Gregory S. Alexander

An Introduction to Property Theory

This book surveys the leading modern theories of property – Lockean, libertarian, utilitarian/law-and-economics, personhood, Kantian, and human flourishing – and then applies those theories to concrete contexts in which property issues have been espe- cially controversial. These include redistribution, the right to exclude, regulatory takings, eminent domain, and intellectual property. The book highlights the Aristotelian human flourishing theory of property, providing the most comprehensive and accessible introduction to that theory to date. The book’s goal is neither to cover every conceivable theory nor to discuss every possible facet of the theories covered. Instead, it aims to make the major property theories comprehensible to beginners, without sacrificing accuracy or sophistication. The book will be of particular interest to students seeking an accessible introduction to contemporary theories of property, but even specialists will benefit from the book’s lucid descriptions of contemporary debates.

Property and Community

Introduction: Property and Community Gregory S. Alexander & Eduardo M. Penalver Chapter 1: The Objects of Virtue David Lametti Chapter 2: Re-Imagining Takings Law Hanoch Dagan Chapter 3: How Property Norms Construct the Externalities of Ownership Joseph William Singer Chapter 4: Property and Marginality A. J. van der Walt Chapter 5: Facts on the Ground Nomi Maya Stolzenberg Chapter 6: Commons and Legality Avital Margalit Chapter 7: The Legal Order of the Queue Kevin Gray

Pensions and Passivity

One of Equitys least-discussed triumphs1 is also one of its most significant: passive ownership of property. Passive ownership of property has become the dominant mode of owning capital in the United States. It has triumphed over its great rival, the classical liberal model of property ownership. That model, which the common law of property historically promoted,2 consolidated in a single legal entity, usually an individual person, the relevant rights, privileges, and powers for possessing, using, and transferring assets. The passive model of ownership deviates from classical ownership by disaggregating beneficial property rights from the control and management functions of ownership. Under the passive model, beneficial owners of property rights lack the authority to decide how the assets in which they have a beneficial interest are used. Equity first developed the passive model of ownership through its enforcement of trusts. 3 The trusts separation of property management from beneficial enjoyment provided, in turn, the precedent for the equitable institution that vastly extended the incidence of passive ownership, the corporation.4 As Berle and Meanss classic discussion demonstrated,5 the rise of the modem corporation signalled a fundamental change in the character of ownership in mature capitalist economies. Prior to the emergence of the modem corporation, individuals who supplied capital for enterprises retained extensive control over

The Transformation of Trusts as a Legal Category, 1800-1914

Sometimes we are least aware of that which most affects us. So it seems with respect to legal categories. Lawyers do not take legal categories very seriously today. But they should. Legal categories are central to legal reasoning; indeed it is almost impossible to imagine legal reasoning without the use of categories. Categorical thinking affects every area of law. In constitutional law, for example, equal protection analysis turns crucially on categories of affected interests. Specialists in landlord-tenant law debate whether the implied covenant of habitability is a property doctrine or a contract doctrine. And if the public/private distinction is dead, as some reports have suggested, it rules us yet from its grave. Legal categories are not simply housekeeping devices. They inhibit our imagination of what is acceptable, indeed, of what is possible. They take on a quality of givenness and thereby disempower us. We can retain control over categories, and ultimately over our own legal imagination, only by reminding ourselves that we have created them and are capable of remaking them.

The Dilution of the Trust

Trust-like arrangements are appearing in civil law jurisdictions at an increasing rate. Two or three decades ago, such a development would have been unthinkable. But few, if any, of the new arrangements are true trusts, that is, trusts as the common lawyer would recognize them. These civilian arrangements are diluting the trust. For example, the Draft EU Directive on Protected Funds, which appeared in 2009, does not authorize the trust but rather what we might the “trust-lite.” This paper considers some reasons for the spread of these trust-like devices and discusses possible implications for common-law trusts.

Property and Human Flourishing

This chapter sets out a theory of property that aims at realizing the ideal of human flourishing. The theory draws inspiration from the political and moral theories of Aristotle and Thomas Aquinas. Though it departs in significant ways from those classical theories, enough debt to Aristotle remains that we will sometimes refer to the theory simply as “Aristotelian.” As background, we first briefly examine the historical ancestry of this theory, notably in Aristotle’s and Aquinas’s discussions of property. ARISTOTLE Human Nature We begin with Aristotle’s famous statement, which he repeated seven times, that “a human being is by nature a political animal.” This statement contains both empirical and normative claims. Empirically, part of his meaning is that humans are social creatures and that we characteristically choose to live with others. As he states in the Nicomachean Ethics , “[n]o one would choose to have all good things all by himself, for man is a social and political being and his natural condition is to live with others.” Beyond this general inclination toward the company of others (at least sometimes), Aristotle also means that we have a deeper need to be part of a political community within which we experience richer and more complete lives than are available to us either alone or within small family units.

An Introduction to Property Theory: Locke and Libertarian Theories of Property

No single person has had more of an impact on property thought in the English-speaking world than John Locke. Among contemporary theorists, however, Locke’s influence is felt most directly among property rights libertarians. This is somewhat ironic, because these libertarians are able to rely on Locke only by excising from his theory several of its foundational elements. In this chapter, we will describe the outlines of Locke’s theory and explore some of the debates over its cogency and meaning. LOCKE’S CONTEXT Locke’s theory of property is laid out in his Two Treatises of Government , with the bulk of the relatively brief discussion appearing in the fifth chapter of the second treatise. (There are, as we will see, important elements of his discussion in the first treatise as well.) In thinking about Locke’s theory, it is helpful to understand something about the debates in which he likely understood himself to be participating. Although the Two Treatises was not published until 1689, in the immediate aftermath of the Glorious Revolution, most commentators agree that the work was actually written several years earlier, between roughly 1679 and 1682, during the Exclusion Crisis, in which the Whigs, led by the First Earl of Shaftesbury (Locke’s patron), attempted to prevent the Catholic James, Duke of York, from inheriting the throne.

An Introduction to Property Theory: Utilitarian Property Theories

As a leading property law casebook puts it, “[u]tilitarian theory is, without doubt, the dominant view of property today, at least among lawyers.” This is certainly true, but the story is also significantly more complicated. Although utilitarian analysis provides tremendous insight into the institution of property, it raises a number of important questions when treated as a comprehensive theory of property. Moreover, the term utilitarian masks a great deal of intellectual and methodological diversity. Rather than a single utilitarian theory, it is more appropriate to speak of a number of utilitarian (or even utilitarian-influenced) property theories . For our purposes, these utilitarian-influenced theories include many contemporary theories that refer to themselves as economic or welfarist . In this chapter, we will explore the broad outlines of these theories, focusing on their points of overlap and also on key areas of disagreement. A BRIEF INTRODUCTION TO UTILITARIANISM Utilitarianism is a consequentialist moral philosophy, that is, one that judges the rightness and wrongness of actions or rules or institutions by the goodness and badness of the consequences they bring about. Utilitarianism assesses the goodness or badness of consequences in terms of their tendency to maximize utility or welfare. Bernard Williams has observed that “[t]he fathers of utilitarianism thought of it principally as a system of social and political decision,” as opposed to “a system of personal morality.” As Williams correctly notes, it is sometimes hard to keep these two domains apart. Nevertheless, it is plainly as a theory of social choice that utilitarianism has been deployed in the context of property theory.