#11266 - Acquisition - Property

Lands are only owned if their occupants exercise a sufficient degree of occupancy to establish possession. Historically, nomads who did not establish permanent settlements were only entitled to a right of occupancy.

Lands which were not owned went to whichever European nation whose citizens first discovered it.

One European power could take discovered territory from another through mutual agreement or conquest.

The American Revolution transferred sovereignty over America from the British Crown to the U.S. Government.

Johnson v. M’Intosh: Πs succeeded to investors who bought land from an Indian tribe before the Revolution. Δs bought the same land from the federal government after the Revolution. Held, the Indians did not possess the land, because they were nomadic and did not establish permanent villages, and therefore did not have title to the land, only a right of occupancy. The only party who can convey title to the Indian-occupied lands is the sovereign. The British Crown obtained title to the land when its citizens discovered/conquered it. The American government succeeded to the Crown’s title after the Revolution. Since Πs bought the land directly from the Indians, who did not have title, the sale was invalid.

1. Wild Animals

The Rule of Capture states that ferae naturae become the property of the captor who 1) Deprives the animal of its natural liberty; 2) manifests a clear intent to take possession; and 3) takes total control of the animal. This establishes occupancy in the creature and gives the captor superior title against subsequent possessors.

• Natural liberty: merely wounding or pursuing is not enough. See: Pierson v. Post.

• Clear intent: killing an animal and then walking away leaves it up for grabs.

• Total control: an animal which is halfway in your net before escaping is up for grabs. But see: Popov v. Hayashi; where captor A’s ability to establish total control was disrupted by the wrongful intervention of third parties, the proceeds from the sale of the ball were equitably split between A and B.

Policy: The RoC promotes competition to actually capture animals, rather than pursuers. Actual capture is easier to prove than mere pursuit. (But note: the RoC promotes harvest, and does not account for our interest in conservation.)

1. Occupancy

Ordinarily, satisfying all the elements of the RoC gives a captor superior claim against all others, even if he subsequently loses the animal to another.

1. Ratione Soli

Ratione soli is the “law of the soil;” it entitles a landowner to game captured on his land.

Ratione soli trumps occupancy if captor A takes the animal while trespassing on B’s land.

Provided an animal is on your land, you have an action against anyone who interferes in your right to harvest it. See: Keeble v. Hickeringill.

1. Animus Revertendi

A wild animal who is captured and escapes is typically up for grabs.

BUT, a wild animal who is captured and tamed, such that it exhibits an instinct to return to its original master, is not available for capture.

Policy: We want to reward people for taming wild animals, and protect their right to the fruits of their labor.

1. Oil and Gas

Oil and gas are subject to the RoC. They are considered a fugitive resource.

Oil exists in underground reserves which may stretch across property lines. Pumping oil on lot A drains the oil not only under lot A but also from neighboring lots if the reserves are connected. This is considered legal, and the owner of A is entitled to the proceeds from the oil that he pumps.

To prevent neighboring property owners from racing to drain the reserves, states have enacted compulsory unitization regimes. These require landowners to split the proceeds from drilling with their neighbors, minus the cost of exploration and extraction.

1. Finders

The right to a chattel is determined by ownership and possession. An owner does not lose title to an object by losing it. The “true owner” of the object has a claim superior to the rest of the world, regardless of who possesses it.

However, proving ownership is harder than proving possession. A possessor of an item has superior title to all subsequent possessors. True Owner Finder / Possessor Subsequent Possessor. See Armorie v. Delamirie.

Possession is established by asserting physical control over the property and by the intent to assume dominion over it.

After Acquired Title Doctrine: If X sells an item to Y without perfect title, and O sues X in trover, X may not sue down the chain of possession, only up.

In a suit against the seller of a good with imperfect title, O typically recovers the sale price of the item. However, some jurisdictions award the fair market value of the good at the time of the suit. See: Menzell v. Liszt.

A finder or thief is treated as an involuntary bailee. If F sues J for damages, J may still be liable to O in a second suit.

If F is a voluntary bailee, and F sues J and recovers, J is protected from another suit. See: Winkfield.

1. Owners of Premises

The owner of land where property is found may be in constructive possession and have superior title to the finder, particularly when: 1) The finder is a trespasser; 2) The finder is an employee of the owner; 3) The finder is on the premises for a limited purpose.

The owner of property is held to have the right to exclude others on his property and to admit them only for specific purposes, which does not include harvesting found property on his land.

At common law, the owner of land was held to be in constructive possession of everything embedded in the soil on his property. The exception (in England, not America) was for deliberately buried treasure, which went to the crown.

If property is found in a private place on O’s property, O has constructive possession and superior title.

• Exception: Where the owner has not yet taken possession of the premises, he may not have constructive possession of found property. See Hannah v. Peel.

If property is found in a public place on O’s property, the law distinguishes between property which is lost and mislaid.

• Lost property goes to the finder. The owner likely does not know where it is, so there is no policy advantage to awarding it to the owner of the premises.

• Mislaid property goes to the owner of the premises. The owner of the item deliberately put it where it was found and will likely return for it. The owner of the premises is in a better position to return it.

  1. Multiple Finders

Where there are multiple finders, the court may order equitable division: forced sale and equally splitting the proceeds. See Popov v. Hayashi.

1. Body Products

Body products are generally considered property, but may be “market inalienable,” meaning that the owner cannot sell his body parts on the open market.

Moore v. Regents of University of California: Δ doctors took Π’s diseased spleen in an operation. Later, the doctors used the cells from the spleen to cultivate a valuable cell line. Π asserted the right to collect damages from the doctors and against all subsequent users of his cell line. If it were not Π’s spleen we were discussing, this would be the result. But the court cited the policy concerns of promoting research and preventing people from monetizing their body parts in its ruling that Π was not entitled to collect. (Strange ruling...what would be wrong with making researchers pay up front to use Π’s cells? The effect of this is to deprive Π of a property right in his own body, but to preserve that property right for all subsequent possessors).

Policy: Think Calabresi and Melamed. We may simply not want people to be able to convert their healthy body parts into currency when desperation makes it tempting to do so.

1. Adverse Possession

Adverse possession gives clear title to a party who has possessed it for the statute of limitations period. The AP’s title becomes supreme, even against the true owner.

AP bars the true owner’s action in ejectment and creates a new title in the AP. If the AP wants his title recorded, he must file a quiet title action and prevail.

Policy: The AP doctrine has several justifications.

• Protecting title/barring stale claims. AP ensures that longstanding possessors of property cannot be displaced by ancient disputes which may be poorly documented and for which the evidence has all but disappeared. It

• To promote productive use of the land. AP punishes absentee landlords who sit on their rights. If an AP takes the land and puts it to good use and O never takes action remove him, we presume AP is doing a service to society by putting the land back in circulation.

• To honor expectations. Once people have been in possession of land a long time, they expect to stay there. It is equitable not to order them to leave in the face of ancient claims.

The statute of limitations is between 5 and 21 years, depending on the jurisdiction. The modern trend is towards shorter statutes of limitation.

The requirements for Adverse Possession:

• (1) Actual entry giving exclusive possession

• (2) Open and notorious possession

• (3) Adverse and under a claim of right

• (4) Continuous, uninterrupted possession

  1. Requirements

     1. Actual Entry

Actual entry triggers the cause of action in the true owner O.

Actual entry onto part of a property establishes constructive possession of the whole.

The possession must be exclusive; it cannot be shared with the owner or the public.

1. Open and Notorious (and Visible)

The possession must be of a sort which would put O and the community on...