Property is the relationship among persons with respect to things and resources.

Not a relationship between you and the thing, but rather my thing and my relation to it, gives me power over someone else. What are the bundle of sticks that come with property? y Right to use y Right to exclude y Right to dispose Policy Reasons for Rule y Law protects the first finder because otherwise there would be a free for all of taking other people s things and no claim of title for found objects y Law protects the honest finder. If you honestly find it, you can keep. y Law values those who find things & make them usable again. y Law provides incentives to report lost items. If finder reports it and the owner never shows up, it s theirs honestly.

Right to Exclude
y Essence of property rights- Should the owner of land have an absolute right
to exclude others? Jacque v. Steenberg Homes Inc. Steenberg intentionally trespassed breached a fundamental right of property law; state was wrong to reverse punitive damages because nominal damages were $1. Person has the right to exclusive enjoyment of his own land for any purposes which does not invade the rights of another person

y See also Loretto case in ED. Right to exclude is essential and when gov takes
that away- it s a taking . y Should not be regarded as incapable of being violated, public interest plays a part o Limits on exclusion (human values): State v. Shack the essence of private property is always the right to exclude others, but should not be regarded as inviolable, to protect interest of more vulnerable, to distribute resources earned by the more vulnerable party for contributions to joint effort. Tedesco s right to exclude ended where the tenant worker s need for reasonable access by visitors begun. Rights are relative.

PROPERTY FALL 2010 OUTLINE Pg.1

THEORY
a. LABOR i. John Locke, Second Treatise on Govt (1690): 1. God gave the world to all man in common to be used for the best advantage of life and convenience; this requires that land is appropriated from the common for beneficial use 2. Every man has an exclusive property in his own person and the fruits of his labor; whatever a man removes out of the state of nature and joins with his labor is thereby his property; this fusion of labor with property occurs at the first instance of labor (i.e., gathering the acorns) and does not require the consent of the common under whom the property was previously held (justification for taking land from NAs) 3. Acquisition is not without limits; one may only fix a property in so much as he is able to use for advantage before it spoils and beyond that is not his and belongs to those who can use it for advantage. Haslem v. Lockwood (1871): the first party to occupy abandoned property and improve it with his labor has the legal right to that property [ shoveled manure to side of road and left overnight before collecting came and carted manure away a. UTILITY & EFFICIENCY a. Efficient response to scarcity. Efficiency is utilitarian; why waste things? EXTERNALITIES (costs that are produced by an activity but not borne by the person reaping the benefits of the activity) are INTERNALIZED (borne by their maker). This makes the production of goods needed for human life more efficient. Few people would take the time and effort to partake in activities like crop producing if they weren t able to keep the benefits. Recognition of a property right in the crop internalizes the benefits. b. NATURAL LAW THEORIES a. Not popular- vary too greatly, but it is universal human trait to link possession of an object with ownership. c. CUSTOM a. Property rights can often occur by customs, that are intended to maximize aggregate wealth of the customary participants. i. EX: Whalers, customs designed to deal with the uncertain business of capturing whales and max the profits of the enterprise. d. POSSESSION a. Physical Act- you take possession of PROPERTY FALL 2010 OUTLINE Pg.2

b. Legal Conclusion: the host of the party is in possession of the home when he tosses you out of it (created for a law) c. * sometimes physical possession is the fact that produces the legal conclusion that flows from ownership of property.

Acquisition by Discovery/Conquest
Johnson v. M Intosh (1823): Title given to first civilized occupiers of land based on first in time principle; discovery vests title; justified by Locke (nomadic Indians didn t blend labor with land) and English tradition; right of occupancy is granted to conquered people, but not right of title to dispose of land [conflict between two people with title to land, one from govt land grant the other purchased from Indians; held, Indians did not have title and therefore could not covey it] (Shows limits on justiceI am not calling into question the legitimacy of the US property right)

y y

Only res nullius or terra nullius ( a thing or territory belonging to no one ) can be discovered- virtually no unknown territories on earth and territories beyond the earth are governed by treaties. The fact of conquest as a source of property rights is a reminder of the socially contingent nature of property : property rights are defined by the society in which they are at issue- because the Piankeshaw Indians and those who derived their title from them, were perceived as a conquered society, their rights were declared to be subservient to those of the dominant society.

Acquisition by Capture
1. You must have actual possession, or else constructive possession by inflicting a mortal wound; pursuit does not vest title. Pierson v. Post (1805) [on common, unowned land- a wild beach-one hunter was pursuing the fox when another hunter shot it; hunter who shot the fox had possession Post (original hunter) did not own the fox until he had physical possession of it, mere pursuit wasn t enough. Perhaps it was labor but until pursuit produced the ultimate goal of capture, it wasn t property. Actual possession would promote certainity and peach and would spur people to kill foxes] i. mortal wound approach: (1) is objectively likely to deprive the fox of his natural liberty; (2) shows a subjective manifest intention to seize the animal (i.e., not just for the enjoyment of the chase) ii. socially useful enterprise majority accepts that killing foxes is a socially useful enterprise; dissent elaborates that it protects activities of chicken farmers (wants to protect pursuit as PROPERTY FALL 2010 OUTLINE Pg.3

possession to encourage more hunting; intruder should not gain from labor of first person) iii. Other reasoning: keeps the peace, decreases litigation (the end of the hunt is an objective measure whereas the beginning is subjective), clear and easy to administer b. Dissent: pursuit should acquire property, also turn it over to tribunal sportsmen, encouraging the hunting of wild animals, instrumental end, if we want to promote hunting , let the pursuit claim property, but this defeats the idea that the whoever kills it get it (which killing is ultimate goal) c. RELATIVE TITLE: one person s claimed property right is almost always good (or not good) only in relation to others. What if in Pierson, the fox was on Post s land and Pierson had been the trespasser? Pierson s actual possession of the fox would have given him a property right in it, but only until or unless that right was trumped by Post, invoking his right to exclude others from his reale state. i. Conflict between two different property rules FIRST POSSESSION v. landowners RIGHT TO EXCLUDE others. ii. Post, the landowner, would have a better claim to the fox, not because he was a PRIOR POSSESSOR of the fox, but because he was entitled to DEPRIVE trespassers of their game taken from his estate. It would have been Pierson s fox if Post has bagged it on Pierson s farm. assumes society thinks it s more important to discourage trespass than to reward first possession of unowned objects when the two values collide. iii. Law rarely encourages trespassing because security of exclusive possession is conducive to peace and order and investment of an owner s resource in that property iv. Even among wrongdoers FIRST IN POSSESSION prevails. 2. Custom: when should customary rules pertaining to acquisition of ownership establish the legal doctrine? Individuals conform to these rules out of self-interest: in the long run they will be better off, and in the short run, deviation from the customs will result in substantial informal sanctions from the group. Ghen v. Rich: Whaling group in MA has developed a way to distinguish whose whales are whose, the device that kills them, makes them sick, rises in a few days, floats to another town, norm is that the person who finds it calls the person whose device it is and notifies them- here the person who found the whale, doesn t follow protocol. Court held that custom determined ownership because the nature of the fin-back whale industry was that the animals could only be killed without acquiring immediate possession, and that a first=physical possession rule of ownership would eliminate all incentive to whale hunt, thus depriving the society of the benefits of a continued supply of whale oil and blabber. PROPERTY FALL 2010 OUTLINE Pg.4

Why didn t court go with Pierson v. Post (mere pursuit is not enough), they followed custom here, problems with that 1)court doesn t represent the whaling industy 2) third parties are bound to the customs of whalers for other industries 3) in most cases it doesn t follow to do a custom How you decide a case matters 3. POLICY ENDS & PROPERTY RIGHTS: as the law tries to serve human values that are important to people of the society, they tinker with the doctrine to serve those policy ends- trying to serve 01. Reward productivity and foster efficiency 02. Create simple, easily enforceable rules 03. Creat property rules that are consistent with societal habits and customs 04. Produce fairness in terms of prevailing cultural expectations of fairness y Sometimes these point to a single resolution, sometimes they point in different directions. Keeble v. Hickeringill: Landowner had decoy pond that was designed to trap ducks to be killed and consumed as food. Keeble maintained the pond. Hickeringill, his neighbor, frightened the ducks away from the pond by discharging a shotgun nearby. Courts ruled that such conduct was actionable on the grounds that H was maliciously interfering with K s lawful activity. Distinguished form fair competition, nothing that it would be perfectly fine for a schoolmaster to lure students away from another school by offering better instruction but unlawful to frighten them away. NOTION that fair competition IMPROVES SOCIETY, (BETTER SCHOOLS) which H s actions was a dead-weight drag on societal improvement (FEWER DUCKS) could be different in a society that sees the killing of ducks as unlawful. 4. ESCAPEES AND DOMESTICATED ANIMALS: when a wild animal escapes, it is UNOWNED, belongs to the next first possessor. Domesticated animals are not wild, so they continue to belong to their prior possessor when they wander off. A wild animal becomes domesticated when, as a matter of fact, it demonstrates the propensity to return home (animus revertendi). Ex: Silver Fox, native to Canada but not to Mississippi (where it was confined by its owner- possessor), which escaped and was killed by a hunter, Doctrine says hunter wins. Should a hunter have a reasonable expectation of acquiring ownership of a wild animal not native to the region? it being silver would have put the hunter on notice- look at the effort for importation, can t say this animal had a propensity to return to Mississippi, so capture rule? BUT let s look at the underlying principles. PROPERTY FALL 2010 OUTLINE Pg.5

5. OIL AND GAS y Fugitive in nature as it wanders place to place. Court has decided that like they decide wild animals, rule of capture, they reasoned that ownership of oil and gas should be determined in the same manner. They belong to the owner so long as they are on it or in it. When they ESCAPE the title of the former is GONE. y HOW TO BEST FOSTER PRODUCTVITY by the EFFICIENT EXPLOITATION OF OIL AND GAS o Underground reservoir of oil open to all drillers o BUT other suggest that overexploitation of the unowned resource might be susceptible to an injunction tragedy of the commons (tendency to over exploit a common resource because the full costs fo the exploitation are not borne by each user, while the former is an uncritical application of the first possession doctrine to circumstances where sound public might warrant a different approach. o Hammonds v. Central Kentucky Natural Gas Co. natural gas injected into natural underground reservoirs is no longer owned by the injector, is a mechanical application of doctrine with little though to its policy consequences. this denies the society at large the benefits of economical underground storage, and also makes the owner build tanks, and spend money o *PROPER POLICY CONCLUSOINS & the DOCTRINE that derives from them, vary with their circumstances, such as the chameleon changes color with the background.

Externalities Acquisition by Creation

Many intangible property rights are created. Your image, your novel but not always (Silk Patterns with Cheney Bros. v. Doris Silk Corp. y Comes from Locke s Labor Theory- the product should be yours also fairness y If you create something its yours to exploit foundation is the expenditure of money and labor, past efforts (INS v. AP) y Copyright: the right to control reproduction and distribution of the creation. y Patent/Trade Secrets: protection of discoveries (Intellectual Property) y EXCLUSIVITY: the problem of imitation: what is the degree the property owner has in exploiting the intangible right. The law of PROPERTY FALL 2010 OUTLINE Pg.6

misappropriation= the branch of unfair competition law that protects new ideas- tries to answer the question of when imitation is permissible and when it is not because it destroy the incentive to create. International News Service v. Associate Press: SCOTUS held it was misappropriate for INS to copy AP s news and release it before AP could. AP expended money and efforts to gather the news; the Court though that INS was attempting to reap what is has not sown AP has stuff in relation to INS but not the pubic, because the news is not property, but between INS and AP , there is a quasi property right, reminds us what property is- relationship among persons with respect to things, depends on who you are standing with BUT Imitation of Perfume/Seasonal fabric is not misappropriation Cheney Bros. v. Doris Silk Corp. : their can t be too harsh of a line or it will hurt the incentive to create. P manufactures silks, many patterns, no such originality as worthy of design patent, D coped the design and undercut the price- you can go ahead and copy, larger issues are at stake, to prevent any imitation creates a monopoly, gives a party too much power- P relied on INS SCOTUS, but court says that case was more specialized. Smith v. Chanel, Inc. : court held that a perfume company could claim in advertisements that its product was the equivalent of the more expensive Chanel No. 5 (trademark)- Imitations are good for society and to have public benefit . Spending money/investment doesn t mean you ll get property right at the end of the say, imitation is the lifeblood of our society

*Conflict between the inefficiencies produces by a monopoly over creation (higher prices, less accessibility to a desired good) and both the sense of unfairness of allowing copycats to reap what they haven t sown and the fear that , without protection, creators will not create. Personal Image as Property y the ability to exploit your image for profit is recognized as a valuable property right because we have created a culture of celebrity in which money can be made from selling image. Law evolves to protect newly created cultural expectations. White v. Samsung Electronics America: The court concluded that Samsung s depiction of a robot clad in a blonde wig, dress and jewels posing in front of the wheel of fortune infringed White s common law right of publicity , DISSENT: this is classic overprotection- because it extended the publicity to preclude even image, name, likeness, or

PROPERTY FALL 2010 OUTLINE Pg.7

signature. Overturned the balance between protection of creative endeavors and leaving room for new innovation.

ACQUISITION BY FIND
a. General Rule: Finder has title superior to everyone except the rightful owner. A property owner continues to own its property even after he loses or misplaces it. Finder s claim to the property depends on who the rival claimant is and whether the property was lost, mislaid or abandoned by the TO. b. Finder has relative title. c. Policy Objectives 1) to restore property to the TO 2) reward honest finders 3) deliver the reasonable expectations of landowners 4) discourage trespassers and other wrongdoers 4) encourage the productive use of found property d. Abadoned Property: property to which the TO has voluntarily given up any claim of ownership, generally a finder of abandoned property acquires title, but this rule is not invariable, trespassers aren t rewarded, and owners of land where abandoned property is discovered may have expectations of ownership of such property. Statutes can also modify this. i. EX: TO places his laptop on sidewalk in front of his house with card that says free-take me . TO has abandoned his ownership, the first possessor becomes the next TO, but if it was under a bed, not so clear that it was abandoned, conclusion usually has to be made by circumstantial evidence e. Lost and Mislaid Property: general rule a finder s title is good against the whole world except the TO, prior finders and (sometimes) the owner of the land where an object is found. i. Lost property: slips out of your pocket ii. Mislaid property: the TO places somewhere with the intention of returning for it, but which cannot now be located. iii. Prior Finders Prevail Over Later Finders: a. Ex: TO loses his watch, found by FF, FF then loses the watch, which is found by SF. FF prevails over SF on the basis of prior possession. TO would, of course, prevail over FF. Armory v. Delamirie- chimney sweep finds jewel and carries over to jewelry to get appraised, jeweler keeps it and boy sues- boys wins money damages for value of jewel because he found it first and true owner was never determined- it the jewler had been the TO, the chimney sweep would have lost. Finders only have relative title.<-- law intervenes so sweep doesn t take matters into his own hands- Promotes Bailment: the right possession of goods by someone who is not the owenr, you the owner transfer the PROPERTY FALL 2010 OUTLINE Pg.8

possession to someone else (bailee) for limited time and limited purpose. f. Found on Private Property i. Conflicts frequently arise between a finder and the owner of the land upon which the property was found (often called the owner of the locus in quo) There is no conflict if the landowner also owns the found object. If the TO is neither the finder nor the landowner, conflict erupts a. Trespassing Finders: As is true of abandoned property, trespassing finders of lost or mislaid property lose. b. Employee Finders: Older cases tend to find that employee finds must surrender the find to their employer if the employee has a contractual duty to report finds or a carpenter employed by a hotel was allowed to keep property he found in a hotel guest room he was redecorating, becaue his carpentry duties did not include reporting found property. *You should be combining a duty to report with award to the finder when the TO never materializes c. Invitee Finders: landowners often invite workers and others to their property for specifc and limited purposes, almost never to find property, an invitee who finds property in the course of doing what he or she was invited to do must surrender it to the landlord South Stafforshire Water Co. v. Sharman 1896 landowner employed Sharman to clean out the Minster pool, Sharman found two gold rings, the rings went to the landowner, who conceded that the had been unaware of their existence until the find- landowner was treated as CONSTRUCTIVE POSSESSOR of the rings, a label that simply a legal conclusion that landowner should prevail. d. Embedded Objects and Treasure Trove: when property is embedded in or under the soil, it is awarde to the landowner, on the rationale that the landowner s expectations of owning things in the dirt itself are especially strong. e. Private Homes: homeowners are awarded objects found in their homes. A homeowner has an especially strong expectation of ownership of objects found insider her home and, to the extent the property was mislaid, the odds of its recovery by the TO are increased by leaving it with the homeowner. When the homeowner is an absentee ownerPROPERTY FALL 2010 OUTLINE Pg.9

not in possession of the home- resolution of the question turns on whether the homeowner was in constructive possession of the home. If the homeowner is briefly absent, she is in constructive possession of objects found in her absence. Hannah v. Peel: Major Peel purchased house but never moved in. WWII broke out, the Crown took the house to quarter soldiers. Corp. Hannah found a brooch while adjusting curtains. He reported the find. Two years later, the owner not having appeared, the brooch was turned over to Perl, who then sold it. Hannah demanded the sale proceeds and won. Because Peel never moved in, he never had constructive possession of House s unknown lost contents.All or nothing Approach, poorly fitted to the goals of finders law. Ownership in Peel punishes the honest finder. Ownership in Hannah defeats Peel s reasonable expectation that he owns everything that came with the House. Perhaps the value should have been split. g. Public Places: Lost Property: Lost property in public places goes to the finder. Mislaid property found in public places goes to the landowner. A

finder of property acquires no rights in mislaid property, is entitled to possession of lost property against everyone except the true owner, and is entitled to keep abandoned property. * The odds of restoring lost property to the TO are slim, but
while the TO of mislaid property may return to the place where it was mislaid, but TO s usually retrace their steps when items are lost. i. McAvoy v. Medina: walled is found on a barbershop counter, it was probably placed there by a customer then forgotten. As mislaid property, it goes to the barberhsiop owner. But if the wallet is foudnd on the barber s floor , it was probably dropped there unintentionally by a customer. As lost property, it goes to the finder Bridges v. Hawksworth---the lost-mislaid distinction requires courts to surmise from circumstantial evidence (policies of finders law might be served by a sharing rule) h. Equitable Division : sometimes the all or nothing approach to found property sometimes results in irreconcilable conflict between the goals of finders law, some argue that found property should be shared equitably among the competing claimants, each of who m have a claim as good as the other claimant. Ex: Baseball of Barry Bonds- both claimants had claims better than anyone else, and neither claim was better than the other. CA trial court said both had equal interests in the ball and must share its value equally. PROPERTY FALL 2010 OUTLINE Pg.1 0

ADVERSE POSSESSION
Gaining title by AP results from the operation of the statute of limitations for trespass to real property. If an owner does not, within the statutory period, take legal action to eject a possessor who claims adversely to the owner, the owner is thereafter forever barred from bringing suit for enjectment and title is vested in the possessor. Two requirements 1) expiration of the relevant statute of limitations (this is determined by statute) and (2) adverse possession during the limitations period (common law elements concerning the nature of the possession that must be proven. 3 Major Justifications for AP: 1) Sleeping Theory: a. Slothful owners, who ignore people using their land in brazen violation of legal right, deserve to be penalized. May bear the risk of losing his property if he does not care enough to assert his ownership. Use it or lose it. 2) Earning Theory: a. People who use land productively and beneficially for a long time ought to be rewarded. AP might have invested time and effort in making it productive. When coupled with the sleeping theory, the justice of cutting off the true owner s claim seems even stronger. AP DEVELOPS expectations of continued possession, which expectations are met by the doctrine of AP. 3) Stability Theory: a. AP enables disputes or doubts about land titles to be cleared expeditiously by delivering title to the person who has occupied the land as if she were the owner for a long period of time without objection Elements of AP: 1) actually enter and take exclusive possession that is 2) open and notorious, 3) adverse or hostile to the true owner s interest and under a claim of right and 4) continuous for the limitations period. 1) Actual and Exclusive Possession- actual physical concept of the land that is exclusive, not being shared with the landowner, bicycling across the land you are not excluding the land to anyone else a. Owner s cause of action accrues at that moment, and the clock on the limitations period starts to run at the moment of actual entry. b. Exclusive Possession means that the professor has excluded the public and the owner c. A group of people adversely occupying may acquire a shared titleconcurrent ownership- by AP. d. Some states define actual possession by statute PROPERTY FALL 2010 OUTLINE Pg.1 1

Van Valkenburgh v. Lutz: NY required adverse possessors occupying without color of title to prove that they had substantially enclosed or usually cultivated or improved the property. Lutz had been on the land 28 years, built garden and shack, court found it wasn t enclosed or improved or that he believed it was his. Acquisition of title by AP requires actual possession and (sometimes) improvement of the land. Dissent takes the view that actual possession only means possession that will put the owner on notice. Another goal of property law is to encourage honesty. This is one way to explain why the majority requires that an AP acquire title under claim of right. If a possessor honestly believes that property is his, he may be eligible to receive title to it. 2) Open and Notorious a. Occupation must be readily visible to any inspector of the propertythat the TO would know of any occupation if he visited his property b. Constitutes NOTICE to the owner that his rights are being violated. Occupation is open and notorious if it is the type of occupation a TO would make (Would a reasonable person be notified by this?) c. Boundary Disputes: some jurisdictions hold that encroachments by one neighbor onto the land of another are not open and notorious if the encroachment is of a small area and is not clearly and selfevidently an encroachment. The limitations statue does not begin to run until and unless the owner has actual knowledge of the encroachment. Mannillo v. Gorski: Possession need not be knowingly and intentionally hostile, but it must be notorious enough to give the TO actual or constructive notice of the encroachment. The D didn t know her steps were on the P s property (that s ok) BUT because it was 15 inches court says that wasn t enough to give notice to TO of the AP.

3) Adverse or Hostile to the TO s Interest and under claim of right a. APossessor must occupy the land WITHOUT THE CONSENT OF THE OWNER and with an INTENTION TO REMAIN. Often called HOSTILITY, but it does not mean malice or ill will. Rather that the possessor has NO PERMISSION to be there and ALSO CLAIMS THE RIGHT TO BE THERE. Consent or permission means that the possessor has occupied in some capacity subordinate to the owner s title. (a lease) b. In deciding whether the possessor claims the right to stay there: (approaches) i. Minority View: Subjective: good faith occupation: AP must have a genuine, good faith belief that she owns the occupied PROPERTY FALL 2010 OUTLINE Pg.1 2

property. If possessor knows that the property they are occupying is not there own, they cannot acquire title by AP in jurisdictions that apply this. ii. Extreme minority view:Subjective: Aggressive trespass: old cases that require the occupier to know the property isn t theirs but intend to claim it nevertheless. no one uses this view now, b/c it rewards deliberate trespassers. iii. Majority View: Objective: State of Mind Irrelevant: Often claimed to be the majority view, the state of mind of the occupier is essentially not relevant. Instead courts focus on 1)lack of permission (make sure that occupation isn t subordinate to the owner s title) and 2) whether the occupier s acts and statements objectively appear to be claims of ownership. We don t care what you secretly believe, but have you acted like a TO would? iv. Disclaimers of ownership: if AP disclaims ownership in order to persuade the owner not to sue, the possessor has stopped being adverse. v. Boundary Disputes: If a landowner mistakenly occupies a strip of her neighbor s land in the belief that is her own. Most courts apply an objective test of hostility to those cases. Does the encroacher s actions appear to the world to be those of TO (she builds a fence), then she occupies adversely. A Minority of states apply a variant subjective test, often called THE MAINE DOCTRINE. Occupier is NOT possessing adversely if she occupied in good faith, but mistaken, belief that land is hers, but she would not have occupied if she had known the true facts., encourages perjury Unlike Connecticut Doctrine, which doesn t punish mistaken entrant. vi. Color of Title NOT Claim of Right: 1. Claim of Right: element describing hostility or adversity 2. Color of Title: if entered under this, one has a defective deed or other writing that purports to deliver title to the possessor, but which the possessor does not know to be invalid. Possessors who enter under color of title satisfy the adversity element. 4) Continuous Possession a. An AP must occupy continuously-without interruption- during the limitations period, but need not STAY on the land for every moment of the 10 or 20 years of the limitation period. Rather, the AP must occupy the property as continually as would a reasonable & average TO of the property. If the AP ever abandons or intentionally gives up PROPERTY FALL 2010 OUTLINE Pg.1 3

possession with no intent of returning- continuity is destroyed. A later return triggers a new cause of action and fresh limitations period. Howard v. Kunto: Kunto occupied a summer residence under color of title (a defective deed). When Howard, the record owner, sought to eject him, Kunto countered that the limitations period had expired Howard said Kunto hadn t occupied continuously (summer only), That was good enough. A reasonable person would have used the property during the summers and not at different times b. Tacking-AP i. Problems arise with whether one possessor can add-TACK- the possession of a prior possessor to his own. If PRIVITY OF ESTATE exists between the prior possessor and the present possessor, tacking is permitted treating it as one continuous period. PRIVITY OF ESTATE_ means the VOLUNTARY TRANSFER form the first possessor to the second possessor of EITHER an ESTATE in the land or ACTUAL POSSESSION of it. c. Ouster if an AP is ousted from possession by a third party- the third party may not tack the ousted AP s period of possession onto his own. Privity is lacking because the transfer was not voluntary. i. Re-entry, new clock on statute of limitations? ii. Calling third party a trespasser and treating the ousted possessor as being in constructive possession during third party s occupation iii. Ousted possessor can tack her new possession onto her old possession but cannot take credit for occupation by the third party. That period is tolled or suspended. Extent of Property Acquired by AP 1) What is the physical extent of the occupied property? Depends on whether the AP entered with or without color of title (a defective deed, but not knowing about that defect) a. Entry without color of title: AP without color of title acquire only the land they have actually physically possessed for the limitations period. b. Entry under color of title: AP who enter under color of title are deemed to posses all the land described in the defective deed, so long as it consists of a single parcel, and the possessor has occupied a significant portion of the parcel. Statutory Issues of AP y The owner s cause of action to recover possession accrues when there is an adverse entry of the land. y Disabled Owner: Statutes of limitation typically provide for a suspension of the limitations time clock if the owner is disabled from bringing an action to recover possession at the time the cause of action accrues. PROPERTY FALL 2010 OUTLINE Pg.1 4

o Insanity or other unsound mind o Imprisonment o The condition of being a minor y *Statutes typically read that IF THE OWNER IS DISABLED AT THE TIME THE CAUSE OF ACTION ACCRUES, THE OWNER MAY BRING SUIT FOR SOME SPECIFIED PERIOD AFTER THE DISABILITY CEASES, EVEN THOUGH THE NORMAL LIMITATIONS PERIOD HAS EXPIRED. o EX: If Owner was imprisoned when Possessor entered in 1970, and is released form prison in 1995, Owner has until 2005 to file suit to recover possession. o *Holders of future interests- present ownership interest in property of a right to possession at some future time- are also not entitled to possession now- they must wait until they become entitled to possession- then his cause of action accrues and then the limitations period starts running. AP by tenants and co-owners y tenants: rarely possible because their entry was permissive- subordinate to the owner s claim of title y co-owners: may not usually AP against their co-owner because every coowner has an equal right to possession- ouster would be needed. AP of personal property y Title to personal property can be acquired through AP, a different, usually shorter, statute of limitations applies- this isn t very OPEN and NOTORIOUS, traditional answer is that open and notorious possession is satisfied so long as the possessor uses the object in the way the average owner would. *The statute should begin to run when the TO discovers or should have discovered the whereabouts of the stolen property. O Keefe v. Snyder: O Keefe had painting stolen, years later found for sale in an art gallery, Snyder, the gallery owner argued that his predecessor in interest had acquired the title by AP. Answer hinges on whether the possessor s exhibition of the painting in his own home was sufficiently open and notorious. NJ Sup. Court said the law of adverse possession need not apply. Instead the limitations period for recovery of personal property start to run at the earlier of 1) when the loss occurs (except when there is fraud or concealment) or 2) when the owner first discovers, or through reasonable effort should have discovered, the cause of action (including the identity of the possessor). turns focus onto the owner s conduct, and encourages owners to report their losses and undertake reasonable investigation. Title Acquired by AP y When AP acquire title, they acquire a new title, new title cannot be any greater in scope that the former owner s title (life estate, when person dies, the Ap title dies too) PROPERTY FALL 2010 OUTLINE Pg.1 5

AP s new title cannot be recorded in the public land records, because there is no written record of it- must bring suit against the former owner to QUIET TITLE in the AP that can be recorded.

Acquisition by Gift
A gift is a voluntary transfer of property for NO CONSIDERATION. To accomplish a gift or personal property, the donor must 1)INTEND TO MAKE A GIFT, the property must be 2)DELIVERED TO THE DONEE (the recipient of the gift) and the 3)donee must ACCEPT the property. y Gifts are commonly divided into: o INTER VIVOS GIFTS: during life, with no knowledge or threat of impending death. These gifts are irrevocable. o CAUSA MORTIS GIFTS: in contemplation of death, made with knowledge or under threat of immediate death and motivated by that fact. These gifts are revocable if the donor recovers from the illness or threat causing the causing the donor to make the gift in contemplation of death (ANYTIME BEFORE DEATH), or if the donor dies of some other cause that did not prompt the gift. viewed with skepticism because the donor is likely to be dead, and the completed gift is a substitute for a will, a form of giving at death that is laden with formalities to be sure that the dead person s wishes are accurately carried out. 1) Intent: The donor must intend to transfer title. If the donor s intent is merely to transfer possession, no gift has been accomplished. Evidence on this is usually circumstantial, unless the donor executes a deed or some other written expression of donative intent. Newman (owner knew what he was doing) i. Gifts Causa Mortis: the donor s intention here is presumed to make the gift only because of impending death, but if the donor intends to the gift to be irrevocable regardless of her impending death, it is not a gift causa mortis (revocable) but is an irrevocable inter vivos gift. 2) Delivery: The subject of the gift must be delivered to the recipient in order for the gift to be complete. The best form of delivery is actual physical possession, but that is not always required a. When physical delivery is IMPRACTICLE or IMPOSSIBLE , delivery may be accomplished by SYMBOLIC DELIVERY OR CONSTRUCTIVE DELIVERY b. Rationale/ what Delivery functions as: i. Making abstraction a reality: when a donor must part with a possession, the idea of giving becomes real ii. Objective Evidence of Intent: secondary check (this is objective) iii. Objective Evidence of Acceptance: presumptive PROPERTY FALL 2010 OUTLINE Pg.1 6

c. In looking at delivery other than ACTUAL PHYSICAL POSSESSION- must ask what did the donor intend by her acts? i. Delivery by Deed: delivery can be accomplished by a deed or gift or some other writing under seal ii. Symbolic Delivery: when actual physical delivery is impossible or impractical, delivery can be accomplished by delivering some object that is symbolic of possession. 1. Ex: gift of a copyright (intangible) 2. Handing over a written instrument declaring a gift of the subject matter 3. I give this piano to you , but b/c it won t fit in your apart. Ill keep it here and you can come play it when you want and take it when you can. symbolic delivery iii. Constructive Delivery: When actual physical delivery is POSSIBLE BUT IMPRACTICAL, delivery so some object that is the MEANS OF OBTAINING POSSESSION of the property constitutes CONSTRUCTIVE DELIVERY 1. Courts find a constructive delivery adequate when the evidence of donative intent is concrete and undisputed, when there is every indication that the donor intended to make a present transfer of the subject- matter of the gift, and when the steps taken by the donor to effect such a transfer must have been deemed by the donor as sufficient to pass the donor s interest to the donee. Newman v. Bost: On his deathbed (causa mortis) Jack gives to Julia all the keys to the household furniture, saying that he intends for her to have everything in the house. Delivery of the keys constitutes constructive delivery of the furniture, because it is impractical to make physical delivery under the circumstances. BUT delivery of the keys does not constitute constructive delivery of a life insurance policy locked in a bureau drawer, because it was not impractical to deliver the intangible evidence of the life insurance right- the policy itself. 3) Acceptance- not really ever an issue 4) Special Problems a. Donee in possession: when a donee already has possession there is no need to perform the useless act of shifting the property back and forth to prove delivery. It has been delivered. Once is enough. Gruen v. Gruen: Inter Vivos Gift. Father writes letter to his son, student in college, telling him that for his 21st birthday he was giving his son a valuable painting that was displayed in his home, but that he wished to retain possession for the remainder of his life. NY Court of Appeals- held that the letter constituted a completed and valid gift to son of a remainder interest in the painting, a PROPERTY FALL 2010 OUTLINE Pg.1 7

property right that would automatically become possessory upon the father s death. Father retained a life estate in the painting. The father manifested his donative intent at the time of the gift because the remainder interest was a presently existing property right . Letter was sufficient to constitute delivery. Son has also shown acceptance acknowledging the gift to his friends and retaining the letter for 17 years. In order to make a valid gift there must be intent, delivery and acceptance. The intent must be to make a gift of some interest in the gifted property at the present time, whether that interest be a present interest or a future interest. A donor may gift a future interest and retain the present interest in the gifted property. Since the donor intends to retain possession of the painting until his death, actual deliver of the painting to S would be inappropriate and inconsistent with the nature of the gifted interest; a remainder interest in the painting

Eminent Domain
Government s power to take private property for public purposes, so long as to just compensation is paid. Regulatory Takings, the point at which a government regulation of property becomes a taking requiring compensation. (5th Amendment = Just compensation) THE TAKINGS CLAUSE: limits takings to those for public purposes and requires just compensation for all takings. y Rationale: if you didn t require gov to pay that would make land a free input, putting a price makes better economic decisions, not just take y Protects the owner s expectations and investment in the property y FED AND STATE can take in various ways: o Straightforward action brought by gov to condemn property o Permanent Physical Occupation authorized by Gov o So-called Regulatory Takings y Three Principal Issues that arise under the TC 1) Public Use: is it for public use? Gov sometimes takes and conveys to a private person in order to reap some alleged collateral public benefit 2) Regulatory Takings: (restricting its use, possession or disposition) at what point does it become so burdensome that is it is a defacto taking of property, which triggers the constitutional requirement of just compensation 3) Compensation: Fair Market Value, includes any reasonable expectations that a buyer may have about possible future uses. An owner is not PROPERTY FALL 2010 OUTLINE Pg.1 8

entitled to any additional value that is subjective and peculiar to the owner (i.e. sentimental value) PUBLIC USE REQUIREMENT: is satisfied so long as there is a conceivable public purpose for the taking (local gov. can decide this) y A literal reading in the text would limit governmental power to take private property to instances where the property will actually be used by the public (park, school, road) BUT what about seizures of private land conveyed to a private corporation in order to construct a factory that will provide economic benefits to the community SCOTUS has eliminated the need for actual public use and instead , required it to be RATIONALLY RELATED TO ANY CONVEIVABLE PUBLIC PURPOSE public use is whatever the legislature rationally thinks is conducive to the public welfare y Ends Test: focus on the contemplated ends of an act of condemnation, if the ends are sufficiently public y Means Tesst: if power of ED is really necessary to accomplish whatever aim the government has in mind, then is passed Kelo v. City of New London: Takings of private property for use by other private citizens pursuant to an economic development plan intended for a public purpose are valid under the 5th Amendment. Issue as to whether conveying these peoples land to private company to make a corporation and park area qualified as a public use within the takings clause of the 5th Amendment. The court had ruled in Berman v. Parker that an urban renewal scheme in which blighted property was condemned and transferred to a private developer was a public use. In Hawaii Housing Authority v. Midkiff the court upheld as a public use the forced transfer of fee titled to long-term lessees of the ground on which their residences were located, given the monopoly the landowners had land oligarchy - Court said they would defer to the judgment of the local government officials who say it s a public benefit. RAISED the possibility that anyone s property could be taken so long as the government could offer some plausible possibility that the new private user would make it more economically productive. JUST COMPENSATION: o Satisfied by payment of FMVo If the gov taking makes the remainder of your property value goes down, the gov will usually pay you for the reduction in value. o What if it increases your value? Gov doesn t require you to pay back o Zoning rules impose restrictions on the use of land. Then the land is taken by ED. Is JC determined based onteh value of the land taking into account the zoning rules or not? Have to look at it when and where it is taken. TROUBLE OTHERWISE_ they would regulate everything- making it cheaper.

PROPERTY FALL 2010 OUTLINE Pg.1 9

HOW MUCH REGULATION IS TOO MUCH- at some point government regulation of property becomes so extensive that it amounts to a de facto taking, even though the government denies that it is taking the property. Regulations can interfere with an owner s right to use, dispose, or possess property. o PERMANENT DISPOSSESSION: when a government regulation permanently dispossess an owner of her property, the regulation is a taking. For REAL PROPERTY: a taking has occurred if a regulation produces a permanent PHYSICAL OCCUPATION of all or a part of the property. Temporary Occupations are not per se takings. o PER SE: does not constitute a taking Loretto v. Teleprompter Manhattan CA TV Corp.: NY required landlords to permit cable tv to install cable facilities on their property. Loretto, landlord, claimed that was a taking of her property, even though it was a half inch in diameter along the roof. SCOTUS says a permanent physical occupation authorized by government is a taking without regard to the public interest that it may serve. Permanent loss of the ability to exclude others is destructive of property expectations. the character of the invasion is qualitatively more intrusive than perhaps any other category of property regulation. EXCLUSION GOOD , protects our ability to use and to enjoy our prop EXCLUSION BAD, excludes people, could cause problems with tenant/landlord, rent control 3. Estates 4. The Life Estates y

5. Future Interests

Co-ownership and Martial Interests

Ownership can be shared or mutual, a. Common Law Concurrent Interests (3) i. Tenancy in Common a. Separate but undivided interest in the property (the holder of the interest is entitled to possess it in whole, but it is a share) b. Each own half, share the half, but can possess the whole c. Is descendible (can be passed to the heirs, wills or intestate) d. Subject to claims of the tenant s creditors e. No survivorship rights. f. T to A & B (A & B are TIC) g. If A transfers to C, then C & B are TIC h. If B dies intestate, B s heirs are TIC with C i. TIC can possess the entire property if no other cotenant objects ii. Joint Tenancy a. Right of survivorship, regarded together as a single owner, each owns the undivided whole of the property; when one dies PROPERTY FALL 2010 OUTLINE Pg.2 0

NOTHING passes to the surviving JT, rather estate continues in survivors freed from the participation of the decedent. b. Requirements for JT, TTIP (if not then it s a TIC) 1. Time: interest must be acquired at the same time 2. Title: Each joint tenant must acquire title by the same instrument (will, deed, decree quieting title) or by a joint adverse possession, never by intestate succession 3. Interest: each joint tenant must have equal shares in the property 1) each JT must have the same share of the undivided whole and 2) each JT must have the same durational estate. 4. Possession: Only unity that the JT has in common with the TIC- each tenant has the right to possess the whole *state statutes mess with these c. Severance of JT Mutually or Individually Most begin with some voluntary act of a JT that immediately implicates the four unities and thus, JT. Two instances in which the law operates to sever a JT even without voluntary acts: Homicide/Simultaneous Death Conveying his interest to a third party, this severs the JT as between the third party and his cotenants because it destroys one or more of the unities. (don t need to put the other person on notice) 1. Riddle v. Harmon: court held that P could validly sever the JT with her husband by conveyance from herself as JT to herself as TIC, California had already had a statute allowing creation of JT by a conveyance from A to A & B and joint tenants - this is a realistic view of severance and elevates the intent of the grantor to prominence.  Mortgages: Jurisdictions are split as to whether a JT is severed by the act of one JT mortgaging his interest. Depends on the nature of the bank s interest: y Title Theory: view a mortgage as a transference of title to the bank, or the lender y Lien Theory: Mortgage doesn t give title to the lender, but rather a lien on the property, to the extent the borrow doesn t fulfill its obligation to pay the debt Harms v. Sprague: When J executed mortgage on behalf of the Simmons, JT is still in tact) - free of the mortgage b/c mortgage only burdened J s interest and that because J s interest died with him, mortgage had died too. PROPERTY FALL 2010 OUTLINE Pg.2 1

Lien on title - is what the majority of states recognize the mortgage as and one JT s execution of a mortgage on her interest does not by itself cause a severance.* severance occurs only if the mortgage is foreclosed and the property sold. y Leases: Most jurisdictions today do NOT regard a JT severed by one JT s lease of his interest. The survivorship right continues but, as with mortgages, the problem is presented of whether the lease survives the death Judicial partition- If TIC or JT cannot solve problems by mutual agreement, any one of them can bring an action for a. Court will either physically partition (Partition In-Kind) the tract of land into separately owned parts or order the land sold and divide the proceeds among the tenants b. Partition in Kind: physical division, court will order unless 1) that physical partition is impossible or extremely impractical or 2) that physical partition is not in the best interest of all the parties - (economic costs, look at the deal, sentimental attachment) Delfino v. Vealencis: partition by sale should only happen if interests of all owners would better be promitied by parition by sale- wasn t the case for Ms. Vealencis and her time there and her business c. Partition by Sale: most common method, b/c of the hardships that come with dividing most real property, after the sale the net proceeds are divide among the coowners in proportion to their ownership interests, would get more out of it and would probably result in a one owners who might manage and use the property better d. Owelty: When implementing partition in kind, courts strive to divide property so that the value of each divided parcel (as a fraction of the value of the entire property) is equal to the ownership share of the recipient. If not, the recipient of the disproportionately valuable parcel is obligated to pay owelty/compensation- enough cash to the other tenant(s) to equalize values. JT Bank Accounts: There can be a variety of reasons for creating a bank account is established in JT

PROPERTY FALL 2010 OUTLINE Pg.2 2

o Present Gift: of an undivided interest in the account ( it s yours and min together from now on ) A and B or A or B o Will Substitute: a payable on death or POD account ( it s mine until I die, and then it s yours ) A, payable on death to B o Convenience: to permit the other owner to manage the depositor s money, much like giving a person power of attorney ex: Widower opens up a JT with his niece Ally, telling her I want your name on this account so if I get sick you can get the money for me. No present gift was intended ; this was a convenience account. A, in trust for B o AFTER DEATH: A majority of jurisdictions hold that the surviving JT takes the sum remaining on deposit in a joint account unless there is clear & convincing evidence that a convenience account was intended. *Burden of proof is put on the person challenging the surviving JT/Survivor. In some jurisdictions, to avoid litigation, the presumption that survivorship rights were intended in a joint bank account is conclusive. o DURING THE LIFETIME: litigation may arise over what present rights the parties to a joint account have in the sum or deposit/PRESUMPTION is that the joint account belongs to the parties in proportion to the net contributions of each party. Rents, Profits & Possessions o Each co-owner has the right to possess the entire property, and no co-owner may exclude his fellow co-owners. If coowners cannot agree on how they share possession, the default rules apply. o A co-tenant out of possession has a right to share in rents from third parties and in profits derived from a use of the land that reduces its value (e.g. removal of minerals) o Exclusive Possession by One Co-Owner: is valid: b/c each co-owner has a right to possess all of the property. IF not by agreement, the cotenant in exclusive possession has the following obligations to this cotenant.  Rental Value of exclusive possession: jurisdictions split on the question of whether the cotenant in exclusive possession is liable to his cotenants for their share of the fair rental value of his exclusive possession has the following obligations to his cotenants. Two views: y No liability absent ouster or special duty: PROPERTY FALL 2010 OUTLINE Pg.2 3

o the majority rule is that a cotenant in exclusive possession has no liability for her share of the rental value of possession unless: o 1) the other cotenants have been ousted or 2) the cotenant in possession owes a fiduciary duty to the other cotenants or 3) the cotenant in possession has agreed to pay rent. o Fiduciary duty/agree to pay rent= cotenant in possession has voluntarily assumed a duty to his cotenants or ouster- has prevented his cotenants from exercising their equal right to possession o Ouster: occurs if the tenant in exclusive possession either 1) actually prevents or bars physical entry by a cotenant or (2) denies the cotenant s claim to title. Spiller v. Mackereth: Spiller took possession of the entire building and used it as a warehouse. M demanded that he vacate half the building or pay rent, M sued for rental value of half the building, Alab. Sup. Court denied award of rent, saying S neither denied that M was an owner or prevented M from actually moving in. M s demand letter that S vacate or pay rent was insufficient to trigger ouster, needed to prove she actually sought to occupy building and was denied. Min View: Cotenant is not liable for rent without a clear demand to vacate or pay rent, y Liability for Rent: Minority rule is that the cotenant in exclusive possession is liable to cotenants out of possession for their share of the fair rental value of the occupied premises, unless there has been an agreement among the parties to excuse the tenant in possession from this obligation Rents from third parties: a cotenant who receives rents on the property from a third PROPERTY FALL 2010 OUTLINE Pg.2 4

party is obligated to account to his cotenants for those rents. If the rents or other income received by a cotenant are greater than the cotenant s share, he is obligated to pay the excess to the other cotenants. Accounting for the costs of ownership: each cotenant is liable for his proportionate share of the costs of ownership- mostly mortgage payments, taxes, repairs and maintenance o Mortgage Payment: interest: each cotenant is obligated to pay his proportionate share of mortgage interest. Principle: each cotenant is obligated to his proportionate share of the mortgage principal o Taxes: Each cotenant is obligated to pay his proportionate share of the taxes, and a cotenant who pays more than his share can recover the excess from his fellow cotenants at any time during the tenancy, upon partition, or within the limitations period after cessation of cotenancy. o Repairs: Cotenant has NO obligation to repair his property, but contribution may be compelled for excess repair costs in two situations.  Accounting for Rents: if the one repairing is under a duty to account for rent (whether from third parties or the reasonable rental value of exclusive occupancy) the repairing cotenant MAY DEDUCT from the rents due the other cotenants share of the repair costs the incurred)  Partition: upon partition a repairing cotenant is entitled to be reimbursed for the repair costs in excess of her share. o Improvements: No cotenant has duty to improve- upon partition or if the improving cotenant is under a duty to account to cotenants for rent, the improving cotenant is entitled to rec over only the value added by the improvement, not the costs of the improvement. No value added? No recovery Adverse Possession: Cotenants CAN AP to their fellow cotenants, but it takes more than possession, because every cotenant is entitled to be in possession, a cotenant must give his cotenants ABSOLUTELY CLEAR AND UNEQUIVOCAL notice that he claims exclusive and sole title in order for AP to begin. NOTHING less will do. Unhappy with the actions of fellow cotenant

PROPERTY FALL 2010 OUTLINE Pg.2 5

Swartzbaugh v. Sampson: H and W owned land in JT, H leased 4 acres to Sampson, who constructed a boxing pavilion on the site, W did not join in on the lease, sought to cancel the lease Ca. Court of Appeals denied her claim, reasoning a lease made by a single JT to a third party is not nullity but is a valid..contract so far as the interest of the lessor in the joint property is concerned. ii. Tenancy by the Entirety (not recognized in comm. prop states) 1. Husband and Wife ONLY 2. All 4 unities of JT required, plus must be husband and wifemust hold as own as one3. If they want to sever they must act together a. Death of either spouse (leaving the survivor sole owner of the fee) b. Divorce (leaving parties as tenants in common with no right of survivorship c. Mutual agreement d. Execution by a joint creditor of BOTH husband and wife (a creditor of one or the other cannot execute 4. Divorce severs TBE 5. Modern Operation of the tenancy by the entirety: Treats both spouses as equal, Married Women s Act , 1) women acquired equal rights with the man to alienate her possession and survivorship rights or 2) neither spouse was permitted to alienate their possession and survivorship rights Equal right to Alienate : 6 dozen states provide that either spouse may alienate their possession or survivorship rights in a tenancy by the entirety. The principal effect of this version of equality, which gives the wife the same rights the husband had at common law, is to enable her creditors to seize her possessory interest in the tenancy but not the survivorship right. (indestructible survivorship rights) Neither Spouse may Alienate: the majority of states recognize this, places husband on same footing as the wife at common law with respect to a tenancy by the entirety, is that it prevents the creditors of either spouse from seizure of their interest in the tenancy Sawada v. Endo: H & W own home in TBE. H is sued by M and H Sawada by his negligent operation of an auto. Before the suit was brough, H & W conveyed their home to their sons. This conveyance would be a fraud on H s PROPERTY FALL 2010 OUTLINE Pg.2 6

creditors IF they were entitled to seize his interest in the TBE to satisfy their claims. BUT Hawaii Sup Court says property held in TBE may not be subjected to claims of creditors against only one spouse. /Protection of family unit iii. Presumptions 1. Statutes now saw that a grant or devise to two or more persons creates a TIC unless an intent to create a JT is expressly declared 2. To A & B as Joint Tenants with right of survivorship B. Marital Interest y Old Common Law: o Single woman had power to use, dispose and possess her own property but a married woman had almost none of those rights o Husband: upon marriage he had right to possess, or convey all of his wife s property, for the duration of their marriage o Wife s rights: had no legal control over her property, but had  Support from her husband  Right of dower: right to life estate in one-third of each and every possessory freehold estate the husband enjoyed at any point during the marriage, which was capable of inheritance by children born of the marriage.  Dower could only removed by divorce or with the wife s consent  If a property was not susceptible to division (for her third) then the wife received a third of the rents or profits from the land for the remainder of her life.  In most states Dower has been abolished and replaced with SPOUSAL ELECTIVE SHARE: entitles a surviving spouse to take a specified portion of the decedents probate estate even if the decedent spouse left a lesser share by will to the surviving spouse.  Curtesy- gave husband who survived his wife a right similar to dower, called curtesy- attached all possessory interests in land of the wife- no longer exists in the US y Modern Law: common law : statutes vary considerably, but set forth below are the major themes of these statutory alterations. o Rights on Divorce: Differences in what is defined as marital property that is subject to equitable distribution (some states authorize a court to divide all property owned by the spouse, regardless of the time and manner of acquisition 1. All property owned by either spouse: whenever and however acquired PROPERTY FALL 2010 OUTLINE Pg.2 7

2. Property acquired during marriage: not matter how 3. Property acquired by the earnings of the marital partners: based on the principle underlying community property- that marriage is a partnership and property acquired form earnings of the spouses during marriage should be equally divided upon dissolution of partnership 10 states 4. *Alimony: rehabilitative alimony, limited period of time alimony y Professional Skills and Credentials: o Not property: some states hold that professional degrees and sklls are not property but simply personal accomplishments that may or may not produce property, and thus not subject to equitable distribution o In Re Marriage of Graham: Court concluded that H s MBA was not property because it could not be transferred or inherited but was simply an intellectual achievement , no other marital assets were accumulated during their marriage, you cannot sell an MBA degree, but is this fair? Dissent: courts should go beyond narrow concepts of property to prevent injustice. o Property Subject to Equitable Distribution: New York treats professional degrees and enhanced professional skills as property subject to equitable distribution o Elkus v. Elkus: Husband sued for her new opera star status to be property divided, since he nourished it and coached it, NY appellate court ruled that the contributions to her career and career potential made by her husband entitled him to share in the increased earnings power acquired by von Stade during their marriage. o Reimbursement Alimony: Mahoney v. Mahoney middle course requiring the degree-enhanced spouse to reimburse the supporting spouse for the financial support Rights on Death o ELECTIVE SHARE: In place of the dower, most states give the surviving spouse the right to receive in fee simple a fraction of all property owned by the deceased spouse at his or her death. Surviving PROPERTY FALL 2010 OUTLINE Pg.2 8

spouse may elect his share OR take under the deceased spouse s will, BUT CAN T TAKE BOTH  Differences between dower and elect shareelective share applied to ALL PROPERTY of the deceased OWNED at his death or her death (not just freehold property) but narrower in that (only property owned at spouse s death)  Spouse can avoid this by transferring all his property to a trust, and vesting a remainder in someone other than his spouse Community Property: influenced by French or Spanish law, treats husband and wife as an economic unit- marriage is a partnership of equals and that the property acquired during the marriage by the efforts of either spouse belongs to that marital community. Each spouse has equal claim of the assets of the marital community. o Definition: the earnings during marriage of either spouse and all property acquired form such earnings.  Excludes property acquired before marriage or acquired during marriage by gift, devise, or inheritance.  That property is SEPARATE PROPERTY and is owned soley by that spouse  Can only exist between a husband and wife  Conveyance of share: neither spouse acting alone can convey his or her undivided onehalf share of community property, except to the other spouse, neither spouse can change community property into separate property without the consent of the other.  At death: each spouse has the power to dispose by will of one-half the community property at death. If spouse dies intestate in community property, his shares of comm. Prop pass to surviving spouse, no right of survivorship  Sale After Death: ?  STEPPED UP BASIS Buy house for lower price, husband dies, want to sell house, in tax world-you get to only be taxed on what the value was y Management of Community Property: o Can be conveyed ONLY as an UNDIVIDED WHOLE PROPERTY FALL 2010 OUTLINE Pg.2 9

Commingling of Separate & Community Property: a variation of principles occur when a partially paid-for asset is brought to a marriage and the remainder of the purchase price is paid with community funds o Inception of right: (Texas) holds that the character of the property is determined at the inception of the legal right of the property. o Time of Vesting: Holds that the character of the property is determined when title passes o Pro-rata apportionment: holds that the percentage of the purchase price paid prior to marriage establishes the portion of the property that is separate, and the percentage of the purchase price paid with community funds establishes the community interest in the property. Migrating Couple: once property has been initially characterized, the ownership does not change when the parties change their domicile unless both parties consent.

PROPERTY FALL 2010 OUTLINE Pg.3 0