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Thursday, August 24, 2006

Questions on Property Rules, Liability Rules, and Hohfeld's Fundamental Legal Conceptions

I taught the first class of my property theory seminar today.  The material for the first class focuses on different ways to conceptualize property, and includes short readings on Hohfeld's fundamental conceptions and Calabresi & Melamed's property, liability, and inalienability rules.  Trying to draw the two together, I asked the students to think about how to express property, liability, and inalienability rules in Hohfeldian terms.  In A Theory of Property, Stephen Munzer has this to say on the subject (p.27, n.14):

Statements in Calabresi and Melamed's terminology can be paraphrased in Hohfeld's language.  If A's entitlement is protected by a property rule, then others have a disability (a no-power) in regard to obtaining the entitlement except at a price agreed to by A.  If A's entitlement is protected by a liability rule, then others have a disability in regard to obtaining or reducing the value of the entitlement unless they discharge a duty to compensate A ex post by a collectively determined amount.  If A's entitlement is protected by a rule of inalienability, A has a disability in regard to transferring the entitlement to others.

Munzer's approach seems accurate to me.  But are there other ways of doing it?  Take the basic facts of Boomer v. Atlantic Cement, with a polluting cement factory and complaining neighbors.  If the neighbors' entitlement not to be polluted-upon is protected by a property rule, could you say that the neighbors have a privilege not to be polluted-upon, and that the cement factory has a correlative no-right to pollute?  Similarly, with a liability rule, could you say that the cement factory has the power to alter the neighbors' position and the neighbors have a corresponding liability?  It seems that if the same relationships can be characterized in different ways, the usefulness of Hohfeld's approach is reduced -- the whole point is to have precision in the description of legal relationships.  So am I missing something in my understanding of Hohfeld's system when I characterize property rules and liability rules in this way?

Ben Barros

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