things in severalty which by the law ofnature, unqualified by that of
society, were common to all mankind”.
 945

KANT also supported this theory in his classic work "philosophy oflaw”

BLACKSTONE, "by the law of nature and reason, he who first began to use a
thing acquired therein a kind of transient property that lasted so long as he was
using it and no longer". However, all the population increased, the meaning of
property was extended not to the inordinate use only but to the substance of thing
to be used. Thus, the theory of occupancy is the ground and foundation of all
property.

Of the natural law theories, POUND has said, some proceed on ideology of
principles of natural reason deduced from the nature of things, whereas some
others proceed on conception of human nature. The theories which are founded
on the notion of nature of things constitute the ideas of the Roman lawyers. They
begin with a definite principle found as the explanation of concrete case and make
it universal basis for a general law of property. Such theories have usually
emanated either from the idea of occupation or from the idea of creation by
labour. The latter, that is, theories based on the conception of human nature are of
three kinds:
1) That which is rooted in the conception of natural rights;
2) That that is based on a social contract; and
3) That which has arisen as a result of economic natural law.

In this form of theory a general basis of property is derived from the economic
nature of man or from the nature of man as an economic entity. These are
generally known as modem theories of natural law on an economic than on the
i

ethical ground .

The natural theory of property has been criticized by Sir HENRY MAINE and
BENTHAM. According to HENRY MAINE it is erroneous to think that

1
See, POUND, Op lit PP 114-115
 946

possession gives rise to title1 for there is no reasonable ordinance to support this

contention. BENTHAM holds that property has not originated by first occupation
of an ownerless thing, but it is a creation of law. He does not believe in the
existence of property without the existence of law.

2)_ The Labour Theory

According to this theory, a thing "res ” is the property of the person who produces
it or brings into existence. However, this view has been criticized by HAROLD
LASKI on the ground that labour does not produce property, it is only a means to
earn property2.

Notably, the MARXIST theory of property is based on predominance of labour in

economy of a country. This theory has lost significance in modem times because
it has been shown that there may be many situations when property can by
acquired without labour, e.g. property obtained by inheritance or under a will.

The labour theory of property is also sometimes called as the positive theory. It
was propounded by SPENCER who based it on the fundamental law of equal
freedom of individual. He asserted that property is the result of individual labour
and, therefore, no one has a moral right to property which he has not acquired y
the personal labour.

31 The Metaphysical Theory

Metaphysical theories of property are the result of general movement which
replaced the 17th and 18th century theories of natural rights based on the nature of
the abstract man or on an assumdd contract.

' Sir HENRY MAINE : Ancient Law, P.269

2 HAROLD LASKI : A Grammer of Politics (5,h Ed.) P.185
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KANT, who may be said to have taken a lead set himself to justify the idea of
property, that is, an idea of "external meum and tuum ", KANT, who believed in
the inviolability of the individual human personality, said, that a thing is mine
when I am so connected with it that anyone who used it without any consent
cause an injury to me. For justification of law of property, it is necessary that one
should move for beyond tire cases of possession where there is an actual physical
relation to the object and interference therewith is a transgression of personality.
A thing may only be mine for the purchase of legal system of "meum and tuum ”,
where I shall be wronged by another’s use of it when it is not actually in my
possession. The first possessor, according to him, based upon a common innate
right of taking possession, and to disturb him is a wrong. The first taking of
possession has a title of right, behind it in the doctrine of original common claim
to possession. It results that this taker obtains a control "realized by the
understanding and independent of relations of space ” and he or those who derive
from him may possess a parcel of land through remote form it physically1. Such a
possession, is only possible in a state of civil society.

Having thus worked out a theory of ”muem and tuum”; as legal institution, KANT
then proceeded to a theory of acquisition, by distinguishing original and primary from
a derived acquisition, then proceeded to a theory of acquisition, by distinguishing
original and primary from a derived acquisition, and stated that noting is originally
mine without a judicial act2. The essential elements of this legal transaction of

original acquisition, he said, are three:

1) “Penetration " of an object that belongs to none;
2) An act of the free will interdicting all others from using it as theirs;
3) Appropriation as a permanent acquisition.

Having worked out a theory of acquisition, he then turned to a ownership of

derivative acquisition by way of transfer, delivery and contract as a legal giving

' KANT, Metaphysische Anfangsgrunde der Rechisichre, 2nd, Ed., 1798, Paras: 1,6-8, 10. Also Pound,
Op.Cit. PP 117-118
2 POUND: Op. Cit. P.119
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effect to the individual will by universal rules. This metaphysical version of the
Roman theory is, no doubt, a connecting link between the 18th century and

SAVIGNY’s aphorism that all property is founded on adverse possession ripened by

prescription.

KANTs theory that property is a part of the human personality is little concerned
with realities, yet it manifests a truism that a person relying upon the property of
another may not live a free and happy life. Property thus is necessary for self-
realization.

According to HEGEL, "property is the objective manifestation of the personality of

an individual’’. In other words, property' is the object on which a person has the
liberty to direct his will. Property according to him is the external manifestation of
liberty. “Person has a right to direct his will upon an external object and an object
on which it is so directed becomes his. It is not an end in itself; it gets its whole
rational significance form his will". Property, HEGEL said, is necessary to make a
man free.

HEGEL’s metaphysical theory of property has been under a severe attack from the
view point of “res extra commercium". It is in fact, very difficult to reconcile
HEGEL’s argument with the argument put behind the notion of “res extra
commercium” that certain things were not subject to private ownership.

MILLER pointed out that beyond what is required for the natural existence and
development of the person property, “can only be held as a trustfor the state .

In modem times, a periodical redistribution is economically inadmissible yet if

anyone’s holdings have exceeded, the natural bounds of reason, the legislature may
unhesitantly impose limitations on behalf of the society preventing any injustice to
be done through caricaturing an abstract right.

1 MILLER Lectures on Philosophy of Law (1884) Lect.5

 949

While linking metaphysical theories with the theories based on the human nature.
LORIMER stated that the conception of property is inseparably linked “not only with
the life of man but with the organic existence in general ” that “life confers rights to
its exercise corresponding in extent to the power of which it consists”1.

il The Historical theory

Tliis theory believes that private property has its growth in three distinct stages.

1± In the First Stage

A tendency is developed among people to take things in to natural

possession and exercise control over them independently of the law or the
state.

21 In the Second Stage

The juristic conception of possession gradually developed which meant

possession in fact as well as in law.

il In the Third and the Last Stage

There was development of ownership which is purely a legal conception

having its origin in law. The law guarantees the owner of property,
exclusive control and enjoyment of property owned by him.

This theory lays down two propositions.

Il The First Proposition ''

That the institution of property has developed through a process of steady

growth.

LORIMER Institutes of Law (2nd Ed. 1880) P.215

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21 The Second Proposition

That the idea of individual property developed out of group or collective

property.

Expounding the first proposition the theory says that property developed through
above three stages. In brief...
a) A mere control of the "res”.
b) Fact of control received legal recognition. It called juristic possession.
c) The concept of ownership came into being.

Sir HENRY MAINE was the chief supporter of the historical theory of the origin
of property. He observed that property originally belonged not to individuals, not
even to isolated families, but to large societies composed on the patriarchal
pattern. It was at a later stage that collective property disintegrated and individual
rights of property came into existence1.

Dean ROSCOE POUND also agrees that the earliest form of property was group
property which subsequently disintegrated into family property and finally the
concept of individual property evolved. The noted Italian juristic MIRAGLIA has
also supported the historical theory of property.

51 The Psychological Theory

this theory says that there is a natural instinct in man to acquire and control
objects. It is this instinct that brings the property into being. The law takes
account of the instinct and confers certain rights on individuals over the objects
which they have acquired.

According to psychological theory - property came into existence on account of

the acquisitive tendency of human beings. Every one desires to own things and
keeps them in his possession and control.

1 Sir HENRY MAINE : Ancient Law, P.270

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BENTFAM lias supported this theory of property and pointed out that property is
altogether a conception of mind. It is nothing more than an expectation to derive
certain advantages from the object according to one’s capacity.

DEAN POUND also supports BENTHAM and hold that the sole basis of
conception of property is the acquisitive instinct of individual which motives him
to assert his claim over objects in his possession and control.

The theory has been criticized for beings MAINE’S imaginative reconstruction
based on Indian village communities and certain local customs prevailing in
ancient Indian village and, therefore, it lacks universal application.

6[ The Functional theory

This theory emphasizes that the concept of property should not only be confined
to private rights but it should be considered as a social institution securing
maximum interests of the society.

In modem times, an approach to the concept of property has been made from
functional point of view. This approach says that there should not be any "a
priori" theory for the justification of property. Any theory of property should be,
built by an analysis of the function and the social effect of the property. Property
obtained through labour or effect is justified, but if it is acquired otherwise it is
not justified. The distribution of property in the society must be on proper and
equitable principles. It will encourage the production of property and will
consequently increase the social wellbeing.

JENKS suggests that no one can be allowed an unrestricted use of his property to
the detriment of others. In his opinion, the use of property should conform to the
rules of reason and welfare of the community. The theory justifies acquisition of
property by law and individual - efforts. Its distribution, however, should be on
equitable basis.
 952

LASKI also supports the functional theory of property. He observes, “property is

a social fact like any other and it is the character of social facts to keep on
changing. Property, therefore, has assumed varied aspects and is further liable
to changes with the changing norms of the society".

7} Theory that Property is the Creation of State

According to this theory the origin of property is to be traced back to the origin of
law and the state.

Property is “a creation of the state and achieved only after a long struggle with
the clan’’1. If one regards the various rights that he enjoys in respect of his
property as the essential characteristic of property, undoubtedly, it is the state that
has provided the machinery by which these rights are enjoyed. It is submitted that
the rights in the property were gradually created, defined and regulated by the
state and the state protects and enforces these rights, but to say that the state
created the property is not a sound proposition. The emergence of the state and
the creation of private property were the results of some social and economic
forces, therefore, it is not true to say that one is the creation of the other. There
may be private property without a highly developed state.

JENKS observed that property and law were born together and would die
together.

This, in other words, means that property came into existence when laws were
framed by the state. In this context ROUSSEAU observed, “it was to convert
possession into property and Usurpation into a right that law and state were
founded". He asserted that property was the creation of the state and property is
nothing but a systematic expression of degrees and forms of control, use and
enjoyment of things by persons that are recognized and protected by law. There
is, however, little truth in this theory because in fact both the state and property

1 JENKS, Law and Political in tbs Middle Ages

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have their origin in the socio-economic forces, therefore, one cannot be the source
of origin of the other.

81 Positive Theory

According to positivists the foundation of property is necessarily the same as that

of metaphysical jurists. Thus, HERBERT SPENCER’s theory is a deduction
from a fundamental “law of equal freedom ”, verified by the observation of the
facts of primitive life1. But this law of equal freedom, supposed to be ascertained
by observation is in fact KANT’s formula of justice. With a distinction that
metaphysical jurists relied mainly on primitive occupation of ownerless things,
the positivists were inclined to lay emphasis upon creation of new things through
labour, that is, that property is the outcome of labour. The theory of SPENCER
involves the same drawbacks as those involved in the metaphysical deduction.
For, it accounts an abstract idea of property rather than the regime which exist in
reality inequalities are bound to occur due to greater strength or greater ingenuity
of those who have acquired more than their fellowmen2. Furthermore in modem

times, property can no longer be stated as a result of labour when the value of a
piece of land is augmented as some mine has been discovered there.

Similarly, property may again, not be the result of labour, specially in a case
where a man has inherited a good fortune.

Professor POUND has well .remarked : “Also if, instead of looking at property
( from an ideal of a maximum of individual activity, as SPENCER did, one looks at
it from an idea of a maximum effectiveness of the economic order, a distinction
may be drawn, as in the Soviet Idw, between instruments ofproduction, which it is
assumed may be used more efficiently when socialized, and consumer’s goods
articles of personal consumption and comfort, destined only to be consumed or

1 SPENCER stated : 'ifone individual interferes with the relations ofanother ofthe natural media upon
which the latter '.v life depends, the infringes the like liberties ofothers by which his own are measured"
HERBERT, SPENCER Justice (1891), Chap 12
2 POUND : Op. Cit. P.123
 954

used for the individual life, with - no potentiality of producing anything.

Accordingly how to give a rational account of the so-called natural right of
property and how to fix the natural limits of that right became vexed questions of
philosophical jurisprudence ”.

9j Sociological Theories
Sociological theories of property are of various types. Of these some are
positivist, some psychological and some social utilitarian.

An important example of the first is DUGUIT’s deduction from social

interdependence through similarity of interest and through division of labour,
DUGUIT made it quite clear that the law of property is becoming socialized but
by this he never meant to say that property is becoming collective. He only meant
that men are ceasing to think of it in the sense of private right and are thinking of
it in he sense of social function. Thus, according to DUGUIT property is no more
than a social institution based upon an economic need in a society organized
through division of labour.

The second type of sociological theories are psycho-sociological theories. These

theories which have specially been popular in Italy, sought the basis of property in
an instinct of acquisitiveness considering it a social development or social
institution on this basis.

Another kind of it are social utilitarian theories. These justify property as an

institution securing or satisfying maximum of interests or wants, conceiving it to
be a wise wit of social engineering.

Recent socio-economic theories have turned out to the function of property in the
social welfare state. It is stated that ownership which in law mean the absolute
power of disposing of a thing, had originally been a just and adequate legal
 955

institution in a society in which property, work and use went together in a simple
economic order. '

MARX contended that in the evolution of society ownership of a complex of

things no longer coincides with the substrata of personal work and use but as
absolute control of the complex, regarded as capital, becomes a source of new
power of command. MARX gave the following thought:

"The capitalist is not capitalist because he directs 'the work’ but he becomes an
industrial commander, because he is a capitalist. Industrial command becomes
an attribute of capital, as under feudalism the power of command was, in war and
in law, an attribute of ownership ofland"1.

By means of this power, the capitalist exercise a quasi-public exercise a quasi­

public authority over those who are tied to him by the service contract.

RENNER who developed the thesis stated that the juristic institution is still the
same as at the time when the worker also owned the means of production but its
function has changed. The owner of certain things can use his ownership to
control other persons2. Thus, while in legal form property is an institution of

private law, a complex power of doing what one likes with the thing owned, it has
become in economic effect an institution of public law in the sense of power of
command exercised through incidental legal institutions developed from the law
of obligation3.

FRIEDMANN has remarked th&t in the economic order of the day ownership and
control have become increasingly divorced, “where the management of a vast and
complex corporate enterprise can either govern undisturbed because of the
dispersal of shareholdings among multitudes of small owners or because it can, if

1 MARX : Das ICapital, 1,297

2 See, FRE1DMANN, W. Legal Theory, PP.329-330
1 POUND, op. cit, P.131
 956

necessary, stir up the majority of shareholders in order to fight the dominant

minority”1.

Thus, according to FRIEDMANN, what has been called managerial revolution

must be taken into cognizance. "The powers formerly, necessarily attendant on
property have now largely passed to those who, without necessarily being owners,
can control and direct a variety of owners of shares or assets in an enterprise,
whether this be the result of diffusion of ownership, of apathy, of skillful
manipulation, of the centralization of know how and administrative control in the
hands of management, or a combination ofall these factors

KINDS OF PROPERTY
Property is mainly of two kinds, namely,
1) Corporeal, and i
2) Incorporeal

Corporeal property is the right of ownership in material things, whereas....

Incorporeal property is any other proprietary right “in rem ” e.g.

patent right,
right of way

Corporeal property is always visible and tangible while...incorporeal property is not.

Both are, however, valuable rights in as much as they are legal rights recognized and
enforced by law.

Corporeal property is of two kinds,

1) Movable, and
2) Immovable

1 FRIEDMANN, W., Law in a changing society, P.78

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Incorporeal property is further divisible into two kinds, namely

i) “Jura in re aliena” or encumbrances, whether over material or immaterial things,
e.g. a) lease; b) mortgages; c) servitude &

ii) “Jura in re propria" over immaterial things such as a) patents, b) trade marks, c)
copy rights, etc.

The detailed classification of property is shown in the chart given below:-

OWNERSHIP OF MATERIAL THINGS

The owner of a material object is he who owns a right to the aggregate of its uses. Thus,
ownership is the right of general use. This need not be absolute or unlimited use. He
who has merely a specific right of way is not the owner of the thing but merely an
encumbrance of it. The right of ownership is an inheritable right. In short, the right of
 958

ownership in a material thing may be defined as the general, permanent and inheritable
right to the uses of a thing1.

11 Corporeal Property
It is called tangible property also, because it has a tangible existence. It includes
all material things. The person who has the right to the aggregate use of an object
is called the owner of the object and the object is called his property. But the
right means a right of general use only. It does not mean that the right is absolute
or unlimited. Generally, there are two kinds of restrictions on one’s use of his
property.

1) The first kind of restrictions are those that are imposed by law, and it is
done in the interest of society.
2) The second kind of restrictions are those that are encumbrances on the
property.

The right of ownership is general, permanent and heritable.

In another words, as stated earlier, corporeal property is also called tangible

property because it has a tangible existence in the world. It relates to material
things e.g. land, house, money, ornaments, gold, silver, etc. are corporeal property
the existence of which be felt by the sense organs.

In Roman law - corporeal property is termed “res corporalis”. BUCKLAND,

however suggests that corporeal property under Roman law referred only to the
ownership of the right of general user.

The corporeal property can be divided into:

1) Movable and immovable property.
2) Real and personal property

1 SALMOND : Jurisprudence (12th Ed.) P.415

 959

II Movable and Immovable property

The division of property into movable and immovable is very important.

This division is general found in all the legal systems but the basis on
which this division is made is not uniform and it is different in different
legal system. A number of incidents and the extent of rights in property
depend on its being movable or immovable. In India, the division of
property is into movable and immovable, but in English law the same is
known as chattels and land.

All corporeal property is either movable or immovable. In English law

these are termed as chattels and land respectively.

According to SALMOND, immovable property “i.e. land” has the

following elements:-

a) Determinate portion of the earth’s surface;

b) The ground beneath the surface down to the centre of the earth;
c) The column of space above the surface "ad infinitum ”;
d) All objects which are on or under the surface in its natural state
e.g. minerals, natural vegetation, or stones lying loose upon the
surface;
e) All objects placed by human agency on or under the surface of the
land with the intention of permanent annexation e.g. house, walls1,

fences, doors, et.c These become part of the land and lose their
identity or separate movable chattels. It must, however, be noted
that physical attachment without the intents of permanent
annexation does not make change in the nature of movable
property. For example, carpets or ornaments nailed to the floor
wall of a house or money buried in the ground are as much a
chattel “movable property” as money in the owner’s pocket.

1
Moti V. Barnes (1901) KB 205
 960

Immovable property has been defined in the general clauses act, 1897 to
include land, benefits to arises out of land, and thin attached to the earth,
or permanently fastened to anything attached to the earth1. The term is
also defined in the Indian registration act, 1908, thus immovable property
includes land, buildings, hereditary allowances, right to way, light, ferries,
fisheries or any other benefits to arise out of land and things attached to
the earth or permanently fastened to anything which is attached to the
earth, but not standing timber, growing crop or grass.

The transfer of property act, 1882 excludes standing timber, growing crops
and grass from the definition of immovable property.

The following are judicially recognized as immovable property-

a) Right of way
b) Right to collect rent of immovable property
c) A right of ferry
d) A mortgagor’s right to radeem the mortgage.
e) The interest of mortgagee in immovable property
f) Right of fishery
g) Righ to collect "lac ” from trees.

The following are not judicially recognized as immovable property-

a) Standing timber;
b) Growing crops;
c) Grass;
d) A right to recover maintenance allowance even though it is
charged through immovable property;
e) Right of purchaser to have the land registered in his name;
f) Royalty
g) A decreeof sale or sale of immovable property on a mortgage

Section 3 (26) of the Generafclauses act, 1897

 961

Movable property, on the other hand, may be defined as any corporeal

property which is not immovable property.

H Real and Personal Property

The distinction between real and personal property is closely connected

with but not identical with the distinction between movable and
immovable property. The distinction, however, has no scientific basis, it
is mostly the product of the history of the law of action in England.

Real property means all rights over land recognized by law.

Personal property, on the other hand, means all other proprietary rights
whether they are right “in rem ” or right “in personam Commenting on
this distinction, SALMOND observed, “the law of real property is almost
equivalent to the law of land while the law ofpersonal property is almost
identical with the law ofmovables .

The distinction between real and personal property has been drawn from
the Roman law. The real property and immovable property form
intersecting circles which are very nearly though not quite coincident.

Movable property is commonly termed as chattel which has three different

meanings:
1) Any movable physical object such as table, money, dog, etc.
2) Incorporeal proprietary rights such as debts, shares and other rights
“in rem ” which are not rights over land.
3) Personal property, whether movable or immovable, as opposed to
real property.

SALMOND : jurisprudence (12* Ed.) P.420

 I

962

21 Incorporeal Property

RIGHTS IN RE PROPRIA IN IMMATERIAL THINGS

Proprietary rights are both in relation to material and immaterial things.

Material things are physical objects and al other things which may be subject-
matter of a right are immaterial things.

They are various immaterial products of human skill and labour. These
immaterial forms of property are as follows-

i) Patents
ii) Copy right
iii) Commercial goodwill “trademarks and trade names ”

fl Patents

The subject matter of a patent rights is an invention such as the idea of a

new process, instrument or manufacture. The person by whose skill or
labour the invention or a new process or manufacture is “introduced” has
the exclusive right of patent in it. This is granted to the inventor by the
state1.

In other words, a patent is the new idea or particular process of

manufacture produced or discovered by human skill and labour. Patents
become commercially valuable as a monopoly of exploitation is given to
the patentee. Law takes action against those who infringe in any way the
patents.

The Indian patents & designs act provides that a person who has registered
a patent gets the exclusive right to make use or sell the patented invention

1 the rights of a person who is responsible for a new invention are protected by the Indian patents and
Designs act, 1911
 963

for a period of fourteen years, and any person who whether with or
without the knowledge of the existence of the patent right, infringes the
same, may be restrained by injunction and if he knowingly infringes the
patents, shall be liable also for damages.

ijl Copyright
The subject-matter of the right is the literary expression of facts or
thought. The right may be available to writer, pointers, engravers,
sculptures, photographers, musical and dramatic personnel for their
outstanding work. When such a person does some creative work by
utilizing his intellect, skill and labour, he is entitled to exclusive copyright
which is an immaterial form of property. In short, copyright may be
literary copyright or artistic copyright or musical and dramatic copyright1.

Literary copyright is possessed by the author of the books. No person is

allowed to print it and if he does so, he is liable to be punished. Literary
copyright is a great born to the writers of the world.

It is thus right which enables them to earn their livelihood and also make
provision for their successors. The copyright exists not only during the
life-time of the author and the co-author, but even after their death.

In the case of artistic copyright, the subject-matter are the particular

designs or fomis. The artist alone has the exclusive use of design or form.
Such a copyright exists in the case of drawing, painting, photography, etc.

Musical and dramatic copyright consists in musical and dramatic works.

The composer, musician and the dramatist have the exclusive right to the

1 Infringement of copyright is punishable under IPC or may be proceeded against by a civil suit for
damages
 964

use of their things. Any unauthorized performance or representation is

liable to be punished with imprisonment or fine or both.

m) Commercial Goodwill “Trademarksand Tradenames”

Yet another form of immaterial property is commercial good will,
trademarks and tradenames. The good will of commercial business is a
valuable right acquired by the owner by his labour and skill. He has
exclusive right of use and profit from the business and anyone who seeks
to make use of it by falsely representing to the public that he is himself
carrying on the business in question, shall be violating this right.

The good will of a company is a valuable right acquired by a person by his

labour and skill exercised for a considerable period. Very often, the sale
of goodwill brings a lot of money to its owner.

Tradenames and trademarks are also the property of persons who own
them. They protect the public from the cheaters. They guarantee a
particular quality of goods.

HOLLAND adds a new type of tangible property to the list. To quote

. him, “with such intangible property should probably also be classified
those royal privileges subsisting in the hands of a subject which are known
in English law as franchises, such as right to have a fair or market, a
forest, free warren or free fishery”.

RIGHT IN RE ALIENA “ENCUMBERANCES”

Rights in "re aliena” are known by the name of encumbrances. They are rights “in rem ”
and a "res” owned by another. Such rights run with the “res” encumbered. They bind
the "res ” in whosoever hands it any pass. Encumbrances are the rights of particular user
as distinguished from ownership which is the right of general user. Encumbrances
 965

prevent the owner from exercising some definite rights with regard to his property. The
main categories of rights in “re aliena” or encumbrances are:-

i) Leases;
ii) Servitudes;
iii) Securities, and
iv) Trusts

ll Leases

A lease is that form of encumbrance of property vested in one person by a right to

the possession and use of it vested in another.

In other words, a lease is an encumbrance giving a right to the possession and use
of the property of another person.

Thus it is transfer of right to the possession and use of property owned by some
other person. It is an outcome of the rightful separation of ownership from
possession. A lease may either be for a certain specified period or in perpetuity.
It is an encumbrance in which the lessor i.e. the owner of property transfers his
right of possession to the lessee... Thus, if I own a house which is let out to a
tenant, I have created a lease i.e. I have detached my possession from my
ownership. I am still the owner of the house but the tenant i.e. the lessee has the
possession of it and he can use it so long as the lease subsists.

A lease of immovable property, therefore, is a transfer of a right to use and enjoy

such property for a certain period, express or implied or in perpetuity in
consideration of:
a) A price paid or promised, or
b) Money, or
c) Share in crops, or
d) Service, or
 966

e) Any other thing of value to be rendered periodically or on specified

occasions to the transferee “i.e. lessee" who accepts the transfer on such
terms1. The price is called the "premium” and the money, share or
produce or service rendered is called the “rent", the transfer or is called
the lessor and the transferee the lessee.

The essentials of a lease may be summarized thus:

a) The lessor. He must be a person competent to contract and must have title
or authority.
b) The lessee. He must also be competent to contract since a lease is to be
executed by both - lessor and the lessee.
c) Subject-matter of the lease which must be immovable property.
d) Transfer of right of possession to use and enjoy such property.
e) Duration of the lease. It may be express, implied or in perpetuity.
f) Consideration which may be premium, rent or both. As already stated
premium is the price paid or promised in consideration of a transfer by
way of lease. Any payment by the lessee that is part of consideration of
the lease is rent.
g) The lessee must accept the transfer; and
h) In certain cases, a lease must be made through a registered deed.

Generally speaking, a lease is always with respect to immovable property i.e.

land. The right involved in a lease is also called “tenancy”. However, in
jurisprudential terms a “lease ” has a much wider meaning and may also include
tenancy in land, bailment of movable property, all encumbrances relating to
incorporeal property, etc. In this comprehensive sense, every right that can be
possessed, can be made the subject of a lease. Thus, there can be a lease of
copyright, patenty right of way, etc. In practice, however, lease ordinarily refers
to transfer of possession by the owner “lessor” to the lessee for certain
consideration which may be premium or rent.

1 Section - 105 of the Transfer Property Act, 1882

 967

Servitudes
A servitudes is that form of encumbrance which consists in a right to the limited
use of the piece of land without the possession of it; for example,
- a right of way
- a right to passage of light, o water across the adjoining land
- right of fishing, etc.

A servitude, therefore, is a right to the limited use of a piece of land without

ownership or possession thereof. There is no transfer of possession in case of a
servitude and his distinguishes it from a lease. If a person secures exclusive
possession of a piece of land without getting its ownership, he acquires a lease of
that land but if he only acquires a right to use that piece of land without getting its
ownership or possession, he acquires a servitude on that land. Ordinarily, he
acquires a servitude on that land. Ordinarily, servitudes exist with respect to land
alone.

Servitudes are of two kinds-

a) Private,or
b) Public

A private servitude is vested in a determine individual as in case of a right of way,

or light or support vested in the owner of a piece of land over and adjoining piece
of land.

A public servitude, on the other hand, is vested in the public at large or some class
of indeterminate individuals such as the public right of navigation or fishing,
public right of way over land in private ownership or right of inhabitants of a
village to use certain piece of land for recreation.
SALMOND has further classified servitudes as
i) Appurtenant, or
ii) In gross
 968

“A servitude appurtenant 'it is also called as servitude’” is one which is not

merely an encumbrance of one piece of land but is also accessory to another piece
of land. It is a right of using one piece of land for the benefit of another; as in the
case of a right of support for a building. The land which is burdened with such
servitude is called “servient tenement” and the land which has the benefit of it is
called the “dominent tenant” the servitude runs with each of the tenements into
the hands of successive owners and occupiers1.

A servitude is said to be “in gross ” when it is not so attached and accessory to

any dominant tenement for whose benefit it exists; for example a public right of
way or navigation; or a private right of fishing or mining, etc

iij) Securities
A security is an encumbrance vested in a creditor over the property of his debtor
for the purpose of securing the recovery of the debt. In other words, it may be
said to be a right to retain possession of a chattel until the debt is paid. Security
on immovable property is called a “mortgage ” and on movable property. It is
called a “pledge

According to SALMOND a security is an encumbrance the purpose of which is to

ensure or facilitate the fulfillment or enjoyment of some other right "usually
though not necessarily a debt ” vested in the same person. It would not be out of
place to distinguish security from a surety. In case of security, a particular “res”
is charged with tire debt, but in the case of surety, the person giving surety is
under an obligation to pay the debt of another if the latter fails to pay the debt
himself.
Securities over property are of two kinds:-
i) Mortgages, and
ii) Liens

1 According to SALMOND, an easement, in the strictest sense, means a particular kind of servitude;
namely private and appurtenant servitude which is not a right to take any profit from the servient land.
 969

!l Mortgages

Where immovable property is secured to another for consideration, the

transaction is called a mortgage. It is called “pledge ” if the property is
movable.

A mortgage is in the transfer of interest in specific immovable property for

the purpose of securing:-
a) The payment of money advanced by way of loan
b) An existing or a future debt, or
c) The performance of an agreement which may give rise to
pecuniary liability1.

The transferor is called a “mortgagor ” and the transferee a “mortgagee

The instrument by which the transfer is effected is called a mortgage -
deed. There are six kinds of mortgages.

They are-
a) Simple mortgage
b) Mortgage by conditional sale
c) Usufructuary mortgage
d) English mortgage
e) Equitable mortgage “also known as mortgage by deposit of title
deeds ” and
f) Anomalous mortgage.

These mortgages are explained in section 58(b) to (g) of the transfer of

property act.

Sec 58(a) of the Transfer of Property Act, 1882

 970

ijl Lien
A lien is the right to hold property of another person as a security for the
performance of an obligation.

In other words, lien is a right of one man to retain that which is in his
possession belonging to other until certain demands in respect of the
person in possession are satisfied. Thus, a finder of a goods ahs a right to
retain the goods against the owner till he receives from the owner, the
compensation for trouble and expenses incurred by him, and also specific
reward which the owner may have offered for the return of such goods.
The finder is said to have a lien upon the goods so found. Lien is right to
retain possession of goods and does not include right of ownership or sale.

Liens are of different kinds. They are-

dl Possessory Lien
A possessory lien consists in the right to retain possession of
chattels or other property of the debtor. Examples are pledges of
chattels and the liens of inn-keepers and vendors of good.
b[ Agent’s Lien

In absence of any contract to the contrary, an agent is entitled to

retain goods, papers and other property, whether movable or
immovable, of the principal received by him, until the amount due
to himself for commission, disbursements and services in respect
of the same has been paid or accounted for to him. This is
provided in section-221 of the Indian contract act.

cl Unpaid Vendor ‘s Lien1

The unpaid seller of goods who is in possession of them is entitled

to retain possession of them until the payment or tender of the
price.

Sec 55 (4) (b) of T.P Act

 971

Df Power of Forfeiture

The creditor has the power of destroying some adverse right vested
in the debtor e.g. landlord’s right of re-entry on his land.

E)_ Charges

The creditor has a right to receive payment out of some specific

fund out of the proceeds of specific property. A charge may be
created by act of parties and it may also arise by the operation of
law.

In India ‘‘charge ” is a right which in many respects resembles a

mortgage but it is a lesser right than a mortgage. Section-100 of
the transfer of property act, 1882, defines a “charge ” thus:

“where immovable property ofone person is by act ofparties or by

operation of law, made security for the payment of money to
another and the transaction does not amount to a mortgage, the
latter person is said to have a charge on the property”. A
“charge ” may either be fixed or floating. When a charge pertains
to some specific fixed property, it is called "fixed charge ” but a
floating charge is not so fixed; it may become fixed on the
happening of some future even.

DISTINCTION BETWEEN MORTGAGE AND LIEN

A mortgage is distinguishable from a lien on the following grounds:
1) A mortgage is an indepefident and principal right and not a mere security
but a lien is only a security for a debt. It is merely a right to retain
possession of chattel until payment is made.
2) The right of mortgagee is vested in him conditionally and by ways of
security only whereas right of lien is vested in the lienee absolutely and
not merely as security.
 972

3) Mortgage is created either by transfer or by encumbrance but a lien is

created by way of an encumbrance only.
4) A mortgagor has an infallible right of redemption or mortgage but there is
nothing like “redemption " in case of a lien.
5) In case of mortgage, encumbrance is created independent of debt whereas
in a lien duration is dependent on the debt secured.
6) If a mortgage by transfer of mortgaged property, the mortgagor “debtor ”
remains the equitable or beneficial owner of the property. On repayment
of debt, the mortgagee holds property in trust for the mortgagor. In case
of a lien, full legal and equitable ownership vests in the debtor and the
creditor has only such limited rights which gives sufficient protection to
recover the debt.
7) A mortgage pre-supposes a contract between the parties but existence of a
contract is not always necessary in case of a lien.

41 Trusts
A trusts is an encumbrance in which the ownership of property is limited to deal
with it for the benefit of some third person.

In other words a trust is an obligation annexed to the ownership of property. It

arises out of a confidence reposed in and accepted by the owner.

According to SALMOND, a trust is ordinarily created for the benefit of unborn

persons, infants, minors, lunatics and persons who suffer from some legal
disability1. It is also created for the perfection of some disputed property or
safeguarding the common interest of several persons. The law relating to trusts in
contained in the Indian trusts act, 1882. Thus, in case of a trust though the
property is legally vested in the trustee, he keeps it for the benefit of the
beneficiary.

1 SALMOND : Jurisprudence (12th Ed) P.434

 973

As regards the importance of trusts, PATON comments that it has proved useful
in many fields:-
1) It has been used by associations as a means whereby their property is used
for the desired purpose,
2) It has facilitated endowment and gift for charitable and religious purposes
by vesting the property in trustees for purposes as desired by the settler.
3) The trust has a great social importance in helping settlement of family
property by protecting the interests of young persons and married women1.

TRUST DISTINGUISHED FROM A MORTGAGE

Though the relation of a mortgagor and mortgagee has some analogy to the
fiduciary relation between trustee and the beneficiary, the two are not identical.

A mortgagee is not a trustee for the mortgagor and he does not hold the legal
estate of the benefit of the mortgagor as a trustee does the beneficiary i.e. “cestui
que trust’’.

Again, the mortgagee has not only the legal interest in the property mortgaged,
but also a beneficial interest in it adverse to the morgagor’s, which he can enforce
by a suit against the mortgagor.

ASHBURNER points out that the mortgagee becomes a trustee only after he has
been paid his debt-money.

In equity-law, his right in the property does not extend beyond what is necessary
to secure repayment of the money due to him. If the mortagee has been
reimbursed by sale of mortgage property, he shall become the trustee of the
surplus proceeds, if any, for the person entitled to the equity of redemption2.

1 PATON G.W. : A textbook of Jurisprudence, P.432

2 In Re bedi (1886) 34 Ch. D. 462
 974

MODES OF ACQUISITION OF PROPERTY

There are four important modes of the acquisition of property. It may be acquired by:
1) Possession;
2) Prescription;
3) Agreement, and
4) Inheritance

H Possession
It has been stated earlier that possession is the objective realization of ownership.

It is “prima-facie ” evidence of ownership. The property which belongs to no one

i.e. “res mllius", belongs to the first possessor of it and he acquires a valid title to
it as against the world. Thus the fish of the sea and the bird flying in open sky
belong to one who first succeeds in obtaining possessio of them and acquire an
absolute title over them. This mode of acquisition has been called as "occuptaio ”
in Roman law.

A property which is already in possession of some one else, when acquired by

possession, gives a good title to the possessor against all third persons except the
true owner. Even as against the true owner, the possessor is entitled to maintain
his possession until evicted in due course by law. In such a case of adverse
possession there are in fact two owners, the ownership of one is absolute and
perfect, while that of the other is relative and imperfect and often called as
possessory ownership of reason of its origin in possession1. 2

If the person in adverse possession i.e. possessory owner is wrongfully deprived

of the thing by a person other than the true owner, that person cannot set up the
defence of “jus tertii’’, that is, he cannot plead that the thing does not belong to
the possessory owner either .

1 SALMOND : Jurisprudence (12th Ed.) P.434

2 Arraony V. Delomine, (1722) Istr. 504
 975

In other words, a possessory owner’s possession shall be protected against all

except the true owner. This rule is justified on the ground of maintenance of
peace and order and to prevent misuse of force.

“Occupalio " and “accessio " in Roman law and similar provisions of Hindu law.
Title was first acquired by possession.

“Occupalio" and acquisition of title in a “res nullis”. The person was first
reduced into possession an ownerless object acquired title in it. This title was
good against the whoe world.

In modern times, there is little scope for acquisition of property in this way except
in very limited kinds of cases, such as the birds in the air and fish in the water.
The “accessio" was the acquisition of title in those objects of which there was a
previous owner.

For example, “ifI adorn my sock with wool which is not mine the wool 'codes to ’
or is merged in my socks and thereby I become owner of it".

Agent from “occupation" and “accessio” the possession of any other kind also
“including a wrongful possession ” gives right over the object and title also which
is good against the whole world except the owner.

In such cases, there are two persons who have the title in the object - the real
owner and the possessor. The person who is the real or legal owner of the object
has an absolute title in it. The" possessor has only a relative title - it is good
against the whole world except the owner. The person who acquires title by
possession is called the possessory owner. If he is wrongly deprived of the thing
by a person other than the true owner, he can recover it from him. The reasons
for giving these rights to the posesssory owner are discussed earlier in the chapter
"Possession
 976

21 Prescription
SALMOND defines prescription as “the effect of laps of time in creating and
destroying rights; it is the operation of time as a vestive fact”1.

It is of two kinds:
a) Positive or acquisitive prescription
b) Negative or extinctive prescription

dl Positive or Acquisitive Prescription

When the right is created by lapse of time it is called the positive
prescription.

For example, the acquisition of right of way by use of it for a prescribed

period "in India according to the easement act this period is 20 years " is
a positive prescription

• §1 Nega tive or Extinctive Prescription

When a right already existing is destroyed due to its non exercise for a
prescribed period, it is called negative prescription.

For example, the right to sue for debt is destroyed after a prescribed
period “in India it is 3 years ”,

Thus, it is a case of negative prescription. The prescription is based on a

conclusive prescription of rightfulness of a long possession, and it is
against the person who islnot in possession or is not exercising his rights.

The positive prescription is generally based on the ground of possession.

Therefore, it would apply on those object only which admit of possession.

SALMOND : Jurisprudence
 977

The negative prescription applies to property and obligations both. The

negative prescription is of two kind:
a) Perfect; and
b) Imperfect.

The “perfect ” negative prescription is that in which the principal itself is

destroyed.

In "imperfect” negative prescription only the right of action is destroyed

and not the principal right itself, as in case of debt, if the creditor does not
exercise his right of action within a prescribed period, he loses his right of
action but the principal right, that is, right to debt remains unimpaired.

It is significant to note that the law of prescription is based on the general

principle that law helps the vigilant and not the dormant1

H Agreement
The third mode of acquisition of property is agreement, which is enforceable by
law.

Professor PATON defines agreement as an expression by two or more persons

communicated to each other, of a common intention to affect the legal relations
between them. It therefore, follows that an agreement has four essential elements
namely

a) It being a bilateral act' there should be two or more parties to an

agreement;
b) Mutual consent of the parties;
c) It should be communicated; and
d) There should be common intention to affect the legal relationship

1 Vgiliantibus nor dormeintibus jurasubveniunt

 978

As a proprietary right “in rem ” agreement is of two minds, namely

i) Assignment, and
ii) Grant

An “assignment” transfers existing rights from one owner to another e.g:

assignment of a subsisting lease-hold from assignor to the assignee.

Under a "grant” new rights are created by way of encumbrance upon the existing
rights of the granter e.g. grant of a lease of land is the creation of agreement
between grantor and grantee.

Assignment is either formal or informal.

Formal agreements are written and require the formality of registration and
attestation of the deed to be completed before they are effective.

Informal agreements are verbal and do not require any formality.

The Roman law, however, required that an alienation during life time of the
persons should not only be by an agreement between the parties but there should
also be delivery of possession1.

Thus, in other words meant that alienation was conceived to consist of the
essential element of transfer of possession.

In English law, until the year T845 conveyance of land was not possible without
the delivery of possession and no deed of conveyance could be effective without
delivery of possession. But in actual practice, the rule was evaded for centuries
by taking advantage by fictitious delivery of possession under the statute of uses.

1 In Roman law, delivery of possession was called "traditio”

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The statute of the year 1845, however, modified this rule and now the ownership
of land could be legally transferred without the possession of it.

A rightly pointed out by SALMOND, it is an important principle of law of

agreements that the title of an assignee or a grantee cannot be better than that of
his assignor or grantee. The general rule is that no one can transfer a better title
than what he himself possesses. This is expressed in the latin maxim “memo plus
juris and alium transferee potest, quam ipse hHebert”. This rule is, however,
subject to following two exceptions1. 2

1) In case of trust, the legal ownership is with the trustee and the equitable
ownership is that of the beneficiary. Thus there exist two separate
ownership due to separation of legal from equitable ownership. The
trustee holds the property on behalf of the benefiairy and not for himself,
and therefore, the obligation of the trusteeship is an encumbrance upon
trustee’s title. If the trust property is sold to a “bonafide purchaser for
value ” and without notice, he shall acquire a better "unencumbered” title
to the property so purchased.

In simple words, if the third person “bonafide purchaser” purchases the

trust property for value and without the knowledge of the existence of the
trust, he shall acquire better title than the trustee according to the equitable
doctrine of purchase for value without notice-.

ii) The second exception to the general rule that no one can transfer a better
title than what he himself possesses is where the possession of a thing is in
one man and the ownership of it is in another.

1 Section 41 of the Transfer of Property Act, 1882

2 There is an exception to Section-63 of the Indian trusts act, 1882
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In such cases, the possessor is allowed to pass a good title to one who
deals with him in good faith believing him to be the true owner.

The most striking example of this is the case of negotiable instruments, a

possessor or a bank note may have not title to it; for he might have found
it or stolen it; but he gives a good title to anyone who takes it from him for
value and in good faith. Likewise, mercantile agents, in possession of
good of their principles, can transfer the ownership of them; whether they
are authorized to sell them or not1.

The acquisition of property by living persons in possible through

possession, prescription and agreement whereas property can be acquired
by inheritance by the heirs and successors of the deceased. Thus,
inheritance is also one of the mode of acquisition of property.

41 Inheritance

In respect of the death of their owners all rights are divisible into classes, namely,
i) Inheritable and
ii) Uninheritable

A right is inheritable, if it survives its owner and it is uninheritable if it dies with

him. Proprietary rights are inheritable and most personal rights are uninheritable.
But there are certain exceptions to this general rule.

For example, the right of action survives the death of both parties as a general
rule. Proprietary rights may bd uninheritable in case of a lease for life of the
leasee only or in case of joint - ownership.

The rights which a dead man behind him vest in his representatives or successors.
But he has also to bear the liability of the deceased. This liability is, however,

1 SALMOND: Jurisprudence (12th Ed.) P.442

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limited to the amount of property which he has acquired from the deceased. Thus,
inheritance is some sort of legal and fictious continuation of the personality of the
dead man1. 2

Succession to the property of a person may be either testate or it may be interstate

i.e. by means of will or without a will. If the deceased had made a will,
succession would take place according to the terms of the will. But if there is no
will, then succession would take place by the operation of law which is known as
non-testamentary succession. In case there are no heirs of the deceased, his
property shall go to the state.

The power of a person to dispose of his property by testament "will" is subject to

the following limitations:-
i) Limitations of time;
ii) Limitation of amount
iii) Limitation of purpose

i± Limitation of Time

No person can be allowed to vest his property in perpetuity, that is, the
testator cannot control the devaluation of the estate in property for an
indefinite period.

In Indian law, the property cannot be vested by the testator beyond the
period of his life time plus eighteen years thereafter . He must so order to
destination of his property that within this period the whole of it shall
become vested absolutely in some one or more persons, free from all free
from all testamentary conditions and restrictions. Any testamentary
devolution beyond the prescribed period mentioned above, shall render the
disposition wholly void under the English law, but in India, it shall be void

1 Atchuthen Pilai P.S.: Jurisprudence & Legal Theory (1995) P.219

2 Section 14 of the Transfer of Property Act, 1882
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only to the extent of excessive period beyond life-time of the testator

“plus” eighteen years.

Ill Limitation of Amount

In most legal systems, a testator cannot dispose of his entire estate but
instead he has to leave a certain portion of it for those to whom he owns a
legal duty to support such as wife, children, etc.

In other words, a testator can dispose of only a certain portion of his estate
by a will and has to set aside the rest of the portion for those whom he is
legally bound to support.

The rule under Mohammadan law that no Muslim can bequeath more than
one third of the surplus of the estate after providing for his funeral
expenses and payment of debt unless the heirs consent to the same, is
based on this limitation.

Hindu law permits a person only disposition of his self-acquired property

and the ancestral property shall devolve in the heirs according to the rules
of Hindu succession act, 1956.

The old texts of Hindu law also contain certain rules about disposition of
property which are akin to modern concept of “will”.

Thus, KATYAYAN states, “what a man has promised, in health or

sickness, for religious putpose must be given, and if he dies without giving
it, his son shall doubtless be compelled to deliver it”. How the concept of
will gradually evolved has been elaborately discussed in Tagore V.
Tagore1. Initially, the Hindu will act was passed in 1870 which was

(1872) 1 1A Sup. Vol.57 68

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replaced by the Indian succession act, 1925, and now we have the Hindu
succession act, 1956

III) LiMITA TION OF P URPOSE

A person whose exercising power of testamentary disposition, may
provide that his estate may be used by his heirs and successors for benefit
of other persons who survive him. However, he cannot validly leave any
direction in the will which is against public-interest, nor can he withdraw
the property from the use of the living persons.

For example, he cannot leave a direction in his will that his money be
buried in the grave alongwith his dead-body or thrown into the sea1, that
his estate or land shall lie waste after his death. Such a testamentary
disposition shall be wholly void.

In conclusion it may be stated that the concept of property has a special

significance in jurisprudence because the determination of proprietary
rights such as ownership, title, etc. is solely based on property. The
concepts of “ownership ” and “possession ” have also originated from the
conception of property.

Again, rights and duties are also closely related to property. It is for this
reason that the law relating to property has been developed as an
independent branch of law in jurisprudence. The estate or property for
which there is no heir or successor, shall vest in the state .

' Brown V. Burdett(1882)21 Ch D 667

■ Tins is called Bona Vacantia in law