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Property ClassPractice Midterm -- Sample Answers

Notes on Essay 1: Students get points for weaving the facts from the question together with the law from the cases. This is where the credit comes in law school issue spotting. For most of the elements of AP, there is some split in the law that I discussed in class and/or some ambiguity in the facts and how they would apply to those legal rules. For example, with state of mind: is this a jurisdiction where state of mind is irrelevant or is good faith required (in law or in practice)? What might be the effect of B’s statement or D’s under each of the rules? The median student answer often assumes that one rule is right and only analyzes the facts under that rule. The highest scoring answers spot the legal splits or factual ambiguities, and then analyze each branch separately.

Generally, most students’ give well-organized answers for adverse possession issue spotters in that they analyze each element in turn. I like seeing brief headers, useful to keep the answer on track. Otherwise, students sometimes discuss legal issues under one heading, say actual entry, but then use the tests and apply facts relevant to another, such as continuity. Sometimes students have long unnecessary summaries either at the beginning or the end or both, and then recapitulate those points in the balance of the essay. I only give credit for a point once, so I encourage you to save the space and time: make the point and move on. I also encourage you not to waste time with full case cites: put just enough to identify the case. Some write lengthy legal summaries but do not apply the law to the question. Or less usefully, some give summaries of the facts of cases in the casebook. These don’t score points.

Notes on Essay 2: On the “happy commons” policy question, generally, the strongest answers connect concrete examples with bigger themes such as the benefits of a commons in a state of abundance. Don’t assume I want my own writing read back to me. In this essay, discussing the anticommons seems mostly off point; defining the Liberal Commons without connecting back to the question is also off point.

Overall: I give checks where there is an on-point application of the facts in the question to the relevant law. I calibrate what counts as enough analysis to warrant a check by comparison with the other students’ answers on that element. A more subtle or deeper analysis of an element can earn another check. I don’t give checks for things that everyone got right or for basic statements of the law that aren’t connected to the facts. Sometimes, I put “x” alongside text to show that I considered it and decided it was off-point in some way. However, I don’t mark down for things that are wrong – the score is just the sum of the check marks.

The answer below is based on the top 3 answers from a big section some years back. I combined the best points from each and deleted half (or more) of each top answer that was repetitive, wrong, or over-long. Also, at 800 words, this is longer than students were allowed on this practice exam, but I wanted to make available a comprehensive sample answer. On the actual final, there is no word limit.

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Answer to Practice Midterm Essay 1 – Adverse Possession

A. HAS 10 YEAR PERIOD RUN?

As a threshold issue, it makes sense to first consider whether the statute for AP has run.

If not, Charlie’s re-entry ends the dispute before it even starts.1 If the SOL is 10 years as E says,

the period in question runs from March 2003 to March 2013, so it perhaps has run. While use of

the football field and deck construction began in March 2003, the exact dates matter. The burden

is on D&E to show that A and B carved out a football field ten years and a day before C filed his

ejectment suit. If the statute has not run, C can kick you off his land, and the adverse possession

discussion is unnecessary. If we can show that the SOL period has run, you have two possible

AP claims: (1) for the whole lot based on the touch football games and garden and (2) for 2 feet

based on the deck encroachment.

B. ACTUAL ENTRY

It is questionable whether playing football constitutes actual entry. The majority rule

states that the AP need not occupy the entire land, but generally the APers must use it as would

an ordinary owner, according to the majority rule. Sporadic football games might amount to

actual entry, depending on how the land was used. Factors that would be useful in considering

this issue include: was the field unkempt or mowed from border to border? Were permanent field

goal posts put on the land? Were lines chalked into the ground? However, if the rules in NC are

similar to New York under Lutz, then the land would have to be "usually cultivated or improved”

and the adverse possessors would have to use the entirety of the land, which might not have been

the case here. The fact that the garden was used in conjunction with the football games (aside

from the occasional trampling of poor Doug’s begonias) seems to indicate that the entire lot was

1 As a general note, you would not want to answer this question in the affirmative. Try to avoid answers that totally shut off the issues at play. Even if you think the 10 years hadn’t run here, you would want to say something along the lines of: “In the event that the 10 years had run . . . .”

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not being used for the football games. Since garden use did not begin until 2007, it might be the

case that the statute has run with respect to the area used for football, but not for the area used for

gardening. Finally, as to the AP claim for the deck, there was actual entry.

C. OPEN AND NOTORIOUS

The football use would seem to count as open and notorious, because it is the sort of use

that would put a reasonably attentive landowner on notice that an AP claim had started running.

Unlike Marengo Caves, a reasonably vigilant owner would see strangers crossing onto and

occupying his land year-round (as the football games were played rain or shine, all year long).

Moreover, if changes were made to the land (such as chalk lines), notice would be present even

in the players' absence. On the encroachment claim involving the deck, under Manillo, small

encroachments like a two foot strip may be held not to be open and notorious. If NC follows that

minority rule, you would have to prove that C had actual knowledge, which is exceedingly

unlikely; the better rule requires only inquiry notice in a case like this where the building of the

deck would put the homeowner on notice.

D. ADVERSE AND UNDER A CLAIM OF RIGHT

What state of mind does NC require? Under the objective test, state of mind should not

matter, and D/E would be more likely to win. However, Helmholz showed that, in practice, bad-

faith APers rarely win, so your claim might be in trouble regardless of the legal standard if E's

statement is seen as bad faith. If NC follows the Maine rule, there is another issue revolving

around who the APer is in this case. If it is the football players as a group (perhaps more likely

given that A&B didn’t seem to use it without the whole group), B’s comment might not matter as

long as some of them intended to AP. If it is just A&B, then B’s comment might defeat the

original period of AP, meaning the AP didn’t start until 2007 with D&E (but there is uncertainty

there as well given D’s nodding). On the deck encroachment, however, bad faith is not evident

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(we need to check if A/B surveyed land, etc), so this AP prong would be met if the court uses the

objective test (as Manillo held) rather than the Maine rule requiring bad-faith AP.

E. CONTINUITY

With respect to the deck, if the statutory period has passed, the continuity requirement is

likely met. Even if not, D/E might still be “mistaken improveCrs” of the two feet. They would be

obligated pay FMV to C (Manillo), or nothing if the intrusion is de minimus. For the lot as a

whole, the football games are not constant possession but are likely sufficiently regular (also

considering they did more than play football, including picnicking and partying on the land).

This is analogous to summer use in Kunto. Also, per Kunto, D/E should be able to tack their

possession onto A/B, because the purchase/sale relationship creates vertical privity. We should

check if C's time in the military is a qualifying disability, which might defeat the claim.

However, this is unlikely. Granting the land to D&E is more consistent with sleeping theory

(penalizing C), earning theory (rewarding D&E for productively using the resource), and even

perhaps Singer’s reliance interest (honoring legitimate expectations of football players).

F. CONCLUSION

The AP claim as to the football field presents some challenges if bad-faith state of mind

is required. Moreover, in a court, there would likely be some equitable consideration of the fact

that C was in the military and allowing AP of property owned by people serving this country

might be socially suboptimal. The encroachment claim is stronger if the jurisdiction follows the

majority rejecting the Maine doctrine and the odd Manillo “actual knowledge” requirement.

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Answer to Practice Midterm

Essay 2Time Limit: 35 minutes.Target length: 500 words (about 2 double spaced pages).

Garrett Hardin in The Tragedy of the Commons explains why common ownership often leads to overuse of scarce resources. Harold Demsetz in Towards a Theory of Property Rights argues that switching to a private property regime may help people conserve resources and overcome tragedy.

Explain the conditions under which common management of scarce resources may not lead to such bleak outcomes. Where appropriate, note also how property law can facilitate happy commons property results. Draw on concrete examples and theoretical arguments from the casebook and other assigned readings.

Essay 2 – Happy Commons

A. Abundance. According to economics-oriented legal scholars, commons management

is most appropriate when resources are in abundance and there is no problem with waste. In that

case, there are few externalities imposed by individual resource use, and little reason to incur the

costs of converting to a private property system. For example, the vast lands owned in common

by Native Americans prior to fur trade were used in a way that did not create substantial conflicts

among people, so creating private property was not worthwhile. According to Demsetz,

switching to a private property regime entails transaction costs, e.g. the costs of setting up the

property regime, and those costs must exceed the gains from internalizing externalities before it

make sense to convert away from the commons. Ellickson gives the example of the cost of

stringing barbed wire on the open range. Before barbed wire, rangeland was held in common in

an economically efficient manner. After barbed wire became available as a cheap way to mark

private property boundaries, the switch to a private property regime was less costly.

B. Pooling and Risk Spreading. According to Ellickson, common ownership can also

help people pool risks and spread out their effects to all members; in other words common

ownership can in some circumstances act as a form of insurance. Everyone will either starve or

survive together, such as with the high-risk Pioneer settlements in Jamestown. When they first

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move out West, people may prefer to own in common to minimize risk from disease and because

it is easier to protect from outside attacks. Defense may be easier when people can cooperate in a

group. Moreover, Ellickson argues that there may be economies of scale in commons

management---members will not have to incur enforcement costs for policing individual private

property boundaries, but instead can share the cost in policing a common boundary.

As discussed in Dagan and Heller’s Liberal Commons, co-owned land may be another

example, where there are gains if the co-owners can manage to use the property cooperatively.

Partition sales suggest that the value of the resource may be higher when used as a single unit, as

compared to being broken up into smaller parcels. Perhaps property law could facilitate

cooperation by making partition somewhat more difficult: in other words, to make it a second,

rather than first, choice for co-owners. Similarly, oil unitization serves as an example of a sort of

quasi-commons ownership with a regime to keep the unit's members from extracting too much

oil. By doing this, unitization avoid a tragedy of the commons that would result from the old rule

of capture, where everyone tries to plunge their wells into the ground and extracts the oil too

quickly.

C. Non-economic benefits. Managing resources in common may serve non-economic,

but utility maximizing functions, such as encouraging people to adopt more of the “plural self”

view. Similarly, Rose suggests that managing resources in common may satisfy certain

communitarian values, desires people have to work together, that may outweigh in some

circumstances the gains from converting to private property. Banner’s example regarding the

Maori in Two Systems also suggests non-utilitarian advantages---religious and political---that

communal ownership may foster. Converting to private property may indeed eliminate the social

gains from locking people together and forcing them to work it out.

D. Norm-driven Commons. Ellickson's Order Without Law also shows how tragedy of

the commons may not occur when there is a close-knit community with informal norms, repeated

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transactions, and informal self-help. There, farmers in Shasta County kept each other in check

from abusing the grazing lands and disturbing cooperative use of resources through an elaborate

system of informal norms, policing by negative gossip and so on. In this context, the formal law

of private property operates as a safety net when norms break down.

Acheson's Lobster Gangs in Maine article also illustrates this concept by showing how a

group can informally manage commons property with their own policing rules. Small close-knit

groups can create successful commons ownership situations because there are lower transaction

costs when they negotiate with one another, both because there are smaller numbers and because

they are familiar with each other. Also, the members are somewhat more likely to internalize

their externalities even without private property because they seem to care about the interests of

their co-owners and their future generations. The downside to this, however, might be inefficient

interest group preservation (i.e. the group behaves inefficiently by trying to perpetuate itself).

Still, privatization carries substantial costs (policing, judicial intervention, opportunistic

behavior) that communal ownership might help hem in. One must also consider the nature of the

resource: Maine lobster gangs, though hostile to outsiders, have been able to provide lobsters for

commercial purchase, while not overharvesting. By contrast, the whaling industries of various

countries nearly destroyed the whale population (and would have if not for regulatory

interventions). As Acheson writes, the "problem is not 'common property' but open-access with

no controls on usage."

E. The Liberal Commons article suggests a general framework within which law

operates as a background safety net to support successful management of resources by groups.

Corporations, trusts, partnerships, co-ownership, and marriage can be seen as concrete legal

forms of limited commons property. By attending to background rules on individual

management, self-governance, and exit within each form, subtle legal distinctions may have

substantial effects in promoting the social and economic gains possible from cooperation. For

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example, the rule in Spiller likely promotes a race to occupy co-owned property and leads to

partition. By contrast, the minority default rule in Cohen (and in the Continental tradition), that

the occupying co-owner owes rent to out-of-possession co-owners, likely facilitates co-operation

regarding the co-owned resource and its preservation as a liberal commons.

1 Practice Exam

Part 2 – Estates and Future Interests

Time Limit: 30 minutes.

Notes: (1) The words "and heirs" are not necessary to create a fee. (2) The fee tail is a valid, recognized estate. (3) The early common-law prohibition of executory interests is abolished. (4) The Rule in Shelley’s Case, Doctrine of Worthier Title, Destructibility of Contingent Remainders, and Rule Against Perpetuities are all abolished. These questions are harder than those on the final will be. Also, on the final, there will not be questions that are linked, like problems 3-6. On the final, estates and future interests will be about 12-15 multiple choice questions out of about 50 questions total.

For problems 1 and 2, assume that in his will, T devises Blackacre “to A for life, then to A’s children and their heirs.”

1. At the time of T’s death, A has two children B and C. On T’s death, B and C own what?

a. CR in a FSSELb. CRSO in FSD*c. VRSO in a FSSELd. VRSTD in a FSDe. None of the above

2. Then B dies, survived by a spouse D and child E. B’s will devises everything to D. A has another child F. Then A dies. Given the modern presumptions, who owns what?

*a. C, D, and F are TIC with a PI in FSAb. C and F are TIC with an EI in FSAc. C and F are JT with a PI in FSAd. D and F are TIC with an EI in FSAe. None of the above

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For problems 3-6, assume that T devises Blackacre “to A for life, then to A’s children and heirs, and if any child dies in the lifetime of A, such child’s share shall go to his or her issue who survive A.”

3. At the time of T’s death, A has two children B and C. On T’s death, who owns what?

a. B and C have a VRSO and STD in FSSELb. Unborn children of A could be said to have an EI in FSSELc. Unborn issue of A’s children could be said to have an EI in FSA*d. All of the abovee. None of the above

4. B dies leaving a spouse D and child E. B’s devises all B’s stuff to D. What interest, if any, does D own at this point?

a. CRb. VRSOc. VRSTD*d. VRSO and STDe. None of the above

5. C dies survived by spouse F and no issue. C devises everything to F. What interest, if any, does F own at this point?

a. CR*b. VRSOc. VRSTDd. VRSO and STDe. None of the above

6. A has another child G. Then, A dies survived by D, E, F, and G. Who owns what?

a. D, F, G each have a 1/3 undivided PI as TIC in FSA*b. E, F, G each have a 1/3 undivided PI as TIC in FSAc. F and G each have a 1/2 undivided PI as TIC in FSAd. G has a PI in FSAe. None of the above

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7. O conveys Blackacre “to A, B, and C as joint tenants with right of survivorship.” Then B conveys her share to E; then C dies leaving a will devising all her interest in Blackacre to H. Assuming O’s initial conveyance created a joint tenancy, A now owns:

*a. 2/3 share in a TIC with Eb. 1/2 share in a TIC with Ec. 1/2 share in a JT with Ed. 1/3 share in a TIC with E and H e. None of the above

8. O conveys Blackacre “to A for the duration of B’s life, and if B dies, then to C and his heirs so long as Blackacre is used for school purposes.” Who owns what?

a. A owns a PI in a LEPAV; C owns a CR in FSD, O owns a POR in FSA*b. A owns a PI in a LEPAV; C owns a VR in FSD; O owns a POR in FSAc. A owns a PI in a LESEL; C owns an EI in FSD; O owns a POR in FSAd. A owns a PI in a FSSEL; C owns a EI in FSD; O owns a POR in FSAe. None of the above

For problems 9 and 10, assume that O conveys $10,000 “to X as trustee, in trust to A for life, then if B survives A, to B; but if B does not survive A, then to C if C is living on A’s death.”

9. Immediately after the conveyance,

a. B and C each have a CR in FSAb. B and C have alternative CRs in FSAc. O has a reversion in FSA*d. (a) and (c) are both correcte. (b) and (c) are both correct

10. B dies while A is still alive. Then A renounces the income from the trust. What does C own?

a. PI in FSAb. CR in FSA*c. EI in FSAd. PI in FSSELe. None of the above