Chapter XX: The Law of Property (2)

If, therefore, I am in possession of anything in which I claim a right, I have evidence of my right which differs from all other evidence, inasmuch as it grows stronger instead of weaker with the lapse of years. The tooth of time may eat away all other proofs of title. Documents are lost, memory fails, witnesses die. But as these become of no avail, an efficient substitute is in the same measure provided by the probative force of long possession. So also with long want of possession as evidence of want of title; as the years pass, the evidence in favour of the title fades, while the presumption against it grows ever stronger.

Here, then, we have the chief foundation of the law of prescription. For in this case, as in so many others, the law has deemed it expedient to confer upon a certain species of evidence conclusive force. It has established a conclusive presumption in favour of the rightfulness of long possession, and against the validity of claims which are vitiated by long want of possession. Lapse of time is recognised as creative and destructive of rights, instead of merely as evidence for and against their existence. In substance, though not always in form, prescription has been advanced from the law of evidence to a place in the substantive law.

The conclusive presumption on which prescription is thus founded falls, like all other conclusive presumptions, more or less wide of the truth. Yet in the long run, if used with due safeguards, it is the instrument of justice. It is not true as a matter of fact that a claim unenforced for six years is always unfounded, but it may be wise for the law to act as if it were true. For the effect of thus exaggerating the evidential value of lapse of time is to prevent the persons concerned from permitting such delays as would render their claims in reality doubtful. In order to avoid the difficulty and error that necessarily result from the lapse of time, the presumption of the coincidence of fact and right is rightly accepted as final after a certain number of years. Whoever wishes to dispute this presumption must do so within that period; otherwise his right, if he has one, will be forfeited as a penalty for his neglect. _Vigilantibus non dormientibus jura subveniunt._

Prescription is not limited to rights _in rem_. It is found within the sphere of obligations as well as within that of property. Positive prescription, however, is possible only in the case of rights which admit of possession—that is to say, continuing exercise and enjoyment. Most rights of this nature are rights _in rem_. Rights _in personam_ are commonly extinguished by their exercise, and therefore cannot be possessed or acquired by prescription. And even in that minority of cases in which such rights do admit of possession, and in which positive prescription is therefore theoretically possible, modern law, at least, has seen no occasion for allowing it. This form of prescription, therefore, is peculiar to the law of property. Negative prescription, on the other hand, is common to the law of property and to that of obligations. Most obligations are destroyed by the lapse of time, for since the ownership of them cannot be accompanied by the possession of them, there is nothing to preserve them from the destructive influence of delay in their enforcement.[443]

Negative prescription is of two kinds, which may be distinguished as perfect and imperfect. The latter is commonly called the limitation of actions, the former being then distinguished as prescription in a narrow and specific sense. Perfect prescription is the destruction of the principal right itself, while imperfect prescription is merely the destruction of the accessory _right of action_, the principal right remaining in existence. In other words, in the one case the right is wholly destroyed, but in the other it is merely reduced from a perfect and enforceable right to one which is imperfect and unenforceable.

An example of perfect prescription is the destruction of the ownership of land through dispossession for twelve years. The owner of land who has been out of possession for that period does not merely lose his right of action for the recovery of it, but also loses the right of ownership itself. An example of imperfect prescription, on the other hand, is the case of the owner of a chattel who has been out of possession of it for six years. He loses his right of action for the recovery of it, but he remains the owner of it none the less. His ownership is reduced from a perfect to an imperfect right, but it still subsists. Similarly a creditor loses in six years his right of action for the debt; but the debt itself is not extinguished, and continues to be due and owing.

§ 163. =Agreement.=

We have already considered the general theory of agreement as a title of right. It will be remembered that we used the term to include not merely contracts but all other bilateral acts in the law, that is to say, all expressions of the consenting wills of two or more persons directed to an alteration of their legal relations. Agreement in this wide sense is no less important in the law of property than in that of obligations.

As a title of proprietary rights _in rem_, agreement is of two kinds, namely assignment and grant. By the former, existing rights are transferred from one owner to another; by the latter, new rights are created by way of encumbrance upon the existing rights of the grantor. The grant of a lease of land is the creation by agreement, between grantor and grantee, of a leasehold vested in the latter and encumbering the freehold vested in the former. The assignment of a lease, on the other hand, is the transfer by agreement of a subsisting leasehold from the assignor to the assignee.

Agreement is either formal or informal. We have already sufficiently considered the significance of this formal element in general. There is, however, one formality known to the law of property which requires special notice, namely, the delivery of possession. That _traditio_ was an essential element in the voluntary transfer of _dominium_ was a fundamental principle of Roman law. _Traditionibus et usucapionibus dominia rerum, non nudis pactis transferuntur._[444] So in English law, until the year 1845, land could in theory be conveyed in no other method than by the delivery of possession. No deed of conveyance was in itself of any effect. It is true that in practice this rule was for centuries evaded by taking advantage of that fictitious delivery of possession which was rendered possible by the Statute of Uses. But it is only by virtue of a modern statute,[445] passed in the year mentioned, that the ownership of land can in legal theory be transferred without the possession of it. In the case of chattels the common law itself succeeded, centuries ago, in cutting down to a very large extent the older principle. Chattels can be assigned by deed without delivery, and also by sale without delivery. But a _gift_ of chattels requires to this day to be completed by the transfer of possession.[446]

In this requirement of _traditio_ we may see a curious remnant of an earlier phase of thought. It is a relic of the times when the law attributed to the fact of possession a degree of importance which at the present day seems altogether disproportionate. Ownership seems to have been deemed little more than an accessory of possession. An owner who had ceased to possess had almost ceased to own, for he was deprived of his most important rights. A person who had not yet succeeded in obtaining possession was not an owner at all, however valid his claim to the possession may have been. The transfer of a thing was conceived as consisting essentially in the transfer of the possession of it. The transfer of _rights_, apart from the visible transfer of _things_, had not yet been thought of.

So far as the requirement of _traditio_ is still justifiably retained by the law, it is to be regarded as a formality accessory to the agreement, and serving the same purposes as other formalities. It supplies evidence of the agreement, and it preserves for the parties a _locus poenitentiae_, lest they be prematurely bound by unconsidered consent.

It is a leading principle of law that the title of a grantee or assignee cannot be better than that of his grantor or assignor. _Nemo plus juris ad alium transferre potest, quam ipse haberet._[447] No man can transfer or encumber a right which is not his. To this rule, however, there is a considerable number of important exceptions. The rule is ancient, and most of the exceptions are modern; and we may anticipate that the future course of legal development will show further derogations from the early principle. There are two conflicting interests in the matter. The older rule is devised for the security of established titles. Under its protection he who succeeds in obtaining a perfect title may sit down in peace and keep his property against all the world. The exceptions, on the contrary, are established in the interests of those who seek to _acquire_ property, not of those who seek to _keep_ it. The easier it is to acquire a title with safety, the more difficult it is to keep one in safety; and the law must make a compromise between these two adverse interests. The modern tendency is more and more to sacrifice the security of tenure given by the older rule, to the facilities for safe and speedy acquisition and disposition given by the exceptions to it.

These exceptions are of two kinds: (1) those due to the separation of legal from equitable ownership, and (2) those due to the separation of ownership from possession. We have seen already that when the legal ownership is in one man and the equitable in another, the legal owner is a trustee for the equitable. He holds the property on behalf of that other, and not for himself; and the obligation of this trusteeship is an encumbrance upon his title. Yet he may, none the less, give an unencumbered title to a third person, provided that that person gives value for what he gets, and has at the time no knowledge of the existence of the trust. This rule is known as the equitable doctrine of purchase for value without notice. No man who ignorantly and honestly purchases a defective legal title can be affected by any adverse equitable title vested in any one else. To this extent a legal owner can transfer to another more than he has himself, notwithstanding the maxim, _Nemo dat quod non habet_.

The second class of exceptions to the general principle includes the cases in which the possession of a thing is in one person and the ownership of it in another. Partly by the common law, and partly by various modern statutes, the possessor is in certain cases enabled to give a good title to one who deals with him in good faith believing him to be the owner. The law allows men in these cases to act on the presumption that the possessor of a thing is the owner of it; and he who honestly acts on this presumption will acquire a valid title in all events. The most notable example is the case of negotiable instruments. The possessor of a bank-note may have no title to it; he may have found it or stolen it; but he can give a good title to any one who takes it from him for value and in good faith. Similarly mercantile agents, in possession of goods belonging to their principals, can effectively transfer the ownership of them,[448] whether they are authorised thereto or not.[449]

§ 164. =Inheritance.=

The fourth and last mode of acquisition that we need consider is Inheritance. In respect of the death of their owners all rights are divisible into two classes, being either inheritable or uninheritable. A right is inheritable, if it survives its owner; uninheritable, if it dies with him. This division is to a large extent, though far from completely, coincident with that between proprietary and personal rights. The latter are in almost all cases so intimately connected with the personality of him in whom they are vested, that they are incapable of separate and continued existence. They are not merely _divested_ by death (as are rights of every sort), but are wholly _extinguished_. In exceptional cases, however, this is not so. Some personal rights are inheritable, just as property is, an instance being the status of hereditary nobility and the political and other privileges accessory thereto.

Proprietary rights, on the other hand, are usually inheritable. In respect of them death is a divestitive, but not an extinctive fact. The exceptions, however, are numerous. A lease may be for the life of the lessee instead of for a fixed term of years. Joint ownership is such that the right of him who dies first is wholly destroyed, the survivor acquiring an exclusive title by the _jus accrescendi_ or right of survivorship. Rights of action for a tort die with the person wronged, except so far as the rule of the common law has been altered by statute. In the great majority of cases, however, death destroys merely the ownership of a proprietary right, and not the right itself.

The rights which a dead man thus leaves behind him vest in his _representative_. They pass to some person whom the dead man, or the law on his behalf, has appointed to represent him in the world of the living. This representative bears the person of the deceased, and therefore has vested in him all the inheritable rights, and has imposed upon him all the inheritable liabilities of the deceased. Inheritance is in some sort a legal and fictitious continuation of the personality of the dead man, for the representative is in some sort identified by the law with him whom he represents. The rights which the dead man can no longer own or exercise _in propria persona_, and the obligations which he can no longer _in propria persona_ fulfil, he owns, exercises, and fulfils in the person of a living substitute. To this extent, and in this fashion, it may be said that the legal personality of a man survives his natural personality, until, his obligations being duly performed, and his property duly disposed of, his representation among the living is no longer called for.[450]

The representative of a dead man, though the property of the deceased is vested in him, is not necessarily the beneficial owner of it. He holds it on behalf of two classes of persons, among whom he himself may or may not be numbered. These are the creditors and the beneficiaries of the estate. Just as many of a man’s rights survive him, so also do many of his liabilities; and these inheritable obligations pass to his representative, and must be satisfied by him. Being, however, merely the representative of another, he is not liable _in propria persona_, and his responsibility is limited by the amount of the property which he has acquired from the deceased. He possesses a double personality or capacity, and that which is due from him in right of his executorship cannot be recovered from him in his own right.

The beneficiaries, who are entitled to the residue after satisfaction of the creditors, are of two classes: (1) those nominated by the last will of the deceased, and (2) those appointed by the law in default of any such nomination. The succession of the former is testamentary (_ex testamento_); that of the latter is intestate (_ab intestato_). As to the latter there is nothing that need here be said, save that the law is chiefly guided by the presumed desires of the dead man, and confers the estate upon his relatives in order of proximity. In default of any known relatives the property of an intestate is claimed by the state itself, and goes as _bona vacantia_ to the Crown.

Testamentary succession, on the other hand, demands further consideration. Although a dead man has no rights, a man while yet alive has the right to determine the disposition after he is dead of the property which he leaves behind him. His last will, duly declared in the document which we significantly call by that name, is held inviolable by the law. For half a century and more, the rights and responsibilities of living men may thus be determined by an instrument which was of no effect until the author of it was in his grave and had no longer any concern with the world or its affairs. This power of the dead hand (_mortua manus_) is so familiar a feature in the law, that we accept it as a matter of course, and have some difficulty in realising what a very singular phenomenon it in reality is.

It is clear that some limitation must be imposed by the law upon this power of the dead over the living, and these restrictions are of three chief kinds:

(1) _Limitations of time._ It is only during a limited period after his death, that the directions of a testator as to the disposition of his property are held valid. He must so order the destination of his estate that within this period the whole of it shall become vested absolutely in some one or more persons, free from all testamentary conditions and restrictions. Any attempt to retain the property _in manu mortua_ beyond that limit makes the testamentary disposition of it void. In English law the period is determined by a set of elaborate rules which we need not here consider.

(2) _Limitations of amount._ A second limitation of testamentary power, imposed by most legal systems, though not by our own, is that a testator can deal with a certain proportion of his estate only, the residue being allotted by the law to those to whom he owes a duty of support, namely his wife and children.

(3) _Limitations of purpose._ The power of testamentary disposition is given to a man that he may use it for the benefit of other men who survive him; and to this end only can it be validly exercised. The dead hand will not be suffered to withdraw property from the uses of the living. No man can validly direct that his lands shall lie waste, or that his money, shall be buried with him, or thrown into the sea.[451]

SUMMARY.

Divisions of the substantive civil law:
1. Law of Property—Proprietary rights _in rem_.
2. Law of Obligations—Proprietary rights _in personam_.
3. Law of Status—Personal rights.

Meanings of the term property:
1. All legal rights.
2. All proprietary rights.
3. All proprietary rights _in rem_.
4. Rights of ownership in material things.

Divisions of the law of property:
1. Ownership of material things—Corporeal property.
2. Rights _in re propria_ in immaterial things: _e.g._ patents and
trade-marks.
3. Rights _in re aliena_ over material or immaterial things: _e.g._
leases, trusts, and securities.

The ownership of material things.
Its essential qualities:
1. Generality.
2. Permanence.
3. Inheritance.
Ownership of land in English law.
Movable and immovable property. Land and chattels.
Movable and immovable rights.
The local situation of rights.

Real and personal property.
Meanings of the term chattel.

Rights _in re propria_ in immaterial things:
1. Patents.
2. Literary copyright.
3. Artistic copyright.
4. Musical and dramatic copyright.
5. Good-will, trade-marks, and trade-names.

Encumbrances over property:
1. Leases.
Their nature.
Their subject-matter.
Their duration.
2. Servitudes.
Their nature.
Their kinds:
1. Public and private.
2. Appurtenant and in gross.
3. Securities.
Their nature.
Mortgages and Liens.
The essential nature of a mortgage.
Equities of redemption.
Mortgages { By way of assignment.
{ By way of encumbrance.
The double ownership of mortgaged property.
The reduction of mortgages to liens.
The kinds of liens.

Modes of acquiring property:
I. Possession.
1. Absolute title to _res nullius_. Absolute ownership.
2. Relative title to _res aliena_. Possessory ownership.
II. Prescription.
1. Positive or acquisitive.
2. Negative or extinctive.
Rational basis of prescription.
Presumption of coincidence of possession and ownership.
Classes of rights subject to prescription.
Prescription { Perfect.
{ Imperfect—the limitation of actions.

III. Agreement.
{ 1. Assignment.
{ 2. Grant.
{ 1. Formal.
{ 2. Informal.
The efficacy of agreement.
Nemo dat quod non habet.
Exceptions:
1. Separation of legal and equitable ownership.
2. Separation of ownership and possession.

IV. Inheritance.
Rights { Inheritable.
{ Uninheritable.
The representatives of dead men.
The creditors of dead men.
The beneficiaries of dead men.
1. _Ab intestato._
2. _Ex testamento._
The limits of testamentary power.