November 11, 2011
Delaware sues MERS
On October 27th, Delaware Attorney General Beau Biden filed a verified complaint asserting that MERSCORP, Inc., a Delaware corporation, has repeatedly violated the state's Deceptive Trade Practices Act. Delaware asserts that MERS's deceptive trade practices fall into three main categories:
1. Through its opaque registry of mortgages and assignments, MERS knowingly obscures important information from borrowers. This harms consumers because many borrowers do not know the true identity of the holder of their mortgage, which impairs their ability to raise defenses in a foreclosure action. It also makes it more difficult for borrowers to identify their lender to seek a modification.
2. MERS often acts as an agent without authority from its proper principal, in part because it "often" does not know the identity of its property principal.
3. "MERS is effectively a 'front' organization that has created a systemically important mortgage registry but fails to properly oversee that registry or enforce its own rules on its members that participate in the registry." The de-centralized structure of MERS has contributed to the robo-signing scandal and similar systemic breakdowns.
I have written about MERS before and am not a fan. You can download a copy of the Delaware complaint, an explanatory press release, and obtain other information at the Delaware Attorney General's website.
The Rise of the Mother-in-Law Apartment
The New York Times runs a story on the zoning changes that are making it possible for extended families to all live on the same lot:
California, Massachusetts, Vermont and Washington — have enacted laws encouraging or requiring changes to the zoning rules to permit the so-called accessory dwelling units.
Roger Bernhardt on Property Transactions:
Roger Bernhardt (Golden Gate) has published a flurry of short pieces on Real Estate Transactions:
Katz on The Regulative Function of Property Rights
Larissa Katz (Queens University - Canada) has posted The Regulative Function of Property Rights (ECON Journal Watch) on SSRN. Here's the abstract:
In this paper, I examine three different models of how we manage our common resources through a system of private property rights. One model (the exclusion approach) is to control owners’ decisions indirectly, through markets. Another model (the bundle-of-rights approach) is to regulate owners’ decisions directly, by setting out specifically what they can or cannot do. These first two models have in common their focus on the substantive decisions that owners make. There is a third approach that emerges from my own account of ownership as a position of exclusive agenda-setting authority. A distinguishing feature of this model is that it restricts the class of question that the owner may consider when dealing with the thing rather than the substantive answers that owners come up with.
November 10, 2011
Ballot Box Zoning
Over at Land Use Prof, our good freinds Matt Festa and Ken Stahl square off over voter initiatives and ballot box zoning.
Where the 1% Live
The Atlantic has a nice piece on the geography of the mega-rich:
A drill-down to the zip code level shows that the zip code with the largest number of very rich households is 10023 on the Upper West Side of Manhattan, with 7,621 such households. That zip code, plus one other on the Upper West Side, one on the Upper East Side of Manhattan, and the Washington suburb of Potomac, Maryland, each have about 0.2 percent of all the nation’s very high-income households.
Rounding out the 20 zip codes with the most very high-income households are several in Manhattan (on the Upper East and Upper West Sides, Midtown East, and Greenwich Village), the New York suburb of Scarsdale, Chicago’s Lincoln Park, Cupertino in Silicon Valley, the Houston suburb of Sugar Land, part of Houston’s west side, the Chicago suburb of Barrington, Princeton, a suburban area north of San Diego, and the Washington suburb of Bethesda, Maryland. Wall Street itself doesn’t make the list, since few people live there.
Festa on Academic Writing in a Doctrinal Land Use Course
Matt Festa (South Texas) has posted Academic Research and Writing as Best Practices in a 'Practically Grounded' Land Use Course (Pace Envtl Law Review) on SSRN. Here's the abstract:
Land use is a discipline that involves diverse academic, practical, and social perspectives; it is also an ideal subject for applying nontraditional teaching methods, including those suggested by the “best practices” movement in legal education. In this article - a contribution to the “Practically Grounded” conference on teaching land use and environmental law - I suggest that a scholarly research and writing focus can help students develop their practical and analytical skills and values while achieving “best practices” goals in the context of a doctrinal land use course. In the article I set forth a pedagogical basis for including an academic writing component in a doctrinal land use course; and I discuss the experience of teaching a large land use class with a significant research and writing component. The benefits from an academic writing focus may also apply to teaching in other doctrinal fields.
Halperin on Conservation Easements
Daniel Halperin (Harvard) has posted Incentives for Conservation Easements: The Charitable Deduction or a Better Way (Law & Contemporary Problems) on SSRN. Here's the abstract:
Therefore, to give greater assurance that the public benefit of the gift will be consistent with the claimed deduction, the donee should be required to certify that it has selected the easement consistent with its mission and it has both the resources to manage and enforce the restriction and a commitment to do so. Moreover, it is inappropriate to measure the charitable deduction by the supposed loss in value to the donor from the imposition of the easement. The focus should be on actual benefit to charity. Therefore, eligibility for a charitable deduction for a conservation easement should be contingent on certification – by a public agency or, possibly, an IRS-accredited land trust – that the public benefit from the contribution is equivalent to the claimed deduction.
In fact, the recent changes to various tax-expenditure programs – placing caps on the expenditures and requiring the participation of expert agencies – indicates that Congress is less enamored than it once was with open-ended tax expenditures administered solely by the Treasury Department. This suggests a cap on tax credits for the contribution of conservation easements. Even if the program is open-ended, Congress should mandate participation of an expert agency such as the Bureau of Land Management, which is more capable of evaluating the public value of an easement.
November 9, 2011
Case of the Week
Harrison v. Mayor and Board of Alderman of City of Batesville (Supreme Court of Mississippi)
Facts: A gravel company applied for a zoning variance to expand its mining operation to property adjacent to its current operation. Neighboring property owners opposed the action. The mayor and city board of aldermen approved variance, with certain restrictions. Property owners appealed.
Holding: The company failed to manufacture evidence of unnecessary hardship required for zoning variance, and the board of aldermen failed provide specific findings of fact and conclusions of law to support their decision.
Ruhl on The Endangered Species Act
J.B. Ruhl (Vanderbilt) has posted The Endangered Species Act's Fall from Grace in the Supreme Court on SSRN. Here's the abstract:
Thirty-five years ago, the Endangered Species Act (ESA) had as auspicious a debut in the United States Supreme Court as any statute could hope for. In Tennessee Valley Authority v. Hill, a majority of the Court proclaimed that the ESA was intended “to halt and reverse the trend toward species extinction, whatever the cost” and backed up those and other bold words by preventing a nearly completed federal dam from impounding its reservoir because doing so would eliminate the only known (at the time) habitat of a small fish, the now infamous snail darter. To this day, Hill remains actively discussed in judicial opinions, on environmental lawyers’ short list of important cases, a mainstay of law school casebooks, and a lively focus of legal scholarship. As it turns out, however, Hill has become the extreme outlier in the Court’s ESA jurisprudence. In a series of four decisions spaced out from 1992 to 2007, two focused on standing doctrine and two on statutory substance, the Court has silently but unmistakably eviscerated Hill, thereby knocking the ESA off its pedestal.
This Article is the first to examine the ESA’s remarkable fall from grace in the Court as a measure of where environmental values and environmental law fit in the Court’s jurisprudence and what that suggests for the design of environmental law. Part I of the Article provides brief overviews of the ESA, the cases, and the Justices’ voting patterns to situate the Court’s four post-Hill decisions in their jurisprudential contexts. The body of the Article then moves through three lessons Hill’s unruly successors have to offer. First, Part II uses the ESA’s slow demise as a window into the Court’s environmental values perspective, using what has happened to the ESA to illuminate and evaluate various legal scholars’ theories of how the Court views the environment as a context for decisions. Part III argues that the driving causal agent behind the ESA’s decline has been the evolution of the statute’s implementation from a novelty in environmental law to a robust regulatory program. The evidence from the ESA’s fall from grace, therefore, is that while it suggests the Court has at times been apathetic to, confused about, or hostile to the environment, the better explanation for what has happened to the ESA is that the Court is skeptical about environmental law. Part IV thus closes by extracting what can be learned from the history of the ESA in the Court about the design of environmental law, particularly those aimed at ecosystem protection and biodiversity conservation.
November 8, 2011
Is Co-Housing on the Rise?
From The Guardian:
The trend to build mixed use developments has morphed into "co-housing," the practice in which homes are built to share resources and space. One such development will soon break ground in Mountain View, the home of Google. . . . The 19 flats within this complex, 40 miles south of San Francisco, will have their own kitchen and washer-dryer hookups. Residents, however, will have the option to share laundry facilities, and a shared kitchen will encourage the scheduling of several communal meals a week. Additional shared indoor space will allow more social activities and entertainment.
Property Band Names
A band called "Real Estate" -->
Keith-Foust on Gentrification
Anita Keith-Foust (North Carolina Central) has posted Displacing the Poor to Benefit the Wealthy - The Role of Blight Designation in the 21st Century Gentrification of Hayti. Here's the abstract:
This paper presents an exploration of how a municipality designated a physically healthy African American area legally “blighted” to receive tax credits and other financial incentives. Drawing from historical and ethnographic research, it analyzes various ploys used to gentrify Hayti, a Black community on the southern side of Durham, North Carolina. It argues that although gentrification during the 1960s displaced residents under the guise of road improvements, the current gentrification is more blatant in its intent to create more wealth for the wealthy at the expense of the disenfranchised. This strategy denies the current residents the opportunity to benefit from the financial incentives of the blight designation while seizing their property for developers. The end result is displacement of African American residents, businesses, places of worship, and another generation of property owners deprived of their property rights.
November 7, 2011
Teaching Tip: Joint Tenancy = Borg
Hello after a long, long absence.
If you are using the ubiquitous Dukeminier textbook, you may well be approaching or already teaching concurrent interests. I find students have diffculty with the concept of the 4 unities of the joint tenancy, so I like to have some fun with it by analogizing the joint tenancy to the Borg, the ultimate foe from Star Trek: The Next Generation. (Oh, admit it: you're a geek too or you wouldn't be reading this blog).
Sometimes, I even play them part of this clip to make the point:
"Who are you?"
"I am the Borg."
"That is a contradiction. The Borg have a collective consciousness. There are no individuals."
"I am the beginning. The end. The one who is many. I am the Borg."
Like the Borg, in the joint tenancy, individuals are subsumed into the group, inseparable from the collective entity, and their deaths have no effect on the collective. It simply continues without them, leaderless.
And, for those of you are real Star Trek geeks, you can take it a step further and talk about what it takes to sever an individual from the group, and how even then, the dissolution may not be complete (in much less exciting terms, it creates a tenancy it common).
However, unlike the Borg, join tenancies are not the purest form of evil in the universe. At least as far as I know.
I have to tell you, they seem to get. Try it!
Mark A. Edwards
[Comments are held for approval, so there will be some delay in posting].
Another Complaint About Bikeshare Programs
I'm on record as a bikeshare hater (it's a real life Tragedy of the Commons!). I think they are a poor, poor way to spend public funds. Well, a friend recently asked me if the success of D.C.'s Capital Bikeshare had changed my mind. The answer, in short, is "no."
First, let's talk about the good stuff. People in D.C. seem very positive about their bikeshare program. By all accounts it's very well run; the bosses keep the bikes in good working order and are responsive to public suggestions. The program is also quite popular. In its first year, bikeshare signed up about 16,000 annual members and over 1,200 monthly members. In that span, users took almost 1 million rides.
But here's the problem -- the program is super expensive to run. The bikes cost around $1,000 a piece and have a lifespan of six years. Annual operating costs are somewhere in the ballpark of $2,000 per bike. Revenue doesn't cover overall operating expenses (and that doesn't count the initial expense of installing bike stations at roughly $50,000 a pop). Moreover, there are suggestions that most of the people using the bikes to commute were already using some form of green transportation (walking, buses, subway, etc) to get to work.
Again, why do we insist on spending public money on this kind of thing? If we really want to increase the amount of biking on the public dime, why not purchase bikes and just give them to poor people?
Weird Landlord-Tenant Hypo of the Week
A reader asks the Chicago Tribune the following question: My landlord comes into the house I'm renting to use the shower and groom himself. I feel so violated that I stopped paying rent, fo which he immediately served me eviction papers. What are my rights in this situation? Was I justified in not paying rent?
The paper's real estate pro responds:
My experience tells me that it is not a good idea to withhold the rent — regardless of the reason. . . . My suggestion: You should give your rent to a third party — usually your attorney — to hold in escrow. That shows good faith on your part. Clearly, however, your landlord has no right to interfere with your privacy and your right to peaceful enjoyment of the home. I hope you have a good attorney to defend you in the eviction procedure. I suspect you will prevail.
Ellickson on the Costs of Complex Land Titles
Robert Ellickson (Yale) has posted The Costs of Complex Land Titles: Two Examples from China on SSRN. Here's the abstract:
Chinese customs and law have traditionally prevented a land seller from conveying outright title to a buyer. The ancient custom of dian, which persisted until the 1949 Revolution, gave a land seller and his lineage an immutable option to buy back sold land at the original sale price. This little-analyzed custom discouraged soil conservation and land improvements, and, especially after 1600, contributed to China’s inability to keep pace with England.
After calamitous experiences with land collectivization between 1951 and 1981, China’s Communist government began to confer private land-use rights. But, instead of making outright sales, it chose to award contractual rights only for a fixed-term, for example, 50 years in the case of an industrial parcel. For the same reasons dian did, this policy threatens to impair China’s prospects of economic development.
Prum & Catz on High Speed Rail in America
Darren Prum (Florida State) and Sarah Catz have posted High Speed Rail in America: An Evaluation of the Regulatory, Real Property, and Environmental Obstacles a Project Will Encounter on SSRN. Here's the abstract:
In 2009, President Barak Obama allocated $8 billion in stimulus funding for high speed rail projects across the United States. One year later, in 2010, an additional $2.5 billion was distributed to corridors with High Speed Rail Projects. Even though the most recent congressional budget eliminated high speed rail funding, many corridors are working diligently to break ground by the end of 2012. Before a high speed rail project can be fully implemented there are many legal and environmental issues and regulations to examine. This paper conducts a complete analysis of those issues and regulations and suggests how to apply them to a successful high speed rail project.