October 4, 2005
Should We Have A Model Law of Property?
My students sometimes ask me why we don't cover more of the Restatements in our first year property class. In torts and contracts, the Restatements are all over the place. In property, they don't come up much at all, though I do cover the Restatement (Third) when I'm teaching servitudes. My answer varies, but is based on the following impressions: (1) there is far less uniformity across jurisdictions in property than there is in, say, torts and contracts; (2) the first two Restatements reinforced a lot of silly common law rules and as a result academics don't like them much; and (3) courts are less willing to change the common law of property than they are in other common law disciplines, so the Restatements of Property have had less impact than the Restatements of other subjects.
I don't have any real empirical support for these impressions, and feel free to correct me in the comments if you think I'm wrong about any of them. I've read enough property decisions to think that number 3 is true. Courts are always hesitant to upset expectations by changing the rules in mid-stream, and the long duration of many property relationships reinforces this tendency. Major change in property law, the courts often say, should be done by the legislature.
So if courts are hesitant to reform and rationalize property law, why do we keep doing Restatements? I'm generally a fan of the Restatement (Third) of Property, Servitudes. Among other things, abolition of the distinction between real covenants and equitable servitudes makes a great deal of sense -- the difference between the two is a relic of the division between law and equity, and it seems silly to have different rules if a covenant is going to be enforced through an injunction or money damages. Some courts might be bold enough to make such a radical change, but my bet is that most would not. So why be court-centric? Why don't we put the same substance into a Model Law of Servitudes and try to reform property law through the legislatures? Some legislative property reform might raise takings issues (a subject I'll address in a future post), but I have a hard time seeing that as a problem with servitudes reform.
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There is far more uniformity than one might at first think, but the reason not to have a model law of property is primarily that there isn't a need for one. Necessity is the mother of invention. Real estate, by and large, does present involve a lot of interstate transactions.
Uniformity has developed mostly through the back door, through federal direct regulation, the indirect influence of the bankruptcy code, and the commercial practices of Fannie Mae and Freddy Mac, in the lending process.
Imitation has also been a powerful force. For example, while tens of thousands of jurisdictions have zoning codes, the number of significant variants on the dominant theme probably number less than a dozen. Another area of major change, accompanied by signficant imitation, in property law, has been the law of condominiums. Prior to World War II, New York City co-ops were the principal example of multi-party resident ownership of a single multi-family residence building. Since the 1960s a very significant share of existing apartment buildings have gone condo and many new multi-family developments have been built from their inception on the condominum model.
There may not be a Model Law of Property, but there are certainly many model laws that are pertinent to property law practice.
Posted by: ohwilleke | Oct 11, 2005 9:26:02 AM
2006 August 19
My comments are limited to restrictive covenants as used in common interest developments (CIDs) and property owners associations (POAs). In my consideration of the property and organizational issues, I view the covenants, conditions and restrictions (CC&Rs) as the bridge between property and the POA which is a private government. In effect, the CC&Rs are the charter, or constitution, for the private government. However, CC&Rs are a poor way to define private government, which should be defined by statute in my view.
Purchasers of property units in CIDs are expected to read and understand the CC&Rs and their meaning. Many don't bother to read the CC&Rs, but most of those who read them likely do not understand the meaning given to some of the language by the common law. In essence, the CC&Rs are not to be given the common and ordinary meaning of the words. Even fewer purchasers will seek the advice of a lawyer in translating the meaning of the CC&Rs into plain and ordinary language.
At least as applied to CC&Rs used in CIDs, it would be very helpful to have statutory definition for the interpretation and application of the words — perhaps even a requirement that that interpretation be incorporated into each CC&R. Further, the concepts in the Third Restatement should be debated for inclusion in law governing the content in the CC&Rs or introduced separately as legislative requirements for CIDs.
My research suggests that, if such legislation focused on the fundamentals, there is already a high degree on commonality in the common law from state to state. Again, I stress that such statutory provisions be limited to application only to CIDs defined by CC&Rs.
Governance of Property Owners Associations
Posted by: Don Nordeen | Aug 19, 2006 5:53:53 PM