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Board of Regents v. Roth - Respondents property interest in employment at a public univ. was created and
defined by the terms of his appointment. He did not have a property interest sufficient to require a hearing
when they declined to rehire him.
In re Marriage of Graham - A graduate degree obtained after marriage does not fall under the definition of
property as intended by the legislature when it enacted the division statute. Except in NY!
Is it property? One helpful definition is that property has an exchangeable value or which goes to make
up wealth or estate. It is personal to the holder, terminates with death, not inheritable, and is cumulative product
of years of education.
Dissent: It is not the degree which constitutes the asset in question but the increase in earning power
connected to having the degree, partly a product of the other spouses efforts. In other contexts, future earning
capacity that has been wrongfully deprived, such as in torts, is compensable
Elkus v. Elkus (NY) To the extent that Ds efforts and contributions led to an increase in the value of Ps
career, this appreciation was a product of marital partnership, and therefore, marital property subject to
equitable distribution. The DRL broadly defines marital prop. as property acquired during marriage
regardless of the form in which title is held
ETW Corp. v. Jireh Publishing Inc. Right of Publicity TEST: If a painting has substantial transformative
elements containing much more than a literal portrait of the celebrity, it is protected by the 1 st Am. Where the
effect of limiting the celebritys right of publicity is negligible, societys interest in the freedom of artistic
expression outweighs the celebritys property rights. *BALANCE: PERSONS INTEREST V. SOCIETYS
INTEREST WHY: (1) Painting DOES NOT REDUCE Woods economic interest in value of his likeness. (2)
Societys interest in the freedom of artistic expression outweighs Woods property right Woods engages in an
activity that creates a lot more money unrelated to his right of publicity even without it, he would still earn a
lot of money
Moore v. Regents of University of California Body Parts - Plaintiff did not have an ownership interest in the cells
after they left his body. WHY: (1) No precedent and only property can be converted (2) CA law limits property interest in
cells that have been removed (3) The cell line is not plaintiffs (4) Extending theory would hinder medical research
*THE LEGISLATURE SHOULD DECIDE, NOT THE COURTS*
PURCHASE:
Stambovsky v. Ackley haunted house case RULE: When the seller deliberately created a condition [creates a
haunted reputation] that materially impairs the value of the contract and (1)is peculiarly within the knowledge of the seller
or (2) unlikely to be discovered by a prudent purchaser exercising due care, nondisclosure is a basis for rescission. WHY:
Caveat emptor is not unlimited. Existing cases involve physical condition but this is about ghosts! As-is clause in
contract fails because: (1) the facts are peculiarly within the knowledge of the party invoking it (defendant); (2) the
merger clause disclaims representations made with respect to the physical condition of the house not extended to
paranormal phenomena; and (3) defendant cannot be said to deliver the house vacant because it has poltergeists.
FIND:
Benjamin v. Lindner Aviation found money in plane wing Court will follow common law distinctions for
found property. $18k in plane wing was mislaid property, meaning it goes to the bank (the owner of the
premises) for safekeeping so the person who lost it would go to the bank. Property not likely abandoned b/c of
high value, not likely lost b/c suggests that it was intentionally placed, not treasure trove because money was
printed only 35 yrs ago [remember policy is to reunite found property w/ true owner]
Finders statutes place responsibility on the finder to follow rules to notify owner.
STATUS
PARTY
Prior finders have right of possession and first preference against all except
true owners. (Policy: Reunite lost property w/ true owners and prevent a
string of thefts if other finders exercise ownership over property lost by prior
finders).
True owner retains property right.
Property/Land owner where property was found has the right to possess it
(Policy: Reunite mislaid property w/ true owner who will go to owner when
he remembers).
Finder has right of ownership.
Same rules for lost property
GIFT:
Gruen v. Gruen Father promises painting to son, father dies, son tries to take back painting from evil
stepmother H: A valid inter vivos (between two living persons) may be made when the donor reserves a life
estate on the object and the donee after donor dies. RULE: An inter vivos transfer may be made while the
owner reserves a life estate and the elements gift are established: (1) donative intent, (2) delivery, (3)
acceptance. WHY: (1) Father wrote son letters showing intent, (2) delivery can be actual, constructive (f not
practical), or symbolic especially when donor retains a life estate, and (3) acceptance may be shown by
bragging to friends.
2
are: the timing of the true owners demand to return the painting and the possessors refusal to return it (i.e.,
SOL starts after refusal). WHY: (1) Rejects Discovery Rule (2) NY case law has protected true owners right
even when bona fide purchaser has property (3) placing burden on owner to locate artwork would encourage
theft, it is better to place burden on bona fide purchaser to make sure that hes not buying something thats
stolen. (4) no proof that public disclosure wouldve helped find the painting *Perverse outcome: For an outright
theft, SOL starts on day of theft. For bona fide purchaser, SOL starts when demand to return is refused. *Owner
should not delay bringing suit after demand is refused, because the suit may be estopped by the doctrine of
laches.
Discovery Rule Tolling of S of L = f(reasonable diligence)
Demand and Refuse Rule S of L = f(opp to demand)
Cause of action does not accrue until the injured party discovers
S of L runs from when owner demanded and possessor refused
by exercise of reasonable diligence facts which form basis for it.
delivery of property.
Principle: Visibility intended to put owner on notice, but its
Principle: Offer maximum protection for true owners.
insufficient for chattel. Discovery rule makes up for it.
For: (1) Different visibility requirement discourages larceny in
For: Protects true owners. Important to foreign buyers, who are
art. (2) Encourage careful practice in art purchases. (3) Owner
not likely to have sufficient notice from domestically due
rights shouldnt be invalidated b/c of mechanical applic of law.
diligence. (2) Clarity & predictability.
Against: (1) Onus on owner to prove actions were reasonably
Against: Rewards inaction. Perverse: a thief has a better shot than
dilig. (2) Perverse: non-diligent search means possession = theft.
an honest possessor.
Purpose of S of L: (a) stimulate activity, (b) punish negligence, (c) promote repose.
SHARED OWNERSHIP
SYSTEM OF ESTATES
ESTATES AND FUTURE INTERESTS:
Policy tensions:
1. Allowing owners to disaggregate property rights and the policy of encouraging or mandating consolidation of rights in a land
owner. Consolidation arguably promotes fee use and transfer of land b/c buyers would rather deal with just one owner.
2. Problem of conflicts among generations the old want to control property even after they die and younger generation do not
want to be subjected to that control. How long can the dead control the property? There are rules invalidating unreasonable
restraints on alienation and the rule against perpetuities abolishes future interests that vest too far into the future.
There are four major categories of present and future interests:
1. Fee simple absolute potentially lasts forever, inheritable, alienable
2. Defeasible Fees could also last forever but terminates when some event happens
3. Life Estates last for the life of the owner and then passes on to grantor or 3rd party chosen at the time life estate was created
4. Leaseholds transfer possession for a fixed period of time
ESTATE PRESENT INTEREST
Present estate --------------------------------t----------------------------------
FUTURE INTEREST
Grantor
3rd Party
Fee Simple Absolute no one has a right to possess it in the future; you
own the whole timeline
Life Estate owner has a right to possess it until he/she dies; remainder
in the future (vested, contingent subject to open, divest.)
None
None
Reversion
Remainder
Reversion
Remainder
Possibility of Reverter
None
Right of Entry
None
CONCURRENT OWNERSHIP
CREATION:
Kipp v. Chips Estate ambiguous deed Intention of the parties, gathered from the complete and entire
document, wins over technical terms or their formal arrangement. Legis. prefer tenancies in common over
joint tenancies. Gould conveyed land to parties. The granting clause provided that the conveyance was to
parties as joint tenants while the habendum clause (which names the grantee and defines the estate to be
granted) as tenants in common. H: The court looks at entire deed and here, found that the deed created a
tenancy in common. WHY: (1) State legislature prefers tenancies in common (TIC favors transferability and
discourages ill will. (2) Deed was unambiguous so no external evidence required. Interpretation steps: 1 st look at
the specific language, if ambiguous, then look at language of the whole doc, if still ambiguous, then all relevant
evidence can come in.
Types of concurrent ownership:
1. Tenancy in Common - most basic. Each tenant in common has a separate interest in the property,
which he can dispose of as he chooses. If A and B are tenants in common, and A sells his interest to C,
then B and C are tenants in common. The interest of each party does not have to be equal (i.e., A can
have 25% and B 75%)
2. Joint Tenancy similar to TIC except that joint tenants have rights of survivorship when one dies,
the other automatically gets the interest. If A and B are joint tenants, and A dies, B gets As interest
regardless of what As will says. Joint tenancy is useful because it keeps property out of the probate
process, saving time and money. Traditionally, to create a joint tenancy, parties need the four unities:
Unity of time - interest created @ same time
Unity of title interest created by same document
Unity of interest equal shares (50/50, 33/33/33)
Unity of possession each joint tenant had the right to possess property
3. Tenancy by the entirety like joint tenancy but available only to married couples. TBEs cannot be
severed unilaterally by one party. TBE is terminated by divorce. Exists in about of the states.
Benefit: creditors of one spouse cant go after the other spouses share.
PARTITION:
Delfino v. Vealencis A partition by sale should be ordered only when (1) it is clear that physical partition is
unfair or impractical AND (2) the interests of the owners are better promoted by partition by sale. parties are
tenants in common with P owning 69% and D 31%. Property is rectangular. D operates a garbage business but
P wants to develop property on his own share. H: Trial court made a mistake by ordering a partition by sale
and not a physical partition. WHY: (1) Courts favor physical partitions; (2) Partitions by sale should be
ordered only when: (a) it is clear that a physical partition is unfair or impractical; AND (b) interests of the
owners would be better promoted by a partition by sale. Court should balance and consider interests of all
tenants.
Partition legal remedy for co-tenants (tenants in common) who cant agree on how to use property.
Voluntary partition owners voluntarily partition property by physically dividing it or selling and
sharing the proceeds
Involuntary or judicial partition one of the tenants files a lawsuit for partition against other cotenants.
Order of court could be:
o Partition by sale forced sale and division of proceeds
Usually sold only if physical partition will result in great prejudice to one of the owners
o Physical partition preferred choice
Cons
W/ legal action come legal costs -> time and money
In practice, it could take L months to evict T legally
T has opportunity to abuse property.
L will probably pass on costs of potential litigation to all Ts (dist)
Can parties K around it? In theory, but (a) it could still be disputed in ct and (b) Ts are in weak bargaining position (adhesion)
Types of Leaseholds
Type
Characteristics
Term of years
Periodic tenancy
Notice to Terminate
agreement to remain liable did NOT create a right of re-entry or reversion. (2) the term sublet is used in the
agreement, but it has been used to mean both assign and sublet (ambiguous) (3) Rogers parted w/ property upon
selling go-kart business and the landlord rented to Conditt for ALL of the extended term.
Privity
Privity of contract contract cannot confer rights or obligations under it on non-parties
Privity of estate interest of people who both have an interest in the same land.
Subleases vs. Assignments important b/c it affects remedies available to landlord if he stops receiving rent
Assignment when tenant (assignor) assigns all her interests under the lease for the entire unexpired
term of the lease to the transferee (assignee)
o If assignee fails to pay rent, landlord can sue either assignor or assignee
o Possession goes LTT1L
Landlord (L) has privity of contract with Tenant (T); L has privity of estate with assignee
(T1) so L can recover via privity of K or estate)
Sublease when tenant transfers the leasehold for a period less than the full remaining time of the lease
or reserves a right of entry
o If subtenant fails to pay rent, landlord can only sue original tenant
o Possession goes LTT1TL
L has privity of contract and estate with T, so L can only recover from T and not T1
Kendall v. Pestana Commercial leases: Where commercial lease provides for assignment only w/ prior
approval of lessor, consent may only be withheld if lessor has a commercially reasonable objection to the
assignee or proposed use. Concerns a hangar owned by the city, which city leased to Perlitch. Perlitch then
subleased it to Bixler who then sold his business to OHara. Lease provided that written consent of lessor
(Perlitch) was required before lesee (Bixler) can assign his interest (to OHara). Perlitch actually wants to rent it
out at a higher rent to Pestana! Perlitch argues that he has an absolute right to arbitrarily refuse request. Courts
says NO! Traditional majority that lessor has right to arbitrarily refuse has been eroding because:
1) Dual nature of lease as a conveyance of leasehold interest and a contract because of shortage of
housing and commercial space, allowance of lease clauses prohibiting assignments is being curtailed by
statutes
2) Restatment Second of Property adopts the minority view that landlords consent to alienation cannot be
withheld unreasonably. The preservation of values that go into personal qualities of tenant (like ability
to pay) does not justify allowing landlord the power to arbitrarily and without good reason to allow
transfer of property.
3) There are factors to refuse a contract: financial responsibility of proposed sub-lessee, the suitability of
use for the particular property, legality of proposed use, and need for alteration of the premises. Denying
solely on basis of personal taste, convenience, or sensibility is not commercially reasonable.
4) The market value of real property during the term of the lease properly belongs to the lessee. When
lesee executed the lease, he takes on the risk that he would be paying too much rent if the market
crashes. If the market is good, he shouldnt be deprived of the contractual benefits.
ABANDONMENT:
Sommer v. Kridel D entered lease w/ P from 1972 to 1974. D was discharged from army, lost engagement,
and become a student, supported by stepfather. Couldnt afford rent wo wrote landlord asking for sympathy and
willing to forfeit down payment of 1st months rent and security deposit. P doesnt reply and refuses to re-let
apartment to another prospective tenant who was willing and able to pay. H: Landlords have an obligation to
make a reasonable effort to mitigate damages if tenant wrongfully abandons a lease. Tenant is still liable for
back-rent and expenses incurred in re-letting. WHY: (1) Old majority rule is that landlords did not have a duty
to mitigate but law of estates has evolved to mirror law of contracts which emphasizes equity and fairness; (2)
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Lost volume doesnt apply b/c prospective tenant requested Ds particular unit and none else; (3) L has burden
of proving that he used reasonably diligence (b/c hes in a superior position of information by taking out ads,
etc.) POLICY: Not imposing duty to mitigate is inefficient and allows valuable rental space to lie fallow.
POLICY AGAINST: Imposing a duty increases rent or security deposits on everyone, hurting lower income
people disproportionally + tenants are more likely to break leases, which will increase vacancies in short run.
Landlords remedies incl. suing for back rent, and below:
(1) Accept Tenants Surrender
(2) Re-let on Tenants Account
Leasehold terminates. No further obligations and landlord is free to lease the property
to someone else. Remedies still available for breaches prior to surrender.
Landlord refuses to accept tenants surrender and the tenant remains liable. But tenant
implies a wish to be relieved of the liability, which occurs if the landlord can find a
replacement tenant. Original tenant still liable if new tenant defaults.
Damages based on anticipatory breach. Breach must be unequivocal. Damages =
difference b/n reserved rent and fair rental value. Assumes that the landlord relets the
premises and suffers only the difference.
Landlord waits until the unpaid rent has accrued to the end of the term before he sues.
Modern courts impose a duty to mitigate, which could affect damages.
For duty: breach may be efficient and duty avoids waste
Against duty: L bargained for security of income; judicial interp tough; search costs
K around it: autonomy, mkt trusted. Counter: imbalance of power problem,
especially if acceleration clause
Stonehedge Square Limited Partnership v. Movie Merchants, Inc. (PA)-Stonehedge owns and operates
shopping center (L) and entered into lease with General Video Corporation (T) and T assigned its rights under
lease to Movie Merchants (T1), and L wanted to hold T1 liable on the lease and sued for rent under acceleration
clause in the lease.
a. Rule Non-breaching commercial landlord has no duty to mitigate (they are referring
to a commercial lease): REASONING:
Rule is firmly established in PA
Established rule is simple (less litigation)
Old Landlord & Tenant Act of 1951 does not modify landlords duty to mitigate
Fundamental unfairness in allowing breaching tenant to require nonbreaching
landlord to mitigate damages
Tenant was in a position to mitigate his own damages (by assigning, etc).
a. Could say that Sommer and Stonehedge are reconcilable since that one applies to residential
leases and this to commercial, but it seems like courts reasoning of common law rule of no
mitigation could just as easily apply to residential leases too (contradicting Sommer v. Kridel
even though most states require L to mitigate if lease abandon in residential leases):
i. Simple to apply; unfairness to L.
b. States split on duty to mitigate in commercial leases
c. Which is the better decision? Sommer because want to protect tenants and have fair results
(tenant could lose all their $ and have to move to cheaper place) and want to use housing
stock efficiently but argument for Stonehedge is that dont want to reward breachers and
punish no breachers.
consumer expectations of renting a habitable home must be protected (4) housing codes suggest that legislature
wants to place burden of maintenance on landlord.
Major changes in landlord-tenant law from implied warranty of habitability:
1. Abandons caveat emptor
2. Landlord-tenant covenant was dependent partys obligations are contingent on other party complying
with their own obligation. Breach of this K relieves other party of obligation.
Bases for implied warranty:
1. Arises from contractual relationship between landlord and tenant where tenants expect that apt is
habitable during lease term
2. Housing code renting out a place is an implied representation that landlord would comply w/ housing
code
NOTE: Some violations of housing code are not serious enough to be a violation of the implied
warranty of habitability (it has to be material) but also some conditions that do not violate the
code can count as breach such as (no heat or hot water, broken windows, pest infestation)
Remedies available to tenant: ***Tenant needs to give landlord proper notice***
1. Termination of tenancy (Rescission of K)
2. Withholding rent
3. Rent abatement
4. Damages
5. Injunction or specific performance (court order to fix problem)
6. Repair and deduct
7. Housing code remedies inspector visit and inspection facility orders landlord to fix problem else fines
Implied warranty is non-disclaimable. Restatement allows parties to K as to condition as long as
agreement is not against public policy or unconscionable
Most courts refuse to extend implied warranty to commercial leases b/c
o Commercial tenants are usually sophisticated; and
o Have sufficient bargaining power to obtain fair terms; and
o Tenants often have the power to make repairs or improvements (per lease agreement)
K around it?
For: autonomy/free mkt; negotiating
could price
Against: majority of jurisdictions dont
allow it; social safety net; poorer renters
could be ramroded; loophole for mean Ls
RETALIATORY EVICTION:
11
Remedy.
(1) Repudiate the lease/rescind K most
allow it outright; some require Ls
breach to be material; Uniform Res L
and T Act allows it only if breach
materially affects health and safety.
(2) Rent withholding until problem is
fixed; allows T to stay in the property
(3) Rent abatement ct can reduce rent
owed; the diff b/n actual and fair
rental value given poor condition
(4) Damages T can recover rent + b/c of
violations of implied warranty
(5) Injunction
(6) Repair and deduct
(7) Housing code remedies housing
inspector may testify and ct may order
civil or crim fines
Building Monitoring Systems, Inc. v. Paxton UD action and D is asserting retaliatory eviction defense.
Shortly after moving in, D informed P that apt plumbing and wiring need to be repaired. Mgr tried but failed to
fix. Cty Health Dept determined that conditions violated health code and ordered P to fix. P served eviction
notice #1 but reinstated tenancy after accepting rent. D complained to health dept again. P served eviction
notice #2. Rule: Landlord cannot evict in retaliation if T exercises legal rights when L violates a protective
housing statute. H: Even without a retaliatory eviction statute, legislation for health and safety standards
show legislative intent to improve housing conditions, which might be frustrated by tenants reluctant to
report violations. ***Court adopts 2nd Restatement of Property Defense:
1. Theres a protective housing statute
2. Landlord is in business of renting
3. Tenant is not in default in performance of obligations
4. Landlord is motivated to evict b/c tenant complained about violation of #1
5. Tenants complaint was made in good faith
Once repairs are made, L may serve T w/ eviction notice and bring a UD action w/o submitting evidence of
intent, but landlord has burden to show that T has had reasonable opportunity to find other housing.
Retaliatory eviction does not apply to commercial leases
Housing codes run parallel to implied warranty of habitability
HOUSING DISCRIMINATION (FEDERAL LAW):
The Fair Housing Act (FHA)
Applies to all sales and rental of housing.
Exceptions: (a) Single-family homes, if owner owns less than four. If owner doesnt live in the home he can sell once every 2
years. (b) Cant use if seller advertised or used services of a broker, agent, etc. (c) Owners home, as long as not more tha n 4
families could live there independently.
N/A to ability of states and feds to regulate the max # of occupants.
Discrimination (applies to renter or buyer, or persons affiliated w/ them)
(a) Cant refuse to negotiate for sale or rental b/c of race, color, religion, sex, familial status, natl origin
(b) Cant discriminate through terms or conditions.
(c) Cant advertise to rent or sell dwelling by indicating preference based on race, gender, etc.
(d) Cant tell someone that a vacant unit is taken b/c of race, gender, etc.
(e) Cant misrepresent qualities of neighborhood (e.g., racial makeup) to induce into selling or renting.
(f) Cant refuse to make reasonable accommodations to afford equal access.
Equal Access
(g) Have to allow buyers to modify the premises to enjoy equal opportunity of use. Renter may need to restore it to its original
condition upon leaving, though.
(h) Covered multi-family buildings built after 1988 must be accessible by handicapped. Covered multi-family dwellings include,
generally, 4 or more unit buildings.
(i) Act sets a floor, not a ceiling. State may require more.
Excepted Groups
Religious organization can allocate property based on religious preferences. Private clubs can favor members. Elderly homes can
give preference based on familial status.
Enforcement
Private civil action.
U.S. DOJ can bring civil actions on behalf of the government. Officer w/in the civil rights department would get 3 testers, 2 white
and 1 black, and give them equal credentials.
Funky: Female seeks female for apt share. Inadvertently banned under 3604(c) of the FHA.
12
Many state laws have statutes prohibiting discrimination based on marital status protecting tenants from denial of housing
because they are or are not married.
Can landlords refuse to rent to unmarried couple based on religious beliefs? Probably not.
o Claim of a federal constitutional right to an exemption from antidiscrimination laws have been struck down by the
SCOTUS:
o Employment Division v. Smith except in very unusual cases, generally applicable laws cannot be disregarded on
ground that compliance interferes with free exercise of religion
o Congress passed Religious Freedom Restoration Act (RFRA) prohibiting govt from substantially burdening free
exercise of religion unless theres a compelling state interest and no less-restrictive means (strict scrutiny) [struck
down by SCOTUS, see below]
In City of Boerne v. Flores, SCOTUS struck down RFRA b/c 14th Am gave Congress power to protect liberty of religion as
defined by 1st Am but to not go beyond it.
ARGUMENT: Had landlords been able to use religious belief argument to counter anti-segregation laws, then those laws
would lose their force. Same with FHA.
13
CA v. General Motors nuisance re: pollution (complete); probably better for the legislature; manufacturers do
not directly pollute, they just sell cars
14
EASEMENTS right to do specific acts on someone elses land. Intended to be permanent or for a specified
period. Also not revocable at owners will. In the absence of any agreement, the owner of the easement has the
responsibility to maintain it. Usually created by a deed granted by owner of burdened land to easement owner.
Easements are transferable.
Different from licenses, which are temporary invitations where owners waive the right to exclude nonowners and simultaneously exercise their privilege to admit others. Licenses can be express (paper invitation)
or implied (shop owner allowing public to enter) ***MAIN DIFFERENCE: Licenses can be revoked at any
time by the owner.***
Two types of easements:
1. Easement appurtenant runs with the land
a. This easement benefits the dominant estate
i. The easement stays with dominant estate if title changes
b. Servient estate parcel where easement is located
i. The easement stays with servient estate if title changes
2. Easement in gross stops w/ person transferable; does not benefit another parcel of land
a. No dominant estate; only servient
b. Examples include: power lines, sewage, public easements
c. When sold, the easement in gross stays with the owner of the easement
Kitchen v. Kitchen (Michigan) Court ruled that Michigan will not recognize easements by estoppel. Rather,
statute requires that easements to be in writing. Irrevocable license (a/k/a easements) cannot be based on
oral promises alone.
WHY?
Easements constitute an interest in real estate and are not revocable they need to be clear and in
writing to prevent litigation based on he-said, she-said approach
Prevents owners from falsely claiming that others gave them oral permission to cross property and that
they relied on this promise to build their homes
Clarifies property rights, prevents fraud, and decreases needless litigation
Purchases will be placed on notice because easements would be recorded (prevents surprises for future
owners of the servient estate)
PRESCRIPTIVE EASEMENTS prescriptive easements is what adverse possession is to fee simples. Courts
are sometimes more lenient on some factors depending on character of land and use.
ELEMENTS: (**A Hooker ON Every Corner Actual, Hostile, Open & Notorious, Exclusive, Continuous + Statutory Period)
1. Actual courts tend to relax substantial identity clear line of path not necessary since there is a
substantial identity to the easement
2. ***Hostile against owners interests; w/o permission
3. Open & Notorious enough to give notice
4. Exclusive **for public prescriptive easements there is no exclusivity requirement owner can
still be there, as long as not completely in the way of others use. If a single individual wants to
claim a prescriptive easement, then they cannot share it with others.
5. Continuous depends on the character, for beaches, people dont use it during bad weather
6. For the statutory period
Concerned Citizens of Brunswick Cty. Taxpayers Assoc. v. Holden Beach Enterprises beachgoers won path
though exact placement (actual requirement) moved due to nature the path to beach is prescriptive easement,
attempts to exclude beachgoers were unsuccessful though reasonable attempts to prevent continuous use.
Owner has to successfully discontinue use.
How to defeat a prescriptive easement need to defeat just one element:
1. Block access one a day a year to prevent continuous
2. Put up a sign granting permission to defeat adverse/hostile
3. Bring suit before SOL is up problem: for public prescriptive easement, whom do you sue?
IMPLIED EASEMENTS
Implied: Easement by pre-existing/prior use.
Elements:
1. Common grantor (parcels used to be a single property)
2. Back when there was a single parcel, there was a quasi-easement (one part of the parcel was being
used by another part of the parcel) (note that this shouldve existed & used at the time of the severance)
3. The use was apparent, continuous, and reasonably necessary
o Apparent something that the buyer knew about or reasonably should have known about when
buying the parcel
o Continuous the use is still going on
o Reasonably necessary something like usefulness it confers a substantial usefulness to the
dominant parcel, implying that the parties intended to keep it in place after the property was sold
[see that courts interpretations of these elements, especially the reasonably necessary subelement, vary]
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Russakoff v. Scruggs lake used by lot owners for frogging, sprinkler feed, court held that there was an
easement by prior/pre-existing use; plaintiffs met elements: (1) the Ps lot was part of a single tract, (2) when
Ps predecessors bought the track, the lake was the servient tract, and (3) there is evidence that the Ps used the
lake for recreation and to water their lawns (using a pump). That use was continuous and apparent. Plaintiffs
also had a legitimate expectation to use the lake for their enjoyment. The development company envisioned the
enjoyment of the lake by those who bought tracts around it.
Russakoff had an appurtenant easement (benefited his parcel) and when he moves, the person who
buys the house also gets to use the easement because it runs with the land.
Implied: Easement by necessity key points: (1) just showing want or need is not enough and (2) if it is selfinflicted, one is barred from claiming easement by necessity.
ELEMENTS:
1. Common grantor
2. Necessity (e.g., actual necessity to access a road or if a lake is the only source of water)*
3. Necessity has to have existed at the time of severance
RATIONALES
1. If seller and buyer of landlocked property, they wouldve included an easement in the deed (no one
would by a landlocked parcel), but maybe they forgot (i.e., if they had thought about it, they
wouldve created an explicit easement)
2. Its bad public policy to have landlocked parcels
Schwab v. Timmons no easement by necessity because P failed to satisfy prong #3 necessity should have
existed at the time of severance no easement by implication (prior existing use) or necessity because P can
access roadway by building over bluffs instead of going over Ds land (so not landlocked) although
inconvenient and because at the time of severance, P was not landlocked. P sold the bluff to someone else! R:
(1) Easement by necessity only if common owner severs landlocked portion of property and owner of
landlocked portion cannot access a public roadway US never severed a landlocked portion of property (2)
Owners had access to a public road, even though not ideal or convenient, but they sold it! landlock-ing
resulted not from grant of property but their own conveyance (3) policy of not sanctioning hidden easements
If P cannot show that he meets prong 3, he cannot have an easement by necessity.
Public policy disfavors easements by necessity implied easements in general because they are
hidden. There should be public records to prevent surprises.
Termination of easements:
1. Servient and dominant parcels are placed under one ownership
2. Abandonment
Pre-existing Use Elements
(1) Common grantor (former unity of ownership)
(2) Quasi easement one part of the land had to be benefiting the
land before the severance/split
(3) Apparent, continuous and reasonably necessary (more than
convenient, but not required to be absolutely necessary)
Goals: at least one party would have demanded it at the time of
severance
Necessity Elements
(1) Common grantor
(2) Necessity necessary for egress
17
COVENANTS
CREATION
Covenants are negative easements (restrictions) intended to run with the land binding successors
agreements that bind owners and successors that give them the right to prevent others from doing something on
their own land. Real covenants are agreements among landowners like contracts with something extra because
they bind future owners. The most common real covenant is when it limits use of land to single family
residential use because people will buy more if they have some sort of guarantee that it will be residential
around them ( home values)
Real Covenants at Law Requirements:
1. Intent both parties [A-B] must intend to bind their successors
2. Covenant has to touch and concern the land (physically or economically affect the land)
3. Privity of estate:
Horizontal Privity relationship between original covenanting parties (A-B). Both must have a
mutual interest in the land subject to restriction (e.g., landlord & tenant, concurrent owners,
grantor & grantee, owner & owner of easement). Note that neighbors dont have horizontal
privity if they dont have a covenant.
Vertical Privity refers to relationship between original covenanting party and successor (AC::B-D). Parties are in vertical privity if the successor takes the entire estate in the land of
predecessor.
Burdens & Benefits every covenant has a burden and a benefit; most covenants involve reciprocal
burdens and benefits.
For a burden to run to a successor, you need horizontal and vertical privity
o A promises B to build only single-family homes (A has burden, B has benefit). A sells his
property to D. B, to enforce the covenant, has to show horizontal privity between A and B;
and vertical privity between A and D.
For a benefit to run to a successor, only need vertical privity
o A promises to build only sf homes (A has burden, B has benefit). B sells his property to C.
A starts building an apartment. C, to enforce the covenant, only has to show vertical privity
between B and C.
o A promises to build only sf homes. (A has burden, B has benefit). B sells property to C. A
sells property to D. D starts building an apartment. For C to enforce, has to show benefit has
run (vertical privity b/w B and C) and burden has run (horizontal privity b/w A and B;
vertical privity b/w A and D.)
18
Runyon & Williams v. Paley (condo builders) D Paleys want to build condos on their property. Runyon and
Williams contend that Paleys property is subject to restrictive covenant prohibiting construction of condos.
HELD: Runyon had no vertical privity b/c they got their land before covenant was created. Williams met all
elements and proved that is is a real covenant b/c (1) economic impact on land (enhanced value of dominant
estate and decreased value of servient estate) (2) proves benefit and burden run (satisfied both horizontal and
vertical privity) and (3) proved that intent of parties was to run with the land and bind successors.
WILLIAMS: REAL COVENANT (RESTRICTIVE COVENANT)
1.
Intent
Clear from language of agreement that original parties intended for burden (restriction) to run regardless of who owns it.
YES
2.
Touch and Concern
Its a restriction on the use of the land.
YES
3.
Privity
FOR PRIVITY, SHE NEEDS TO SHOW VERTICAL & HORIZONTAL PRIVITY:
YES
For Burden: Paleys vertical to Brughs (yes, because Brughs they have fee simple ownership) and Burghs horizontal to Gaskins (yes, Brughs
has horizontal privity because both have mutual interest in same land)
For Benefit: Williams can show vertical privity (fee simple ownership of estate)
EQUITABLE SERVITUDE
3. Notice
YES
The Paleys would have read the deed that mentioned the restriction or referred to it (they wouldve had actual and constructive).
Equitable Servitudes
Requirements:
1. Intent - Landowners have to intend to bind successors
2. Covenant has to touch & concern the land economic or physical
3. Successor has notice (actual or constructive does the person youre trying to enforce the restriction
against knew or reasonably should have known) when he bought the property [**look at deed first for
notice notice is taken care of so long as there was proper filing of the deed. Assume that everyone is
supposed to do a title search when they buy property]
See table above for Runyon v. Paley Williams won on real covenant. Runyons still dont win on equitable
servitude because they cannot prove intent.
Implied Reciprocal Servitudes based on a common scheme of restrictions (read this under the intent
element in a covenant or servitude) When a common grantor develops land and divides it and sells the lots and
includes a common scheme of restrictions on all the lots, the grantees acquire by implication the right to enforce
the same restriction on the grantor (if the grantors lot does not have an explicit restriction
Elements:
1. Intent common grantor
2. Touches and concerns the land
3. Notice common scheme obvious
D -> purchaser
[implied reciprocal servitude]
3 [explicit]
6 [explicit]
1 [explicit]
2 [explicit]
4 [explicit]
7 [explicit]
5 [explicit]
8 [explicit]
TERMINATION
El Di. V. Bethany Beach (booze seller just wants to sell his booze) Covenant to prohibit alcohol not
enforceable because conditions have changed so much. Changed Conditions Doctrine covenants will not be
enforced if conditions have changed so much inside the neighborhood restricted by the covenant that
enforcement will no longer be of substantial benefit to the dominant estate. Developers of Bethany Beach
restricted prop to residential use only and prohibited sale of alcoholic beverages. This covenant affected 2/3 rd of
the property. Alcohol is for sale at a packaging store 200 yds from El Dis business and several nearby
19
restaurants. Holiday House customers have followed a BYOB/brown-bagging policy for years. H: Covenant no
longer enforceable when conditions have changed so much (1) change need not be to the whole parcel, partial
change is sufficient (2) purpose of covenant was to maintain quiet, residential, church dominated community.
Now its a resort town w/ 85% of the municipality not subject to restrictions. (3) Town zoned Ds property for
commercial use in 1952. (4) Consumption of alcohol is tolerated by owners of similarly restricted lots (20 yr
brown bagging policy. + Public Policy to control the sale of liquor. (5) El Dis business is in the commercial
section.
Ways to Terminate a Covenant
1. By common ownership if same entity owns all affected parcels, he can terminate it
2. By release/agreement:
a. If all the parties agree to rescind covenant
b. Or if provided by the covenant, termination by a % vote or in a number of given years
3. Restricted duration covenant has an expiration or statute setting expiration
4. Abandonment widespread non-compliance
5. Estoppel (unclean hands) If P w/ right to enforce a covenant is himself violating it
6. Changed conditions if conditions have changed so much that enforcement of the covenant would no
longer benefit dominant estates; covenant is valueless to parties
7. Injunctive Relief if covenant is unreasonable
8. SoL when someone violates covenant, the right to sue stops
CONDOMINIUMS AND PRIVATE SUBDIVISIONS
Nahrstedt v. Lakeside Village Condominium Assn. COMMON INTEREST DEVELOPMENT cat lady
just wants to keep her cats! Covenants recorded in declaration of common interest are enforceable unless
theyre unreasonable. Unreasonable if (1) burden substantially > benefits of restriction, (2) arbitrary, (3)
contrary to public policy) P had 3 cats in her condo and wanted reasonableness test applied on a case-by-case
basis. Covenant restricts: No animals (which shall mean dogs and cats) livestockkept in any unit. P says
covenant not enforceable against her and that application of reasonableness should be on a case-by-case basis.
Court declines because covenant applies to whole (policy: decreases litigation). No pets policy is enforceable
as an equitable servitude because (1) intent to parties for it to run w land binding successors 2) touches and
concerns the land and 3) notice given since pet restriction was contained in condos agreement document and
recorded w county recorder before unites were fold. For common interest properties, the test is
reasonableness
COMMON INTEREST DEVELOPMENT encompasses a pvt subdivision (spread out condos) and condos
(every owner owning their place in fee simple and common areas are owned by HoA where all owners are
members or owned by owners as joint tenants). Common rules include the appearance of the exterior,
restrictions on ability to rent unity out (approval of HoA governing board). CCR-covenant, conditions, and
restrictions
TO ENFORCE Covenants of Common Interest by Equitable Servitude
1. Must have intent
2. Touch & Concern the land
3. Notice
4. Many states add an additional requirement that Restrictions must be reasonable (enforceable
equitable servitudes unless unreasonable)
a. REASONABLENESS some states have a dual approach. If a rule is created before the
units are sold, it does not have to be reasonable. Once the units are sold, all other rules made
after the sale must be reasonable.
20
Legislature
Enabling legislation
Zoning Ordinance
Administrative Agency
Planning Commission
21
Comment [T35]:
How to react to non-conforming use:
1.No special treatment no town tries to enact a
zoning ordinance that does this: its really harsh
to reverse an investment really quickly
2.Exempt them from ordinance (grandfather
them in)
3.Give them some time to phase out
Comment [T36]: Another way of dealing with a
non-conforming use so that owner will have
reasonable time to bring use into conformity
enough time for owner to get reasonable return on
their investment, find another place to set up shop,
etc.
Comment [T37]: Gvt can regulate property a
point. If gvt goes too far in infringing owners rts,
its a taking and gvt has to pay just compensation.
Comment [T38]: As a policy matter, not
allowing amortization hinders communities ability
to change. Would like to keep amortization and
would hold amortization in this cause unreasonable
because its way too short.
Rays Stateline Market, Inc. v. Town of Pelham (donut counter case) pre-existing non-conforming use is
generally exempted/grandfathered if the proposed change does not result in illegally expanding
nonconforming use and if the change wouldnt have an appreciable effect on the neighborhood. **A
zoning ordinance applies to preexisting use when use is altered for a purpose or in a manner that is substantially
different from the use to which it was put before alteration. F: changing donut counter to Dunkin Donuts
counter is not a substantial change. Court rules for market bc coffee counter permit would not result in a
substantial change or an illegal expansion of the nonconforming use and the sign permit would not result in any
appreciable effect on the neighborhood. Zoning ordinances can limit any extension, expansion, or enlargement
of a nonconforming use and prohibits its change to substantially different nonconforming use.
FACTORS IN EVALUATING EXTENT OF NON-CONFORMING USE:
1. Whether challenged use is merely different manner of using original nonconforming use; or
2. Whether it constitutes a different use AND whether the challenged use will have a substantially different
impact upon neighborhood
NOTE: Court has recognized that nonconforming uses may be expanded as long as expansion is a (1)
natural activity, (2) closely related to manner in which a piece of property is used at time of the enactment
of ordinance creating non-conforming use
ZONING: VARIANCES
Lang v. Zoning Board of Adjustment swimming pool case Variance (should) be granted bc of exceptional
property conditions (narrow shape & preexisting structures) + enforcement of ordinance would result in
exceptional, undue hardship or (2) if public benefits outweigh proposed changes variance due to undue
hardship granted variance bc backyard and lot was uniquely shaped and had been a non-conforming use
(the lots dimensions were smaller than subsequent zoning law) . The unusual narrowness of Calabreses lot,
combined w preexistence of paved driveway and garage along northerly side of propertys rear yard, and that
these unique attributes of property constituted exceptional and undue hardship w/I meaning of the statute.
Variance granted and allowed him to construct an in-ground swimming pool. Court supported variance because
of propertys unusual narrowness and shape justified the variance. Also, replacing an above ground pool with
average sized in-ground pool is consistent with the promotion of a desirable visual environment and would
advance the safety and visual purpose of zoning
***Reviewing courts also give wide latitude to zoning authorities because they have familiarity w/ community.
Absent clear abuse of discretion, the courts will not declare their decisions invalid
2 techniques to allow departures from zoning ordinances:
Variances permissions to deviate from zoning law when application of the ordinance would (permission to depart from the terms of
the zoning ordinance):
1. Impose an unnecessary hardship; and
2. The proposed use would not be contrary to the public interest and would not substantially impair the purpose of the zoning
plan and ordinance
Special Exception exception to the ordinance thats specified in the ordinance itself
*RULES VERSUS STANDARDS - Regulating by rules and by standards:
Rule hard line (minimum age for presidency, speed limits)
o Advantages: easy to apply, outcomes are predictable
o Disadvantage: inflexible, easy to imagine hardship cases where applying the rule doesnt seem right (speed limit
and emergencies)
Standards fuzzier, more fact sensitive classifications (law of nuisance (governed by reasonableness), negligence, implied
warranty of habitability, zoning with variances
o Advantage: allow shaping to accommodate hardship cases
o Disadvantage: outcome is hard to predict; how would the standards be applied in practice
Zonings have moved from being rules to standards (taking out rigidity of early zoning). With zoning, its hard to anticipate the best
outcome ex ante. There may be fact situations where we do not want a strict rule. Variances mitigate the effect of strict rules.
22
ZONING: AESTHETICS
Stoyanoff v. Berkeley Pyramid house loses RULE: Aesthetic zoning is okay if not arbitrary and
unreasonable and serves the purpose of promoting the general welfare (w/I bounds of zoning ordinance and
is constitutional). Denial is reasonable if D can show that structure would (1) be detrimental to property
values, (2) not in conformity with character of the community, and (3) not in conformity w desirable land us
in community & furtherance of ordinance P applied for weird looking house in a snobby community. The
applicants were refused a building permit for the construction of their proposed residence upon the ground that
the permit was not approved by a city architectural board (board) which was set up to assure that plans for
buildings conformed to minimum standards of appearance. Almost all of the other houses have traditional
architecture. P challenged aesthetic criteria as (1) unconstitutional bc its too vague and allows for
unreasonable, unguided, and arbitrary choices violating due process and (2) city exceeded its statutory power in
enacting the ordinance/architectural review board which the enabling statute did not authorize. **in the
matter of enacting zoning ordinances and the procedures for determining whether any certain proposed structure
or use was in compliance with or offended the basic ordinance, the court would not substitute its judgment for
the city's legislative body if the result was not oppressive, arbitrary, or unreasonable and did not infringe upon a
valid preexisting nonconforming use:
Stoyanoff arguments:
1. The creation of an architectural board for the purpose of maintaining general conformity with style is unauthorized by the
enabling statute
a. Ds response: The enabling statute provides in part thatsuch regulations shall be made with reasonable
considerationto the character of the districtwith a view to conserving the values of buildings
2. That Ordinances 131 and 281 are invalid and unconstitutional as being an arbitrary and unreasonable exercise of police
power (based on aesthetic values) Arbitrariness and subjectivity violates due process.
a. Ds response: Its not just taste but the ugliness affects property values, the Board is made up of architects, plus the
applicant has a chance to be heard and theres an appeals process
i. Problem is gauging the adverse effect on stability of values would be speculation because the house has not
been built
b. Enabling statutetownsare hereby empowered to regulate and restrict P ignores other parts of the
ordinance: unsightly, grotesque and unsuitable structures, detrimental to the stability of value and welfare.be
avoided and that appropriate standards of beauty and conformity be fostered and encouraged
3. That Ordinances 131 and 281 are invalid as an unlawful delegation of legislative powers
a. Ds response: There are public hearings with notice to the applicant, by the Architectural Board and the City Council
on appeal on the factual issues to be determined under the ordinance. So the realtors rights are protected in this
respect.
3. Court makes clear that it relies on state law, not fed constitution to foreclose on SCOTUS overruling and
not even on statute b/c amending state constitution is more difficult.
4. Remedy given: 90 days from date, or additional time, to adopt amendments to correct deficiency in
zoning code.
Cost of local govt = Property Taxes = (tax rate)(value of property)
See that elected officials have an incentive to lower the tax rate (so to keep property taxes coming, you want to keep the value
of property up by encouraging industrial and commercial uses AND for residential parcels you want them to be bigger and
more valuable) or keep the cost of local govt down (lower school population so lower density towns)
o Note that even if the mayor is not a snob or a racist, he would still have the same incentive to keep densities low,
lowers taxes, and increase property values
24
TAKINGS CLAUSE
PUBLIC USE REQUIREMENT
Kelo v. City of New London economic (re)development plan for area = public use P are residents and
owners of homes in Fort Turnbull, a neighborhood in the City of New London. Pfizer announced that they
would build a facility near Fort Turnbull. Two mts later, New Londons City Council gave approval for a
development corporation to prepare a development plan. NLDC is a private non-profit w/ mission to assist the
city council in economic dev planning. NLDC also had eminent domain power. NLDC planned to build all sorts
of things parks, condos, offices, etc.(more tax revenue, more jobs)
DISSENT: No pre-condemnation use that was affirmatively harming society. Draws a distinction
between a public harm like blight (which is a public use) and getting rid of something that is not a public harm.
Eminent Domain gvt power to take pvt property for (1) public use (2) w/ just compensation. When gvt wants
to take property, it has to be for a public use (in most cases, theres no serious dispute about the exercise of
ED)
Procedure: Gvt files a suit for condemnation proceedings against the property and one of the questions would be how much
would the owner be compensated
What is a public use there has to be some rational link between taking and some public purpose
CASE LAW before Kelo
o Poletown transfer of land to GM which wanted to build a plant. They threatened to move to another state unless
Poletown was condemned, Detroit agreed. Challenged as not being a public use. Majority said its a public use by
supporting the economy of Detroit.
o Hawaii Housing Authority v. Midkiff HI lots were owned by a small # of people. Gvt took land and sold that
land to tenants.
o Berman v. Parker gvt condemned poor neighborhoods (slums), take them, and sell them to private developers for
revitalization. Takings challenged based on not being a public use Court: renovation of cities is a public use and
courts will be very deferential to legislatures determination of what is in the publics interest
o NY CITY wanted to attract intl business so condemned old electronics district w/ a lot of small businesses to build
WTC
Economic impact of regulation and extent to which regulation has interfered w/ distinct investment-backed expectations
(note that the latter is narrower)
a. Just economic impact not having a skyscraper is probably a massive loss for the plaintiff; but if you look at it in
terms of investment backed expectations (they havent lost anything)
b. Interference Investment-backed expectations: In Penn Stn when they bought it, they expected to run a train
station, certainly not to raze it and build a skyscraper (see that this is more gvt friendly and economic impact is more
owner friendly)
c. The regulation does not interfere with the present use of the terminal; the law allows the
plaintiff to use the terminal for the same purpose used for the past 65+ yrs -> the law allows the
plaintiff to have a reasonable return on their investment
2.
25
Implicit in Goldblatt use restriction on property may constitute a taking if not reasonably necessary to promote a
substantial public purpose (i.e., could the gvt accomplish this goal in a way so as to not take property) or if it has
an unduly harsh impact on owners use of property
Extent to which a single property owner is being singled out or whether the burdens are being spread more widely
(say theres only one historical building except for over 400, then stronger argument for a taking)
a. In PA Coal average reciprocity of advantage where lots of people are burdened and everyone is enjoying
correspondent benefits -> if this exists, less likely that its a taking
b.
3.
b. Landmark laws are not like discriminatory or reverse spot zoning where a regulation arbitrarily
singles out one parcel for different, less favorable treatment than neighboring parcels
i. Its true that landmark law burdens some owners more than others but this does not
mean that the law effects a taking
ii. The plaintiffs argument that theyre singled out is unavailing because there are over 21
historic districts and over 400 historic landmarks in NYC
iii. POLICY: Private owner should not pay to provide a public good.
iv. **Offset by transferable development rights ordinance would allow owner of
burdened property to transfer the rights to another building (tack on an extra 10 stories to
another building)
**Note that Penn Central is very pro gvt and it is hard for a property owner to win under a Penn Central regulatory taking. P would
have to show a very large drop in the value of the property or great interference with investment backed expectations. He also will
have to show being singled out or having to bear the burden of a public benefit
PHYSICAL TAKINGS STRICT RULE: Permanent Physical Occupation is a per se taking (regardless of
economic impact or purpose served). Hard line rule so P should first argue physical taking then regulatory.
Loretto v. Teleprompter Manhattan - Loretto owns building. Teleprompter company installed a small box on
her roof but its on her property pursuant to Citys laws that allows companies to install boxes and wires.
There are TV cables across her roof and a cable that drops down the front of her building. It is a taking bc it
destroys the owners rights to possess, exclude others, use, and dispose that part of the property. NYs statute
says landlord may not interfere with installation of CATV facilities and may not demand payment from any
tenant for permitting CATV or from CATV company in excess of what state commission says is reasonable.
DISSENT: Penn Central can say that they were more burdened because they lost millions of dollars,
and Loretto only had to give up a small piece of her roof. In modern times, govt regulations can diminish value
of property far more than minor physical touching. This rule (permanent physical occupation) is a poor way of
distinguishing significant vs. insignificant intrusions
Precedent
Policy
Administrability
MAJORITY
DISSENT
Penn Central most recent case held that all claims that
gvt action that reduces the value of property will be
evaluated by the Penn Central factors (economic impact,
etc.)
*Remember that govt/CATV can leave the box on the roof as long as shes justly compensated (to be
determined at trial). Having CATV probably increased her property value, so her compensation might be $0.
Also, govt mandated structures like fire escapes wouldnt be physical takings b/c the owner would still own
those items.
WIPEOUTS only for real property! 100% reduction in value from regulation per se taking
26
Lucas v. South Carolina Coastal Council beach house wipeout - State prohibited construction wherever the
beach has eroded in the past to prevent further erosion. This prevented Lucas from building houses on the
beach houses. The law was passed after Lucas bought the parcels. RULE: If regulation denies ALL
economically beneficial/viable use of the land in the name of the common good (i.e., to leave property
economically idle) per se taking. R: (1) similarly situated owners have engaged in same use, this imports
lack of any common law prohibition. Similarly situated landowners are permitted to continue use denied to
claimant. (2) Confiscatory regulations (i.e., those that prohibit all economically beneficial use of land) Any
limitation so severe cannot be newly legislated or decreed, but must exist in title itself, in restrictions that
principles of State property and nuisance law already place on ownership.
1) Where regulation denies all economically beneficial or productive use taking
2) Legislature can pass law which can be characterized as preventing harm so you can have an exception to
taking on basis of preventing harm
3) If forbidden use is already illegal under common law nuisance, then deprivation of value wont be a
taking
***NOTE: Distinguish by saying that here, the trial court found that the regulation have rendered the lots
valueless
**EXCEPTION: Chattels/Personal Property - Court uses Par. 17 for personal property: the holding of Lucas
does not apply to personal property (i.e., not real property) so like Andrus v. Allard prohibiting sales of eagle
feathers gvt does not compensate for this, since its not a taking **B/c of States traditionally high degree of
control over commercial dealingsWith personal property, you take your chance, because its a highly
regulated world and one risks having personal property rendered economically worthless (like the feathers or
machine gun dealer after machine guns are outlawed)
*Practical effects:
Shifts power from legislatures to judges bc post-Lucas, regulations that would ban use of land to prevent
harm would need to persuade courts that public harm is a nuisance.
Question again is who should pay for the cost of the public benefit (protecting beaches)
Regulations must tie harm to existing nuisance law or leave some economically available use
JUST COMPENSATION Interest taking is a physical taking, BUT when there is no net loss to owner, just
compensation for taking = 0
Brown v. Legal Foundation of Washington - IOLTA Program/Accounts is for deposits that on their own would
not generate enough net interest after administrative costs. Precedent: Phillips v. Washington Legal Foundation
held that interest income from IOLTA accounts was private property of the owner of the principal. Phillips
Rule: Interest follows principal. MAJORITY: (1) State law requiring client funds that could not otherwise
generate net earnings for client is not a regulatory taking; (2) law that requires interest on those funds be
transferred to a different owner for a legitimate public use could be a per se taking requiring payment of just
compensation, but (3) because compensation is measured by owners monetary loss 0 net loss then no
violation of Just Compensation Clause. The focus is not on what gvt gains, but what owner has lost. The interest
only exists because of the IOLTA program, and if it was possible for moneys to earn interest on their own, they
wouldnt be in an IOLTA program.
DISSENT: Majority focuses on net loss while dissent focuses on fair market value. Mkt value is not
what owner lost, but the value of the good in the market. The decision counters Phillips precedent. Disagrees
with majoritys before picture IOLTA accounts are earning interest, theyre worth something, and according
to Phillips, its the owners property. Rationale (which is very bad) of majority: What the gvt hath given, gvt
may freely take away. ROBIN HOOD TAKING
27
Regulatory Takings
per se taking;
(Penn Central)
Wipeouts (Lucas)
per se taking for confiscatory
regulations that deprive owner of all
economically viable use of land OR if
regulation doesnt substantially
promote legitimate govt end
Penn Central
requires balancing of three factors:
Economic Impact+investment backed
expectations, Character of Gvt
Action, Singling Out
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Comment [T59]:
Ultimate Source of Law
1)Federal Constitution
2)Federal Statutes
3)Federal Agency Regulations & Decisions
4)State Constitutions
5)State Statutes
6)State Administrative Agency Regulations and
Decisions
7)Local Ordinances
8)Local Agency Regulations and Decisions
9)Common Law
a)Precedent
b)Analogies (indirect precedent, not binding but
can help things hang together)
c)Public policy