Personal Property:

Finders – Possession
Creation (2): Characteristics: Details:
Possession: 1. Lost Finder has better claim than
anyone other than a true owner or
2. Mislaid prior possessor
- Discovery 3. Abandoned (requires Custom
intent of TO) De Facto Possession
AND 4. Agency Type of industry
Public v. Private = English
5. Treasure Trove
- Control 6. Voidable Title (UCC) Trover, Detinue, Replevin,
Conversion

Rules:
- Finder does not have absolute title to the found property, better claim than subsequent possessors
- Good faith finder of lost objects on land under lease will prevail in finding of a chattel over landowner
- (1) Lost or mislaid, (2) landowner or trespasser or invitee
- (a) lost = finder has better claim
- (b) mislaid = landowner, created to give landowner a cause of action (bailment – constructive possession)
- (c) abandoned = finder always win
- (d) treasure trove = finder always wins; shipwreck = finder wins, but landowner has claim over
- Jus Tertii Rule – TP proves that finder does not have claim to deny finder
- Trespasser, Honesty, Luck, TO’s interest. Generally, protect TO then to finder.
- Most states have legislation to deal with these types of issues
 Personal Property:
Animals
Creation (2): Characteristics: Details:
1) Kill Wild Animals (Ferae Careful of a “branded” or
Naturae): known animal
2) Capture - Not possessed, no prior
possessors Look for mark of
3) Mortally Wound + ownership to
Reasonable Pros. Domestic Animals (Animus determine whether
Capture Revertendi) wild or domestic and
- Owned argue policy
4) Pursuit + R P Capture
(Livingston rule)
Rules:
• Mere Pusuit = not enough
• Ratione Soli = landowner has constructive possession of wild animals on land ,
• Policy – if domesticated

• ECONOMIC NUISANCE – Keeble case

 Personal Property:
Gifts
Creation (2): Characteristics: Issues:
Inter Vivos – Constructive v. Symbolic
- Present Intent • Irrevocable
- (a) intent to transfer title • Must show present intent Looking for present intent
at present time • Present Possession (LE/FI)
- (b) clear at delivery Testamentary = giving future
intent
- Clear Delivery Causa Mortis
- Actual • Contemplation of death Life Estate – if conditional then
- Constructive • Death must be imminent may be a gift, question over the
- Symbolic • Revocable intent

- Acceptance (presumed) Testamentary

• Given through wills
• Written + 2 witnesses
Rules:
 Personal (other) Property:
Et Cetera
Types: Issues:
News & Information
•
Generally policy
• Fixtures issues to argue
• Bacteria/Natural Processes
whether or not
something should
• Personality – Evisceration
be subject to the
• Interference with Property rules of property
Rules:

• Labor Theory (Locke)

• Demsetz
• Externalities
• Posner Theory
• Theory of the Commons
• Law Accession – question over who made it
• Unfair Competition
 Adverse Possession:
General (COAH)
Creation: Characteristics: Issues:
Notice (boundaries) – estoppel v. actual v.
acquiescence v. mistaken improvers
- Continuous & Objective Test:
Exclusive • Acts demonstrate intent, Tacking (must have privity & non-hostile) – (1)
improvements voluntary = new time; (2) eviction by non-TO –
subtract; (3) maintain as if there whole time
- Open & Notorious Subjective Test: Constructive Adverse Poss./Color of Title
• Good Faith – color of title
- Actual Entry Ouster
• Bad Faith – known
adverse Joint Adverse Possession
- Hostile & Adverse
Leaving & Returning
Kunto – stretch privity rule to
include non-privity to Disabilities (infancy, imprison, insanity) + 10,
satisfy policy goals cannot tack disabilities

Maine Rule v. CT Rule

Rules:
• Continuous – uninterrupted for given statutory period
• Exclusive – without permission, and only one
• Open – sort of possession that would normally occur
• Notorious – whole area possessed must be open & notorious, clearly known by neighbors were they to view
• Actual - no symbolic entrance, must be actual
• Hostile/Adverse – possessor does not have true owner’s permission
• Objective Test – demonstrate intent by actions
• Subjective Test – good faith & bad faith
 Adverse Possession:
Of Chattel or Real Property
Creation: Characteristics: Issues:
- Demand & Refusal Demand & Refusal - If the open element is not met
for the AP of chattel – TO in
equity may be required to convey
- Discovery Adverse Possession – normally to relieve burden and AP will
“open” requirement not met have to compensate the TO for
the loss
- Adverse Possession Discovery
• Possession at taking and statute
- Title Theory begins until TO knows and reports
- Title forever, doesn’t (stops) – when found, statute begins
matter again

Title Theory
• Title forever, TO always wins
Rules:
• Color of Title
• No adverse possession against the government
• Once statute passes, adverse possessor has better claim to title than TO
• Maine Rule – intent must be known, hostile; MISTAKE is not acceptable
• CT Rule -
 Estates in Land:
Fee Simple Absolute (FSA)
Creation (2):
1. To A, OR
2. To A, and his heirs
*Heirs no longer needed
Characteristics: Future Interest:
1. Absolute ownership of 1. NO future interest
potentially infinite
duration
2. Devisable
3. Descendible
4. Alienable

• Shenade O’Connor Rule: Vocabulary: Restraints:

• Living person has no heirs Heirs Disabling – prevent transfer
Issue Forfeiture – cannot prevent transfer to
• Review the: Ancestors another
• Words of Purchase (who) Collaterals Promissory – promise not to transfer
• Words of Limitation (what) Escheat
Primogeniture
Reversion, Remainder (V & C)
Disclaim an interest
Holographic Will
Rule of Destructibility
Merger
 Estates in Land:
Fee Tail – no longer used
Creation (2): Characteristics: Future Interest:

1.“To A, and 1.NOW 1. Reversion – to

O when heirs no
the heirs of creates a FSA longer exist
his body…”

Historically
• Would pass through blood
relationship
• Purpose was to maintain
family dynasties
 Estates in Land:
Life Estate
Types: Issues: Future Interest
Pur Autre Vi • No future interest
• To A, for life… • Measured by the life
of another – happens
after a life estate has
• Must be measured in been conveyed

explicit life terms Determinable Life

• Never in terms of Estates
• May end the life
years estate if condition is
met

Notes:
Defeasible Fees:
Generally
General Elements of Construction:
1. Words of mere desire or hope or intention are insufficient to create a
defeasible fee
• Cts disfavor restrictions on land
• Will avoid finding a defeasible fee
• “For the purpose…” or “With expectation…” = not enough

2. Absolute Restraints on Alienation are VOID

• Absolute ban on power to sell or transfer
• Considered repugnant
• Will be turned into an FSA

3. Words of Purchase v. Words of Limitation

• Purchase – who has the right
• Limitation – what they can do with it
 Defeasible Fees:
Fee Simple Determinable (FSD-POR)
Creation: Characteristics: Future Interest:

• “To A, so long as…” • Devisable • Possibility of

• Descendible Reverter – exists in O,
• “To A, during…” • Alienable the grantor, if the
• “To A, until…” • ALWAYS subject to the condition is broken
condition

• Grantor must use CLEAR DETERMINABLE LANGUAGE

• If violated, forfeiture is AUTOMATIC

• McJager Rule – “can’t always get what you want…”

• Normally used to encourage something to happen – presumption is for FSCS

• May come to an end by its terms
 Defeasible Fees:
Fee Simple Subject to Condition
Subsequent (FSCS)
Creation: Characteristics: Future Interest:
• “To A, but if X event occurs, • Devisable • Right of Entry
grantor reserves the right to reenter • Descendible • Power of Termination
& retake…” • Alienable
• ALWAYS subject to the condition,
• Elements: but NOT automatically terminated
a. Clear durational language • Can be cut short by GRANTOR’s
b. Must carve out right to OPTION if stated condition
reenter occurs

Bobby Brown Rule – “it’s my

perogative”
 Defeasible Fees:
Fee Simple Subject to Executory
Limitation (FSEL)
Creation: Characteristics: Future Interest:
• “To A, but if X event occurs, • Devisable • Shifting Executory
THEN TO B…” • Descendible Interest
• Alienable • Springing Executory
• Elements: • Just like FSD, but if condition is
a. Outcome-Determinative broken, then estate
Interests
b. Executory Language – AUTOMATICALLY forfeited to
forfeiture works in favor of someone other than the grantor • “Same as subject to
the non-grantor 3rd party • Works in favor to a 3rd party divestment”
Future Interests
Capable of Creation
FUTURE INTEREST
CREATED IN GRANTOR
Possibility of Reverter
(grantor)
Right of Entry /
Power of Termination
(grantor)
Reversion (grantor)
“Subject to Divestment” (TP)
“Subject to Open” (TP)
Remainder
TYPE OF ESTATE WHERE
NOTES
CREATED
- Fee Simple Determinable Always with FSD, only with FSD
- Fee Simple Subject to
Arises on violation of condition
Condition Subsequent (FSCS)
Arises in O (grantor) who transfers
-Life Estate
less than he has other than a
-Term of Years Estate defeasible fee – “leftovers…”
-if interest exists at
conveyance but may go to
another party
-interest may extend to others Typically with children
See later slides
 Future Interests
In Tranferees/Grantees
Remainder – comes about at the natural end of a life estate or term of years
• Sociable: never travels alone (follows preceding estate of KNOWN, FIXED, duration – typically LE or
TOY)
• Patient/Polite: “never follows a defeasible fee”
• Vested – (a) created in ascertained person AND (b) not subject to condition precedent
• Contingent – (a) created in unascertained person, OR (b) subject to condition precedent, OR (c)
both
1) Determine which future interests have been created by the conveyance.
• RAP – only to contingent remainders, executory interests, and certain vested contingent remainders subject to open
• Will not apply to any future interest to O, the grantor; not to indefeasibly vested remainders, not to sub

2) Identify the Conditions Precedent to the vesting of a suspect, future interest. What has to happen before future interest holder can
take?

3) Find a measuring life.

• Find person alive at conveyance and decide whether relevant to the condition.

4) Outcome-Determinative – will we know with certainty within 21 years of the death of measuring life if future interest holder can or
cannot take?
• If yes – conveyance is good
• If no – future interest is void
• Many executory interests with no limit within which it must vest will violate the rule against perpetuities – does not violate when
the grant is to O and his heirs
 Future Interests
In Tranferees/Grantees
Future Interest Types NOTES
Certain to acquire in future w/ no
Indefeasible Vested Remainder conditions attached
Remainderman exists but not subject to any
Vested Subject to Complete condition precedent or prerequisite
Divestment Condition Subsequent – set alone by
Vested Remainder commas creates the VR in 1st place
Vested in a group of takers – at least one of
Vested Subject to Open (rule of whom is qualified to take possession;
subject to partial diminution b/c additional
convenience) takers not yet ascertained can still qualify as
class members (class = open or closed)

Condition Precedent, Shelly’s

Contingent Remainder
Executory
Interest/Limitation
(Rule Against Perpetuities)
Rule, Rule of Destructibility, Arises on violation of condition
Doctrine of Destructibility
Into another person, executioner
Shifting cutting into another’s interest
Springing Into grantor or his heirs

Rule Against Perpetuities – certain types of limitations on future interests are void if there is any possibility, however
remote, that the given interest may vest more than 21 years after the death of a measuring life
 Future Interests
Restraints on Conveyance

Restraint Types NOTES

Cannot prevent a future

Direct Restraint
possessor from selling the
on Alienation
interest in the property

Common law doctrine Marketability Restraint –

Indirect Restraint where condition severely
where condition made limits the ability of the
on Alienation
the deed unmarketable property to be productive
 Joint Tenancy:
Types of Concurrent Interests
Types: Issues: Severance/COAs
• Tenancy in Common Joint Tenancy • Partition
-if broken, will become TIC • Voluntary Agreement
• Separate undivided interest in • In Kind
property that is descendible -severed when transferred to a
• Physically divide the property,
third party presumed unless (a) physical
and may be conveyed by will or -subject to judicial partition impracticability/inequity,AND
deed -agreement not to partition (b) interests of owners better
-car crash, who died first? served
• Joint Tenancy (TTIPS) -destroyed by death, law,
• By Sale
• Time – same time voluntary/involuntary
• Generally used more often
acts, omission by one JT
• Title – instrument, or joint without consent of • Final Accounting
adverse possession another • Rents
• Interest – equal, undivided -lease = only transfer rights one • Mense Profits
shares has
• Contribution
• Possession – possess whole • Fees
• Survivorship - automatic Tenancy by the Entirety • Taxes
-avoidance of probate • Improvements
-survivorship
• Tenancy by the Entirety -when conveyed to married • Partitioning a Lease
• JT plus marriage couple • Land – depends on uniqueness

Notes:
• Avoidance of probate
• Presumption is for TIC over any other; law tends to disfavor creation of a joint tenancy
• Right to the whole
• Complete Possession; Exclusive Possession; Rent from 3rd; Adverse Poss; Carrying Costs; Repairs; Improvements; Partition
 Joint Tenancy:
Leaseholds & LL/Tenant & Bank Accounts
Leasehold Types: Bank Accounts

• Tenancy for Years • True Joint Tenancy (survivorship)

• Set amount of time
• Payable-on-Death Account
• Periodic Tenancy • No individual drawing but will get
• Term ends survivorship on death

• Term Tenancy • Convenience Account

• No end point • Used by 2 individuals but no right
to survivorship
• Tenancy at Will
• Tenancy that can be estopped
by the LL or tenant by
notification

Notes:
 Joint Tenancy:
Ouster (CCCDD)
5 Types of Ouster: Issues:
• High Threshold (majority)
1. Common Law • OT demand,
• Show prevention of possession by the In- • IT refusal
• Required OT action,
Tenant • THEN COA arises

2. CA Statutory • Low Threshold (minority)

• Demand + Refusal + 60 days • OT demand
• IT refusal
3. Constructive • COA arises
• Normally ex-spouses, don’t require entry

4. De Facto
• Property only possessed by 1, impossible for
dual possession

5. Divorce (Presumptive)
• Not triggering violence

Notes:
• Issues arise with a lease – lease is valid, so must determine how to split
 Law of Servitudes:
Easements
Type of Easement: Issues: Termination:
• Transferability • Terms
• Commercial easements in gross • Impossibility
Easement Appurtenant (in are treated as appurtenant
writing = express) • Merger
• Eminent Domain
• Divisible/Apportionment
• Surcharge • Release
Easement in Gross • Abandon
• Illegal Use
• Overuse • Purpose
Affirmative/Negative • Diminution in Value • Prescription
• Reasonability • Estoppel
• Terms •
Expressed/Implied Recording Statute
• Passes authomatically
• Title Insurance

• Negative Easements (LASSS)

• Light, Air, Support, Stream Water,
Scenic View (some JX)
Notes:
• Express Easement by Reservation
• Express Easement by Exception
• Reservation v. Exception - cannot be made
• Cannot have easement in own property
into a 3rd party or considered void. Grantor
• Commercial Easements in Gross
may reserve interest in a conveyance and
then transfer to 3rd party but cannot do at
time of conveyance.
 Law of Servitudes:
Implied Easements
Estoppel (Oral
Prior Use Necessity Prescriptive Easement or
Irrevocable License)
Severable Property Severable Property

Same Grantor Same Grantor

Open Use Reliance – some
expression or
Visible/Apparent Land conveyed by grantor Continuous implication
is landlocked after through conduct
Continuous conveyance
Adverse (gf/bf)
Necessity for Dominant Continuous Permission –
Estate’s enjoyment Notorious (public) something done
Necessity
or said

Duration – theoretically
forever but governed by
Does not require
the doctrine of
Reasonable Use standard will exclusivity
reasonability
govern
May end when no longer
Location – place of use at
necessary Scope – fixed at creation,
Same rights as easement and creation
balance of interests
may last as long
Scope – must be continuous
Can be lost by adverse use
by the true owner
 Law of Servitudes:
Real Covenants & Equitable Servitudes
Creation Elements: Types: Termination (RESTMJx3):
1. Written or Implied • Affirmative 1. Release
1. (law) + SOF
• Negative (Restrictive)
2. Written & Implied (equity) 2. Merger
2. Privity – horizontal / vertical
3. Intent to Bind Successors • Damages 3. Terms
4. Touch & Concern • Cov = $ damage
5. Running with the Land • ES = injunction 4. Statute

Burden Running: Only property law if 5. Eminent Domain

• Writing
• Intent
involves subsequent
takers 6. Judicial Decision
• Touch & Concern a. Change in Neighborhood (strict)
• Vertical Privity i. Market Area
• NOTICE Contractual by nature ii. Neighborhood

Benefit Running: b. Change in Law

• Writing
• Intent c. Behavior – Waiver, Estoppel,
• Touch & Concern Abandonment
• Vertical Privity
Law of Servitudes:
Real Covenants & Equitable Servitudes RUNNING
Burden Benefit
Covenant Eq. Serv Covenant Eq. Serv

Vert. Privity PLUS Notice Vert Privity PLUS

Intent
Affirmative Intent Intent Intent
T&C
T & C PLUS T & C PLUS T&C

Vert Privity Notice Lite Privity

Intent
Negative Intent Intent Intent
T&C
T&C T&C T&C

Touch & Concern => (a) affect use/enjoyment/occ. of land; (b) meet expectation of parties; (c) will
not unreasonably interfere with use/marketability/alienability; (d) pub policy considerations
 Law of Servitudes:
Implied Reciprocal Negative Easement
Creation Elements: Termination:
1. Inquiry Notice – in other deeds
• Look at neighborhood Change of Neighborhood
• All properties are benefited by the covenant
• Apparent by inspection Change of Law
• SPLIT => JX 1 – notice for other common deeds in neighborhood,
JX 2 – record notice on prior deeds need not be satisfied

2. Visible – sub divider has general scheme of residential

development which included lot in question

3. Continuous

4. Creating Mutual Benefit & Burden

• Need to evaluate suit – suing for benefit or burden

• While it should be written, and some courts do not accept, other courts will try to maintain neighborhood integrity and imply these
unwritten covenants
• Not written but obvious at the end after the houses are built
• NOT by implication or prescription
• Only property law if it involves
 Eminent Domain:
Takings & Constitutional Issues
Creation Elements: Issues:: Determining Legitimacy:
SLPT-C
1. Finding a state, enabling • 5th Amendment = • Illegitimate:
statute Takings Clause • To a private entity
• No plan
2. Action must be legitimate
• Due Process Test – • “Private Use”
3. For a public purpose, and substantially advances a
legitimate government • Good Taking:
4. The means of the taking are interest (standard of • Transfer to public entity
not irrational, then review is deference to • To private w/ “general plan”
the legislature) • “Blighted Area”/”Public
5. Acceptable so long as just Need”
compensation
• Equal Protection • Local politics included in
Clause considerations decision
• Deference/Rational Basis
 Transferring Real Property:
Conveyance Process
Takings Elements: Issues:: Remedies:
1. Search Period – viewing and • Listings: • Buyers’ Remedy:
offering • Closed • Specific Performance (with
financial abatement)
• Open
• Rescission, Restitution, Damages
2. Contract of Sale • Net Listing
Period/Executory Period • Sellers’ Remedy:
a. Offer • Real Estate Agent Duty: • Specific performance
b. Acceptance • Fiduciary • Damages – liquated typically
c. Financing • Good Faith (presume)
d. Good Title • Disclosure
• MARKETABLE TITLE:
e. Inspection • Seller promises to include
f. K = disclosure, warranties, • Statute of Frauds: title free from reasonable
review, • Written deed doubt of lawsuits or threat
• Signed by party to be of litigation
3. Property Law – Closing charged
• Adverse Possession –
1. Law – title in seller • Description
• JX 1 – must have good record
2. Equity – title in buyer, • Price • JX 2 – ad. poss. allowed
legal title trans at • Material Terms • Encumbrances
• JX 1 – yes • Must be unencumbered unless
closing • JX 2 – not needed waived by buyer
3. Recording • Zoning Violations
• Unmarketable if in violation

Warranties in Land Contract – (1) marketable title & (2) no false statements of material
fact or omissions – depending on the weight of the JX
Transferring Real Property:
Mortgages
Type of Mortgages: Remedies:
1. Power of Sale Mortgage
• Creditor has much leeway – must act in good faith: (a) Damages – limited to recovery of
post notice; (b) available buyers; (c) due diligence the purchase price (often not
great)
2. Land Purchase Contract
• Seller keeps the title, and does not transfer until
installment payments are complete
• Create – EQUITABLE TITLE – require foresclosure

Issues:
• Mineral Estates v. Surface Estates
• Actual eviction –
• Statute of Limitations on Claims
Transferring Real Property:
Deeds
Type of Deeds:
1. Quit Claim
• no deed covenants included
2. Special Assurance
• Special promises, grantor
makes promise on behalf of
self that not conveyed to
anyone else & free from
encumbrances
3. General Warranty Deed
• Warrants against all defects
in title, including grantor’s
predecessors
Writing + Lawful + Delivered
then formed at the passage to buyer
Issues: Remedies:
• Good Title • Buyers’ Remedy:
• Marketability • Specific Performance (with
financial abatement)
• Rescission, Restitution, Damages
• Title Insurance
• Lender Policy • Sellers’ Remedy:
• Owner Policy • Specific performance
• Duty of Insurance • Damages – liquated typically
Company - inform (presume)
• Title Insurance v. DC Doctrine of Part
• Exceptions Performance:
• On record defects (a)Possession of land
• Off record defects (b)Remit all or part of purchase
• Running w/ land price
• Indemnify (c)Substantial improvement on the
premises
 Transferring Real Property:
Seller’s Obligations
Obligations: Remedies:
1. Latent Defects • Buyers’ Remedy:
• That seller knows OR has reason to know either (a) impairs value, OR (b) • Specific
Performance (with
unknown to the buy, then the seller has a duty to disclose (preempt caveat
financial
emptor) abatement)
• Rescission,
2. Conditions on Sellers Restitution,
• Impairs Value of Property – disclose Damages
• Unknown to Buyer – disclose (objective test)
• Sellers’ Remedy:
• Turns on the action of Seller – up to seller to remedy (can do through
• Specific
newspaper ad, et al) performance
• Damages –
3. Builder Exception liquated typically
• 1st buyer can sue original builder, warranty may extend to subsequent buyer (presume)

4. Issues:
• Silence does NOT create condition, UNLESS latent, material defect
• Importance of INTENT – objective test v. subjective test
• Seller cannot engage in active concealment
• Real Estate Agent
• JX 1 – has a duty to disclose known or should know latent material
defects
• JX 2 – puts obligation on the agent to disclose
Transferring Real Property:
Deed Covenants
Type of Deed Covenants: Remedies:
1. Present Covenants (broken at closing)
Damages – limited to recovery of
1. Seisin – promise that grantor owns estate the purchase price (often not
2. Right to Convey – power to convey (not JT, infant) great)
3. Encumbrances – marketability (no unknown
encumbrances) Encumbrances (if unkown)
Restrictive Covenants – yes, yes
2. Future Covenants (until affect) Zoning Ordinances - no
Recorded Easements – yes, yes
1. Warranty in Title – defend against future TP claims Visible Telephone Lines (Split)
2. Quiet Enjoyment – some TP claim against title Buried Telephone (unseen encum)
causes loss of enjoyment – constructive eviction (actual Historic Homes – no, no
eviction required for COA to arise, must be paramount Wetlands Regulations – no,V yes
– not TIC claim) Subdivision Regs – no,V no
3. Future Assurances – type of warranty/discrete Housing Code – no,V no

Issues:
• Mineral Estates v. Surface Estates
• Statute of Limitations on Claims
• “Paramount Claim” – claim better than present possessor’s claim
 Transferring Real Property:
Duty to Disclose
Disclosure Policies: Issues: Other Issues:
Caveat Emptor
• No duty to disclose Subjective v. objective test to Real Estate Agent
• No fraudulent misrepresentations or active concealment Issues:
• Unless in fiduciary relationship
Silence may not create a (a) Duty to Disclose a
Stambovzky condition, instead must relationship with
• Condition created by the seller that (a) materially look to the seller’s intent another party in the
affects the value that is unknown OR not easily sale
detected by the buyer (objective test); then duty Patent defects burden goes to (b) Serves as a
to disclose to buyer and may be grounds for the buyer fiduciary
recission
• Actions of seller are critical to determining notice New Jersey – statute
Latent defect to the seller where the agent must
Johnson certify the waste near a
• Affirmative duty to disclose
Issue occurs when the property
• Latent defect that seller knows OR should know: unknown thing
impairs value or unknown, duty to disclose by INCREASES the value of
seller the house

Lempke
• Subsequent purchasers may sue against builder, warranty
 Transferring Real Property:
Recording System
Record Systems: Recording JXs: Other Issues:
1. Recording Race JX
• First in time, first in right Title Search –
Statutes Grantor/Grantee
• First to record
Indexing System
2. Title Insurance Notice JX
• Whether subsequent purchaser has Actual Notice
System
notice of paramount title – if yes,
then loses, if no then prevails Record/Constructive
3. Torrens System • 2 Test Dates: Notice
• At time of conveyance
• At time of recording Inquiry Notice

Race-Notice JX Chain of Title

• When 2 BFPs, subsequent purchaser
who records first prevails When to LOOK in the
• Shelter Rule – may play into effect chain – sale, record
Notes:
Bona Fide Purchaser – (a) purchases land, (b) for value, (c) without notice that anyone else has bought land –actual/constructive/inquiry
Acknowledgement
Late Recording & Early Recording (out of chain)
Look for “subsequent taker”
 Policy Considerations:
• Natural Rights Theory – labor produces X, that labor should be protected through property
rights
• Protection is deserved as a matter of the social contract people have in organized society
• Utilitarian – no “property” outside the state – determined by the state, property is not value.
Critique of NRT b/c the labor theory promotes the protection of monopoly interests based on
production.
• Conventions – rules that society adapts to through law-making w/o NRT in mind
• Remedies should be provided by state to serve state’s purpose, must make good social sense;
consequences of rules are key
• Law can come from custom, but it must be verified through the state
• Moral Theory (“personhood”) – similar to the NRT of old; need to protect individual autonomy
and dignity
• Posner, Law & Economics – principles of efficiency are key, allow for judges to make laws based
on essential principles to promote efficient practice and generate maximum wealth
• Decreasing Marginal Utility –affecting the relative value of property to different individuals
• Demsetz – externalities and the effect on property rights, transaction costs, communal property
causes the over consumption and private allows for the internalization of externalities
• Moral Hazard, Coarse Theorem, Pareto Efficiency (movement from one allocation to another
that can make at least on better while not making any worse), Transaction Costs, Kaldor Hick
Efficiency (using actual compensation to improve those hurt by loss)
• Holdouts, Bilateral Monopolies, Division of Labor, Sustainability
• Internet – new form of the commons
• Body as Property – (1) alienable, (2) market alienable, (3) inalienable; commoditization