JOHN MARSHALL LAW SCHOOL CHAPTER 1: REAL VERSUS PERSONAL PROPERTY A. Real Property ...s3.amazonaws.com/.../IL.Shepard.PersonalProperty.pdf · · 2016-03-10A. Real Property versus

PERSONAL PROPERTY PROFESSOR SCOTT SHEPARD

JOHN MARSHALL LAW SCHOOL

CHAPTER 1: REAL VERSUS PERSONAL PROPERTY

A. Real Property versus Personal Property

Real property is _______________________ or __________________________. It is usually the

ownership of or a use right in _______________________________.

Personal property is movable.

1. Annexation and Severance

o Personal property can be ______________________ or __________________ to real

property by attaching it to the real property so that it, too, becomes

____________________________.

o Generally, one can sever the personal property from the real property if:

1) There is no intent to make a _______________________________ annexation;

2) The severance occurs during the tenant’s ____________________________; and

3) It can be severed without ______________________ to the remaining real property.

2. The Leasehold Quirk

a. Leaseholds

Leaseholds are ___________________________, even though they are also estates in

land.

Example 1: Testator devises all her real property to her son and all her

personal property to her daughter. One of the pieces of property she owned was

the remaining interest in a 5-year lease on a residential apartment. Who

receives the interest in the 5-year lease?

Answer:

_________________________________________________________________

b. Crops

Wild crops are __________________________; cultivated crops are

________________________.

When conveying land, both types of crops will pass with the land, unless otherwise

agreed.

2 | © 2013 Themis Bar Review, LLC | Illinois Personal Property

Exception: Doctrine of Emblements

o Tenants or the heirs or assigns of holders of life estates may re-enter to take the

crops that cultivated during their tenure, if the tenure was:

(a) For an ___________________________________, and

(b) If the tenancy was terminated for reasons other than the

____________________________ or the _______________________ of the

tenancy.

Example 2: Farmer Bob holds Blackacre for life. In April, he plants the

summer wheat. In July, he dies. Who gets the wheat?

Answer: Bob’s heirs or assigns will take the wheat under the Doctrine of

Emblements because Bob’s life estate has an

_____________________________ and it was Bob’s labor and materials that

made the wheat grow.

Example 3: Instead, Bob has a 5-year fixed-term lease that ends on July 1. In

April, he plants the wheat. In August, he wants to harvest the wheat. Who

takes the wheat?

Answer: Neither Bob nor his successors may harvest the wheat. It passes to the

____________________ or to a ______________________.


CHAPTER 2: TRANSFER OF TITLE – PART 1

A. Summary: Transfer of Title to Personal Property

1. There are eight ways to acquire (or, sometimes, to lose) title to personal property:

1) Capture

2) Creation

3) Conversion

4) Find

5) Accession

6) Confusion

7) Adverse Possession

8) Gift

2. In addition to these eight, there are five ways to lose title:

1) Abandonment

2) Loss

3) Misplacement

4) Fraud

5) Conversion

B. Transferring Title of Property in More Detail

1. Capture of Un-owned Property

a. Wild Animals

Wild animals remained un-owned until someone __________________ them to

____________________________.

This happens when a party can exercise _______________________________________

over them.

b. Owned Animal Escapes

Owned animals that escape into the wild become un-owned again, unless:


i) The owner has ___________________ (e.g., tagged or branded) the animal, and

the owner makes diligent efforts to ___________________________ it;

ii) The owner is in the act of

______________________________________________ (e.g., hot pursuit); or

iii) The animal periodically leaves the owner’s property, but

_____________________________ (e.g., domesticated cats).

Trespassers do not take captured property for themselves. They capture for the benefit

of ______________________________________.

If capturing un-owned property violates a statute, there can be penalties imposed,

which include forfeiture of the right to title by capture.

Example 4: Imagine that you go hunting for bear on your own property (or on

another’s property with permission.) Do you own the bears wandering through

the woods?

Answer: ____________. You cannot make a consistent ownership claim to the

bears. To become the owner of the bear, you have to reduce it to your

possession and control.

Example 5: Imagine that you go hunting on your neighbor’s land without his

permission and bag a brace of pheasants. Do you own the animals you

captured?

Answer: ___________. You will have to turn over your capture to the

landowner; a trespass is a wrong, and the wrongdoer cannot profit from the

wrong done.

2. Creating New Personal Property

Exam Tip 1: The most tested example: ___________________________.

o Products of the mind are protected by common-law rule and especially by federal statute,

including the patent, trademark and copyright statutes.

o In order to gain a common-law copyright, the author must:

a) Show the work is actually __________________________ and is

___________________; and it obtains from the point when the creator

b) Converts the idea into a fixed, tangible medium of expression.

o The copyright will last for the author’s lifetime plus ________ years after the author’s death.

(Anonymous authors get either 95 years from publication or 120 years from the creation of

the work.)

o However, the copyright must be ____________________________ in order to permit a

__________________________________ and to receive federal statutory damages.


3. Conversion of Personal Property

o General rule: Someone who has converted the property of another, and who does not have

good title to it, generally cannot pass along good title to it to a third party.

o Exceptions:

Transfers of _____________________ or other negotiable goods from the converter to

an _______________________________________;

Transfers of goods that were obtained through ___________________ or

misrepresentation to an innocent third- party purchaser (good faith purchaser for

value).

o Passive conversion as a cause of action: An owner whose property has been misdelivered

to some third party or substantially damaged can bring a claim for conversion, and can force

the breacher to ___________________ the goods from the original owner and pay

_______________________________________________________________________.



A. Transfer of Property (continued)

1. Finders Law: Abandoned, Lost and Misplaced Property

a. Abandoned Property

If someone expressly and intentionally abandons property, it becomes

_________________ and available for capture by the finder under the rules for capture.

If no one claims abandoned property for long enough, the property will

__________________, or be forfeited to the state.

b. Lost and Misplaced Property; Treasure Trove

A finder can take title to both lost and misplaced property, but does so subject to a

superior claim from the ______________________________.

Goods are lost when the original owner __________________________ puts them in

some place _______________________ to the owner.

Finders’ claims are ALWAYS inferior to:

The true owner, AND

The underlying _____________________________ if:

i) The finder is a ___________________________ on the land; or

ii) If the land is ______________________________ and the general public is not

invited there; or

iii) If the goods were __________________________________________ the land.

In most states (including Illinois), the finder must turn over the property to his employer

if he found it while performing his duties.

Goods are misplaced when the original owner _____________________ put them down

somewhere and later

____________________________________________________________________.

Finders’ interests are ALWAYS inferior to:

i) The true owner; and

ii) The rightful possessor of the land on which the goods are misplaced.

Goods are a treasure trove if they are intentionally concealed in anticipation of

retrieving them at a later date.

Common Law: Any finder, even a trespasser, could claim a treasure trove.

Modern Rule: Generally, the property is treated as if it were ____________.


Note 1: Whoever has the best title in each circumstance, other than the true owner, becomes a “_______________________” and can treat the property as if it were his own until the true property owner claims it. But the party has a duty to try to locate the true owner, and could be held liable if he fails to do so.

Uniform Disposition of Unclaimed Property Act

Illinois, like most states, has a statute dealing with the disposition of intangible

property (money, stocks, items in a safe deposit box) if the property goes unclaimed

through the statutory period after notice is posted.

2. Accession

o Definition: Accession occurs when some personal property is altered or improved by the

____________________ of ___________________________________________ to the

original property.

o The accession of materials to an owner’s goods, whether in the course of repair or

otherwise, generally transfers ownership of the materials accessed to

________________________________________________________.

o Two issues with trespassers

1) Innocent Trespasser

Genuinely, but wrongly, believes he is improving his own goods with his own

materials.

The preferred course, if possible, is to

___________________________________________________ without

_____________________________________________________________.

If this cannot be done, the default rule is that the original owner will

_________________________________, unless the original identity of the property

is _________ due to the accession, transforming the goods into a

_______________________________. The accessing party must pay the value of

the goods effectively converted.

If not substantially altered, but the owner feels the goods were damaged by the

accession rather than improved by it, the owner can seek compensation.

Example 6: Bob and Sally are neighbors with a backyard not cut by a fence.

In that back yard has long stood a grill that both parties have used without

complaint – in fact, after all these years, both think they own it. Bob goes out

one day to do some work on the grill. He solders and makes other repairs that

cannot easily be removed from the grill. Sally thanks him the next day and Bob

asks why she is so happy. They realize that Sally is actually the owner of the

grill. Does Bob have any claim under these circumstances to the grill or its

improvements? Why or why not?


Answer: __________________________________________________________

_________________________________________________________________

_________________________________________________________________

Example 7: Same situation as above, except this time, Sally collects 2x4s

from the back yard thinking they are hers and builds a birdhouse to put in the

yard. Bob, who owns the wood, realizes what she has done with it. Who owns

the birdhouse? What other consequences arise?

Answer: __________________________________________________________

_________________________________________________________________

_________________________________________________________________

2) Willful Trespassers

A willful trespasser gets nothing, and owes for any damages caused.

Example 8: Assume a thief stole a beat up car that barely ran. After he steals

it, he gets it running like new. He is then arrested and the car is returned to the

original owner. Who gets the car? Can the thief seek compensation?

Answer: The car will be returned to its original owner, and the thief cannot

request compensation from the owner.

3. Confusion

o If everyone has an unquantified claim to an undifferentiated mass of the same goods, all

mixed together in the same place, no one will be able to discern her property from that of

the other property owners.

o The law declares all the property owners to be

“__________________________________________” of the mass in proportion to their

contribution to the property pile.

If the parties don’t know how much they each contributed to the mass, proportionally,

and no one wrongly contributed to the confusion, then everyone shares out the mass

___________________________.

If someone wrongly contributed to the confusion, he must demonstrate his proportional

contribution. If unable to do so, he takes _________________________ and the other

owners divvy up the mass equally between themselves.

4. Adverse Possession

o Adverse possession requires the possessor to maintain possession that is:


1) _____________________________

2) _____________________________

3) _____________________________

4) _____________________________

5) ________________________________________________________

Note 2: This possession must continue throughout the _____________________________________________________________ period; this is usually much shorter for personal property than for real property.

Note 3: Courts are particularly wary of adverse possession of personal property because of the ___________________________________ requirement; it is much easier to conceal possession of personal property than of real property.

Example 9: You come into possession of a precious oil painting, and hang the

painting over the mantel. However, the true owner of the painting never comes

to your house. If the true owner of the painting had no other reason to know of

your possession, then your possession could not qualify as adverse possession. It

is difficult to prove the ______________________ element.

o Separate trespassers may tack as long as there is privity between the trespassing parties.

o Tolling works the same as with real property.



A. Transfer of Property (continued)

1. Gifts

o Definition: Voluntary transfer of ownership of property without _________________ or

_______________________________.

o A promise to make a gift of personal property in the future is not binding unless:

1) There is ___________________________; or

2) There has been reasonable ________________________.

a. Inter vivos gifts. Three elements/requirements:

1) Donor’s intent

Requires the ___________________________ to intend something, and

May be ___________________________.

Example 10: Bob and Sally plan to get married, and receive a large number of

wedding gifts. They decide to call it off two days before. Will they be able to

keep the gifts?

Answer: _________________________________________________________

________________________________________________________________

2) Delivery

Delivery provides a clear manifestation of the donor’s intent to relinquish her title

and possessory interest. The decisive factor is whether the putative donor has the

power independently to re-claim the property.

Four ways to deliver the gift:

i) Physical (preferred)

Example 11: Sally decides to give Bob a present and leaves it on her back

porch while he is at work. Sally changes her mind and retrieves the present

before Bob gets home. If Bob returns later and discovers Sally’s actions, could

he reclaim the gift?

Answer: _________________________________________________________

________________________________________________________________.

Example 12: What if Bob came home early, noticed the present on his back

porch, and took it inside?


Answer: Bob can keep the gift. Sally is now incapable of taking the gift back

without Bob’s consent. The gift is delivered because Bob took actual, physical

delivery.

ii) Constructive Delivery

(a) The law imputes actual delivery where circumstances make the physical

delivery impractical.

(b) A simple declaration is ___________________________ to establish

constructive delivery. It must be coupled with something more to

demonstrate delivery, particularly some action that transfers to the grantee

the ability to access the gift.

iii) Express Signed Writing

iv) Symbolic Delivery

(a) Giving someone a formal manifestation of inchoate goods, thus symbolizing

the gift. The most common examples of symbolic deliveries are of

_______________________________.

(b) Delivery of a ____________ is not complete until presented and cashed.

The value remains in the donor’s control until the check is cashed.

(c) Delivery of a stock certificate is complete upon delivery, because bearing

the stock certificate

_____________________________________________________.

3) Acceptance

Presumed. If a grantee wants to reject a gift, she must make this clear.

b. Gifts Causa Mortis

Definition: Gifts given ____________________________________________________.

Elements:

Intent

Delivery

Acceptance

_____________________________________

Such gifts are effectively __________________________________.

Example 13: Let’s assume that Bob is at death’s door. He gives his car to Sally.

We presume that he genuinely wants her to have the car, but also that he

wouldn’t have granted the car to her if he weren’t dying. Thus, the key

distinction – gifts causa mortis are:


Revocable (unlike inter vivos gifts)

Grantor can revoke until _______________ or ______________________.

Revoked by operation of law if the person recovers.

Gifts causa mortis may only be made involving _________________________, not

____________________________________.

c. Gifts to minors

The Illinois Uniform Transfer to Minors Act allows ____________________________ to

be given to minors before majority for tax-exclusion purposes, but the minor does not

receive the property until the age of majority.

The control of the gift property is given to a ____________________ who must act with

______________________ responsibility toward the property until handed over to the

minor.


CHAPTER 5: REMEDY ACTIONS & LIENS

A. Remedies of Personal Property Owners

Conversion:

______________________________________________________________________________

Replevin: ______________________________________________________________________

Trespass:

______________________________________________________________________________

Trover:

______________________________________________________________________________

B. Liens

1. Definition

o ___________________________________________________________________________

2. Parties

o Lienor – the person entitled to the goods until the debt has been paid (creditor).

o Lienee – the person who must pay to regain control of his goods (debtor).

3. Types of Liens

o General: allows the lienor to continue to possess the debtor’s property until the debtor has

satisfied all debts owed to the lienor arising from the same line of business.

o Special: lien lasts until payment is made for the work or service that put the goods in the

lienor’s possession.

o The more common kind of lien (by far) is the _________________________ lien.

o Statutory Liens - Illinois Mechanic’s Lien Law

o Common Law Liens – apply to artisan and tradesmen who repair personal property,

warehouses and other bailees which move or store goods, landlords who have a lien over

the tenant’s goods that are kept on the landlord’s property and hoteliers and inn keepers

who have liens over the possessions of their guests

4. Discharge of Liens

o Satisfaction of Debt

o Waiver or Release without satisfaction (expressly or implied by behavior)

o Conditional return without a waiver of the lien.

Example 14: Sally is a repair shop owner. Bob is a famer and has brought his

tractor in for repair. Bob hasn't paid off the repair work, and lacks the money to

pay. In fact, Bob needs tractor in order to bring in the harvest so that he can sell

it to earn the money to pay for the tractor repairs and satisfy the lien. Sally can


"lend" his tractor back to Bob, for the limited purpose of harvesting the crop,

without waiving her lien.


CHAPTER 6: BAILMENTS

A bailment occurs every time someone passes _____________________________ of his/her

property to someone else without passing ______________________________.

Definition: The delivery of personal property by the bailor (i.e. owner) to another person, the

bailee, for a period of time without ownership of the property passing to the bailee. These

arrangements can be by contract or can be ________________________________.

Elements:

1) Actual ____________________________ of the goods by the bailee;

2) _____________________ of exactly what is possessed by the bailee; and

3) _____________________ to possession.

Example 15: Sally is going on vacation and she wants Bob to look after her

car. If they make the agreement and Sally delivers the car, then the bailment

has been created. However, if she just parks the car in the driveway, a proper

bailment will not be created until Bob notices and agrees to serve as a bailee.

Even if they had agreed previously as to the car, but Bob did not know that Sally

had left a box of vinyl records in the trunk, Bob would not be a bailee of those

records – and would not be liable if they melted in the heat while Sally was

gone.

A. Conditional Bailments

Bailor gives the bailee possession for a specific purpose; these conditions can be

___________________ or _______________________.

Consignment: Bailment for the conditional purpose of the bailee’s _____________ of goods.

Pledge: The bailor gives the bailee/creditor a pledge of collateral goods against the

__________________ they are contracting.

A bailee is __________________________ to the bailor for damages resulting from a violation

of the bailment conditions.

B. Duties of the Bailee

If the bailment is entirely for the benefit of the bailor, the bailee owes only a

___________________ duty of care.

If the bailment is mutually beneficial, the bailee owes an __________________ duty of care.

(Consists mostly of ___________________ bailments, e.g., to ________________________.)

If the bailment is entirely for the benefit of the bailee, the bailee owes a ______________ duty

of care.

Example 16: Bob's car breaks down and is in the shop. He needs a car to get

to work, and Sally has an extra car. Bob borrows Sally's extra car to get to


work. Because the bailment is solely for Bob’s advantage, Bob owes a

_________________ duty of care.

o Even a bailment for the sole benefit of the bailee does not create strict liability.

o Strict liability is reserved for cases in which the bailee

_________________________________________________, including delivery and re-

delivery.

The bailee is NOT an ______________________ for the goods, except innkeepers.

C. Rights of the Bailee

Steps into the bailor’s possessory interest to the extent of the terms of bailment, and can

therefore bring the same ____________________ a bailor can, and may be subject to creditors

of the bailor.

Bailor will pay for ________________________________________ arising during the bailment,

and the bailee can put a lien on the property.

Example 17: Sally keeps Bob’s car at her house while he goes out of town.

Sally has to move Bob’s car to get her own car out of the garage, but it won’t

start. Bob is unreachable. Sally has to call a tow truck to move Bob’s car. This is

an extraordinary expense, not Sally’s (bailee’s) fault, so Bob (bailor) must pay

the expenses, and Sally has a lien on the car until he reimburses her.

D. Rights and Duties of Bailor

Action based on _________________________ occurring during the bailment (if conditions

followed, a type of negligence will apply; if they were violated, strict liability).

Action based on breach of _______________________________.

Action against ___________________________ who interfere with the bailment.

The bailor must inform the compensated bailee of any _________________ in the personal

property.

E. Termination of Bailment

According to terms

Conduct of the parties

Example 18: A homerun ball is caught by a young fan. The fan hands the ball

to his father for safe keeping until they return home. The ball is stolen by a

thief. The thief takes it to a memorabilia shop, gets the ball valued, and sells

the ball to the shop for about 1/8th of its value. Three questions:

(1) What legal relationship arose when the son handed the ball to his father?


Answer: __________________________________________________________

_________________________________________________________________

_________________________________________________________________

What happened to the baseball team’s ownership of the ball?

________________________

How did the son get ownership? __________________________

(2) What is the cause of action the son could bring against the thief and the

contours of the action?

Answer: _________________________________________________

(3) Can the memorabilia shop that bought the ball from the thief keep it? And

can it use the belief that the thief owned the ball as a defense against the son?

Answer:__________________________________________________________

_________________________________________________________________

________________________________________________________________

[END OF HANDOUT]

JOHN MARSHALL LAW SCHOOL CHAPTER 1: REAL VERSUS PERSONAL PROPERTY A. Real Property ...s3.amazonaws.com/.../IL.Shepard.PersonalProperty.pdf · · 2016-03-10A. Real Property versus

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