Tuesday, February 19, 2013

Eagle on 'Economic Impact' in Regulatory Takings Law

Eagle_stevenSteven Eagle (George Mason) has posted 'Economic Impact' in Regulatory Takings Law (West-Northwest Journal of Environmental Law & Policy) on SSRN.  Here's the abstract:

In Penn Central Transportation Co. v. City of New York the Supreme Court stated that the existence of a regulatory taking would be determined through “essentially ad hoc, factual inquiries,” and that one of three factors of “particular significance” was the economic impact of the regulation on the claimant. This article examines the conceptual problem whereby the Fifth Amendment requires compensation for the taking of property and not a fraction of its owner’s worth. The fact that economic impact of stringent regulations is greater when parcels are smaller has led to a complex “parcel as a whole” test that conflates impact with another Penn Central test, owner’s expectations. Furthermore, application of the impact test to parcels held as investment property might vitiate the temporary taking. The Federal Circuit’s recent abandonment of its prior “return on equity” approach is emblematic of this problem.

Measuring the economic impact upon owners also is complex where government condemns part of an owner’s parcel, leading to difficulties in computing severance damages. Broad assertions that “offsetting benefits” conferred upon property owners by government actions reduce the impact of regulations also requires clarification.

The article concludes that unresolved issues and complexities in adjudicating the “economic impact of the regulation on the claimant” test provide an additional reason why the conceptually incoherent Penn Central doctrine must be replaced.

Steve Clowney

February 19, 2013 | Permalink | Comments (0) | TrackBack (0)

Monday, February 18, 2013

The Loneliest Places on Earth

Gizmodo has pictures of the 20 most isolated buildings in the world.

Steve Clowney

February 18, 2013 | Permalink | Comments (0) | TrackBack (0)

Anderson et al on the Link Between Zoning and Crime

James M. Anderson (RAND Corp), John MacDonald (Penn-Criminology), Ricky Bluthenthal (Southern Cal-Medicine), and J. Scott Ashwood (RAND Corp)  have posted Reducing Crime by Shaping the Built Environment with Zoning: An Empirical Study of Los Angeles (Penn Law Review) on SSRN.  Here's the abstract:

The idea of using law to change the built environment in ways that reduce opportunities to commit crimes has a long history. Unfortunately, this idea has received relatively little attention in the legal academy and only limited rigorous empirical scrutiny. In this Article, we review the considerable literature on the relationship between zoning, the built environment, and crime. We then report the results of two empirical studies on these relationships. First, we conducted a study of the effect of zoning on crime using 205 blocks selected in eight different relatively high crime neighborhoods in Los Angeles that have similar demographic character- istics but different forms of zoned land use. We find that mixed commercial- and residential-zoned areas are associated with lower crime than are commercial-only zoned areas. Second, we matched neighborhoods undergoing zoning changes between 2006 and 2010 with neighborhoods that underwent no zoning changes during this period but had similar preexisting crime trajectories between 1994 and 2005. The primary zoning change in these neighborhoods was to convert parcels to residential uses. We find that neighborhoods in which there was a zoning change experienced a significant decline in crime. Our results suggest that mixing residential-only zoning into commercial blocks may be a promising means of reducing crime.

Steve Clowney

February 18, 2013 | Permalink | Comments (0) | TrackBack (0)

Sunday, February 17, 2013

Gun Violence, Property Taxes, and Community on Chicago's South Side

Although my field is comparative property law, today’s post is about a property issue a bit further from my expertise, and a bit closer to home. 

President Obama visited my neighborhood on the South Side of Chicago on Friday.  He came to give a speech on gun control at the Hyde Park Academy, a high school located just a twenty minute walk from President Obama’s Chicago home and a five minute walk from the University of Chicago Medical Center (UCMC), where Michelle Obama served as Vice President for Community and External Affairs.  Hyde Park Academy is also located at the edge of an area with one of the highest gun violence rates in the city of Chicago, which itself has one of the highest homicide rates in the country.  The speech was intended to emphasize that gun control is not only an issue of dealing with mass shootings of white children in small town Connecticut, but also everyday gun violence in urban areas across the country. 

Discussions about gun violence have been particularly common on the University of Chicago campus during the weeks leading up to President Obama’s visit.  On January 27, the university police arrested four high school and university students and alumni who were conducting a peaceful protest at the UCMC’s Center for Care and Discovery, a $700 million new building that the university has called the “largest single health care investment in [the] history of the South Side.”  The January 27 protest was part of a broader campaign by community and student groups to push the university to re-establish a Level 1 trauma center, which could treat victims of trauma-related injuries suffered as a result of things like car accidents and gun violence. 

Although the University of Chicago had a Level 1 trauma center decades ago, it was closed in 1988, with the university citing high costs.  The predominantly black and low-income communities on the South Side now possess no adult Level 1 trauma center, requiring victims of trauma on the South Side to be transported to hospitals elsewhere in the city to receive attention.  The need to re-establish such a center has been highlighted by a number of community organizations, one of the most prominent being a group of local students called Fearless Leading by the Youth (FLY).  FLY’s 18-year-old co-founder, Damian Turner, was hit in 2010 by a stray bullet three blocks from the UCMC, but died 90 minutes later, after a nearly ten mile long ambulance ride to Northwestern Memorial Hospital.  The university, however, has remained firm that an adult trauma center would imply excessive costs and that the difference in transport time is medically insignificant.

One of the arguments that has been raised in the debate over the trauma center is that the University of Chicago is tax exempt, but provides insufficient care (particularly trauma care) for the surrounding community to merit its exemption as a charitable organization.  As with other non-profit hospitals across the country, one of the charity-based exemptions the UCMC receives is from property tax.  (See this article by John Colombo for a detailed analysis of hospital property tax exemptions in Illinois.)  The issue of property tax exemptions for non-profit hospitals has become a lightning rod in Chicago, particularly since the 2010 Illinois Supreme Court decision in Provena Covenant Medical Center v. the (Illinois) Department of Revenue.  In Provena, a plurality found that the Department of Revenue had appropriately denied property tax exemption to a non-profit Chicago hospital due to its failure to exercise sufficient charitable use of the property.  Rejecting the “community benefit” test widely used for federal tax exemption (which had replaced the previous emphasis on providing free or heavily discounted “charity care” for the poor in favor of a broader standard that could include things like health education or research), the plurality found that the appropriate basis for property tax exemption was relief of government burden.  This relief could be provided in part through charity care, understood as a “gift” for the benefit of individuals or lessening the burden of government. 

The Provena ruling did not, however, lay out a specific standard for appropriate levels of relief of government burden or charity care.  In 2012, the Illinois legislature took up the issue, enacting a law stating that hospitals would qualify for property tax exemption provided the value of the hospital’s charitable activities met or exceeded its estimated property tax liability.  These activities could include charity care, health services to poor or underserved communities, subsidies of state health care programs or state or local government activities related to health care for underserved or low-income populations, unreimbursed costs for Medicare or Medicaid patients, or any other activity that relieves the burden of government or addresses the health of low-income or underserved individuals. 

What might these developments mean for the current debate over the re-establishment of a trauma center at the UCMC?  In this post, John Colombo argues that the recent legislation is unlikely to affect hospital behavior generally, since hospitals that are underperforming in terms of charity care can simply cut a check to a government program to make up the difference.  While this difference could potentially be large for UCMC - a 2009 study by the Center for Tax and Budget Accountability found that the UCMC received annual property tax breaks that were estimated at nearly three times (and total tax breaks estimated at nearly six times) what the UCMC spent annually on charity care - the legislation provides wide leeway for discretion as to how a hospital makes it up.  This discretionary element of a hospital’s determination of how it meets the standard is key for the trauma center debate.  As with a broad “community benefit” standard, the flexibility in how the new standard is met means that there is no mandate for hospitals to provide particular kinds of services or fit a particular community’s needs.  Colombo argues for a third way, in which the question is not how much charity care a non-profit hospital offers or broad “community benefits,” but what services it brings to its community that cannot be acquired in the private market, playing a “gap filler” role which fits more closely the underlying reason that non-profit entities exist.  Such a standard, though unlikely to be implemented, could have interesting implications for the kinds of services that UCMC would be expected to provide. 

But underlying all these standards is a persistent ambiguity about who exactly a non-profit hospital is responsible for serving, and what “community” might mean.  If we think about this in terms of Gregory Alexander’s social obligation theory, in which owners are obligated to provide to their communities benefits that the community reasonably considers to be necessary for human flourishing, to what community is a non-profit hospital obligated to provide such benefits, particularly when it receives property tax exemptions?  Should a hospital’s charitable activities serve the neighborhood in which it is located?  Or does “community” mean something broader?  Does it simply mean “the public,” as is implied by the Illinois legislation’s approach to property tax exemption for charitable activities that relieve government burden?  How might our analysis differ for federal tax exemptions and something like a property tax exemption, where the tax dollars lost to the government through exemption would have been spent on local services?  In the case of the UCMC, how can we reconcile the importance of the broad benefits it provides through cutting-edge research and specialty-care services with the local nature of its property tax exemptions and the trauma care needs of the South Side?

In his speech on Friday, President Obama emphasized that what he was talking about was “not just a gun issue,” but also a question of “the kinds of communities that we’re building.”  This question seems appropriately posed not only in relation to the prevention of gun violence, but also responsibility for the care of its victims.

Meghan Morris

February 17, 2013 | Permalink | Comments (0) | TrackBack (0)

The Wild Pig Theory of Law Journal Creation

When I was a young associate at a large law firm, I discovered something interesting about partnership management structure.  I called it The Wild Pig Theory of Law Firm Management.

Here it is in its simplest and most elegant form:

If there was a herd of wild pigs rampaging through the office, no one would mention it, because the first person who did would be appointed chair of the Ad Hoc Committee to Rid the Firm of Wild Pigs. 

It is law review submission season again.  If you use Expresso, you can scroll through some 600-700 places to submit your work.  There are hundreds of specialty law journals.  Carved out a niche for yourself in maritime law?  There are a handful of journals just for you.  Animal law?  Check.  Criminal law?  Of course.  Business law?  Dozens and dozens.

You know where this is going.

There is no single, general comprehensive law journal devoted to all things Property.

There are timely land use journals, innovative IP journals, cutting-edge human rights journals that may occasionally include property related issues, cranky law-and-economics journals still applying game theory to trespass, and estate and gift tax journals for those unafraid of math.

But there is no one journal that would, for example, be the natural home of the impressive scholarship produced at the ALPS conference each year.

Here's the thing: I can't create it, and probably neither can you.  I don't have the time or resources.  You probably don't either. 

But, I thought it was worth asking:  Anybody good at herding wild pigs?

Because it sure would be nice.

Mark A. Edwards

February 17, 2013 | Permalink | Comments (2) | TrackBack (0)

Friday, February 15, 2013

A Philosopher's Quest for the Perfect Home

Open Culture summarizes philosopher Alain de Bottom's thoughts about architecture and neighborhood building:

In the first episode of The Perfect Home, embedded above, philosophical journalist and broadcaster Alain de Botton contends that we don’t live in the modern world. Rather, we do live in the modern world in that we exist in it, but we don’t live in the modern world in that few of us choose to make our homes there. As de Botton sees it, the residents of the developed world have, despite keeping up with the latest cars, clothes, and gadgetry, chosen to hole up in shells of aesthetic nostalgia: our mock Tudors, our restored cottages, our Greek Revivals. Having written books and presented television shows on philosophical subjects — you may remember Philosophy: A Guide to Happiness — he even brings in Nietzsche to diagnose this architectural disorder as an abject denial of reality. According to old Friedrich, he who builds himself into a fake reality ultimately pays a much greater price than what enduring real reality would have cost. With that ominous bit of wisdom in mind, de Botton travels the world in search of buildings designed with modern sensibilities and modern technology that nevertheless make us happy without enabling self-delusion.

Steve Clowney

February 15, 2013 | Permalink | Comments (0) | TrackBack (0)

Owen on Taking Groundwater

Owen2Dave Owen (Maine) has posted Taking Groundwater on SSRN.  Here's the abstract:

In February, 2012, in a case called Edwards Aquifer Authority v. Day, the Texas Supreme Court held that landowners hold property rights to the groundwater beneath their land, and that a regulatory restriction on groundwater use could constitute a taking of private property. The decision provoked strong reactions, both positive and negative, throughout the world of water law, for it signaled the possibility of severe restrictions on governmental ability to regulate groundwater use.

This Article considers the deeper issue that confronted the Texas Supreme Court, and that has confronted other courts across the country: how should the Takings Clause of the Fifth Amendment, and parallel clauses of state constitutions, apply to groundwater use regulation? Initially, this Article explains why this issue is exceedingly and increasingly important. It then reviews all of the groundwater/takings decisions from federal and state courts in the United States. Finally, the Article considers the implications of foundational property theories for the application of takings doctrine to groundwater use.

The analysis supports two key conclusions. First, it undermines arguments against treating water rights as “constitutional property” — that is, property protected by federal and state takings clauses. Proponents of those arguments generally assert that treating water rights as property has uneven support from prior caselaw and that such treatment will be prevent sensible governance. A review of groundwater caselaw demonstrates that the former assertion runs counter to the weight of authority, and that the fears underlying the latter argument are overstated. Second, and more importantly, the analysis undermines arguments for granting groundwater use rights heightened protection against regulatory takings. Recently, litigants and commentators skeptical of government regulatory authority have widely advanced those arguments. But they find no support in past groundwater/takings caselaw, and no property theory justifies adopting such an approach.

Steve Clowney

February 15, 2013 | Permalink | Comments (0) | TrackBack (0)

Thursday, February 14, 2013

Land Use in Palestine

The Atlantic's Armin Rosen takes a visit to Rawabi, the first Palestinian planned city in the West Bank.

Rawabi represents something totally new -- a visionary Palestinian-directed private sector project, with support from both Israeli businesses and a major Arab government. It has the potential to shift the conversation on the region's future on both sides of the Green Line. It could convince Palestinians -- and the rest of the world -- that the future of the West Bank shouldn't be shackled to Ramallah or Jerusalem's vacillating willingness to hash out fundamental issues. It could prove that there's an appetite, both among Palestinian consumers and foreign donors, for the creation of a social and economic existence in the West Bank that's de-coupled, insomuch as currently possible, from the Middle East's tense and labyrinthine politics. 

It would also help solidify the benefits of the current cessation in hostilities. Indeed, Palestinian leader Mahmoud Abbas's progress in fostering the end of violent resistance in the West Bank in the years after the bloody Second Intifada, coupled with Palestinian Prime Minister Salaam Fayyad's widely-respected institution-building initiative, could get a crucial private sector assist through Rawabi's eventual success.

Steve Clowney

February 14, 2013 | Permalink | Comments (0) | TrackBack (0)

Nolon on the Emergence of the Law of Sustainable Development

John_NolonJohn Nolon (Pace) has posted Shifting Paradigms Transform Environmental and Land Use Law: The Emergence of the Law of Sustainable Development (Fordham Envt'l Law Journal) on SSRN.  Here's the abstract:

We began these two decades reacting to the market’s interest in developing greenfields and coastal property and end it wondering how to prepare more urbanized places for a growing population of smaller households who seek the amenities of urban living and some protection from the storms ahead. This essay discusses this and nine other fundamental paradigm shifts in environmental and economic conditions that are reshaping the law and changing the way state and local governments control land use and order human settlements.

Steve Clowney

February 14, 2013 | Permalink | Comments (0) | TrackBack (0)

Wednesday, February 13, 2013

When Neighbors Hate Neighbors

Over at the Faculty Lounge Al Brophy highlights a dramatic story out of Virginia about homeowners association that destroyed itself in a protracted lawsuit over a yard sign:

[The board of the homeowners association] passed a resolution allowing the board to fine residents up to $900 per infraction for violating HOA guidelines. Across the country, fining authority has been controversial, with HOAs hitting residents with levies for such transgressions as displays of colored Christmas lights and patches of dead grass.

Board members believed that they had the right under Virginia law, but the Farrans saw an illegal power grab that had no basis in the HOA’s covenants. When the board, acting at a meeting that was not publicly announced, rejected the Farrans’ roof and deck projects for aesthetic and architectural reasons, the Farrans said it was retribution.

“It’s like we weren’t living in America,” Maria Farran said. “You are always one board election away from a tyranny. They wield enormous power.” The Farrans filed a lawsuit against the HOA saying it didn’t have the authority to impose fines and had vindictively rejected their home improvements.

Steve Clowney

February 13, 2013 | Permalink | Comments (0) | TrackBack (0)

Rendleman on Boomer v. Atlantic Cement

RendlemandDoug Rendleman (Washington & Lee) has posted Rejecting Property Rules-Liability Rules for Boomer's Nuisance Remedy: The Last Tour You Need of Calabresi and Melamed's Cathedral on SSRN.  Here's the abstract:

This draft article analyzes and criticizes the New York court’s tort remedies in its nuisance decision, Boomer v. Atlantic Cement, and Calabresi and Melamed’s famous law-and-economics article, One View of the Cathedral. From the Remedies branch of Legal Realism, this draft finds both wanting because both subordinate the winning plaintiffs’ injunction remedy to money damages.

Both the Boomer decision and the Cathedral article undervalue public health and environmental protection. This mindset militates against robust and effective private-law remedies for defendants’ environmental torts.

In addition, the Cathedral article’s four-rule organization and vocabulary are confusing and misleading. In particular its Rule 1) over-emphasizes the effect of an injunction, which, if the defendant breaches, will usually lead to compensatory contempt and a money award that converts a so-called “property right” into a so-called “liability right.”

Behavioral economists’ studies and recent events have undermined and qualified many of the market-economics theories in the Cathedral article. This draft favors a flexible and pragmatic common-law technique instead of the law-and-economics analysis that favors awarding a nuisance-trespass plaintiff damages over an injunction. Moreover, the draft maintains that the economists’ presumption of nuisance-trespass parties’ post-injunction negotiation leading to an excessive coerced money settlement is overstated and should yield to more particularized and contextual analysis.

This draft maintains that the Cathedral article’s four point array of remedies solutions is both too long and too short. Rule 3) is the liability decision that doesn't belong in a remedies analysis at all. Rule 4)’s plaintiff-pays solution destabilizes property rights and should be abandoned in private litigation. Rule 2)’s preference for damages over an injunction should be a rare remedy. Analysis of the trespass and nuisance injunction should study structural litigation’s injunctions and emphasize flexibility and equitable discretion, in short a broadened Rule 1). Other remedies, punitive damages and restitution, should also be considered as viable options.

Taking earlier Legal Realists cue, this article seeks to replace theory with a more functional approach. By arguing in this draft for more and more detailed injunctions, the author hopes for augmented environmental protection and private-law remedies against global warming and climate change.

Steve Clowney

February 13, 2013 | Permalink | Comments (0) | TrackBack (0)

Tuesday, February 12, 2013

Do You Want to Be A Tenant in a Community Owned Building?

The N.Y. Times takes a look the city's First Look program, "in which a small number of banks have agreed that instead of selling troubled residential buildings to the highest bidder, they will give community developers first crack at taking the buildings over."

While the conditions in some of the buildings at issue sound truly awful, I do wonder if turning over the apartments to a non-profit is a viable long-term solution.  The article suggests that community groups don't really have enough cash to pull off these large scale purchases.  And, everyone seems to be ignoring that the real reason that these buildings have fallen into disrepair is New York City's rent control legislation. 

Steve Clowney

February 12, 2013 | Permalink | Comments (0) | TrackBack (0)

Ngov on Privatizing Public Land to Avoid Violating the Establishment Clause

NgovEang Ngov (Barry) has posted Selling Land and Religion (Kansas Law Review) on SSRN.  Here's the abstract:

Thousands of religious monuments have been donated to cities and towns. Under Pleasant Grove City v. Summum, local, state, and federal governments now have greater freedom to accept religious monuments, symbols, and objects donated to them for permanent display in public spaces without violating the Free Speech Clause. Now that governments may embrace religious monuments and symbols as their own speech, the obvious question arises whether governments violate the Establishment Clause by permanently displaying a religiously significant object.

Fearing an Establishment Clause violation, some governmental bodies have privatized religious objects and the land beneath them by selling or transferring the objects and land to private parties. Some transactions have included restrictive covenants that require the buyer to maintain the religious object or reversionary clauses that allow the government to reclaim the land. Others have sold or transferred the religious object without soliciting bids from other buyers.

This article provides an in-depth analysis of five cases in which governmental bodies resorted to privatizing public land to avoid violating the Establishment Clause. Drawing from Establishment Clause jurisprudence involving religious displays, this article utilizes the Lemon and Endorsement tests as analytical tools for resolving the constitutionality of land dispositions involving religious displays.

This article considers the purported secular government purposes for selling or transferring land to private parties. The government has sought to justify these land dispositions as a means to provide memorials that honor veterans or promote civic-mindedness, to preserve the religious object in order to avoid showing disrespect to religion, and to avoid violating the Establishment Clause. I argue that these purported government purposes are secondary to a religious interest because there are other alternatives to achieve the government’s purposes.

I also examine the effects of these land dispositions on the reasonable observer. The Herculean efforts exerted by the government to save the religious monument send a message of government endorsement of religion. Restrictive covenants that require the private owner to maintain the religious monument and reversionary clauses that allow the government to reclaim the monument and underlying land perpetuate state action and excessively entangle the government.

I conclude that the best measure to avoid the Establishment Clause is to simply remove the religious object. Removing the religious object will protect the dilution of sacred religious symbols through their secularization and will provide greater inclusiveness in public spaces for religious minorities and nonbelievers.

Steve Clowney

February 12, 2013 | Permalink | Comments (0) | TrackBack (0)

Monday, February 11, 2013

Is New Urbanism the End of Land Use Law?

Jonathan Zasloff of UCLA asks why there's very little case law on form-based land use codes:

One can understand that in several ways, I suppose.  You could infer that New Urbanism just leaves less room for legal disputes than traditional Euclidean zoning.  For example, there is no need to worry about non-conforming uses, use variances, or conditional use permits with Form-Based Codes because those codes do not regulate uses to begin with.  Certainly many advocates of New Urbanism might make this argument; they would argue that New Urbanist codes, based upon building form and the transect, are more certain than traditional Euclidean zoning and also more protective of private property precisely because they leave more discretion in the market.  They are right about the general point, but it is hard to argue that any legal framework simply eliminates legal disputes — if it did, it would either be the first such system to do so or rely upon a sort of coercion wholly at odds with New Urbanism.  (Not too many land use disputes under Stalinist land use, but that surely did not reflect an advantage of the system).

Alternatively, you could argue, as many critics of New Urbanism do, that its land use philosophy is essentially a boutique product, suitable for Berkeley, Boulder, or Austin, but not for “real” American places.  Thus, it is not prevalent enough to generate cases.  This argument runs aground on facts.  New Urbanism does not work everywhere, but it is hard not be impressed by the wide variety of American communities that are adopting it.

Steve Clowney

February 11, 2013 | Permalink | Comments (1) | TrackBack (0)

Ruhl on Climate Change

RuhlJ.B. Ruhl (Vanderbilt) has posted A Summary of Present and Future Climate Adaptation Law (Book Chapter) on SSRN.  Here's the abstract:

In anticipation of the inevitable shift from adaptation planning to adaptation action, this chapter provides a background on climate change adaptation policy and a survey of climate impacts and adaptation responses likely to put some demand on legal institutions and rules. The chapter opens by defining the key terms and concepts of climate change adaptation as it has been discussed in major policy analyses. The chapter then summarizes the scope and focus of federal, state, local, tribal, and private climate change adaptation planning initiatives. From there, the chapter reviews the current law of climate change adaptation, which as mentioned above is not yet extensive. What few morsels of legal initiative exist break down into five types: (1) coastal land use controls; (2) environmental impact assessment programs; (3) corporate disclosure requirements; (4) endangered species protection; and (5) anti-adaptation measures The chapter closes with a survey of the potential legal issues climate change adaptation could spark, organized into five categories: (1) land and resources; (2) infrastructure; (3) business disputes and regulation; (4) health and safety concerns; and (5) governance and process.

Steve Clowney

February 11, 2013 | Permalink | Comments (0) | TrackBack (0)

Saturday, February 9, 2013

Tinkering with property, from Havana to Hershey

One of the most unlikely tourist attractions in Cuba is the tiny town of Hershey. Located about 40 miles east of Havana, Hershey was established by Milton Hershey himself in 1918 as a site to mill and refine sugar used in chocolate production. Like many other sugar towns in Cuba, Hershey had a sugar mill at its heart, with the town itself, housing for workers, and sugar fields built around it. Milton Hershey also constructed an electric railroad which ran from Hershey to Havana, allowing the company to bring the refined sugar to port. He sold the mill in 1946 to the Cuban Atlantic Sugar Company; it was then nationalized after the 1959 Cuban revolution, and continued to produce sugar for several decades. Today, however, Hershey is something of a ghost town. The Cuban government closed nearly half the country’s sugar mills in the early 2000s, including the Hershey mill, as part of a mass restructuring of the sugar industry. This left the town desolate and crumbling, with residents reminiscing about its glory days, while the lands once farmed for sugar became overgrown with dense thickets of marabú, a virulent, quick-spreading weed. (Hershey is, however, still accessible by the same ancient, rickety train, facilitating myriad tourist accounts of post-industrial decay reminiscent of the recent rise of American Rust Belt “ruin porn.”)

The mass closure of sugar mills created situations much like Hershey’s in towns across Cuba, where the growth of marabú on abandoned canefields began to seem to outpace that of edible crops on productive land, even as the country’s food imports rose to up to 80% of its domestic consumption requirements. While some proposed harvesting the marabú and turning it into a source of renewable energy – and indeed, there has been recent foreign investment in Cuba for renewable energy based on marabú – the Cuban government determined that the millions of acres it covered could be more profitably used for agriculture.  In 2008, Raúl Castro’s government passed Law 259, which granted 10 year renewable usufruct rights to individuals willing to farm idle land in a “rational and sustainable” manner.  Part of a string of dramatic reforms to property rules (including the lifting of restrictions on the sale of houses and cars which had been in place for nearly half a century), Law 259 came as close to allowing private property in land as the country had seen for decades. Rather than continue to restrict agricultural production to cooperatives or state farms, Law 259 allowed individual farmers to hold usufruct rights and farm independently.

Over the first several years that Law 259 was in force, the Ministry of Agriculture reported that nearly 170,000 farmers received usufruct rights. Successful ventures were featured in Granma, the state newspaper, with smiling farmers pictured next to their produce, extolling the virtues of individual usufruct. The reality of the impact of the reform, however, was more complicated. While it appeared on paper that thousands of individual farmers had received usufruct rights to the land, many of these concessions had simply expanded existing cooperatives or been made to individuals working collectively. Many farmers were uncertain about whether the state would take back land concessions based on ambiguous determinations of what was and wasn’t “rational” or “sustainable.” There was also confusion as to whether or not it made economic sense for farmers to build structures and live on land they held in usufruct. And in addition to these uncertainties, making the investment in farming idle land was costly. Marabú is a particularly tenacious weed, and can grow to the size of a tree, requiring heavy equipment for its removal. These were costs and uncertainties that were difficult to bear alone, but made some sense for certain cooperatives or groups of farmers to take on. So Cuban farmers took advantage of the opening provided by Law 259 to make productive use of the land, but in ways that skirted the letter of the law, and were often distinct from the expansion of individual farming the state had intended.

This type of creative practice in gray zones of legality is something that characterizes the relationship between social life and the law in Cuba more broadly. A common Cuban saying that reflects this is inventar - to invent - which is used to describe resourcefulness in the face of scarcity, as well as the creative skirting of the law through engagement in activities ranging from ambiguously to clearly illegal. Inventar could be what you do when there are no eggs left at the state-run market and you buy some from a black market shop. Or when you can’t buy car parts for your '57 Chevy that you use as an unofficial taxi, and you get the parts from a neighbor in exchange for extra ration cards you have for a grandson that now lives in the UK. Or when you marry someone in order to transfer a title to a house to them, evading prohibitions on home sales, and then immediately divorce. Or when you work at a state-run cafe, where you sell your own personal sodas to customers under the table to make a bit of extra cash. Or when farmers expand existing cooperatives through “individual” usufruct concessions, both taking advantage of and violating Law 259. These “inventions” are the creative practices that create markets in all shades of black and gray, keeping the economy moving both because of and in spite of formal property rules.

In December 2012, the Cuban government issued Law 300, which replaced Law 259. Law 300 expanded the category of possible usufruct holders to include cooperatives, increased the acreage available through usufruct concessions, and sanctioned the building of structures on concessions, amongst other changes (see this piece in Spanish by Armando Nova González for a more thorough comparison of Law 259 and Law 300). These shifts incorporated the kinds of practices that farmers had been exercising under Law 259 - practices that had been in a gray zone of legality, but became authorized under Law 300. Much as Peñalver and Katyal describe in Property Outlaws, the illegal practices of farmers can be understood to have pushed needed legal reforms in a productive way.

I think that Law 259, Law 300, and the events in between also tell us a remarkable story about the role of not only illegal activity, but also of creativity, in legal change. On the one hand, the development and promulgation of Law 259 itself was an creative move in response to the burgeoning problem of agricultural production on the island. The Cuban state has explicitly described such recent moves as experimental, acknowledging the economic problems on the island, while conducting such legal experiments in order to "perfect socialism." But as historian of science Hans-Jorg Rheinberger notes, experimental systems also behave as generators of surprises. These surprises emerged in the form of an explosion of tinkering by the populace with the new property rules, which they selectively used and violated in order to “invent” solutions to the uncertainties and costs attached to the opportunities Law 259 provided. Many of these “inventions” were then codified in Law 300.

This brings me to a question I have been puzzling over in the wake of the recent promulgation of Law 300. If Law 259 is understood as a true experiment - which has no predetermined outcome, but is known to generate surprises - can we understand the Cuban state as having implicitly called upon the populace to tinker with its rules, generating solutions that might be more lasting and productive? Or should we understand the promulgation of Law 300 as the acknowledgement of an experimental failure of sorts, in which Law 259 simply didn’t have the desired outcome, and widespread illegal practices forced the state to adjust its strategy? Either way, the story of these recent reforms underscores the importance (which Adriana Premat notes in relation to urban agriculture) of examining both the activities of individuals and the work of the state in assessing recent property reforms in Cuba, understanding that changes in property rules emerge not only from Havana, but also from Hershey.

Meghan Morris

February 9, 2013 | Permalink | Comments (1) | TrackBack (0)

To What Extent Do You Teach IP?

Choosing whether to include any IP in a first-year Property course is an annual dilemma for me.  I suspect that for many of us Property profs, IP topics are outside our comfort zone.  I know a little about patents, a little more about copyright, a little less about trademark.  If something has to be cut -- and something always does -- then it is easy for me to cut IP.  I don't have to worry about what I don't know.

On the other hand, if there is one property issue young law students are likely to be interested in, it is IP, and especially copyright.  They live in a world of changing copyright boundaries, where sampling and mashing are celebrated, file-sharing is illegal but common place, and collaborating without attribution is a daily event on twitter but could get you expelled in law school.  

Profs can take what I think of as the Dukeminier approach: treat IP as just an example of obtaining first rights, akin to colonizing a continent, and move on without getting into the particulars of actual IP law.  I've done that, but it seems like a cop out to me.  These days, I either teach some IP or I don't.  Usually, I don't.  Probably, I should.

What do you do?

Mark A. Edwards 


February 9, 2013 | Permalink | Comments (1) | TrackBack (0)

Friday, February 8, 2013

House the Poor in Cages?


That's the approach that Hong Kong as taken:

For many of the richest people in Hong Kong, one of Asia's wealthiest cities, home is a mansion with an expansive view from the heights of Victoria Peak. For some of the poorest, like Leung Cho-yin, home is a metal cage.  The 67-year-old former butcher pays 1,300 Hong Kong dollars ($167) a month for one of about a dozen wire mesh cages resembling rabbit hutches crammed into a dilapidated apartment in a gritty, working-class West Kowloon neighborhood.

Forced by skyrocketing housing prices to live in cramped, dirty and unsafe conditions, their plight also highlights one of the biggest headaches facing Hong Kong's unpopular Beijing-backed leader: growing public rage over the city's housing crisis.

Leung Chun-ying took office as Hong Kong's chief executive in July pledging to provide more affordable housing in a bid to cool the anger. Home prices rose 23 percent in the first 10 months of 2012 and have doubled since bottoming out in 2008 during the global financial crisis, the International Monetary Fund said in a report last month. Rents have followed a similar trajectory.

Steve Clowney

February 8, 2013 | Permalink | Comments (1) | TrackBack (0)

Thursday, February 7, 2013

Living With Landlord

The N.Y. Times takes a look at the pros and cons of living in the same building as your landlord:

For some, however, the landlord is not abstract. For better (he’s always around checking up on things) or worse (he’s always around checking up on things), the landlord is the upstairs or downstairs neighbor. It’s the durable stuff of movies and sitcoms, like the 1960s series “Hey, Landlord” and the ’70s series “Three’s Company.”

Life with the landlord has its own particular complications and compensations. These range from the too-much-in-your-face and too-much-in-your-business sort, to the homeowner whose table always has an extra place. If the relationship is contentious— well, you know where the door is. But if it’s harmonious, that could translate into attractive terms when the lease comes up for renewal.

Steve Clowney

February 7, 2013 | Permalink | Comments (1) | TrackBack (0)

Odinet on The Rise of Super Priority and the Fall of the Recordation Doctrine in Real Estate

Odinet_ChristopherChris Odinet (Phelps Dunbar) has posted The Rise of Super Priority and the Fall of the Recordation Doctrine on SSRN.  Here's the abstract:

The recordation doctrine serves as a principal backbone of real property transactions. We rely upon it to ensure that there is stability in the market and that parties are diligent and careful to establish and protect their rights. The system rewards the conscientious and the cautious, and punishes the tardy or the unwary. We make exceptions, however, for those right-holders whose activities serve a special societal purpose. The most prevalent exception is in the collection of real property taxes. The failure to pay property taxes results in a lien against the property, and such a security right is superior and deemed to prime any other security interest in the property, even those which have been previously established and recorded. We do this because public policy dictates that timely payment and prompt collection of property taxes is essential to the efficient operation of government and the common good. However, the ever-growing political movement to create public-private partnership in the development of real estate has caused an expansion of this general exception. In order to help individuals finance infrastructure and other foundational improvements in the development of private real estate, cities and municipalities have created special taxing districts that give the developer the ability to charge assessments on the property over time in order to pay for the improvements. By legislation, these assessments are given the same lien priority as real property taxes, priming any pre-exiting security rights of the developer’s lenders. Over the past several years, special taxing districts have been created across the country to fund a variety of improvements, including utilities, green infrastructure, sustainability, and transportation projects. However, the additional assessments add to the holding cost of the property and diminish any pre-exiting security rights. As a result of the massive decline in the housing market, many developers have been unable to sell their properties and the special districts have gone into default. For instance, between 2003-2008 Florida has created 438 special community development taxing districts, which have issued a total of $6.5 billion in municipal bonds to finance their improvement projects. Of these, over 168 districts have defaulted on nearly $5.1 billion worth of bonds. The continued rise of these special taxing districts, despite their significant failures, necessitates a reevaluation of our understanding of the core purposes of the public recordation doctrine, as well as the fairness to the position of secured lenders who invest in these real estate developments on the front end. This Article argues that we should reconsider the widespread delegation of super priority to these special taxing districts and calls for a closer examination as to if and when the government should allow private projects to be clothed with public powers, and, if and when they are allowed, how to better screen, evaluate, and monitor them.

Steve Clowney

February 7, 2013 | Permalink | Comments (0) | TrackBack (0)