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What is property?
! In

General - Strictly speaking, property is a general term for the rules that govern people's access to and control of things like land, natural resources, the means of production, manufactured goods, and also texts, ideas, inventions, and other intellectual products. ! A system of managing resources.
! Capitalism vs. Socialism ! Common ownership vs. Private Ownership

What is property
! Property

in the broadest sense is a set of claims that people have in resources that correspond to duties of respect in others. ! Entitlement to resources protected by legal institutions

Property as Thing
! Property

rights pertains directly on things, rather than people, it is in rem

! In rem - the right attaches to the object, rather to particular people, it is universally binding on all who encounter the object. ! Quieting - binds all conceivable claimants whether or not they have participated in the proceedings; ! Property must be things worth managing though the exercise of exclusion right



Theories on Property
! Helps

form the foundation of property law. ! No one theory is accepted as the only justification for property. ! Property rights is usually a blend of different approaches.

Theories on Property
! First

Possession ! Labor ! Personhood ! Utilitarian ! Democracy

First possession is the root of title - Carol Rose



First Possession
! Practical

rule - Who had it first. ! Describes how unowned resources came to be owned ! Best in in settings were resources are plentiful but people are few ! Less relevance today because almost every tangible things are owned by someone

First Possession
! Carol

Rose on Possession as Origin of Property

! Common law possession or occupancy as the origin of property ! Wild animals, Discovery ! Analogies show up time and again when courts have to deal on a non-statutory basis with some "fugitive" resource that is being reduced to property for the first time, such as oil, gas, groundwater, or space on the spectrum of radio frequencies.

First Possession

Pierson vs. Post - occupancy" or "possession" went to the one who killed the animal, or who at least wounded it mortally or caught it in a net. ! Control gives rise to possession and hence a claim to ownership. ! Notice/Intent to enable others to dispute the claim

First Possession
! Brumagin

vs. Bradshow Is the owners (Treat) act sufficient notice of appropriation? ! The court ruled that the jury should decide whether Treat's acts gave sufficient notice to the public that he had appropriated the property. If so, he had "possessed" it and could pass it on as an owner. ! Carol Rose - If the use that Treat made was unsuitable, his use would not give notice of his claim.

First Possession

Johnson v. McIntosh
! Thomas Johnson claim of title Sale from Piankeshaw Indian Tribes ! William McIntosh claim of title Patent from US Government ! Discovery Doctrine law of nations; extinguish the right of occupancy by indigenous people ! Became the foundation of real property ownership in colonies ! Carino vs. Insular Government Different view, Justice Holmes recognises property rights of native inhabitants of the Philippines

First Possession
! Popov

v. Hayashi

! Barry Bond baseball case ! Popov sued Hayashi for conversion, believing that once it had touched his glove the baseball became his and although Hayashi came about it legally, he still had the duty to return it to its rightful owner."

First Possession
! First

possessor not a worthy gatekeeper ! The doctrine of adverse possession operates to transfer property to one who is initially a trespasser if the trespasser's presence is open to everyone, lasts continuously for a given period of time, and if the title owner takes no action to get rid of him during that time.

First Possession
! Problems

! Signs, symbolic gestures or clear acts of claiming and notice difficult to demarcate ! Actions must be understood and taken seriously by the community ! Not appropriate when resources are scarce ! Tragedy of the Commons over consumption, i.e. fishing in international waters, maximum gain in shortest time

An original owner is one who mixes his or her labor with a thing and, by commingling that labor with the thing, establishes ownership of it. - John Locke



Labor Theory
! John

Locke ! An original owner is one who mixes his or her labor with a thing and by commingling that labor with the thing, establishes ownership of it. ! The one who expended labor upon objects could remove them from the common and claim them as private property. ! But how much do you value labor?

A right to personhood property should be given priority over a conflicting claim by the owner of the non-personhood property.



Margaret Radin

right to personhood property should be given priority over a conflicting claim by the owner of the non-personhood property. ! People are bound up with things. Object that has become part of oneself as against object that is perfectly replaceable ! Someone's relationship with an object may be gauge by the kind of pain that would be occasioned by its loss.

! What

is important in personhood is a continuing character structure encompassing future projects or plans, as well as past events and feelings. ! The general idea of expressing one's character through property. ! Property for personal autonomy absence of which will hinder liberty attributed to a person


This view of personhood also gives us insight into why protecting people's "expectations" of continuing control over objects seems so important. If an object you now control is bound up in your future plans or in your anticipation of your future self, and it is partly these plans for your own continuity that make you a person, then your personhood depends on the realization of these expectations.

! Fetishism

- A "thing" that someone claims to be bound up with nevertheless should not be treated as personal vis-a-vis other people's claimed rights and interests when there is an objective moral consensus that to be bound up with that category of "thing" is inconsistent with personhood or healthy self-constitution.

Property rights is recognized in order to maximize the overall happiness of society



! Jeremy


! Property rights is defined and distributed to promote welfare of all and not only of the owners. ! i.e. X owning a farmland of his right is protected, he can cultivate and harvest produce for consumption. Ownership gave X the security that he needs to use the farm.


Harold Demsetz (Law and Economics) ! Property rights specify how persons may be benefited and harmed, and, therefore, who must pay whom to modify the actions taken by persons ! Internalisation of externalities

Property rules have developed in response to externalities; ! Externalities are internalize by property owners

! i.e. If a single person owns land, he will attempt to maximize its present value by taking into account alternative future time streams of benefits and costs and selecting that one which he believes will maximize the present value of his privatelyowned land rights.



exists to ensure that owners use resources in an efficient manner that is, in a manner which maximizes economic value defined as a persons willingness to pay. !Avoids the Tragedy of the Commons
! X cuts tree in a communal forest ! X gained benefits but the cost is impose on the others. ! Everyone will try to cut trees resulting to the tragedy of the commons

! Howard

Gensler Three basic features of property law to attain optimal level of production
! Universality all resources must be owned, i.e. society that excludes minerals is at a disadvantage ! Exclusivity no incentive to improve things, if there is open access, i.e. free riders ! Transferability trading, i.e. everyone is stuck with what they have, no gains from trade

Personal security and personal independence from the government are guaranteed in a system in which rights of ownership are protected through public institutions.



Property and Democracy


The right to a stable system of property rights one with which the state will interfere only occasionally or in a limited way with a provision for compensation is necessary to democracy. The right to own private property has an important and salutary effect on the citizens relationship with the state and equally important on their understanding of that relationship. A state in which private property does not exist, citizens are dependent on the good will of government officials, almost on a daily basis.

Property and Democracy

! The

best ways to destroy a democratic s y s t e m i s t o e n s u re t h a t t h e distribution of wealth and resources is unstable and constantly up for new evaluation by the political process. ! Personal security and personal independence from the government are guaranteed in a system in which rights of ownership are protected through public institutions.

Property and Democracy

Cass Sunstein Function of Property ! First, it takes advantage of the powerful human inclination to bring goods and services to oneself and to people one cares about. A system without private property stifles incentives and thus induces both sloth and waste. ! Second, it performs a crucial coordinating function. It ensures that the multiple desires of hundreds, thousands, or millions of consumers will be reflected in market outcomes.

Property and Democracy

Cass Sunstein Function of Property ! Third, it solves, all at once, a serious collective action problem faced by people in any system without that institution. When property is unowned, no one has a sufficient incentive to use it to its full advantage or to protect it against exploitation. ! Finally, it creates the kind of stability and protection of expectations that are preconditions for investment and initiative, from both international and domestic sources.

Property as an Institution

Effective way of managing resources;

! The property strategy for resource management is to delegate near dictatorial powers over particular resources to individual owner-manage, which powers are then backed up by the authority of the state; ! Decentralization of resources - permits owners to specialize in developing the knowledge and skills pertinent to their particular resources ! More stable and requires fewer expenditures as against might is right

Property as an Institution
! Provides

incentives for persons to make investments and engage in effective management of the resources they control;
! Owner reap what he has sown ! Other forms of resources management provides no assurance that those who put in effort to improve the resource will be able to appropriate the fruits of their efforts.

Property as an Institution
! Facilitates

the making of contracts regarding the use and control of resources.

! Necessary to know who controls what resources and hence who may contract with respect to hose resources. ! Exchange of property rights ! Modifying the use of property

Property as an Institution
! Important

source of individual

! Provides material means for individuals to achieve a degree of independence from others ! Important

to the preservation of

! It is a form of personal sovereignty ! Countervails the power of the state

Property as an Institution
! Division

control; ! Use of property in ways that have spillover effects for the owners of other properties Negative externalities ! May lead to Monopoly
! Every property right is a monopoly right; ! Commodification

of things into small units loose

relations ! Promotes inequality

of values and social

In its strict sense, property signifies that dominion or indefinite right of user, control and disposition which one may lawfully exercise over particular things or objects (63 Am Jur 2d).



Property as a Legal Concept


Our property law system is based on the concept that property is a human invention, not the result of a divine gift or natural right.
! Natural Law Theory - certain rights naturally exist as a matter of fundamental justice regardless of government action - has little impact on modern property law. ! Legal Positivism - Property exists only to the extent that it is recognized by the government. Jeremy Bentham - Before laws were made there was no property, take away laws and property ceases

Property as a Legal Concept

! Property

rights is composed of certain constituent elements (Bundle of Rights), namely: The right to exclude The right of use and enjoyment The right to transfer or to dispose

Right to Exclude
! William


! The sole and despotic dominion which one man claims and exercises over the external things of the world, in total exclusion of the right of any other individual in the universe;
! The

duty of the other members of society to keep off, to respect such right, unless the owner has given permission or use the thing in question.

Right to Exclude

Advantage of starting with the right to exclude is this permits us to protect a wide range of interests in use without requiring others to know much about those uses. Simple exclusion strategy Gatekeepers right the owner can select among those uses without the law having to spell out all potential use-rights or interest at all;

Right to Exclude
Larissa Katz, 2008
! What

we mean when we say that ownership is exclusive is that owners have a right to exclude and that the right to exclude has a certain effect: the indirect creation of the space within which the owners liberty to pursue projects of her choosing is preserved.

Bundle of Rights
John R. Commons,The Distribution of Wealth (1893)
! Property

is, not a single absolute right, but a bundle of rights. The different rights which compose it may be distributed among individuals and society some are public and some private, some definite, and there is one that is indefinite.

Bundle of Rights
! Partial

rights are definite. Full rights are the indefinite residuum. ... The first definite right to be deducted from the total right of property is the public right of eminent domain. ! It is merely a definite restriction upon the unlimited control which belongs to the individual.

Bundle of Rights
Ronal Coase, (1960)
! We

may speak of a person owning land and using it as a factor of production but what the land-owner in fact possesses is the right to carry out a circumscribed list of actions.


Exclusion to Governance
! Rules

on particular use arise when there is a major resource conflict, i.e. easement, nuisance and zoning ! Reconfiguration of property rights


Exclusion to Governance
! The

law shifts from giving the owner dictatorial control over who and what to exclude (or include), and instead seeks to prescribe rules about permissible and impermissible uses that constrain all relevantly situated owners. ! Exclusion is shading off into governance.

Property as Things
! Property

rights pertains directly on things, rather than people, it is in rem

! In rem - the right attaches to the object, rather to particular people, it is universally binding on all who encounter the object. ! Quieting - binds all conceivable claimants whether or not they have participated in the proceedings;

Types of Ownership
Ownership Private Common Public Open Access Private Group State No One Access By Owner Management Private

By Joint-Owners By Joint-Owners State Uncontrolled State None


Ownership - over rights and things

Jus Fruendi - right to the fruits
Right to Enjoy (Jus Untendi) Arts. 428, 437, 438, 440

Jus Abutendi - right to consume

Jus Possidendi - right to possess Self-help: actual or threatened, unlawful physical invation or usurpation Right to Fence without detriments to constituted servitudes

People vs. Goya (1965) Warehouse - must be couple with an attack on the person

Right to Exclude Art. 429 (general) Art. 430 (fence)

Villafuerte vs. Court of Appeals (2005) - lease expired, property enclosed by fence; violates procedure People vs. Narvaez (1983) - incomplete defense of property; attack is disproportionate

Right to Dispose! Art. 428


Republic vs. Court of Ownership over rights and Appeals (160 SCRA 228) Art. 437 ! things Surface and Jose dela Rosa land

Extent ! Ownership on Land

everything under it. Can excavate, construct or plant subject to servitude, special laws and ordinance and aerial navigation

Art. 438! Hidden Treasures belongs to the owner of the land, building, on which it is found! Found on property of another or the state 1/2

Treasure Hunting National Museum Act of 1998 Permit for treasure hunting National Museum Determines PL - 75-25/Prvt Land 30-70/shipwreck 50-50

registration vs Benguet Consolidated Bog Wedge Corporation Mining Claim Patent remove it from the public domain/dela Rosa - asserts ownership only on the surface

NPC vs. Ibrahin (2007) NAPOCOR Tunnel 1978; discovered in 1992 application for deep well; NAPOCOR - utility and convenience/no interference

Ownership - over rights and things

Accion Publiciana - lapse of 1 year RIGHT OF VINDICATION! Accion Interdictal forcible entry and unlawful detainer


Article 428 (right of action par. 2)! Art. 432 (damages/ interference)

Accion Reinvidicatoria ownership; claim of title

Presumption - disputable presumption given to possessor (ART 433/539) - in action to recover, plaintiff must rely on the strength of his title (ART 434)

Right to Exclude
Art. 487. Anyone of the co-owners may bring an action in ejectment. -Trespass, interference, prevents persons outside the coownership from using the property

Right to Use
Art. 486. In accordance with the purpose Art 492 Administration through majority with resort to court; controlling interest Art. 500. Mutual accounting at the end of co-ownership Preservation (Art. 488) Repairs (Art 489) Embellishment and Improvement (Art. 489) Alteration (Art. 491) Buildings (Art. 490)

Right to Transfer
Art. 493. May alienate, assign, mortgage, substitute another person in its enjoyment; except personal rights are involved. Art. 493. In alienation limited to the portion which may be allotted to him in the division.


Limitations on Ownership
Police Power ! (Art. 436)
Mere regulation or restriction; No taking; No recovery; Basis is General Welfare

Eminent Domain! (Art. 435)

There is taking; and Just Compensation Property must be for public use or public purpose


Inherent power of the State to raise revenue to support its existence Must not be arbitrary

Limitations on Ownership
Injurious Use! (Art. 431)
Article 19. NCC Every person must, in the exercise of of his rights..give everyone his due, act with justice, honesty and good faith Article XII, Section 6. The use of property bears a social function; economic agent shall contribute to the common good.

Interference with the use of others property! (Art. 432)

Exception: State of necessity 1. An actual or imminent danger; 2. Interference is necessary to avert such danger 3. The threatened damage compared to the attending interference is much greater

People vs. Rebutado The state of necessity must not be brought about by the intentional provocation of the invoking party

Limitations on Ownership
Conditions imposed by law / the owner:! 1. Easements;! 2. Extravagance;! 3. Restrictions on Land Grants!
Limitation impose by the owner a. at the time he transmit the property b. at the time he continues to be the owner of the property Art. 494 and 870 (donor prohibit partition/alienation for 20 years) Leal vs. Court of Appeals - prohibitions that is indefinite as to time; that it may be applicable beyond the lifetime of the original parties, is a nullity Deed of Restrictions

Bel Air Village, Inc. vs. Dionisio - affirm the rule that automatic membership/abide rules and regulations - is a valid restraint on ones ownership = interest of sanitation, security and general welfare

Cariday Investment Corporation vs. CA Forbes Park Restriction - one single family residential building; 2 meters easement; 50 years is a valid restriction, reason overcrowding, pressure on common facilities;


Merry Christmas to be continued next year