Part I Flashcards
What is property?
It is about legal relations among people regarding control and disposition of valued resources.
A set of claims that people have in resources that correspond to duties of respect from others.
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, including texts, ideas, inventions, and other intellectual products.
What is ownership?
It concerns a package of various entitlements and responsibilities like right to exclude, to use, to transfer, etc.
A bundle of rights that refers to the beneficial interests or rights attached to the ownership of property. It includes the right to sell, lease, encumber, use, enjoy, exclude, and to make will.
Dominion or indefinite right of use, control and disposition which one may lawfully exercise over particular things or objects.
William Blackstone: the third absolute right; inherent in every Englishman, is that of property: which consists in the free use, enjoyment and disposal of all his acquisitions, without any control or diminution, save only by the laws of the land.
Types of Systems of Managing Resources
a. Capitalism
- preeminence of private ownership
- citizens have private property
- market forces decides what is best to do with resources
- market economy (A market economy is an economic system in which the decisions regarding investment, production and distribution are guided by the price signals created by the forces of supply and demand)
b. communism/socialism
- preeminence of state ownership
- citizens have limited property, the state owned most of the resources (Super Regalian Doctrine)
- the State decides what is best to do with resources
- planned economy (A planned economy is a type of economic system where investment, production and the allocation of capital goods takes place according to economy-wide economic plans and production plans. A planned economy may use centralized, decentralized, participatory or Soviet-type forms of economic planning)
c. tragedy of the commons
- a situation where there is no property rights in the community
- there is only a shared resource system (common ownership) where individual users acting independently according to their own self-interest behave contrary to the common good and depleted the resource through their collective action
Purpose of Property Laws
- provides an effective way of managing resources (permits owners-managers to specialize in developing the knowledge and skill pertinent to their particular resources)
- provides incentives for individuals to make investments and to engage in effective management of resources they control
- facilitates the making of contracts regarding the use and control of resources - exchange of property rights, we know who use and control the resources
- source of individual autonomy (critical to personal identity or development of individual personality)
- important for the preservation of liberty and a source of countervailing power to the power of the State
Issues and Concerns with Property Laws
- division of the world into separate parcels of land and discrete object of personal property, each with its own individual owners
- monopoly - control on someone with respect to a particular resources that was awarded to him/her
- commodification of values and social relations (world seen merely in owner-object relation)
- may promote inequality (exclusion)
Theories of Property
- First Possession
- allocation of property rights to the first possessor
- less wasteful of resources if there is sufficient notice of first possessor –> intended to reduce conflict and unnecessary competition
- General Rule on Discovery: the thing is awarded to those who first made a claim on the resources - Labor Theory
- John Locke: when one mixes labor with a property or natural resources, it becomes valuable and becomes private property
- Labor + natural resources which are unowned = property rights
- applicable in areas where there is no established ownership (British colonization of North America) - Utilitarian/Economic Theory
a. maximize societal happiness (Jeremy Bentham) - We recognized property in order to maximize the overall happiness of society; to best promote the welfare of all citizens.
b. Law and Economics Approach - Property exists to ensure that’d owners use resources in an efficient manner - that is, in a manner which maximizes
economic valued defined as a person’s willingness to pay.
c. Harold Demsetz Theory of Property Rights - another way of internalizing externalities associated with the use of resources is by establishing property rights in the resources. Property rights, as Demsetz understood them, are rights to exclude others from specific things or resources. By creating such exclusion rights and converting them on an identified owner, man of the
benefits and costs associated with the use of the resource - which otherwise would be experienced as externalities by the others - will instead be borne by the owner. By giving the owner exclusive control over the resource, decisions that affect the value of the
resource in a positive or negative direction will be captured by the owner.
d. Basic Features of Property System - in order for an economy to reach its full potential, there are 3 basic features which its system of property rights must have:
i. universality (all valuable, scarce resources must be owned by someone)
ii. exclusivity ( if an owner is unable to exclude others from the use and enjoyment of the property, then
the owner has no incentive to improve the property)
iii. universality - right to transfer to help ensure that property is devoted to its most valuable use
- Democracy - in a state in which private property does not exist, citizens are dependent on the good will of the government. They come to the state as beggars rather than right holders.
- Personhood
George Hegel - personal development; connection to tangible things
Margaret Jane Radin - strength/significance of one’s relationship to an object; shall be given liberty to control that thing
Legal Theories on Property
- Natural Theory
- Thomas Aquinas
- philosophical system of legal and moral principles
- human nature; lawful and natural to possess; in cases of need, all things are common property - Legal Positivism
a. property rights are defined by law (State)
b. property rights are protected by formal institutions (a thing is not property in the legal sense unless its holder could vindicate his/her rights in the court of laws)
c. property rights are not absolute (among different owners, or owner v. community)
d. property rights evolve as law changes - Property as Law of Things
a. in rem (property rights pertains to things rather than people)
b. in personam (binding only to parties of the contract)
c. property as notice (the in rem aspect of property gives information to large and indefinite audience on
how to interact with each other with regard to the thing)
- duty to keep off
- jurisdiction of courts - Right to Exclude
- William Blackstone
- primacy of the right to exclude
- xpns to the right to exclude: necessity, custom, public accommodation laws, anti-discriminatory laws - Bundle of Rights
- trinity of rights: to exclude, to use and to transfer
- exclusion shoes off into governance
What is ownership
It concerns a package of various entitlements and responsibilities like right to sell, lease, encumber, exclude, use, enjoy, exclude, transfer, and to make will.
Signifies dominion or indefinite right of use, control and disposition which one may lawfully exercise over particular things or objects.
Ownership may be exercised by
a. rights
b. things
What is title?
It is the foundation of ownership and the means whereby the owner is enabled to maintain or assert his possession and enjoyment of a property.
Evidence of ownership or one’s right or of one’s extent of his interest in the property
Incidents of Ownership
- Right to exclude
- enclosure and fences
- self-help
- xpn: lawful interference in cases of acts and necessities; compensate affected owner for damages - Right to use
- xpns: limitation by law
- injurious use
- government control and regulation to secure general welfare
- regulation as to acquisition, enjoyment, and disposition of property for a public purpose with just compensation
- use of property has a social function (Constitution) - the use of property bears a social function, and all economic agents shall contribute to the common good. Individuals and private groups, including corporations, cooperatives and similar collected organisations, shall have the right to own, establish and operate economic enterprises
- distributive justice - state can intervene when necessary - Right to Transfer
- right of alienation or disposition in any lawful manner which the owner deems fit - Right to Vindicate
- the right to protect and defend such possession against intrusion or trespass
- presumption: the law favor actual possessors
Kinds of Transfers
- Assignment of Ownership
2. Assignment of Rights Only
How is Ownership Proved?
- Titles
- Possession
- Adjudication or Confirmation of Titles
- Control and Community Recognition of Claims
How are titles acquired?
Voluntary transfers from the owner through sale, donation, exchange, etc.
Can also be from involuntary transfer - seizures under levy of attachment or execution, transfers in connection with bankruptcy, escheat, condemnation, abandoned property, transfers pursuant to legal separation or dissolution of marriage or eminent domain
What is possession?
It is a proof of ownership but is different and distinct from a title. It is a right that often accompanies ownership but is not necessarily sufficient to prove it. It may give rise to acquisition or lost of ownership (prescription).
Possession gives rise to a presumption of ownership but this can be challenged by another person with a better right or title to the property.
Possession and title may each be transferred independently of the other.
Holding of a thing or the enjoyment of a right.
Exercise of dominion over property.
Res Nullius
Res nullius (literally meaning, nobody’s thing) is a Latin term derived from private Roman law whereby res (an object in the legal sense, anything that can be owned, even a slave, but not a subject in law such as a citizen nor land) is not yet the object of rights of any specific subject.
Such items are considered ownerless property and are free to be acquired by means of occupation.
Kinds of Property
a. As to Ownership
1. common/res nullius - belonging to no one
2. public dominion (property intended for public use, for public service, property for the development of national wealth, patrimonial property)
3. Private Dominion - all properties belonging to private persons either individually or collectively
i. sole ownership
ii. co-ownership (simple, partnerships, corporations)
b. As to Physical Characteristics
1. Immovable Property or Real Property
2. Movable Property or Personal Property
What are immovable properties? (Art. 415 of the Civil Code)
(1) Land, buildings, roads and construction of all kinds adhered to the soil
(2) Trees, plants, and growing fruits, while they are attached to the land or form an integral part of an immovable
(3) Everything attached to an immovable in a fixed manner, in such a way that it cannot be separated therefrom without breaking the material or deterioration of the object;
(4) Statues, reliefs, paintings or other objects for use or ornamentation, placed in buildings or on lands by the owner of the immovable in such a manner that it reveals the intention to attach them permanently to the tenements;
(5) Machinery, receptacles, instruments or implements intended by the owner of the tenement for an industry or works which may be carried on in a building or on a piece of land, and which tend directly to meet the needs of the said industry or works;
(6) Animal houses, pigeon-houses, beehives, fish ponds or breeding places of similar nature, in case their owner has placed them or preserves them with the intention to have them permanently attached to the land, and forming a permanent part of it; the animals in these places are included;
(7) Fertilizer actually used on a piece of land;
(8) Mines, quarries, and slag dumps, while the matter thereof forms part of the bed, and waters either running or stagnant;
(9) Docks and structures which, though floating, are intended by their nature and object to remain at a fixed place on a river, lake, or coast;
(10) Contracts for public works, and servitudes and other real rights over immovable property. (334a)
Classes of Immovable Property
a. Immovable by nature (1 and 8)
- those which cannot be moved from place to place
b. Immovable by incorporation (2, 3, 4, and 6)
- those which are attached to an immovable in such a manner as to form an integral part thereof
c. Immovable by destination (4, 5, 6, 7, and 9)
- those which are placed in an immovable for the use, ornamentation, exploitation or perfection of such immovable
d. Immovable by analogy or by law (10)
- those which are considered immovables by operation of law
Extent of ownership in immovable property
a. surface and everything under
b. minerals are not included (Article XII of Constitution)
Who owns hidden treasures?
Personal
Owner of the land/building
If by chance, 1/2 lang basta hindi sya trespasser
The State may acquire hidden treasure at their just price
What are movable properties?
1) Those movables susceptible of appropriation which are not included in the preceding article;
(2) Real property which by any special provision of law is considered as personalty;
(3) Forces of nature which are brought under control by science; and
(4) In general, all things which can be transported from place to place without impairment of the real property to which they are fixed.
(1) Obligations and actions which have for their object movables or demandable sums; and
(2) Shares of stock of agricultural, commercial and industrial entities, although they may have real estate.
Fungible v. non-fungible
Fungible - can be exchanged
Fungibility or non-fungibility only applies to movables, determined by the intention of the parties.
[1] Fungible things are those which, because of their nature or the will of the parties, are capable of being substituted by others of the same kind, NOT having a distinct individuality.
[2] Non-fungible things are those which cannot be substituted for another. If parties have agreed that the same thing should be returned, it is not fungible.
Constructive Notice v. Actual Notice
Constructive - done in public, you can check it
Actual - done personally
Consumability v. Fungibility
Consumability depends only on the nature of the thing itself but fungibility depends on contractual stipulations or on the nature of the thing itself.
Importance of Distinguishing Movable from Immovable
a. Ownership Rights
i. Statute of Limitations
ii. Registration of Ownership and interest in property registries
b. Taxation
i. real property taxation
ii. taxation of certain movable property
Thing v. Property
Thing is that which is considered to exist as a separate entity, object, quality or concept while property is something that is owned.
What is the focus of property law according to Smith?
To minimize the cost of information we need to figure out who gets to do what with what thing.
Explain property as an exclusion strategy
Property is a system and not just an individual entitlement.
Property is efficient because initial distribution of property makes exchange possible. It also gives us liberty because we cannot decide how to live if we are not given the general power to choose how to use things we own.
Requisites for a thing to be governed by property regime according to Demsetz
- Enough demand for the resource relative to its supply that internalization of externalities associated with the use of the resource will produce significant benefit
- No value, negative value = unlikely to be treated as property
- If there are high costs of establishing and enforcing property rights, it is unlikely to exist
In what ways do the Civil law relate to property law?
a. Family law
b. Contracts and obligations
c. Property Law
d. Succession
e. Estate, probate and testamentary laws
f. Agency
g. Law of Torts
Thing v. Property
thing - broader (includes both appropriable and non-appropriable objects)
property - can also include intangible things (rights, credits)
Real right v. Personal right
Real right - right against the world
Personal right - right against another person
Classification of Movable Property
- According to nature
a. consumable - those that cannot be used according to its nature without it being consumed
b. non-consumable - any other kind of movable property - According to the intention of the parties
a. fungible - can be replaced by an equal quality
b. non-fungible - cannot be replaced, the identical object must be returned
Title
Foundation of ownership and the means whereby the owner is able to maintain or assert his possession and enjoyment of a property.
A bundle of rights in a property in which a party may own either a legal interest or equitable interest.
Formal document that serves as evidence of ownership.
What provides public notice of ownership information?
Registration of ownership in a public registry
Rights of an owner under the Civil Code
a. the right to enjoy (the right to possess, the right to use, the right to the fruits)
b. the right to dispose (the right to consume or destroy or abuse, the right to encumber or alienate)
c. the right to recover or vindicate
Exception or Limitation of one’s right to enclosure and fences
a. servitude
b. easement
A person may fence off his house & lot unless he denies others a right of way to which the latter may be entitled
Principle of Self-Help
The owner has the right to exclude any person from the enjoyment and disposal of the property by use of such force as may be necessary to repel or prevent actual or threatened unlawful physical invasion or usurpation of his property; the right to counter, in certain cases, force with force.
Requisites of self-help
- Reasonable force
- Owner or lawful possessor is the person who will exercise
- Actual or threatened physical invasion or usurpation; and
- No delay in one’s exercise
Exceptions to the right to exclude
a. lawful interference in cases of acts of necessities
b. compensate affected owner for damages
c. discrimination
Exceptions on one’s right to use property
- Limitation by law
- Injurious use
- Police power
- State regulation
Right to Transfer
Includes the right of alienation or disposition in any lawful manner which the owner deems fit. The transfer must comply with the mode appropriate to the kind of property in order to be effectual.
Kinds of Transfers
- Assignment of ownership
2. Assignment of rights only
Right to vindicate
Includes the right to protect and defend such possession against the intrusion or trespass of others through judicial relief but in certain instances may include self-help
The presumption is that the law favors actual possessors. T or F.
True.
Possession v. Title
Possession is a proof of ownership but is different and distinct from a title.
- not necessarily sufficient to prove ownership
- gives rise to presumption of ownership but may be challenged
Possession and title may each be transferred independently of the other. T or F.
True.
Adjudication/Confirmation of Titles
- succession rights
- rights to land under public land, agrarian reform, IP’s rights laws
Co-ownership
The ownership of an undivided thing or rights belongs to different persons.
The share of the co-owners in the benefits as well as in the charges are proportional to their interest and any stipulation altering this proportion is void. T or F.
True.
The co-owner may not alter the thing in common even though it will benefit all co-owners. T or F.
True.
For how many years can a thing in co-ownership be left undivided?
10 years per contract.
Prescription does not run against co-owner as long as he recognizes the co-ownership. T or F.
True.
May a co-owner alienate his right?
Yes.
May a co-owner assign his right?
Yes.
May a co-owner mortgage his right?
Yes.
Exception to the general rule that any co-owner may substitute another person in the enjoyment of the use of a thing?
When personal rights are involved.
Creditors and assignees may take part in the division but cannot impugn any partition that has been executed. T or F.
True.
Obligations of co-owners
- Contribute to the expenses for preservation and to taxes
- Contribute to the expenses for improvement upon majority decision. Majority decision must include co-owners representing controlling interest
- As far as practicable, other co-owners must be notified before a co-owner incur expenses for preservation
