Head 3: Becoming Owner

Question 1

How does someone become owner of property (all types, whether corporeal, heritable etc)?

Answer 1

The traditional distinction is between:
1) Derivative acquisition
⁃ Acquisition from an existing owner by transfer.

2) Original acquisition
⁃ Acquisition without reference to previous ownership creating a brand new right. This may be because there is no previous owner or because the law has extinguished the prior ownership.

Question 2

What are the main examples of original acquisition?

Answer 2

The main examples of original acquisition are:

1. Positive prescription:
   ⁃ The change of rights by the running of time (ie. Uncollected debts after 5 years)
   ⁃ This divides into two classes:-
   ⁃ Positive (Acquisitive) Prescription, and
   ⁃ Negative (or Extinctive) Prescription
   ⁃ Acquisition of ownership by the running of time
   ⁃ In the case of land you can become owner by long term possession
2. Registration under the LRA 1979
3. Occupancy (occupatio)
   ⁃ Occurs when you have ownerless corporeal movable property which you can become owner of by taking possession of it
   ⁃ Example - wild animals (occupatio)
4. Accession
   ⁃ Accessio (accessory accedes to principal - ownership passes by accession)
5. Specification
   ⁃ New object is created by manufacturing process
   ⁃ The person doing the process becomes owner regardless of the original owners of the materials

Question 3

What is derivative acquisition?

Answer 3

Derivative acquisition is acquisition by transfer, ie Alan, the current owner of property, transfers that property to Betty, who becomes owner in turn.

Usually the transfer is voluntary (ie the transfer is carried out by Alan, and without compulsion), but occasionally it is involuntary.

Question 4

What does voluntary transfer require?

Answer 4

(a) some public act or acts +
(b) mutual intention.
(c) The property in question must be sufficiently identified. This is the specificity principle.

Question 5

What is the publicity principle?

Answer 5

The requirement for a public act arises out of the publicity principle - since real rights can potentially affect everyone (good against the world) they require an element of publicity. The extent of publicity depends on the type of property.

What affects third parties must be knowable by third parties - marriage, transfer of property. For Corporeal movable property the publicity principle is satisfied by delivery.

Question 6

When is mutual intention effective?

Answer 6

Generally speaking, the intention is legally effective even when it has been wrongly induced, eg by fraud or force and fear. The intention consists of a double act e.g. Sale as a reason for transfer + delivery as necessary for the transfer.

Question 7

Is there an “in-between right”?

Answer 7

Lord Hodge - There is no ‘in-between’ right, i.e. a right intermediate between a personal right and a real right. Until B becomes owner, he has only a personal right. As we will see, this issue has created controversy in the recent past.
[T]he disponee who has not registered his title enjoys no real right in the subjects. Scots law does not recognise a right which lies between a real right and a personal right ..There is no such thing as a ‘quasi- real right’. 
(3052775 Nova Scotia Ltd v Henderson [2006] CSOH 147 per Lord Hodge at para 11)

Question 8

What is the effect of the conveyance?

Answer 8

Effect of the conveyance is instantaneous. A is divested and simultaneously B is invested. There is no time when both A and B are owners. If A is owner, B is not; and if B is owner, A is not. Scots law is unititular.

Question 9

Must the transferor be owner?

Answer 9

The transferor (A) must be owner or act, as agent, with the authority of the owner. Obviously. This is sometimes called the nemo plus rule. A way of describing this rule, which has found favour in England, is nemo dat quod non habet.

he full version is: nemo plus juris ad alienum transferre potest quam ipse haberet. (No one can transfer to another person a greater right than he/she had). But note:
⁃ This authority is limited
⁃ Good faith does not generally affect this

Question 10

Do the general features of transfer apply to subordinate real rights?

Answer 10

Yes - For example, the creation of a real right in a short lease (not exceeding 20 years in length) requires the mutual intention of the parties, plus the public act of the tenant entering into possession of the subjects.