Wednesday, March 30, 2016
Steven Eagle (George Mason) has posted Property Rights after Horne (NYU Journal of Law & Liberty) on SSRN. Here's the abstract:
This Article analyzes the Supreme Court’s 2015 decision in Horne v. Department of Agriculture, which extended to personal property rules regarding “physical takings” previously applicable only to real property. It considers how the majority and other opinions in Horne relate to substantive and procedural issues in regulatory takings jurisprudence. In particular, the Article asserts that Horne, in tandem with the Court’s 2013 decision in Koontz v. St. Johns County Water Management District, may be a basis for rectifying problems resulting from complexities emanating from Penn Central Transportation Co. v. City of New York and other takings doctrines.
Tuesday, March 29, 2016
Kate Elengold (American) has posted Structural Subjugation: Theorizing Racialized Sexual Harassment in Housing on SSRN. Here's the abstract:
This Article identifies and analyzes the structural forces that permit and ignore racialized sexual harassment in housing. Although scholarship on sexual harassment in housing is sparse, the existing research and resulting body of law generally advances a narrative focused on the female tenants’ economic vulnerability and violation of the sanctity of her home. The narrative advanced in scholarship and advocacy, along with the resulting jurisprudence, presents an archetype of a deviant male landlord abusing his authority to take advantage of women sexually who, because of their economic circumstances, have no alternatives. This Article terms it the “dirty old man” narrative. Drawing attention to the racialized sexual harassment that lies beneath the stock story for many African American female tenants, this Article dismantles that narrative. The purpose of the scholarship is two-fold. The first is to expose, for the first time, the undercurrent of racialized sexual victimization that is absent from the “dirty old man” narrative. To do that, this project methodically examines court filings in sexual harassment cases brought by the Attorney General under the federal Fair Housing Act and analyzes the entire body of federal and state court opinions assessing residential sexual harassment claims. The second objective is to identify the structural factors — cultural acceptance of the “Black Jezebel” myth, legal rights, access, and generational economic and racial hierarchies — that operate together to perpetuate racialized sexual harassment in rental housing, an analysis that draws on social science research, along with critical race, critical feminist, and intersectionality theories. This Article contends that those structural forces are the same factors that have operated to permit and hide the sexual subjugation of Black women in the private sphere throughout history — during slavery, as domestic workers, and in the present-day failure to prosecute sexual assault against Black women. Ultimately, it argues that the prevailing “dirty old man” narrative risks silencing both the individual stories of racialized sexual harassment at home and the larger conversation about the structural forces permitting and ignoring the abuse.
Wian Erlank (Stellenbosch) has posted Finding Property in New Places – Property in Cyber and Outer Space (Potchefstroom Electronic Law Journal) on SSRN. Here's the abstract:
The fields of virtual property and property in space are both new areas of property law that could not have been envisaged a hundred years ago. In both of these new fields, things and other objects of property are located in places that have not previously been considered capable of harbouring property in the traditional sense. New technological and societal developments have resulted in both the creation of property (in virtual worlds) and the ability to get to property (in space), and questions have to be asked about how property law can and will function in these new areas. This article discusses some of the important property questions posed by the creation of these new fields of property law. Although there is some correlation between the unique questions posed by the environments that these new areas of law deal with, each of the fields has some idiosyncrasies that are influenced to a large degree by the location of the property objects in each area. This article highlights these similarities, while simultaneously pointing out some of the main differences between them and traditional (Earth-based) property law.
Sunday, March 27, 2016
I want to take a moment to give a major plug to the American Bar Association's Real Property, Trust and Estate Law fellowship program. I am just finishing my second and final year of this fellowship, and it's been on the most rewarding experiences I've had since entering the academy. The goal of the fellowship is to give young lawyers (including law professors) the chance to work with and gain insight from practitioners in the field. Each fellow is assigned a mentor and a committee with which to work and put on programs, CLEs, webinars, write articles etc. for that substantive area. The areas range from land-use and gift/estate tax to mortgage lending and real estate transactions (and many more). For instance, I've had the pleasure of working with Wilson Freyermuth (Missouri), Tanya Marsh (Wake Forest), Shelby Green (PACE), Jim Smith (Georgia), Jim Durham (Dayton), Amy Hess (Tennessee) and Nancy McLaughlinn (Utah) in working on a number of projects, including the planning and coordinating of the monthly Professor's Corner webinar that so many of you are familiar with.
Overall I think one of the best aspects of the fellowship is that it provided an opportunity for me to stay connected to the practice of property law and to obtain resources in improving the experiential learning aspects of what I do in the classroom. And aside from the many excellent attorneys I've come to know and work with, there's a really superb group of academics who are heavily involved in the section's work. But, probably best of all, the fellowship funds your travel to two big section meetings a year (and in some pretty fun places, too: I went to Boston, DC, Laguna Beach, and Naples, FL during my time).
The fellowship is for a total of two years. In order to be considered, the applicant must (1) have practiced in the trusts and estates or real property area for at least one year, (2) be younger than 36 years of age or have been admitted to the bar less than 10 years, and (3) have demonstrated leadership at the state or local bar level or in the ABA Young Lawyers Division. The section is always looking for junior law professors to be fellows, so please consider applying. It was a really great experience that I highly recommend to everyone teaching in the field.
The application for the 2016-2018 fellowship class is not due until June 30, 2016 and can be accessed by clicking here.
Friday, March 25, 2016
Christine Klein (Florida) has posted a sample chapter from a new first-edition property casebook published last month by Aspen Publishers. Here's the blurb from the Publisher's website:
Property: Cases, Problems, and Skills offers a modern, skills-based approach to Property Law, and includes a balance of classic and new cases, tightly-focused skills exercises (including advocacy, drafting, client interviewing/counseling, and negotiation), selected statutory excerpts, chapter review problems (with answers provided in the Appendix for student self-testing), and other pedagogical features (such as discussion problems raising novel and modern challenges, “A Place to Start” doctrinal overview boxes, and “Reading Guide” boxes). The online teacher’s manual will provide answers to all questions posed in the text and suggestions for conducting the skills exercises (generally, during a group exercise that takes all or part of a single class session). The two-color text is visually appealing, with judicious use of photographs, text boxes, and pedagogical diagrams. Although the text does not take a “hide the ball” approach, it prods students to engage with the law’s complexity, ambiguity, and nuance.
Thursday, March 24, 2016
Archana Mishra (Jindal Global Law School) has posted Towards Women’s Equal Right to Property - Recent Judicial Developments in India on SSRN. Here's the abstract:
This article investigates the judicial activism in developing the Indian law of succession whereby laws have been interpreted to grant more property rights to Indian women. Tribal women who had been denied inheritance right under their customary laws have been constructively interpreted by courts to grant right in their favour. Issue with regard to applicability of coparcenary claim of Hindu daughter, granted to her under Hindu Succession (Amendment) Act, 2005, has now been finally settled by the Supreme Court of India. Applying legal maxims for recognizing the right of a Hindu widow to claim partition of her deceased husband’s share in coparcenary property, in absence of definite statutory right, is another judicial development. Construction of Hanafi law to grant inheritance right to a sister in presence of daughters of the deceased shows judicial approach of uplifting the position of women even under uncodified Muslim personal law. At the same time restricting the right of a Hindu daughter to claim her coparcenary right only after a certain date when no such limitation has been fixed for male coparcener shows clear discrimination on basis of sex. Further granting preferential rights to agnates over cognates under Hindu law appears to have no justification. Even after more than a decade of passing of Constitution, the court adopts a cautious approach in getting into the constitutional validity of personal laws. With the increase in social integration, economic independence, reform movements, there needs to be a further call for the improvement of the woman's position in Indian society.
Yun-chien Chang (Chicago) has posted Eminent Domain Law in Taiwan: New Law, Old Practice? (Book Chapter - Cambridge Press) on SSRN. Here's the abstract:
This chapter summarizes the latest (post-2012) eminent domain law in Taiwan. It focuses on the six pillars of takings law, namely public interest criteria, subjects of the eminent domain power, just compensation, due process, distribution of development surpluses, and the dispute resolution system. The 2012 reform brings along takings laws in books that are stricter than ever in terms of public interest and necessity analysis, but administrative courts typically defer to the administrative agencies’ judgments. Only government agencies and certain public legal persons can apply to the state to condemn. Just compensation now means payment of current market value, but the differences between how much condemnees receive pre- and post-2012 remain unclear. Procedural requirements regarding expropriation constitute an intricate web of rules. Nonetheless, in the process of negotiated purchase, local governments are often criticized for not bargaining in good faith. Thus, the due process requirement does not guarantee substantive equity or efficiency. Development surpluses go entirely to the state. The dispute resolution system consists of two or three levels of re-examination within the administrative branch before the condemnees can bring their cases to the administrative court. This chapter concludes with a policy recommendation that uses hedonic regression models to estimate land value for offers in the negotiated purchase stage and for the land value in the takings compensation stage.
Wednesday, March 23, 2016
Martin Dixon (Cambridge) has posted A Reformist Menu (Conveyancer & Property Law) on SSRN. Here's the abstract:
In the light of the UK general election, what land law related issues might be on a reform agenda?
Dixon has posted a slew of other works on his SSRN page from 2014 & 2015.
John Ruple (Utah) & Robert Keiter (Utah) have posted Alternatives to the Transfer of Public Lands Act (Stegner Center White Paper) on SSRN. Here's the abstract:
This White Paper is the fourth in a series addressing state efforts to take over federally managed public lands. We argue here that state time and resources would be better spent on collaborative efforts to improve resource management practices. Alternatives to litigation, like that threatened under Utah’s Transfer of Public Lands Act, are important because, as our prior work shows, Utah’s claims are likely to fail. The federal government is not obligated to dispose of additional public lands, and even if a disposal obligation were found to exist, such an obligation would not necessitate giving the land to the states. Furthermore, a state takeover of public lands would subject states to significant fiscal risk while likely reducing opportunities for public involvement in land management decisions. Faced with the prospect of a long, costly, and likely fruitless legal fight, states should consider other responses to what are, for many, sincerely held frustrations over the condition and management of our public lands.
This paper discusses five of the main problems that we believe give rise to the frustration driving the public lands transfer movement. We then present seven possible alternatives to demanding title to federal lands that we believe respond to these problems and that are likely to produce lasting and tangible land management improvements. Neither the list of problems, nor the list of alternatives, is exhaustive. While we identify what we see as key challenges and opportunities, others will undoubtedly add to our list. We hope that a productive dialogue over public land management policies and practices can grow from this effort.
Sunday, March 20, 2016
(Photo Credit: The Economist)
It's safe to say that much of the Bitcoin mania has settled down over the last few years, but that doesn't mean that there's nothing more to discuss. While most commentators and policy advocates state (and I believe rightly so) that Bitcoin and other cryptocurrencies will never truly come to displace (or even significantly compete) with fiat currencies, the true value that can be derived from the Bitcoin system is in fact the technology that underpins it: the blockchain. Joshua Fairfield (Washington & Lee) makes this case very compellingly in his recent article, BitProperty (give it a read!).
Now, before I go any further let me say that an explanation of how the blockchain works would take some serious time and even my best attempt would likely leave much to be desired. But lucky, like so many things in life, there's a YouTube video that explains it all! Take a look:
So why does any of this matter? Well, there's been a recent and strong interest by banks and financial institutions in how the blockchain system might be used to track ownership interests in property. The Economist did a story this past week about what some of these firms are up to:
It is easy to see why bankers get excited about distributed ledgers. Instead of having to keep track of their assets in separate databases, as financial firms do now, they can share just one. Trades can be settled almost instantly, without the need for lots of intermediaries. As a result, less capital is tied up during a transaction, reducing risk. * * *
[T]echnical hurdles can be overcome only with a high degree of co-operation between all involved. But this is not a given in the highly competitive world of finance. Some efforts are already under way. More than 40 banks now have a stake in R3 CEV, a startup meant to come up with shared standards. Similarly, firms including IBM and Digital Asset Holdings have started the Open Ledger Project to develop open-source blockchain software.
The Open Ledger Project may have trouble combining the bits of code its members contribute. Such problems will slow adoption, notes Tolga Oguz of McKinsey, a consultancy. Moreover, most projects are still “proofs of concept”. Only a few services have gone live. A dozen banks are using a firm called Ripple to process international payments cheaply. In August Overstock.com, an online retailer, announced a “smart-contract” platform, as did Symbiont, another startup. In January NASDAQ, a stock-exchange operator, launched Linq, a service that allows companies to issue debt and securities. It also plans to initiate a blockchain-based e-voting service for shareholders in firms listed on its exchange in Estonia.
Then there are more specialised services. Everledger uses a blockchain to protect diamonds by sticking data about a stone’s attributes on it, providing proof of its identity should it be stolen. Wave, another blockchain startup, encodes documents used in global supply chains, reducing the risk of disputes and forgeries.
More applications will pop up this year and next. Prime targets will be self-contained markets with complex products, many participants and convoluted procedures. One example is syndicated loans, which can involve dozens of lenders and which can take as long as a month to negotiate. Symbiont recently teamed up with Ipreo, another fintech firm, to automate such loans using smart contracts. Another tempting target is trade finance, which still requires lots of paperwork to travel around the globe along with the goods being sold.
For property law scholars, the emergence of the blockchain comes at an interesting time. There's a recent and fascinating article by Abraham Bell (Bar Ilan/San Diego) and Gideon Parchomovsky (Bar Ilan/UPenn) titled Of Property and Information that advocates for a renewed scholarly interest and debate on the importance of registries. As they note, "In the past, discussions of registries used to be a core topic in property classes and a focal point for property scholarship. In recent decades, registries have lost their luster for scholars, and their discussion has been relegated to the innermost pages of property textbooks. The reason for this is that registries are widely considered the domain of legal practitioners, not of theorists."
I agree with Bell and Parchomovsky and applaud their work on this topic. To that point, it strikes me that the move toward a distributed ledger system for the recording of interests in property has the potential to breathe new life into the academic exploration of the role that registries and information play in property law. And this move toward a "trustless ledger" system (HT: J.A. Fairfield) is not limited to merely intangible personal property like securities or credit rights. Rather, some countries are actually looking to move their entire paper-based land registry system to a blockchain model. Honduras is already in the process of working with a Texas company to build a permanent and secure land title registry system using blockchain technology! The possibilities are endless and ripe for scholarly commentary. More to come in this area, for sure!
Saturday, March 19, 2016
Today I will take a momentary break from my commentary on the remaining POTUS candidates to put a spotlight on a conference occurring this weekend at my home institution, Tulane University Law School. This weekend, Tulane is hosting the American Society of Comparative Law’s Younger Comparativists Committee Fifth Annual Global Conference. More than 100 young scholars (young meaning teaching for less than 10 years) from more than 80 institutions around the globe and from 6 different continents (try as I might, I could not find anyone from Antarctica) have descended upon New Orleans this weekend to discuss comparative law. There are 25 concurrent panels running throughout the weekend on topics such as comparative constitutional law, international arbitration, comparative criminal justice and criminal law, human rights, sex and comparative law, teaching comparative law . . . the list goes on and on.
The main plenary panel at the conference is on a topic that blog readers will enjoy: Comparative Property Law. Two of the papers being presented on the panel have been written by scholars from outside the United States who do not get as much advertisement on this blog. Thus, here is a chance to shine some light on the great comparative property law research being done across the globe.
Luigi Bruno (McGill University) is presenting his article today, E Pluribus Unum: Simplifying Complexity in Secured Credit. Luigi writes that as lawmakers recognize the importance of access to credit for development, countries are reforming laws to ease the getting credit process. The global movement towards secured credit legal regimes has had the effect of producing legal harmonization. Luigi notes that most of the literature on the topic thus far has looked at the process of legal harmonization, but his article strives to study the deeper aspect of the legal transplantation phenomenon that has accompanied the global move toward implementing secured credit legal regimes that conform to particular rules. Luigi writes,
This paper proposes to do so by using the concept of cultural specificity of the law as a point of departure to inquire deeper into the phenomenon. By means of a historic, economic and sociologic contextualisation of the birth and development of secured credit laws across legal families this thesis will question if legal transplantation in the field is actually possible. The analysis will then look at some of the possible negative outcomes generated by such practice. In particular, through a detailed reconstruction of reform processes in France, Belgium, Italy and Quebec, the paper will try to show important traits related to the issue at stake – traits that, hopefully, will also lay the foundation for subsequent research.
Sara Gwendolyn Ross (Osgoode Hall Law School) is also presenting her paper, Protecting Urban Spaces of Intangible Cultural Heritage and Nighttime Community Subcultural Wealth: A Comparison of International and National Strategies, the Agent of Change Principles, and Creative Placekeeping. Sara’s interest in this paper is on determining how legal frameworks that govern city space, such as zoning restrictions, urban planning policies, etc., operate within the real world of a neighborhood. Sara uses both anthropologic and geographic methodologies to assess how cultures and subcultures exist alongside city space regulations that may be consistent with or in conflict with the particular culture or subculture. Her objective in doing so is to discover how to simultaneously and equitably value cultural sustainability and city redevelopment. In particular, Sara focus on Toronto’s culture-based development practices as applied to its Music City aspirations. As Sara writes,
A focus on equitable treatment of different iterations of culture, cultural practices, and the spaces where these are found will be approached through a discussion of community subcultural wealth, use-value of urban spaces and properties, and the importance of a buen vivir (or a “good life”) in the city. This paper will additionally zoom out of the local governance of municipal space and property, and turn to international legal frameworks available for the protection of intangible culture, cultural practices, and the associated spaces of cultural practice and high subcultural community wealth, such as spaces of music culture, beyond a focus on their promotion where potential economic benefits are a result. Examining these international legal frameworks will lead to the suggestion that they remain under-utilized at the local city-level where culture plays out on the planes of everyday life in the city.
Luigi and Sara are two younger scholars doing great work in comparative property law. While the Younger Comparativists are at Tulane this weekend, I wanted to take the opportunity to give them a shout out and shine a spotlight on comparative property law.
Don’t worry—next week we begin looking at the views of Hillary and Bernie on eminent domain. And once that’s finished, I will be starting up a series called WWMGD? What Would Merrick Garland Do? so we can all get deeper sense of Obama’s Supreme Court nominee’s position on property-related matters.
Thursday, March 17, 2016
Amnon Lehavi (ICH - Radzyner) has posted The Culture of Private Law on SSRN. Here's the abstract:
The chief goal of private law is to guide and facilitate interpersonal conduct. In fields such as contracts, property, and corporate governance, lawmakers have an essential normative role of envisioning ideal types of collective action and designing legal and organizational mechanisms that will streamline these types of action, while also giving parties substantial leeway to tailor their interpersonal legal relations.
This Article argues that for such a legal design to be effective, regardless of the substantive content of its underlying normative values, lawmakers must consider the actual congruence between the ideal types of collective action envisioned by private law norms and the prevailing cultural orientations, values, and beliefs that practically guide everyday interactions in a certain society or group. To the extent that a private law reform wishes to promote a new type of collective action that is not initially supported by such grassroots forces, it must find ways to enable at least an incremental shift in the relevant cultural traits to facilitate the desired modes of interpersonal collaboration.
Rejecting an all-or-nothing approach to cultural change, this Article underscores the key role of collective-action organizations, such as business corporations or homeowner associations, in mediating between private law reforms and incremental cultural shifts.
Wednesday, March 16, 2016
Julia Mahoney (UVa) has posted Takings, Legitimacy, and Emergency Action: Lessons from the Financial Crisis of 2008 (George Mason Law Review) on SSRN. Here's the abstract:
Government actions taken during and in the wake of the Financial Crisis of 2008 have generated lawsuits that, somewhat unexpectedly, have made takings law a key vehicle for assessing the government’s response to the crisis. This Essay examines these developments and offers three observations. First, these suits have already served an important public purpose by uncovering information that might not otherwise have come to light about how and why the government chose to do what it did. Second, the prospect of relief for takings claims can bolster the legitimacy of emergency action. This insight leads to this Essay’s final point, which concerns the political economy of public measures to contain financial and economic crises. Government choices regarding who gets help, how much, and with what strings attached inevitably yield winners and losers. Insulating these decisions from review can facilitate the use of crisis to subvert government for private ends. Particularly at a time when anxieties about “crony capitalism” and the outsize influence of elites are running high, these are the wrong incentives to create.
Tuesday, March 15, 2016
Tara Righetti (Wyoming) has posted The Private Pore Space: Condemnation for Subsurface Ways of Necessity (Wyoming Law Review) on SSRN. Here's the abstract:
Article 1, section 32 of the Wyoming Constitution sets forth a private right of eminent domain for ways of necessity. In the 125 years since its passage, section 32, the Wyoming Eminent Domain Act, and the private road statute have been used by private parties to obtain access to homesteads and oil wells, build ditches and flumes to divert irrigation water to arid parcels, and construct railway sidings and tramways through which coal could be transported from a mine to an interstate railway. To date however, the right of condemnation for ways of necessity has only been applied to establish access to and promote development of surface parcels by establishing means of surface use; it has not been used in the subsurface context.
This article examines whether energy developers can condemn subsurface ways of necessity under the Wyoming Eminent Domain Act. In so doing, it describes the nature of the property interest in the subsurface, and applies section 32 and the requirements of the Wyoming Eminent Domain Act to subsurface acquisitions. It then briefly examines challenges posed by calculations of due compensation for subsurface takings.
Monday, March 14, 2016
March 15 is the make or break day for the Kasich campaign. And by “make or break,” I mean this is the day that determines whether Kasich gets to sit at the grown ups table at a contested GOP convention or whether he is stuck at the kiddie table. Yes, the media is talking about Kasich and the Pennsylvania ballot, but c’mon. The Steel State hasn’t voted for a Republican POTUS since 1988 in the general election. Sure it has 71 GOP delegates to give away, but the vote isn’t until April 26. If someone doesn’t have the Republican nomination sewn up by late April, a contested convention is all but a certainty and then what does it matter whether Kasich’s name was on the ballot?
So let’s talk about something that does matter: eminent domain!
As Governor of Ohio, Kasich is familiar with the potential power of eminent domain. The subject has come up in at least one area of Ohio politics: colleges and universities. Early in Kasich’s first term as governor, he proposed the notion of charter universities. Think charter schools at the graduate level. The theory was to give universities more flexibility and exchange public-sector money for private-sector money because public funding was drying up. It was 2011 after all and money was drying up everywhere.
The President of the University of Cincinnati was, at first, excited about the charter idea. So excited he decided to write to Governor Kasich about all of the reforms the Governor could make to the university system by creating charter universities, including giving universities the power to directly acquire land through eminent domain.
I have been to the University of Cincinnati’s campus many times. My brother is a graduate of UC’s College Conservatory of Music (CCM) so I have spent many a weekend flying in an out of the Cincinnati airport and attending the exceptional CCM productions. Go Bearcats, I say. But, as you might guess, not everyone in the state of Ohio thought that handing over eminent domain power to the university system was a good idea. As best as my research shows, it’s not that UC (or other university systems in Ohio) were being greatly harmed by not having the authority to exercise eminent domain power by themselves; the only issue was the university systems had to go through a public agency to acquire property via eminent domain. Ohio Rev. Code sec. 163.01 et seq. has established at least since 2007 that uses of land for public institutions of higher education, as well as for private institutions of higher education, are presumed to be “public uses,” and thus allowed under state eminent domain law. The only real issue is that an “agency” has to do the taking of the property and it doesn’t appear that universities are agencies under the statutory definition. In other words, the universities saw the charter university movement as an opportunity to cut out the government agency middleman when using eminent domain.
At least at first that is how folks perceived the charter university initiative. Over time, universities saw the writing on the wall: the charter university plan meant less state government oversight but also ultimately less money as private money was not likely to match public money. In due course, the charter university proposal was dropped.
Kasich never himself said he wanted to give the universities eminent domain power, but it was well published that at least the President of the UC system was asking for it and there was no record of Kasich saying he was against the idea. Who knows. Maybe if Kasich’s charter university plan had actually come to fruition he would have had to take a hard stance on the topic, but at a minimum he did not reject the notion outright.
And that seems to be a pretty fair analysis of Kasich’s position on eminent domain—unlike Rubio and Cruz, he’s not rejecting the use of eminent domain outright, but he’s not giving it a big bear hug like Trump. Kasich hasn’t said tons about eminent domain on the campaign trail, but he’s made a few comments, including:
It’s a local issue, but the issue of eminent domain is always a serious one. It’s a tough one you have to deal with. I usually come down more on the side of the people who own the property.
Kasich took a similar position when questioned about using eminent domain to build a pipeline in New Hampshire. According to a local newspaper,
Kasich criticized eminent domain, saying it should be a local control issue. The federal government has the power to take property by eminent domain under the Natural Gas Act. Kasich said he is not here to settle the pipeline debate, but said that eminent domain should be a last resort, not a first resort.
Based on his comments while on the campaign trail, Kasich seems to be generally against using eminent domain powers (though not ruling it out). As Governor, he didn’t rule out allowing universities to use eminent domain power, though he never endorsed the idea either. As with most issues, Kasich’s stance on eminent domain appears to be someone between Trump and Rubio/Cruz, with a lean towards the Rubio/Cruz end of the spectrum.
And there you have it—the GOPers (at least those who are still in the race) and their stance on eminent domain. Next up, we turn to the Dems to see how different (or similar) they are to their conservative counterparts.
Ann Eisenberg (West Virginia) has posted Addressing Rural Blight: Lessons from West Virginia and WV LEAP (Journal of Affordable Housing and Community) on SSRN. Here's the abstract:
When we think of “blight,” we tend to think of Baltimore, Detroit, or any number of Rustbelt cities and urban centers with comparable issues. But blight affects rural areas as well, and surprisingly little attention has been devoted to the problem of rural blight. This Article argues that a framework for addressing rural blight should be built from the ground up, and that designing such a framework tailored specifically to rural needs will be more effective than hoping that urban tools turn out to be adequate in rural areas. This analysis draws upon the fields of rural development and sociology, as well as the West Virginia Legal Education to Address Abandoned and Neglected Properties program (WV LEAP) at West Virginia University College of Law’s Land Use and Sustainable Development Law Clinic, a year-long initiative designed to equip communities in the largely rural state of West Virginia to better handle neglected properties. In Part I, the Article discusses common characteristics of rural communities that may hamper their capacity to address blight, and analyzes why some legal tools typically used in an urban context may be inappropriate or unrealistic in rural contexts. Part II provides background on the WV LEAP program and discusses what lessons the program revealed as to how rural communities in West Virginia are frequently impeded in efforts to tackle blight, and how some of those communities manage to overcome those impediments effectively. Part III recommends eight elements as components of a comprehensive rural blight-redemption strategy.
Tim Mulvaney (Texas A&M) has posted On Bargaining for Development (Florida Law Review Forum) on SSRN. Here's the abstract:
In his recent article, Bargaining for Development Post-Koontz, Professor Sean Nolon concludes that the Supreme Court’s recent ill-defined expansion of the circumstances in which land use permit conditions might give rise to takings liability in Koontz v. St. John’s River Water Management District will chill the state’s willingness to communicate with permit applicants about mitigation measures. He sets out five courses that government entities might take in this confusing and chilling post-Koontz world, each of which leaves something to be desired from the perspective of both developers and the public more generally.
This responsive essay proceeds in two parts. First, it illuminates the chilling effect Professor Nolon perceives by explaining Koontz’s grounding in the retroactive takings compensation principle adopted by the Supreme Court nearly thirty years ago in First English Evangelical Lutheran Church of Glendale v. County of Los Angeles. Second, it suggests that Professor Nolon’s list of potential government responses to Koontz can be expanded to include at least five additional (if admittedly more radical) courses, several of which may hold slightly more promise for the public than those advanced in Professor Nolon’s insightful critique.
Sunday, March 13, 2016
(Photo Credit: WSJ, Christina Rexrode and Emily Glazer)
Late last week the Wall Street Journal published a story (behind a paywall) that many of us mortgage finance enthusiasts have been waiting to read. Since the 2008 crash various state attorneys general, the U.S. Department of Justice, and numerous federal agencies have taken aim at the fraudulent foreclosure, lending, and mortgage servicing activities of many of the nation's largest financial institutions. According to this WSJ story, the total amount paid by banks to date from mortgage-related litigation has been roughly $110 billion. To put that in perspective, the total amount of money allocated by Congress in connection with the Troubled Asset Relief Fund of 2008 (TARP) for purposes of aided homeowners was $45.6 billion (out of the program's total $700 billion). The HAMP program (which was supposed to help troubled homeowners get loan modifications) was $30 billion of that amount. And, as an aside, most people know that HAMP was a miserable failure with very little actually getting spent on loan modifications. In fact, of the total 45.6 billion set aside in TARP for housing programs, as of the end of 2015 only $19 billion has actually been spent.
So if all this mortgage litigation was geared toward getting justice for homeowners, where did all that money go? Well...one would assume that it went to homeowners--those most hurt by these abusive practices. But if that's what you thought then you'd be wrong. As indicated below, a great deal of this money went to a host of different parties to fund activities far removed from the everyday struggles of the victims. Some of the funds went to fill gaps in state budgets, others went to pay for state fairs, while yet more went to subsidize the cost of local police forces. The Fiscal Times reports on the WSJ piece and breaks-down the distribution of proceeds as follows:
All of the $34 billion recovered by mortgage giants Fannie Mae and Freddie Mac for being sold fraudulent mortgage securities gets swept into the U.S. Treasury, by law. Some of the federal agencies receiving settlement funds also send those to the Treasury. So in fact, the biggest bubble should be the government’s general fund, with nearly $49 billion in proceeds from the settlements. * * *
The Justice Department also collected “at least $447 million,” according to the report, despite their office building not being under threat of foreclosure either. States received $5.3 billion, but had no obligation to deliver any of that to housing-related programs. In fact, well over half of the $2.5 billion given to states in the 2012 National Mortgage Settlement went to plug budget holes. And the Journal article finds that bank-settlement money built horse stables in New York and funded email accounts in Delaware.
As for that $45 billion bubble of “consumer relief,” this is where the chart is perhaps at most variance with the facts. These were not hard dollars, but credits given to banks for performing certain activities. Many of those activities had nothing to do with rescuing borrowers from foreclosure. Banks got credit for bulldozing homes, donating homes to charity and giving homeowners small amounts of move-out money — routine things banks do anyway for public relations purposes.
Nearly one-quarter of the “relief” in the National Mortgage Settlement came from short sales, in which the bank forgives the difference between the price a distressed homeowner can fetch for their home and the amount they owe on the mortgage. Short sales can be beneficial, but they result in the homeowner losing the home. More people lost their homes in these settlements than saved them.
Even the “relief” that allegedly went to homeowners doesn’t tell the whole story. Banks could get credit by “extinguishing” long-delinquent second mortgages whose real value was $0, since there was no chance of repayment. Banks got credit in the Independent Foreclosure Review settlement administered by the Federal Reserve for the total amount of the mortgage they modified. In other words, if they reduced the principal on a $500,000 mortgage by $1, they got credit for $500,000 of “consumer relief.” That distortion is included in this calculation. Far fewer homeowners benefited from these settlements that it would appear at first glance.
It should also be emphasized that the top-line number of $110 billion in “penalties” doesn’t resemble what the banks actually had to pay. Most of the settlements were tax-deductible, reducing the total value by billions of dollars. Banks reduced principal balances on loans they only serviced and didn’t own, paying their fines with other people’s money. They could get HAMP incentive payments for loans they modified as part of the settlements. Banks even got credit in some settlements for issuing loans in low-income communities, a money-making activity (I’ve referred to this as akin to a bank robber being sentenced to open a lemonade stand).
The findings in the report are startling, but not entirely surprising. Considering how few of the funds earmarked for housing relief under TARP actually helped homeowners-in-distress (or were even spent at all), it's not a huge surprise that the government has not been very effective in distributing the proceeds from these various mortgage settlements.
There are some interesting comparisons to be made here with regarding to how other large-scale settlement funds have been used in the past. For instance, consider the 1998 Tobacco Settlement between the country's four largest tobacco companies and 46 state attorneys general. Under the settlement the defendants agreed to make continuous payments to the states in connection with the medical costs they incurred from the health hazards of smoking. The funds from this settlement have gone to pay for educational and health-related programs, but not without criticisms of the money's long-term handling. More recently (and closer to home) we can look to the handling of funds from the BP oil spill. The $20 billion settlement is earmarked to, among other things, go to state and local governments for their economic loss claims, for habitat restoration and wildlife conservation, for water quality enhancements and recreational opportunities, and for deposit into a reserve fund for future spills. The effectiveness of this distribution plan remains to be seen.
The bottom line is that in order for a settlement of any large scale wrong-doing to be effective the voices of the victims and those who advocate on their behalf must be heard first and foremost. Judging from the way in which the billions in mortgage settlement funds have been spent so far, those voices seem drowned out.
Thursday, March 10, 2016
Those of you who watched the Thursday night's debate heard about HB-1 Visas, Common Core, Social Security, etc. But let’s focus on something else: eminent domain. The question for Property Profs Blog readers—who is more against eminent domain, Ted Cruz or Marco Rubio? You decide.
From Team Rubio:
The fundamental right to private property has been under assault for years through government’s abuses of eminent domain. Eminent domain is the authority vested in government to force the sale of private property. While this authority can be a necessary evil in rare cases related to public development, such as the building of crucial infrastructure, its modern use far exceeds this limitation. Today, it is often wielded by crony capitalist politicians to benefit wealthy and powerful private developers.
Like the defense of other crucial rights, conservative efforts to defend private property are grounded deep in the history of our nation. In fact, abuses of this right were one of the catalysts for the American Revolution. As the first Continental Congress declared, “[The colonists] are entitled to life, liberty and property: and they have never ceded to any foreign power . . . a right to dispose of either without their consent.”
After being founded, in part, to protect these rights, our government has strayed far from this purpose. Compromise after compromise from elected officials in both parties has resulted in a government that believes it has the power to seize your property and sell it to rent-seeking private interests.
My guess is that some of the "crony capitalists" Rubio is at odds with have donated money to his campaign, but that’s just my guess. Pfizer, the “crony capitalist” at the heart of Kelo gave $5,000 to Rubio’s Senate campaign in 2010, though to be fair, Pfizer gave $5,000 to everyone running in Florida's Senate race that year.
Rubio’s website is not the only place he has attacked the Fifth Amendment. Back when the candidates were going door-to-door in New Hampshire, Rubio blasted Trump for supporting eminent domain. Rubio said while in the Florida legislature, he helped to pass “what has become model legislation for other states around the country, that actually passed both a law and a constitutional amendment that keeps developers like Donald Trump from using the power of eminent domain to take private property away from an owner and give it to another owner.”
While in the Florida legislature, Rubio did in fact do what he said he did. Rubio sponsored the Florida legislation in 2006 (House Bill 1567 and House Joint Resolution 1569) that makes eminent domain less than helpful for developers. Under Florida law sponsored by Rubio (and signed into law by then-Governor Jeb Bush), localities must wait ten years before transferring land taken by eminent domain from one owner to another, thereby effectively making it a less-than helpful means for developers to acquire property.
Now from Cruz’ Corner:
Not to be out done, Cruz has also boasted about how much he dislikes eminent domain, though Cruz has done so through TV ads, instead of his campaign website.
Protecting private property rights is an important issue for many of the early primary states like South Carolina, Nevada, and Alaska, so the Cruz campaign cut another ad regarding eminent domain, using very young children, Donald Trump-like dolls, and doll houses. Needless to say, this ad caught the eye of many in reporters.
And then there was a third ad.
It's safe to say, Cruz, like Rubio, is also against using the Fifth Amendment to acquire private property for public use. Except, Cruz does have an exception his anti-eminent domain stance. That exception? Immigration. In July 2012, Cruz was asked about whether eminent domain could be used to take Texans' property for the purposes of building a wall between Texas and Mexico. The answer: a resounding yes because it was an issue of national security.
So you can decide--who stands stronger against eminent domain? Cruz or Rubio?
Tune in soon for a look at John Kasich's stance on the Fifth Amendment and then we will turn to the Dems.
Wednesday, March 9, 2016
Lisa Sun (BYU) & Brigham Daniels (BYU) have posted Externality Entrepreneurism on SSRN. Here's the abstract:
The way that economists have taught us to think about externalities — asking us to identify, measure, and internalize them — while useful, has created a substantial blind spot. According to economic thinking, the law ought to incentivize or force those who create externalities to internalize them. Yet, internalizing externalities is just one way of many that externalities shape law and politics: legal and political actors frequently employ externalities to galvanize or oppose change by strategically identifying, selecting, framing, and promoting externalities. These actors exaggerate and highlight different externalities with the aim of capturing the attention of individuals, the media, networks of interest groups, and ultimately legal and political decisionmakers. We call those who use externalities this way “externality entrepreneurs.” Externality entrepreneurism is prevalent in all levels and branches of government and in almost every area of law and policy, yet it is completely unexplored in existing scholarship. This Article seeks to remedy that neglect and begin the broader conversation about this vitally important lens. Because externality entrepreneurism is so ubiquitous and universal, understanding it is critical not only for those who wish to create change in our political and legal institutions but also for those who wish to more fully understand and evaluate the mechanisms by which such change occurs.