Legl Test 3

Accession

Refers to something “added. When the owner of an old airplane engine has it restored and has an airplane built around it, the owner of the engine now owns the entire airplane

Adverse Possession

Gives you ownership of land (and it only applies to land) under state statute when the possession is as follows: 

• Open and notorious. The possessor must occupy the land in such a way as to put the true owner of the land on notice.  

• Actual and exclusive. The possessor must physically occupy the land. However, the building of a fence around the land or construction of a building on it constitutes physical occupation.  

• Continuous. Possession must not be interrupted.  

• Wrongful. The possessor must not have the owner’s permission to be on the land, for example, under a lease.  

• For a prescribed period of time. Most states specify 10 to 20 years

Artisan’s Lien

When someone who contributes parts and/or services to an object of personal property is not paid. For example, if an automobile owner takes the vehicle to a repair shop but cannot pay when the work is finished, the garage can legally refuse to release vehicle. 

Possessory - the lien has priority only as long as the creditor keeps possession of the collateral 

Attachment

simply means that the security side of the agreement is complete and legally enforceable.

Rules of Attachment

takes place when  

• (1) a secured party has given value 

• (2) the debtor owns the collateral 

• (3) a security agreement is given. 

Bailee

possessor of the object

Bailor

Owner of the object

Sole Benefit of Bailor

Bailee owes only a slight duty of care

Sole Benefit Of Bailee

Bailee owes a very high duty of care, one that is greater than merely what is “reasonable

Buyer in The Ordinary Course of Business

a bona fide purchaser who in a normal or regular business procedure buys goods from a seller in the business of selling goods of that kind

Collateral

a debtor who agrees to give the creditor a security interest in a valuable object, called…

Confusion

rises when fungible goods (i.e., goods that are identical) are mixed together. The common example involves grain in a silo when two or more batches of separately owned grain are mixed together. If occurs by honest mistake or agreement, the owners of the originally separate goods now own a proportional share of the confused goods

Rules of Contract

The rules under which people exchange resources in a property system

Deed

the document of title that transfers ownership of land. Contains a precise legal description of the land that specifies the exact location and boundaries according to a mapping or surveying system.

Deeds of Trust

An agreement between the borrower and a lender to have the property held in trust by a neutral and independent third party until the loan is paid off.

Deficiency

if foreclosure and auction do not produce enough money to satisfy the debt owed by the mortgagor, the creditor-mortgagee can still sue the debtor for the balance owed,

Easement

places a particular use of land behind the exclusive legal fence. Usually, this use involves the right of passage across the land—for example, when a timbering company has purchased the right to bring its harvest of trees out across an owner’s land. Once acquired, the timbering company can exclude others, especially the titleholder of the land, from interfering with passage of its trucks across the land.

Easement by Necessity

At common law, owners of land also had a natural easement to get from their land to the nearest public road. 

Negative Easement

Means that an adjoining landowner cannot do anything that would cause your land to cave in or collapse, such as digging a ditch that would cause the land on your side to collapse 

Easement by Prescription

arises when one person has used another’s land, such as by crossing it openly, wrongfully, and continuously for a period of years (frequently 20), and once an easement by prescription arises, a titleholder of the land can no longer prevent a person from continuing to use the land by crossing it. The titleholder cannot now use the land in such a way to prevent the easement holder from crossing it, and the easement holder can legally exclude a titleholder from trying to prevent passage 

Estate

The bundle of rights and powers of land ownership

Fee Simple

You own the land for life. represents the maximum estate allowed under law, the owner having the fullest legal rights and powers to possess, use, and transfer the land

Fee Simple Absolute

estate has no limitations or conditions attached

Fee Simple Defeasible

estate may have a condition attached to its conveyance (transfer) 

For example, a seller may convey land to a buyer “as long as it is used for agricultural purposes.” If the new owner (buyer) develops the land for other than agricultural purposes, the ownership goes back to the original owner (seller) 

Financing Statement

way of perfecting a security interest. Should contain the names and addresses of the creditor and debtor, a reasonable description of the collateral, and the signature of the debtor

Fixture

an object of personal property that has become an object of real property 

• (1) by physical annexation (attachment) to the land or its buildings 

• (2) because its use has become closely associated with the use to which the land is put. (Manufacturing equipment in a building)

Foreclosure

the exercise of the secured property interest, and usually means that the creditor must go through the court system to ensure that procedures are properly followed before debtors lose their homes and land. 

Gift

something someone gives to you. a donor, who owns something, gives it to a donee, who becomes the new owner. 

Testamentary Gift

A gift made through a will

Intangible Personal Property

applies to nonphysical things, particularly various types of valuable information. Patents, copyrights, trademarks and trade secrets

Joint Tenancy

have equal ownership shares. have the right of survivorship. This right means that if one of the tenants dies, the remaining tenant becomes the sole owner of the entire resource 

Tenancy in Common

can own different shares of the resource (e.g., two-thirds and one-third), no right of survivorship

Land Sales Contract

the owner of land sells it by contract subject to the condition that the seller retains title to the land until the buyer pays the purchase price. Until that time, the buyer has the legal right to possess and use the land and is responsible for paying taxes and insurance. Often used for unimproved land and farmland

Leasehold Estate

The property right granted to tenants by a landlord. Tenants have a qualified possession, use, and transfer of the land, qualified in that they cannot waste the land, which means do something that substantially reduces the value of the land. 

Life Estate

Grants an ownership in land for the lifetime of a specified person. “To Brodie Davis for her life” grants such an estate. Upon Brodie Davis’s death, the land reverts to the original grantor who is said to keep a reversion interest in the land. Present interest

Remainder Interest

If the land goes to someone other than the original grantor upon beneficiaries' death, that person has this future interest

Mechanic’s Lien

Arises when someone contributes materials and/or services to real estate, usually a building, and is not paid. Unlike the artisan’s lien, this lien is not possessory and has priority only if it is perfected by the filing of a written notice, usually in the county where the real estate is found 

Mortgage

an agreement between you and a lender that gives the lender the right to take your property if you fail to repay the money you've borrowed plus interest

Mortgagees

The creditor, someone giving out the funds in exchange for promise of repayment and collateral

Mortgagor

Debtors, someone receiving funds and having to repay or be forced to give up their collateral

Ownership

the act, state, or right of possessing something

Perfection

arises when a security interest has attached and the creditor has taken all proper steps required by Article 9

Personal Property

applies to movable resources, those things that people do not annex to the land.

Private Nuisance

Any unreasonable use of one’s property so as to cause substantial interference with the enjoyment or use of another’s land

Property

The legal right to exclude others from resources that are originally possessed or are acquired without force, theft, or fraud.

Public Nuisance

Nuisance arising from some use of land that causes inconvenience or damage to the public. For example, discharging industrial waste from one’s land that kills the fish in a river constitutes this since fishing rights are publicly held. Claims may be brought only by a public official, not private individuals, unless the latter have suffered some special damage to their property as a result of this

Purchase Money Security Interest

a legal claim that allows a lender to either repossess property financed with its loan or to demand repayment in cash if the borrower defaults. It gives the lender priority over claims made by other creditors.

Real Property

applies ownership to land and interests in land such as mining rights or leases

Right of Redemption

allows the mortgagor to get back the land upon payment of the full amount of the debt, including all interest and costs

Rule Against Perpetuities

limits all exercise of property over resources to a duration of “lives in being plus twenty-one years. The rule prevents an owner from controlling resources through many future generations by setting up trust arrangements, under which trustees are legally required to carry out the wishes of the owner for extended duration 

Rule of First Possession

the first person to reduce previously unowned things to possession becomes their owner.

Secured Transactions

an agreement between two parties in which one of the parties gives property (other than real estate) as collateral, or security, for a loan.

Security Interest

a legal claim on collateral that has been pledged, usually to obtain a loan, that gives a creditor the right to repossession.

Tangible Personal Property

Applies to physical things. Computers, cars, and carrots

Title

The concept of legal ownership that the deed grants you.

Zoning Ordinance

laws that divide counties or municipalities into use districts designated residential, commercial, or industrial 

Variance

An owner can ask a zoning board for this to allow use of land in a way not permitted under a zoning ordinance

Briggs v. Southwestern Energy Production Co

The Briggs family are the owners of property in northeastern Pennsylvania. Although many Pennsylvania landowners have leased their land to natural gas extractors, the Briggs have never done so. However, an adjacent piece of land was leased to Southwestern Energy Production (“Southwestern”). According to the Briggs, Southwestern used “hydraulic fracturing” techniques to extract natural gas from underneath the Briggs’ land by pulling it over to the adjacent land. The process is something like a using a sophisticated straw. The Briggs sued Southwestern for trespass for intruding on their subsurface rights and taking “their” natural gas. The court had to determine whether Southwestern's acts were protected by the “rule of capture.” Although followed in some other states, a lower court determined that Pennsylvania would not apply this rule to hydraulic fracturing 

• The court refused to hold Southwestern liable for a technical trespass under the Briggs’ land. It determined that the nature of subsurface rights required a showing of some physical intrusion.  

• The court determined that, even though hydraulic fracturing is more sophisticated and powerful than traditional well drilling, the “rule of capture” still applies.  

• Other jurisdictions that are home to significant gas and oil extraction activities, such as Texas, follow the same rule 

Duke Energy Carolina’s v Gray 

In 2006, a part of Herbert Gray’s new house was inadvertently built on Duke Energy’s power line easement—referred to as an “incorporeal hereditament”—that was conveyed 50 years earlier. Duke wanted Gray to move his house, but Gray argued that Duke did not act quickly enough to reclaim its right to the easement. Supreme court ruled that this was not a trespass question rather than an adverse easement instance so 20 years applied rather than the 6 year trespass period.

• An easement is entitled to the same legal respect as other forms of real property.  

• One may acquire another’s real property by claiming the property and occupying it (adversely possessing) for a long period of time so long as the original owner does not take action to evict.  

• The time period required to acquire ownership in real property through adverse possession is typically much longer than the time period to be free of liability in a trespass case. 

Cook v Sullivan

The defendants, John and Diane Sullivan, appeal a decision of the Superior Court finding that they created a nuisance on the plaintiffs’ property by filling in wetlands and constructing a home on their property. Caused neighbors land to become wet and flood parts of their house. Court rules in favor of neighbors and Sullivans have to move house.

• The Sullivans transformed their property to support a new house, but this had the effect of unreasonably and substantially harming the Cooks’ property. They did not internalize the costs of their behavior.  

• The water that flooded the Cooks’ property did not necessarily flow from the Sullivans’ property. If it had, the water might have constituted a trespass rather than a nuisance.  

• If the Sullivans had provided the court with another option other than moving their house, the balance of hardships might have come out differently 

Intellectual Property

Classification of intangible personal property. Copyrights, patents, trademarks

Popov v Hayashi

In 2001, Barry Bonds hit his record-breaking 73rd home run, and the ball was caught by Alex Popov. However, a group of fans, including Patrick Hayashi, attempted to grab the ball, and a scrum ensued. The ball eventually ended up in the possession of Patrick Hayashi.

Popov filed a lawsuit against Hayashi, claiming that he had a right to the ball because he had initially caught it and it was his property. Hayashi argued that he was entitled to the ball because he had secured it after it was dropped by Popov during the chaotic scramble, and therefore it was abandoned property.

The court had to determine whether Popov's initial possession constituted ownership, or if Hayashi's possession was legitimate due to his retrieval of the ball after it had been dropped. The case raised questions about the legal concept of "finders, keepers" and whether a brief, momentary possession of the ball by Popov was sufficient to establish ownership.

Ultimately, the court did not provide a clear resolution to the dispute. It found that the ball was a valuable piece of property and that neither party could establish clear ownership. As a result, the court ordered that the ball be sold at auction, and the proceeds would be divided equally between Popov and Hayashi.

Pierson v Post

• Pierson is out fox hunting and they chase it all day, have the fox exhausted and cornered and Pierson goes in for the kill 

• Post pops out from behind a bush and shoots the fox, Post grabs the fox and says he’s the hero 

• Judge sides with Post since he shot it 

• Judge creates rule that pursuit and wounding is not enough 

Swift v Gifford

• Swift and his men throw Harpoons into whale  

• Gifford shows up in his whaling boat and throws Harpoons into whale 

• Gifford wins tug of war and pull whale to his boat and kill it 

• Swift sues 

• Whalers testify as expert witnesses 

• Whalers say they have a saying “first iron holds the whale” meaning since Swift came up on the whale and harpooned it first Gifford should have backed off. INDUSTRY CUSTOM

• Judge gives the whale to swift 

Ghen v Rich

• New technology in Whaling results in reexamining of prior precedent 

• Bomb-lance kills whale in one shot, finback whale sinks to the bottom of the whale and Ghen leaves to hunt other whales 

• Rich takes the whale when it washes up and sells it at market 

• Ghen sues, tradition is that he should be able to go off 

• Judge calls in whaler 

• Tradition is it belongs to Ghen but Rich helped by bringing in the whale to processor. Rich gets a finders fee while Ghen gets money from processor 

• Each whaling company engraves symbol on bomb-lance to mark it, early example of trademarks 

• Judge upholds tradition 

Sock Alley Fight Case

Example of confusion of property, kids fight over sock filled with money that blows up. Since no one had ownership they split money

Trial of Willie Merdith “Drone Slayer”

• David Boggs flies a drone over Willie Meredith’s house and Willie shoots it out of the sky 

• Willie is arrested for firing the gun, Boggs sues for cost of drone 

• Drone was invading air rights 

• Judge dismissed the case and Willies charges were dropped 

• Court threw lawsuit out because federal court did not have jurisdiction and David dropped the suit 

US v. Causby

Causby was a chicken farmer who had coop on his property and right next to the property was govt land that used to be a WW1 airstrip. Causby’s buy and build the farm while the airstrip isn’t being used. In WW2 the govt starts using it again, at the lowest point after takeoff planes are at least 83 ft from the ground.  

• Romans had a Latin saying meaning your airspace was from heaven to hell 

• English common law said whoever owns the soil owns the sky 

• Airtraffic laws said that you owned 500 ft of airspace during the day, 1000 ft at night 

• Court says you own as much as you can “occupy or use in connection with the land” 

• Causby wins and the govt has to buy his house 

Rule of Capture

a legal doctrine in property law that states that a person who captures a natural resource, such as groundwater or wild animals, acquires legal ownership of that resource, even if it was previously unowned. This rule often leads to a "first in time, first in right" principle, where the first person to capture the resource is entitled to it.

Correlative Rights

refer to the shared rights and responsibilities of mineral rights owners in a common oil reservoir. These rights ensure that each owner has a fair opportunity to extract their proportionate share of the oil without causing waste or harm to others sharing the same reservoir.

Prior Appropriation

mainly in western states, can do whatever you want with water on your property 

Riparian Rights Doctrine

A party can use water for reasonable uses but has to allow a reasonable amount of water to continue to flow downstream 

Mario Williams Case

Fiancée tries to keep ring after engagement called off, Mario sues. Settled out of court. Texas was a fault-based return state

Test For Gifts

Test for gifts most states use combination of 3

• Gift requires donative intent – recipient always keeps (only state in Montana) 

• Conditional Gift – recipient must return (condition is marriage) 

• Condition fault-based return – fault-based return 

Montana

Only state that follows exclusively the gift requires donative intent doctrine allowing the recipient to keep the wedding ring no matter what.

Trust

establishes a special legal relationship where the money is specifically to use for the beneficiary of someone else. Way in which the tree that owns itself received its ownership (technically a descendant)

TRIPS

This agreement was formed in 1994 as part of the treaty that created the World Trade Organization (WTO). The United States has been a member since the agreement’s inception and was a major force in drafting its provisions. Requires that member countries provide protection for all of the forms of intellectual property discussed in this chapter.

Blurring

Occurs when firm uses another trademark in a way that blurs the distinctiveness of a famous mark. For example, even if a reasonable person would know the company behind “Google Lawn Service” was different than the search engine giant, Google would have a good argument that permitting the lawn service’s use would blur or reduce its trademark’s power 

Copyright

gives those who have this property a monopoly over the right to exclude others from copying and marketing for a limited period of time. Deals with original expression rather than invention

Design Patent

apply to the appearance of an article of manufacture, unrelated to its function. They cover subject matter more similar to copyright 

Digital Millennium Copyright Act

Makes illegal the effort to get around (circumvent) devices used by copyright owners to keep their works from being infringed. In particular, the act prevents the production, marketing, or sales of a product or service designed to circumvent technological protections of computer software, videos, and compact disks. The act also prevents circumvention of access protections for such products 

Economic Espionage Act

COVERS TRADE SECRETS FEDERALLY. The act makes it a crime to steal (intentionally misappropriate) trade secrets and provides for fines and up to ten years’ imprisonment for individuals and up to a $5 million fine for organizations. Only the federal government can bring a case

Fair Use

includes copying for “criticism, comment, news reporting, teaching (including multiple copies for classroom use), scholarship, or research

Generic

when, through the owner’s actions or another’s inappropriate use, the mark becomes synonymous in the consumers’ mind with the name of the goods or services. if it loses its distinctiveness, it also loses its status as a protected trademark.

Infringement

Civil violation of a trademark (or a patent). An unintentional or a willful unauthorized use, misappropriating the goodwill and reputation that the trademark represents and confusing the public about the identity of the user

Injunction

an order by a judge either to do something or to refrain from doing something. In the case of trade secrets, this orders those who have misappropriated the trade secret to refrain from using it or telling others about it.

Intellectual Property

a work or invention that is the result of creativity, such as a manuscript or a design, to which one has rights and for which one may apply for a patent, copyright, trademark, etc..

Lanham Act of 1946

This act protects the following marks used to represent a product, service, or organization:  

• Trademark—any mark, word, picture, or design that attaches to goods to indicate their source.  

• Service mark—a mark associated with a service, for example, LinkedIn.  

• Certification mark—a mark used by someone other than the owner to certify the quality, point of origin, or other characteristics of goods or services, for example, the Good Housekeeping Seal of Approval.  

• Collective mark—a mark representing membership in a certain organization or association, for example, the National Football League logo. 

Likelihood of Confusion

when the marks are so similar and the goods and/or services for which they are used are so related that consumers would mistakenly believe they come from the same source

Misappropriation

occurs when one improperly acquires secret information through burglary, espionage, or computer hacking. Also occurs when one discloses information that one had a duty to keep secret, even if the original acquisition was proper 

Patent

an inventive act, and conveys a right to exclude others from making, using, selling, or importing the covered invention. 

Patent Trolls

Out of the belief that such non-practicing patent owners are nothing more than a self-appointed toll-taker on a bridge, they have been widely referred to as this…

Piracy

Large-scale copyright infringement

Plant Patents

apply to new varieties of asexually reproduced plants

Tarnishment

occurs when a firm uses a trademark in a way that creates a negative impression about the famous company. For example, Ben & Jerry’s sued a distributer of adult films who wished to use the name “Ben & Cherry’s.” Even if no one would believe an actual connection existed, the ice cream company’s reputation for family fun could be tarnished. 

Trade Dress

refers to a color or shape associated with a product or service. i.e. the red color scheme of Coca-Cola, when associated with the general design of Coca-Cola labeling

Trade Secret

any form of knowledge or information that has economic value from not being generally known to others or readily ascertainable by proper means and has been the subject of reasonable efforts by the owner to maintain secrecy. 

Trademark

marks on what they produce to represent the origin of goods and services. Indicate a specific producer, the law protects them against use by others. 

Trademark Dilution

the use of a trademark or trade name in commerce that is sufficiently similar to a famous mark that by association it confuses or diminishes the public's perception of the famous mark.

Utility Patent

applies to useful, functional inventions