VA Personal Property

Question 1

Things that are personal property

Answer 1

• things that are movable
• personal possessions
• leaseholds
• crops planned and planted

Question 2

Gaining or losing ownership

Answer 2

acquired by capture,
creation,
discovery,
adverse possession,
accession,
confusion,
and gift;

lost by the same methods and by abandonment and fraud

Question 3

Capture of unowned property - classic example is wild animals

Answer 3

• Possession—animals become possessions when an individual manifests the intent to own the animal by exercising actual or constructive dominion or control; the owner does not lose title to an escaped animal if the owner makes efforts to recapture the animal; animal periodical wanders off but returns; or animal is marked and efforts to recapture
• Trespass—a trespasser who captures an animal forfeits his property rights to the landowner
• Violating a statute—a person who traps or captures an animal in violation of a statute loses ownership of the animal

The rule of capture does not apply to domesticated animals. (cattle sheep chicken)

The rule of capture does not apply to pets because they have owners and remain the property of the owners even after wandering off.

Question 4

Creation of new property—authorship of written or recorded works; protected by copyright laws

Answer 4

• Protections—generally owner’s lifetime plus 70 years; for anonymous works or works for hire, the shorter of 95 years from publication or 120 years from creation; works must be registered to be protected
• Limitations—no protection against individuals who independently create similar works

Question 5

Loss of title due to tortious conversion

Answer 5

• Active conversion
  o Generally cannot deny the true owner title because someone who does not have good title cannot transfer it to another
  o Exceptions for bona fide purchasers (BFPs) who lack notice of the conversion:
   The property is money or a negotiable instrument;
   The converter acquired title by fraud in the inducement; or
   The true owner entrusted goods to a seller of goods of that kind and the purchaser is a buyer in the ordinary course of the seller’s business.
• Passive conversion
  o An owner can recover from a wrongdoer through trover
  o Two elements for conversion—(i) the plaintiff must have clear legal ownership or right to possess the property at the time of conversion, and (ii) the defendant must have obtained the property through a wrongful act or by disposition of the plaintiff’s property rights

Question 5

Loss of title due to tortious conversion

Simple conversion does not divest ownership of personal property.

Answer 5

• Active conversion
  o Generally cannot deny the true owner title because someone who does not have good title cannot transfer it to another
  o Exceptions for bona fide purchasers (BFPs) who lack notice of the conversion:
   The property is money or a negotiable instrument;
   The converter acquired title by fraud in the inducement; or
   The true owner entrusted goods to a seller of goods of that kind and the purchaser is a buyer in the ordinary course of the seller’s business.

 Curve ball—Personal property may be converted through loss or damage.
 The owner of the property may have an action for recovery of damages but not for
return of the property.

Question 6

Lost or mislaid property _____ the personal property of the original owner.

Any personal property that has been abandoned ____ to be the property of the original owner.

Answer 6

remains

ceases

Question 7

Lost Property General rule

Answer 7

A finder of lost property has a right to the lost property that is good against all the world except the original owner.
o Once the original owner is located, the finder must return the property to the original owner.
Until the original owner is located, the finder has all the rights attributable to an owner: to possess and use the found property and to exclude others from possessing and using the found property.

Question 8

The general rule of finders does not apply if the finder is ______ on someone else’s
property when the trespasser finds something there.

The general rule of finders does not apply if the person finds the lost property in a _____ where the public is not normally invited

The general rule of finders does not apply if the person finds lost property during the course of employment. The -___-___ has the possessory right to the lost property.

Answer 8

trespassing

private location

employer

Question 9

Mislaid (Misplaced) Property

Definition?

Rule?

Answer 9

Reasonably appears to have been put somewhere on purpose and then forgotten
The finder does not have a possessory right to mislaid property that is good against all the world except the true owner.
o The owner of the place where the property was mislaid gets the possessory right that is good against all the world except the true owner.

Question 10

Abandoned Property

Definition?

Rule?

Answer 10

o The true owner leaves property somewhere and manifests an intent to give up ownership and possession.
o The owner must (i) have the intent to abandon and (ii) must manifest that intent.

o The general rule for abandoned property is that the first person to take possession of the abandoned property becomes the new owner of the property with rights that are good against all the world including the previous owner of the property.

Question 11

Rights and Duties of Possessors

Answer 11

o The finder of lost property and the owner of the place where mislaid property is found has a possessory right to the lost or mislaid property that is good against all the world, except the true owner (a quasi‐bailee).
o The quasi‐bailee has the right to prevent anyone else (except the true owner of the lost or mislaid property) from interfering with her possessory right.
o The quasi‐bailee has a duty to locate the true owner through reasonable means. o The quasi‐bailee has a duty to keep the lost or mislaid property with due care.

Question 12

In Virginia, the statutory rule is that intangible personal property, including money, that has been lost or mislaid by the true owner will be treated as abandoned property if unclaimed by the true owner after ______
 If no such claim is made after ______, the quasi‐bailee will be the new owner with rights against all the world, including the _____

Answer 12

five years.

five years

prior owner.

Question 13

Accession

What is it?

Rule?

Answer 13

the application of labor or materials to one person’s personal property by another person.

If Individual A adds labor and/or materials to Individual B’s property, the materials and the value added by the labor become the personal property of Individual B.

When there is uncertainty between two people about who owned an item of personal property, the person who adds substantial value to the personal property will become the owner through accession, as long as that person is an innocent trespasser.

Question 14

Confusion

What is it?

General Rule?

Answer 14

“Confusion” occurs in cases when the personal property of different people is mixed together and it is difficult or impossible to distinguish one person’s property from someone else’s.

If you know who contributed the goods and in what proportion, the contributors are
proportionate owners of the confused goods.

If you do not know the proportion contributed by different contributors and the confusion is innocent, then the contributors share the confused goods equally.

If you do not know the proportion contributed by different contributors and the confusion is NOT innocent, the person who wrongfully caused the confusion must show his portion; if he cannot show his proportion, the innocent contributors will share the confused goods equally (including the goods put there by the person who wrongfully caused the confusion).

Question 15

Adverse Possession of Personal Property

SOL?

Answer 15

If Person A owns property and Person B takes possession of that property for long enough and under the right circumstances, Person A will lose and Person B will gain ownership of the property.

In Virginia, the statute of limitations for recovery of personal property that someone else possesses is 5 years. After 5 years, ownership is forfeit

An adverse possessor of the watch for the five years becomes the owner of the watch if he has satisfied all the elements of adverse possession, i.e., the possession must have been:
 Actual;
 Open and ;
 Hostile and (without permission);
 Exclusive; and
 Continuous (throughout the entire five‐year statutory period).

Question 16

Gifts definition

Answer 16

o A voluntary and gratuitous transfer of property from one person to another o “Gratuitous” means the donor receives no consideration from the donee.

Question 17

Inter Vivos Gifts

Answer 17

o Gifts made between living persons o Once made, it is irrevocable
o Four elements:
 Donative capacity; (mental capacity)
 Donative intent; (present intent)
 Delivery;(manifest intent, gives control)
(can be symbolic, written, constructive, or physical)
and
 Acceptance.

Question 18

Gifts Causa Mortis

Answer 18

o Made in apprehension of the donor’s impending death
o Revocable at any time until the donor’s death
o Five elements:
 Donative capacity;
 Donative intent;
 Delivery;
 Acceptance; and
 The donor must be in apprehension of his/her impending death (i.e., fast approaching)

o A gift causa mortis is revoked if the donor survives the event or the illness from which the donor anticipated the impending death.
o More specifically, a gift causa mortis can be revoked by (i) an affirmative act of the donor, (ii) the donor’s survival, or (iii) the donee predeceasing the donor.

A gift causa mortis remains valid even if the donor dies of a cause other than the one she was contemplating at the time of the gift.

Question 19

Remedies

Answer 19

1. Detinue
   An action to recover personal property that someone else took possession of but has refused to
   return
2. Trespass
   An action to recover monetary damages from the loss of possession
3. Trover
   An action to recover the value of the property itself

Question 20

BAILMENTS

Answer 20

The transfer of possession, but not ownership of personal property from one person to another
 Bailor—person who transfers property
 Bailee—person who receives the property
 The bailee must return the property to the bailor at the end of the bailment.

Question 21

Virginia law also recognizes a “quasi‐bailment” or a “constructive bailment.”
which are:

Answer 21

o Occurs when someone comes into possession of chattel (personal property) and exercises physical control over it without there having been delivery by the owner and without there having been the permission of the owner
o The quasi‐bailment or constructive bailment arises by operation of law, and it is usually treated as a gratuitous bailment.
o The quasi‐bailee or constructive bailee has some responsibility—although not very much— regarding the safekeeping of the property.

Question 22

Elements of a bailment

Answer 22

o The bailee must have physical possession of the property and the intent to exercise control over the property;
o The bailee must agree to the bailment; and
o The bailee must know of the personal property.

Question 23

Distinguishing Bailments:

Employer’s property

Consignment

Sale

Risk of loss

Answer 23

Employer’s property—An employee’s use of the employer’s property during the course of employment ordinarily does not create a bailment because the employer never loses control over the property.

Consignment—is a bailment
o One person transfers property to another for the purpose of selling that property

Sale—a transfer of ownership
o A bailment is a transfer of possession without the transfer of ownership.

Risk of loss—If the arrangement is a bailment, the risk of loss (in the absence of fault by the bailee) stays with the bailor. If the arrangement is a sale, the risk of loss is on the buyer.

Question 24

Special forms of bailments

Answer 24

 Valet parking lots create a bailment; self‐serve parking lots do not.
 Renting a safe deposit box from a bank is a bailment.
o Renter is bailor; bank is bailee

Question 25

Innkeepers—Innkeepers are not bailees over the property of their guests, but Virginia law has a
statutory scheme about innkeeper liability.

Answer 25

o The innkeeper must take reasonable precautions to protect the property of the guests.
o The innkeeper’s liability is capped at $300 for any property lost from a room occupied by the
guest.
o The innkeeper is not liable in any amount for the loss of jewelry, money, or like valuables
unless they are deposited in the hotel’s office, provided the hotel has posted a notice to that
effect.
o The innkeeper is not liable for any property taken from a room if the guest has failed to lock
the doors and windows.
o If the loss is the result of a fire or some other overwhelming disaster, the innkeeper’s
liability is limited to $250, unless the fire or disaster is the result of the innkeeper’s
negligence.
o None of these limitations applies if the guest’s property was taken by the innkeeper’s
employee or agent of the innkeeper.

Question 26

Bailee Standard of Care

Answer 26

 The bailee has an obligation to exercise care while in possession of the property.
 The standard of care depends on the type of bailment.

Question 27

Bailee Standard of Care

Bailment solely for the benefit of the bailor:

Answer 27

Bailment solely for the benefit of the bailor—the bailee is held to a standard of slight diligence.
o A bailment is solely for the bailor’s benefit when the bailee is not compensated by the bailor.
o Slight diligence—the bailee is liable for a loss to the property if he acts with gross negligence.

Question 28

Bailment Standard of care
Bailment for the mutual benefit of the bailor and the bailee

Answer 28

o The bailee will be liable for loss or damage to the bailed property resulting from the bailee’s negligence.
o A mutual benefit exists in most commercial bailments.

Question 29

Bailment Standard of care
Bailment solely for the benefit of the bailee

Answer 29

o If the bailee uses the bailed goods for some purpose outside the scope of the bailment, the bailee becomes strictly liable to the bailor for any loss or damage.
o If the bailee moves the property from the agreed place of storage, the bailee becomes strictly liable.

o A bailee who agrees to return the bailed property in exactly the condition it was in at the start of the bailment is absolutely liable for a failure to do so.

o A failure to return the property also includes a mis‐delivery of the property

o The bailee will be excused from the delivery requirement without any liability if (i) the bailee buys the bailed property from the bailor, (ii) the bailee is notified that a third party has bought the bailed property from the bailor, (iii) the bailed property is taken from the bailor by court order, or (iv) someone else establishes a superior right to the bailed property and demands possession.

Question 30

Measure of damages

Answer 30

If the bailed property is completely lost or destroyed, the measure of damages is the fair market value of the bailed property at the time of the loss or destruction.

If the bailed property is damaged but not completely lost or destroyed, the measure of damages is the difference between the fair market value of the bailed property in its undamaged state and its actual value in the damaged state.

Question 31

Bailee’s Rights in Bailed Property

Answer 31

o Right of possession
o The bailee’s right of possession during the term of the bailment is exclusive against all the
world, unless the terms of the bailment provide otherwise.
o The bailee can bring an action against any other person who interferes with the right of
possession, including the bailor.
o The bailee’s right of possession trumps the right of any creditors of the bailor.
 The creditors’ rights are no greater than the rights of the bailor to the property.
 Because the bailee’s right of possession trumps the bailor’s right of possession, the bailee’s right of possession trumps the bailor’s creditors’ right of possession.

Question 32

Bailor’s Rights in the Bailed Property

Answer 32

o The bailor can bring an action against the bailee if the bailee returns the property in damaged condition.

o Because the bailor does not have a current right to possess the bailed goods during the bailment term, the bailor cannot sue a third party during the term of the bailment on the theory that the third party has interfered with the bailor’s current right of possession. That action (interference with the current right of possession) can only be brought by the bailee.
 After the bailment has ended, the bailor can sue a third party on the theory that the third party has interfered with the bailor’s current right of possession because the bailor again has the present right of possession.
 During the term of the bailment, the bailor can sue a third party on the theory of an interference with the bailor’s future right of possession.

Question 33

Bailor’s Causes of Action against the Bailee

Answer 33

o Conversion—if the bailee failed to return the bailed item for whatever reason
 Can seek return of the watch itself—a detinue action
 Can seek for return of the watch—either a trover (if seeking the value of the
watch) or action (if seeking payment for losses incurred by not having possession of the watch)
o Negligence
o Breach of contract (bailment agreement)

Question 34

Bailor’s Liability

Answer 34

The bailor is not liable if the bailee does something with the bailed property that causes harm to a third party.

Question 35

Bailee’s Liability

Answer 35

o Public policy frowns on a bailee’s attempt to waive or limit liability.
o Waivers and limitations are not necessarily void but will be strictly construed against the
bailee.
 Waivers are more vulnerable than limitations of liability.

o A bailee may limit his liability as long as (i) the bailor knew or should have known of the limitation at the time the bailment was created and (ii) the bailor agreed to the limitation.
o Signs limiting liability that are posted in certain businesses—a prominent sign puts the bailor on notice about the limitation and handing the good to the bailee signifies the bailor’s agreement to that limitation

Question 36

Bailment Compensation

Answer 36

 Typically, a bailment for the benefit of both the bailor and the bailee will provide compensation to the bailee; normally, set by agreement.

 No legal obligation to compensate the bailee for a bailment if the bailment is solely for the benefit of either the bailor or the bailee.

 In the case of a compensated bailment, the ordinary and customary expenses incurred by the bailee fall to the bailee.

 Extraordinary expenses incurred by the bailee can be charged to the bailor.

Question 37

Actions by the Bailee

Answer 37

 The bailee’s right to possession of the bailed property is superior to all the world, even that of the bailor.
 If the bailor interferes with the bailee’s possession of the bailed property, the bailor has committed the tort of conversion and the bailee can recover against the bailor for that.
 The bailee has a cause of action against any third party who interferes with the bailee’s right of possession.
o If in suing the third party, the bailee recovers more than the value of the bailee’s interest in the bailed property, the excess must go to the bailor.

Question 38

Defects in Bailed Property

Answer 38

 In a compensated bailment, the bailor is obligated to inform the bailee of any defects in the bailed property that the bailor knows or should know of.
 In a gratuitous bailment, the bailor must inform the bailee of any known defects but not of any unknown defects that the bailor should have known about.

Question 39

Terminating a Bailment

Answer 39

 Bailments are generally terminated by agreement.
 Can be terminated by one party giving notice of termination
 Can be terminated by the loss or destruction of the bailed property

Question 40

Three Ways Ownership of Personal Property can be Established or Lost

Answer 40

 Capturing a wild animal or other natural resource that was previously unowned o Physical capture or mortal wounding with continued pursuit
o Does not apply to domesticated animals or pets  Creating new property
o Protections of federal copyright and patent law  Tort of conversion

Question 41

Finding Lost, Mislaid, or Abandoned Property

Answer 41

1. General Rules
   o Lost property—the finder has a right to lost property good against all the world except the true owner
   o Mislaid property—the owner of the place where the mislaid property is found has a right to the mislaid property good against all the world except the true owner
   o Abandoned property—the person who first takes possession of it becomes the new owner

Question 42

Curve Balls for Lost Property

Answer 42

o The finder is trespassing on the place where the property is found;
o The finder finds the lost property in a place where the public is not normally invited; or o The lost property is found during the course of the finder’s employment.

Question 43

Quasi‐Bailee

Answer 43

o Has the right to prevent anyone else, except the true owner, from interfering with her possession of the found property
o Duty to locate the true owner through reasonable means o Duty to keep the property with due care

Question 44

UTMA

Answer 44

 Permits a transferor to transfer personal property to a custodian who holds, manages, and invests the property for the benefit of a minor
 The custodian must distribute the property to the minor when the minor turns 18 or, if provided in the original transfer, when the minor turns 21.

Question 45

Jointly Held Bank Accounts

Answer 45

 General rule—the money belongs to the parties in proportion to how much they put into the account
 If the parties are married, they own the money equally.
 Both rules can be overcome by clear and convincing evidence that the parties intended for the
property to be divided in some other way.

Question 46

Bailments

Answer 46

 Definition—the transfer of personal property by one person to another person to hold for a defined period
 Transfers possession, but not title or ownership
 Three elements:
o The bailee must have physical possession of the property and the intent exercise control over it;
o The bailee must agree to the bailment; and
o The bailee must know of the personal property that is subject to the bailment.

Question 47

A parking garage is a bailee if

Answer 47

the car key is turned over to the attendant.

Question 48

Innkeeper liability:

Answer 48

o An innkeeper must take reasonable precautions to protect the property of the hotel’s guests.
o Liability is generally capped at $300 for property taken from a room occupied by a guest.

Question 49

Standard of care: bailments

Answer 49

o A bailment for the sole benefit of the bailor—the bailee is held to a standard of slight diligence; the bailee is only liable for loss or damages resulting from gross negligence.
o A bailment for the mutual benefit of the bailor and bailee—the bailee has a duty of ordinary care; the bailee is liable for loss or damages resulting from ordinary negligence.
o A bailment for the sole benefit of the bailee—the bailee is held to a standard of great diligence; the bailee is liable for loss or damages resulting from slight negligence.

 Strict liability:
o The bailee uses the property outside the scope of the bailment;
o The bailee removes the property from the place where the property was to be kept; or
o The bailee fails to return the bailed property in the condition it was in at the start of the bailment.

Question 50

Rights of bailee

Answer 50

o Right of possession
o Can bring a cause of action against any person, including the bailor, who interferes with the
bailee’s right of possession
o Superior to the rights of the bailor’s creditors

Question 51

Rights of bailor

Answer 51

o No right of possession
o Can sue the bailee for damage to the property if the bailee fails to meet the applicable
standard of care
o Can sue the bailee for failure to return the property at the end of the bailment o Can sue third parties who convert the property

Question 52

The bailor’s causes of action against the bailee:

Answer 52

o Conversion;
o Negligence; and
o Breach of contract.

 The bailor is NOT liable for how the bailee uses the property during the term of the bailment, even if it causes harm to a third party.

Question 53

Bailments:  Waivers and limitations of liability:

Answer 53

o Outright waivers are usually not respected by VA courts.
o Limitations may be respected if the bailee can show (i) the bailor knew or should have
known of the limitation and (ii) the bailor agreed to the limitation.

Question 54

Compensated bailment

Answer 54

the bailee can look to the bailor for extraordinary expenses, but not for ordinary and customary ones.

Question 55

The bailee can sue the bailor or a third party for _____ with the right of possession.

Answer 55

interference

Question 56

Defects that the bailor knows or should know about must be _____ to the bailee in a
compensated bailment, but not in a gratuitous one.

Answer 56

disclosed

Question 57

Bailments are terminated by:

Answer 57

Agreement;
Notice; or
Loss or destruction of the bailed property.