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Acquisition_of_Property

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					Acquisition of Property
  1. The rule of capture  person who first captures resources is entitled to them; “first in time”
        a. Title by discovery/conquest  Natives didn’t have title, just right of possession (Johnson v. M’Intosh)
        b. Capture of wild animals  must have capture of ferae naturae; pursuit not enough (Pierson v. Post – fox
            case)
                  i. Competition  capture encourages competition, more animals captured
                 ii. Ease of administration  capture is easier to adjudicate; certain & efficient
                          1. Modern day result is overhunting/fishing
                iii. Wounded/trapped animals  virtually certain = captured
                iv. Interference by non-competitor  a competitor may interfere with another’s attempt to capture,
                     but a non-competitor may not (Keeble v. Hickeringhill – ducks case)
                          1. All capture laws are instrumental, promoting capture/killing
                 v. Custom  can determine that capture is not the rule of title (Ghen v. Rich – whale case)
                vi. Animus revertendi  wild animals that habitually return belong to owners even when they roam
                     at large
               vii. Escaped wild animals  captor loses possession; animal is open game (unless an exotic animal,
                     like an animal  owner can put out notice)
              viii. Modern law is concerned with conservation, etc. Animal capture is now regulated by statute
        c. Caves  owner of land has title to the windows, to the walls. Cave doesn’t go to discoverer, but rather
            to the landowner directly over it (and is owned in “portions” based on property lines)
                  i. Landowners over caves get to share profits made by owner of entrance of cave (Edwards v.
                     Sims)
                          1. Criticism  capture rule would be more efficient and reward spelunking; flip side is
                              supply of caves increases
        d. Oil and gas  fugacious resource; rule of capture applies  encourages production of oil and gas; can
            be drained even from under neighbor’s land; if oil moves from under one property to another, it is now
            new property’s (like wild animal) (Hammond v. Central Ky. Gas)
                  i. Modern law regulates oil drilling by statute  well-spacing
        e. Water
                  i. Ground water
                          1. Rule of capture (eastern states where there are underground reservoirs)  percolating
                              ground water can be captured by surface owner
                          2. Reasonable use doctrine  in states where ground water is scare, surface owners may
                              capture the water, but on to the extent that use if reasonable (even if it harms neighbor)
                 ii. Steams and lakes
                          1. Riparian rights  adjacent landowners have rights to use; runs with the land
                          2. Natural flow doctrine  each riparian owner is entitled to the natural flow of water,
                              without material diminution in quantity or quality (can use for commercial purposes, so
                              long as it does not materially affect the quantity/quality of water (non-utilitarian)
                                  a. However, this limit land use for irrigation, etc.
                          3. Reasonable use doctrine  followed by most American courts  riparian owner is
                              entitled to reasonable use of water, and downstream cannot enjoin upstream using unless
                              they are not getting enough for needs, or upstream is substantially interfering with those
                              need
                                  a. Domestic uses generally preferred (upstream cannot be stopped from domestic
                                      uses by downstream; commercial use only if all have domestic needs satisfied
                                  b. Some exceptions made for use of riparian water on non-riparian land (irrigation) –
                                      dry state
                                  c. Economic impact  inefficient; high transaction costs to adjust rights; highest
                                      valued user doesn’t have a better claim
                        4. Prior appropriation doctrine  arid western states  rule of capture; rights are given
                           according to priority of appropriation (first to capture and put to appropriate and
                           beneficial use); can be used on land away from the water (came from miners’ need for
                           water)
                               a. Encourages development of water uses and is predictable; allows transfer of water
                                    rights to a higher valued user; reduced transaction costs
      f. Relevant policy considerations: Coase theorem; externalities
                i. Coase theorem  if transaction costs are nominal, the naturally efficient solution will emerge on
                   its own (i.e. higher valued use will buy out lower value)
               ii. Externalities  cost of an action not internalized as part of that action, but rather borne by
                   everyone else (depletion of animals through hunting)
                        1. Demsetz  property rights are designed to internalize external costs when internalization
                           outweighs the externality e.g. enclosing one’s land internalizes costs of animal depletion,
                           but it is outweighed by the increase in market by making the animal no longer a common
                           good
2. Acquisition by creation
      a. A person can acquire property by creating, but there are material limitations to the rule
                i. Generally rewards labor, but becomes complicated when work of one is combined with another
                    who is the property owner?
      b. Acquisition by accession  when one takes property of another and adds to it either through labor or
          labor and new materials; originally owner is still entitled to value of the property taken, but may lose
          title through the additions (if adder is denied title, original owner is entitled to added value)
                i. Generally, if A adds to B’s raw materials, courts give final product to owner of raw material,
                   unless value added is so significant as to make it unfair to give it to raw owner (and adder must
                   be acting in good faith i.e. not trying to steal property by adding)
                        1. E.g. A cuts B’s timber and processes it; uncut, timber worth $25; cut and processed,
                           timber is worth $500  B can sue for $25 & trespass
               ii. If one unknowingly takes someone else’s property and adds labor and material to it, he will
                   usually get it (O gets value of initial property) e.g. restoring a stripped car
              iii. Confusion of goods  mixing up goods usually results in proportionate distribution
      c. Intellectual property
                i. Policy  how to encourage creativity and reward labor without creating monopolies and stifling
                   others
               ii. Common law  allows copying and imitation (Cheney Brothers v. Doris Silk – copying of
                   fabric patters allowed), but exceptions exist, such as right to publicity (celebrity impression
                   cases)
              iii. Statutes  copyright, patents introduced to solve problem  C&P are limited in time; fair use
                   and right to parody exceptions; one cannot copyright idea, but can copyright expression of it
              iv. Courts may protect IP under unfair competition laws  INS v. AP; news agency has a quasi-
                   property interest that protects it from being copied until it loses commercial value
               v. Rights in body parts  body parts are not freely transferable; therefore, there is no market for
                   them (policy consideration); they can be given, but not sold (exception – eggs)
                        1. Surrogacy contracts  void by some courts (best interest of child – can’t be treated like
                           property); other jurisdictions, only void in certain circumstances)
                        2. Moore v. Regents  court would not give π who had organ taken by researchers and
                           turned into lucrative invention a property right; policy interests (creating a body market)
                           and economic interests (no supply effect by organ on market, so π would get a windfall)
                           were paramount in decision
3. Acquisition by find
      a. TO does not lose title by losing or mislaying property; however, finder has superior right against all but
          TO (Armory v. Delamirie – chimney sweep finds jewel, gives it to jeweler for appraisal, who sells it 
          sweep gets either jewel or value from jeweler)
                i. Applies to both personal and real property
          ii. Policy:
                  1. Prior possession protects TO from thievery, seizures, etc.
                  2. Entrusting goods to another without fear of losing ownership is efficient (bailee
                      examples)
                  3. Prior possessor getting goods back shows that law is just (meets TO expectations)
                  4. Reduces conflicts
                  5. Protecting finder rewards honest finder
                  6. Protecting finder rewards efficient use by enabling return to commerce (e.g if TO is dead)
b.   TO trumps finder1, finder1 trumps finder2 if finder 1 loses it
c.   Prior possession carries over into trespass/thievery; thus, thief1 has superior title to thief2
d.   Possession established by capture and intent to assume dominion (e.g. salvager must put boat over
     wreck with means to raise it to give notice of possession)
e.   Constructive possession  owner possesses something that either he does not or is unaware of; allows
     judges to reach desired results e.g owner of property is in constructive possession of objects under the
     surface even if unaware of them (South Staffordshire Water v. Sharman – pool cleaner finds ring on land
     at bottom of pool)
f.   Finder v. owner of premises as possessor:
           i. Finder is trespasser  owner of premises prevails
          ii. Finder is employee  some say E is acting for owner; contractual duty to report found objects to
              premise owner (however, conflicts with reward honest finder policy)
        iii. Finder on premise for limited purpose  if F is on land to do a specific task, some courts reason
              that F’s only right is to that activity; finding goods is premise owner
         iv. Object under the soil  found under soil or imbedded in soil  premise owner
                  1. Exception  treasure trove; intentionally buried/concealed with intent to return to claim
                      it  English law, goes to crown; US, goes to state; some courts give it to finder, others to
                      landowner as mislaid property; found with dead does not belong to finder
          v. Object found in private home  to owner of home; owner has exclusion rights  finder is in for
              specific purpose, not finding objects
         vi. Owner not in possession  if owner has not moved into house, no constructive possession of
              objects of which he is unaware (Hannah v. Peel – brooch case)
                  1. Perhaps rewards honesty
        vii. Object found in public place  lost/mislaid distinction
                  1. Lost  TO accidentally and casually lost
                          a. Goes to the finder
                  2. Mislaid  intentionally placed somewhere and forgotten
                          a. Goes to owner of premises
                  3. Distinction facilitates return to TO; TO will likely return for mislaid goods
                  4. Bridges v. Hawksworth; McAvoy v. Medina
                  5. Criticisms: lost or mislaid is subject to court’s interpretation
                          a. Also assumes that one only returns if mislaying something; however, many
                              people retrace steps if item is lost
       viii. Abandoned property
                  1. awarded to the finder, as TO no longer claims any right to it
         ix. Statutory changes  some states have changed law to handle the problem e.g. in NY, all
              property is lost and goes to the finder

				
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