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Thursday, August 13, 2009

Marsh on Blackacre and Widgets: "Rethinking Commercial Real Estate Contract Remedies"

Tanya D. Marsh of Indiana University's Kelley School of Business has just posted "Sometimes Blackacre is a Widget: Rethinking Commercial Real Estate Contract Remedies," on ssrn.  Marsh's abstract is:

This Article argues that the presumption that all land is unique, a principle so embedded in the common law that it is “settled beyond the need for citation,” is wrong. The “uniqueness doctrine” is used to justify granting non-breaching purchasers of real property nearly automatic access to the remedy of specific performance without requiring a wronged party to prove that it has no adequate remedy at law. This powerful common law protection for non-breaching purchasers evolved for a variety of social and economic reasons. This Article makes the case that these historical reasons do not support the applicability of the uniqueness doctrine to modern commercial real estate transactions. Despite the illegitimacy of the uniqueness doctrine, this Article argues that allowing the parties to commercial real estate contracts to bargain for equitable relief is not only desirable, but consistent with legitimate doctrine, practical concerns, and the property rule/liability rule paradigm described by Professors Calabresi and Melamed. The instability of the uniqueness doctrine poses an immediate practical problem – any sudden change would cause significant problems and increased costs for the already-troubled $6.5 trillion American commercial real estate sector. This Article proposes that acknowledging the illegitimacy of the uniqueness doctrine is essential to preserving and enhancing the remedies regime relied upon by the industry.

I think you'll enjoy this. 

Al Brophy

August 13, 2009 in Real Estate Transactions | Permalink | Comments (2) | TrackBack (0)

Ostrow on Telluride and Eminent Domain

Ashira Ostrow (Hofstra) has posted Minority Interests, Majority Politics: A Comment on Richard Collins’ 'Telluride’s Tale of Eminent Domain, Home Rule, and Retroactivity' on SSRN.  Here's the abstract:

In his article, Telluride’s Tale of Eminent Domain, Home Rule, and Retroactivity, Professor Richard Collins skillfully parses many of the unique legal issues that confronted the Colorado Supreme Court in Town of Telluride v. San Miguel Valley Corp. In Town of Telluride the court affirmed Telluride's right to condemn and preserve for open space almost 600 acres of land located outside its geographic boundaries. This Comment, written as part of a Home Rule Symposium, expands on Professor Collins’ article, first, by framing Telluride’s tale of extraterritorial eminent domain through the lens of public choice theory, and, second, by arguing that extraterritorial condemnation, wherein a local government condemns land outside of its own geographic boundaries, necessarily implicates extra-local concerns. I conclude that a state perspective, though subject to its own political process failures, is better able to balance the inter-local and statewide interests at stake in cases of extraterritorial eminent domain.

Ben Barros

[Comments are held for approval, so there will be some delay in posting]

August 13, 2009 in Recent Scholarship, Takings | Permalink | Comments (0) | TrackBack (0)

Tuesday, August 11, 2009

Lefcoe on Restraining House Flipping

George Lefcoe (University of Southern California) has posted How 'Spec' Condo and Tract Home Buyers Helped Sink Our Housing and Finance Markets: Should the Alienability of Their Interests Be Restrained by Law? on SSRN.  Here's the abstract:

This paper begins by recounting the extent to which speculating buyers contributed more than proportionately to housing price volatility and the rate of mortgage foreclosure. The second section turns to the way spec buyers deceived mortgage lenders by committing occupancy fraud, claiming falsely that they were buying as owner occupants so they could benefit from more favorable mortgage rates and terms. The third section starts by describing the mischief spec buyers caused home builders and condo developers by signaling phantom housing demand, and degrading ‘for sale’ housing tracts and condo developments by leaving newly bought homes vacant or filling them with short term rentals. The fourth section explores the rationale for a government imposed ban on home flipping. This would be a publicly imposed constraint on alienability.

Ben Barros

[Comments are held for approval, so there will be some delay in posting]

August 11, 2009 in Real Estate Transactions, Recent Scholarship | Permalink | Comments (0) | TrackBack (0)

Reiss on Ratings Agencies and the Subprime Crisis

David J. Reiss (Brooklyn) has posted Rating Agencies: Facilitators of Predatory Lending in the Subprime Market on SSRN.  Here's the abstract:

This book chapter explores how the three largest rating agencies, Standard & Poor’s, Moody’s Investor Service and Fitch Ratings, exploited their privileged regulatory status to profit from the booming subprime mortgage market at the expense of homeowners. These rating agencies boosted their own bottom lines and assisted predatory lenders by effectively vetoing state consumer protection initiatives. While regulators have identified enhanced investor protection regulation of credit rating agencies as a priority, future regulation must ensure that the systemic biases of the rating agency industry are no longer permitted to trump legitimate state consumer protection initiatives.

Ben Barros

[Comments are held for approval, so there will be some delay in posting]

August 11, 2009 in Real Estate Transactions, Recent Scholarship | Permalink | Comments (0) | TrackBack (0)