Ownership is one of the characteristic institutions of human society. A people to whom ownership was unknown, or who accorded it a minor place in their arrangements, who meant by meum and tuum no more than ‘what I (or you) presently hold’ would live in a world that is not our world. Yet to see why their world would be different, and to assess the plausibility of vaguely conceived schemes to replace ‘ownership’ by ‘public administration’, or of vaguely stated claims that the importance of ownership has declined or its character changed in the 20th century, we need first to have a clear idea of what ownership is.
I propose, therefore, to begin by giving an account of the standard incidents of ownership: i.e. those legal rights, duties, and other incidents which apply, in the ordinary case, to the person who has the greatest interest in a thing admitted by a mature legal system. To do so will be to analyse the concept of ownership, by which I mean the ‘liberal’ concept of ‘full’ individual ownership, rather than any more restricted notion to which the same label may be attached in certain contexts.
Secondly, I propose to say something about the notion of title, about the types of rule which legal systems adopt in order to decide who is to own a thing and, if two or more persons have claims to a thing, how priority between them is to be settled. Thirdly, I touch briefly on some instances of split ownership, in which the standard incidents are divided between two or more persons. Last comes the topic of the restriction of ownership in the social interest and the relation between ownership and public administration. This order of treatment should have the following advantage: once the standard case of full ownership has been [108] depicted, the variants and possible alternatives stand out more clearly in contrast, and are easier to understand and assess. On the other hand, this treatment is not meant to prejudge the issue, how far private ownership should stretch and to what extent it should be modified in the public interest. That issue, though it lies outside the scope of this essay, can be understood only with the help of an adequate analysis of the concept of ownership.
1. The liberal concept of ownership
If ownership is provisionally defined as the greatest possible interest in a thing which a mature system of law recognizes, then it follows that, since all mature systems admit the existence of ‘interests’ in ‘things’, all mature systems have, in a sense, a concept of ownership. Indeed, even primitive systems, like that of the Trobriand islanders, have rules by which certain persons, such as the ‘owners’ of canoes, have greater interests in certain things than anyone else.Footnote 2
For mature legal systems, it is possible to make a larger claim. In them, certain important legal incidents are found, which are common to different systems. If it were not so, ‘He owns that umbrella’, said in a purely English context, would mean something different from ‘He owns that umbrella’, preferred as a translation of ‘Ce paraplui est à lui’. Yet, as we know, they mean the same. There is indeed a substantial similarity in the position of one who ‘owns’ an umbrella in England, France, Russia, China, and any other modern country one may care to mention. Everywhere the ‘owner’ can, in the simple uncomplicated case, in which no other person has an interest in the thing, use it, stop others using it, lend it, sell it, or leave it by will. Nowhere may he use it to poke his neighbour in the ribs or to knock over his vase. Ownership, dominium, propriété, Eigentum, and similar words stand not merely for the greatest interest in things in particular systems but for a type of interest with common features transcending particular systems. It must surely be important to know what these common features are? [109]
In stressing the importance of such common features, I do not wish to go beyond the claim that these resemblances exist de facto and can be explained by the common needs of mankind and the common conditions of human life. It would be rash to assert that the features discussed are necessarily common to different mature systems, or that their range and ubiquity proves that what is called ‘general jurisprudence’ is a reputable pursuit. These assertions may indeed be true, but for my purposes it is enough to show that the standard incidents of ownership do not vary from system to system in the erratic, unpredictable way implied by some writers but, on the contrary, have a tendency to remain constant from place to place and age to age.
Nor must the present thesis be confused with the claim that all systems attach an equal importance to ownership (in the full, liberal sense) or regard the same things as capable of being owned. The latter claim would be patently false. In the Soviet Union, for instance, important assets such as land, businesses, and collective farms are in general withdrawn from ‘personal ownership’ (viz. the liberal type of ownership) and subjected to ‘government’ or ‘collective’ ownership, which is a different, though related institution.Footnote 3 The notion of things ‘outside commerce’, not subject to private ownership but to special regulation by the state or public authorities, is an ancient one and has retained its importance in modern continental law.Footnote 4 Again, there is a case for saying that, in the early middle ages, land in England could not plausibly be said to be ‘owned’ because the standard incidents of which I shall speak were so divided between lord and tenant that the position of neither presented a sufficient analogy with the paradigm case of owning a thing.Footnote 5
Indeed, in nearly all systems there will be some things to which not all the standard incidents apply, some things which cannot be sold or left by will, some interests which cannot endure beyond a lifetime, some things (flick knives, Colorado [110] beetles) which it is forbidden to use or to use in certain ways. If the differences between these cases and the paradigm case are striking enough, we shall be tempted to say that the things in question are not or cannot be owned, but it would be a mistake to conclude that the legal systems in which these cases occur do not recognize ownership. Whether a system recognizes ownership, and to what extent it permits ownership (who may own, what may be owned), are widely differing questions. No doubt liberal societies are more inclined than socialist societies to extend the list of items that can be owned, but it does not follow that, when a socialist system permits ownership, or ‘personal ownership’, it is permitting something different from what is permitted in the corresponding case in a liberal society. It may well be – and all the evidence indeed supports the view – that socialist societies recognize the ‘liberal’ notion of ‘full’ ownership, but limit the range of things that can be owned. Perhaps definitions of ownership contained in codes are not a safe guide. Still, it is striking that the French civil code, enacted in an atmosphere of liberal individualism, defines ownership as ‘the right of enjoying and disposing of things in the most absolute manner, provided that one abstains from any use forbidden by statute or subordinate legislation’;Footnote 6 while the Soviet civil code, framed in a socialist context, provides, in very similar language, that ‘within the limits laid down by law, the owner has the right to possess, to use and to dispose of his property’.Footnote 7 Obviously much here depends on what limits are laid down by law in each system; in fact, so far as articles subject to ‘personal ownership’ are concerned, the limits in the two systems hardly differ.
One further caveat. I set out to describe the incidents of ownership in the simple cases in which one would not hesitate to say ‘X owns that thing, that is X's book or house’, even though T may have borrowed it, or r may be X's tenant. In doing this, I do not lose sight of the existence of more complicated cases in which layman and lawyer alike may be puzzled to know which, of two or more persons interested in a thing, to call owner, or whether to say, on the other hand, that neither or [111] none is owner. Just as the rules of a system may so restrict the permissible ways of dealing with certain types of things that we are inclined to say that such things are not capable of being owned in that system, or can be owned only a sense different from the full, liberal sense we are to investigate, so the rules of a system may provide for the splitting of interests in a type of thing which, in general, is admittedly capable of being owned. Houses can be owned, and there is no conceptual difficulty in locating the ownership of a house let on a short lease. But if A lets B a house on a lease for 2,000 years, it may be very unclear, at least to the layman, whether A or B or neither should be called owner. (In this case, legal usage designates A owner despite the tenuous character of his reversionary right.) Again, can a mortgagor be said to ‘own’ a house which is mortgaged? (Legal usage here refuses to designate the mortgagee owner despite the potentially indeterminate character of his interest.) No obvious linguistic convention governs the answer to such problems, and, if the rules of a legal system demand an answer, it must be sought in positive law, in the comparative strength of competing analogies with the paradigm case and in the light shed on the problem by the social context.
The fact that there are such cases of split ownership and that they present baffling problems to one who is compelled to fix on one interested person as the owner of the thing does not make it worthless to try to delineate the incidents present in the ordinary, uncomplicated case. On the contrary, such a delineation is essential in order that it may be possible to assess the strength of the analogies in the peripheral cases. What must, however, be recognized at the outset is that the actual use of ‘owner’ and ‘ownership’ extends beyond the standard case now to be described and that to delineate the standard case is here, as with most legal notions, not to provide a code for the use of the word. For instance, the 16 or so pages of Burrows’ Words and Phrases Judicially Defined,Footnote 8 concerned with the interpretation of the word ‘owner’ in various statutes, amply reveal how the courts have wrestled with provisions extending the [112] legal meaning of ‘owner’ beyond the standard cases. But it is important to see that the very existence of such problems of statutory interpretation presupposes that there are paradigm cases in which the interpretation of ‘owner’ is clear.
Thus, where a statute providedFootnote 9 that ‘“owner” in relation to land, includes every person who jointly or severally whether at law or in equity, is entitled’ to the profits of the land etc., Griffith C. J. pointed out that the term ‘owner’ ‘Prima facie connotes entire dominion. Section 3 [the definition section] extends the meaning so as to take in certain persons who possess some, but not all, of the rights of absolute owners. Although, therefore, the language of the definition is in form inclusive, and not exhaustive, it must be read as if the words “besides the absolute owner” were inserted after “includes”’.Footnote 10 This presupposes that we know, without the help of an interpretation clause, what is meant by ‘absolute owner’. Again, when Jessel M. R. said in a case on the interpretation of the Highways Act, 1835, ‘I am clearly of the opinion that the term “owner” means the man in occupation, who may be either the actual owner or else only the occupying tenant’,Footnote 11 he could not meaningfully have said this unless there were available criteria for the identification of the interest called ‘ownership’ and so of the ‘actual owner’ in the majority of cases.
The standard incidents
I now list what appear to be the standard incidents of ownership. They may be regarded as necessary ingredients in the notion of ownership, in the sense that, if a system did not admit them, and did not provide for them to be united in a single person, we would conclude that it did not know the liberal concept of ownership, though it might still have a modified version of ownership, either of a primitive or sophisticated sort. But the listed incidents are not individually necessary, though they may be together sufficient, conditions for the person [113] of inherence to be designated ‘owner’ of a particular thing in a given system. As we have seen, the use of ‘owner’ will extend to cases in which not all the listed incidents are present.
Ownership comprises the right to possess, the right to use, the right to manage, the right to the income of the thing, the right to the capital, the right to security, the rights or incidents of transmissibility and absence of term, the prohibition of harmful use, liability to execution, and the incident of residuarity: this makes 11 leading incidents. Obviously, there are alternative ways of classifying the incidents; moreover, it is fashionable to speak of ownership as if it were just a bundle of rights, in which case at least two items in the list would have to be omitted.
No doubt the concentration in the same person of the right (liberty)Footnote 12 of using as one wishes, the right to exclude others, the power of alienating and an immunity from expropriation is a cardinal feature of the institution. Yet it would be a distortion – and one of which the 18th century, with its overemphasis on subjective rights, was patently guilty – to speak as if this concentration of patiently garnered rights was the only legally or socially important characteristic of the owner's position. The present analysis, by emphasizing that the owner is subject to characteristic prohibitions and limitations, and that ownership comprises at least one important incident independent of the owner's choice, is an attempt to redress the balance.
(1) The right to possess
The right to possess, viz. to have exclusive physical control of a thing, or to have such control as the nature of the thing admits, is the foundation on which the whole superstructure of ownership rests. It may be divided into two aspects, the right (claim) to be put in exclusive control of a thing and the right to remain in control, viz. the claim that others should not without permission, interfere. Unless a legal system provides some rules and procedures for attaining these ends, it cannot be said to protect ownership. [114]
It is of the essence of the right to possess that it is in rem in the sense of availing against persons generally. This does not, of course, mean that an owner is necessarily entitled to exclude everyone from his property. We happily speak of the ownership of land, yet a largish number of officials have the right of entering on private land without the owner's consent, for some limited period and purpose. On the other hand, a general licence so to enter on the ‘property’ of others would put an end to the institution of landowning as we now know it.
The protection of the right to possess (still using ‘possess’ in the convenient, though oversimple, sense of ‘have exclusive physical control’) should be sharply marked off from the protection of mere present possession. To exclude others from what one presently holds is an instinct found in babies and even, as Holmes points out,Footnote 13 in animals, of which the seal gives a striking example. To sustain this instinct by legal rules is to protect possession but not, as such, to protect the right to possess and so not to protect ownership. If dispossession without the possessor's consent is, in general, forbidden, the possessor is given a right in rem, valid against persons generally, to remain undisturbed, but he has no right to possess in rem unless he is entitled to recover from persons generally what he has lost or had taken from him, and to obtain from them what is due to him but not yet handed over. Admittedly, there may be borderline cases in which the right to possess is partially recognized, e.g. where a thief is entitled to recover from those who oust him and all claiming under them, but not from others.
The protection of the right to possess, and so of one essential clement in ownership, is achieved only when there are rules allotting exclusive physical control to one person rather than another, and that not merely on the basis that the person who has such control at the moment is entitled to continue in control. When children understand that Christmas presents go not to the finder but to the child whose name is written on the outside of the parcel, when a primitive tribe has a rule that a dead man's things go not to the first taker but to his son or his sister's [115] son, we know that they have at least an embryonic idea of ownership.
To have worked out the notion of ‘having a right to’ as distinct from merely ‘having’, or, if that is too subjective a way of putting it, of rules allocating things to people as opposed to rules merely forbidding forcible taking, was a major intellectual achievement. Without it society would have been impossible. Yet the distinction is apt to be overlooked by English lawyers, who are accustomed to the rule that every adverse possession is a root of title, i.e. gives rise to a right to possess,Footnote 14 or at least that ‘de facto possession is prima facie evidence of seisin in fee and right to possession’.Footnote 15
The owner, then, has characteristically a battery of remedies in order to obtain, keep and, if necessary, get back the thing owned. Remedies such as the actions for ejectment and wrongful detention and the vindicatio are designed to enable the plaintiff either to obtain or to get back a thing, or at least to put some pressure on the defendant to hand it over. Others, such as the actions for trespass to land and goods, the Roman possessory interdicts, and their modern counterparts are primarily directed towards enabling a present possessor to keep possession. Few of the remedies mentioned are confined to the owner; most of them are available also to persons with a right to possess falling short of ownership, and some to mere possessors. Conversely, there will be cases in which they are not available to the owner, for instance because he has voluntarily parted with possession for a temporary purpose, as by hiring the thing out. The availability of such remedies is clearly not a necessary and sufficient condition of owning a thing; what is necessary, in order that there may be ownership of things at all, is that such remedies shall be available to the owner in the usual case in which no other person has a right to exclude him from the thing. [116]
(2) The right to use
The present incident and the next two overlap. On a wide interpretation of ‘use’, management and income fall within use. On a narrow interpretation, ‘use’ refers to the owner's personal use and enjoyment of the thing owned. On this interpretation it excludes management and income.
The right (liberty) to use at one's discretion has rightly been recognized as a cardinal feature of ownership, and the fact that, as we shall see, certain limitations on use also fall within the standard incidents of ownership does not detract from its importance, since the standard limitations are, in general, rather precisely defined, while the permissible types of use constitute an open list.
(3) The right to manage
The right to manage is the right to decide how and by whom the thing owned shall be used. This right depends, legally, on a cluster of powers, chiefly powers of licensing acts which would otherwise be unlawful and powers of contracting: the power to admit others to one's land, to permit others to use one's things, to define the limits of such permission, and to contract effectively in regard to the use (in the literal sense) and exploitation of the thing owned. An owner may not merely sit in his own deck chair but may validly license others to sit in it, lend it, impose conditions on the borrower, direct how it is to be painted or cleaned, contract for it to be mended in a particular way. This is the sphere of management in relation to a simple object like a deck chair. When we consider more complex cases, like the ownership of a business, the complex of powers which make up the right to manage seems still more prominent. The power to direct how resources are to be used and exploited is one of the cardinal types of economic and political power; the owner's legal powers of management are one, but only one possible basis for it. Many observers have drawn attention to the growth of managerial power divorced from legal ownership; in such cases, it may be that we should [117] speak of split ownership or redefine our notion of the thing owned. This does not affect the fact that the right to manage is an important element in the notion of ownership; indeed, the fact that we feel doubts in these cases whether the ‘legal owner’ really owns is a testimony to its importance.
Management often takes the form of making contracts relating to the thing owned, whether with servants or agents or independent contractors. This fact, and the growing relative importance of management in comparison with personal use, at least in regard to some types of thing such as businesses, has led some observers to the neat conclusion that, over a wide sphere, obligatio has swallowed up res.Footnote 16 Even if the contrast were an apt one (and, after all, an obligatio is a res, a chose in action a chose), the sentiment would be exaggerated because many powers of management are exercised otherwise than by way of contract, not to mention powers of alienation. The point would be better made by saying that, in the owner's battery of rights, powers have increased in calibre while liberties have declined.
(4) The right to the income
To use or occupy a thing may be regarded as the simplest way of deriving an income from it, of enjoying it. It is, for instance, expressly contemplated by the English income tax legislation that the rent-free use or occupation of a house is a form of income, and only the inconvenience of assessing and collecting the tax presumably prevents the extension of this principle to movables.
Income in the more ordinary sense (fruits, rents, profits) may be thought of as a surrogate of use, a benefit derived from forgoing personal use of a thing and allowing others to use it for reward; as a reward for work done in exploiting the thing; or as the brute product of a thing, made by nature or by other persons. Obviously the line to be drawn between the earned and unearned income from a thing cannot be firmly drawn.
The owner's right to the income, which has always, under one name or another, bulked large in an analysis of his rights, [118] has assumed still greater significance with the increased importance of income relative to capital. Legally, it takes the form of a claim sometimes in rem, sometimes in personam to the income. When the latter is in the form of money, the claim before receipt of the money is in personam; and since the income from many forms of property, such as shares and trust funds, is in this form, there is another opportunity for introducing the apophthegm that obligatio has swallowed up res.
(5) The right to the capital
The right to the capital consists in the power to alienate the thing and the liberty to consume, waste, or destroy the whole or part of it: clearly it has an important economic aspect. The latter liberty need not be regarded as unrestricted; but a general provision requiring things to be conserved in the public interest, so far as not consumed by use in the ordinary way, would perhaps be inconsistent with the liberal idea of ownership.
Most people do not wilfully destroy permanent assets; hence, the power of alienation is the more important aspect of the owner's right to the capital of the thing owned. This comprises the power to alienate during life or on death, by way of sale, mortgage, gift, or other mode, to alienate a part of the thing and partially to alienate it. The power to alienate may be subdivided into the power to make a valid disposition of the thing and the power to transfer the holder's title (or occasionally a better title) to it. The two usually concur but may be separated, as when A has a power of appointment over property held by B in trust.Footnote 17 Again, in some systems, a sale, mortgage, bequest, etc. may be regarded as valid though the seller or mortgagor cannot give a good title. By giving a good title is meant transferring to the transferee the rights of the owner including his power of alienation.
An owner normally has both the power of disposition and the power of transferring title. Disposition on death is not permitted in many primitive societies but seems to form an essential [119] element in the mature notion of ownership. The tenacity of the right of testation once it has been recognized is shown by the Soviet experience. The earliest writers were hostile to inheritance, but gradually Soviet law has come to admit that citizens may dispose freely of their ‘personal property’ on death, subject to limits not unlike those known elsewhere.Footnote 18
(6) The right to security
An important aspect of the owner's position is that he should be able to look forward to remaining owner indefinitely if he so chooses and he remains solvent. His right to do so may be called the right to security. Legally, this is in effect an immunity from expropriation, based on rules which provide that, apart from bankruptcy and execution for debt, the transmission of ownership is consensual.
However, a general right to security, availing against others, is consistent with the existence of a power to expropriate or divest in the state or public authorities. From the point of view of security of property, it is important that when expropriation takes place, adequate compensation should be paid; but a general power to expropriate subject to paying compensation would be fatal to the institution of ownership as we know it. Holmes’ paradox, that where specific restitution of goods is not a normal remedy,Footnote 19 expropriation and wrongful conversion are equivalent, obscures the vital distinction between acts which a legal system permits as rightful and those which it reprobates as wrongful: but if wrongful conversion were general and went unchecked, ownership as we know it would disappear, though damages were regularly paid.
In some systems, as (semble) English law, a private individual may destroy another's property without compensation when this is necessary in order to protect his own person or property from a greater danger.Footnote 20 Such a rule is consistent with security of property only because of its exceptional character. Again, [120] the state's (or local authority's) power of expropriation is usually limited to certain classes of things and certain limited purposes. A general power to expropriate any property for any purpose would be inconsistent with the institution of ownership. If, under such a system, compensation were regularly paid, we might say either that ownership was not recognized in that system, or that money alone could be owned, ‘money’ here meaning a strictly fungible claim on the resources on the community. As we shall see, ‘ownership’ of such claims is not identical with the ownership of material objects and simple claims.
(7) The incident of transmissibility
It is often said that one of the main characteristics of the owner's interest is its ‘duration’. In England, at least, the doctrine of estates made lawyers familiar with the notion of the ‘duration’ of an interest and Maitland, in a luminous metaphor, spoke of estates as ‘projected upon the plane of time’.Footnote 21
Yet this notion is by no means as simple as it seems. What is called ‘unlimited’ duration (perpétuité)Footnote 22 comprises at least two elements (i) that the interest can be transmitted to the holder's successors and so on ad infinitum (the fact that in medieval land law all interests were considered ‘temporary’Footnote 23 is one reason why the terminology of ownership failed to take root, with consequences which have endured long after the cause has disappeared); (ii) that it is not certain to determine at a future date. These two elements may be called ‘transmissibility’ and ‘absence of term’, respectively. We are here concerned with the former.
No one, as Austin points out,Footnote 24 can enjoy a thing after he is dead (except vicariously) so that, in a sense, no interest can outlast death. But an interest which is transmissible to the holder's successors (persons designated by or closely related to the holder who obtain the property after him) is more valuable than one which stops with his death. This is so both because on alienation the alienee or, if transmissibility is generally [121] recognized, the alienee's successors, are thereby enabled to enjoy the thing after the alienor's death so that a better price can be obtained for the thing, and because, even if alienation were not recognized, the present holder would by the very fact of transmissibility be dispensed pro tanto from making provision for his intestate heirs. Hence, for example, the moment when the tenant in fee acquired a heritable (though not yet fully alienable) right was a crucial moment in the evolution of the fee simple. Heritability by the state would not, of course, amount to transmissibility in the present sense: it is assumed that the transmission is in some sense advantageous to the transmitter.
Transmissibility can, of course, be admitted, yet stop short at the first, second, or third generation of transmittees. The owner's interest is characterized by indefinite transmissibility, no limit being placed on the possible number of transmissions, though the nature of the thing may well limit the actual number.
In deference to the conventional view that the exercise of a right must depend on the choice of the holder,Footnote 25 I have refrained from calling transmissibility a right. It is, however, clearly something in which the holder has an economic interest, and it may be that the notion of a right requires revision in order to take account of incidents not depending on the holder's choice which are nevertheless of value to him.
(8) The incident of absence of term
This is the second part of what is vaguely called ‘duration’. The rules of a legal system usually seem to provide for determinate, indeterminate, and determinable interests. The first are certain to determine at a future date or on the occurrence of a future event which is certain to occur. In this class come leases for however long a term, copyrights, etc. Indeterminate interests are those, such as ownership and casements, to which no term is set. Should the holder live for ever, he would, in the ordinary way, be able to continue in the enjoyment of them for [122] ever. Since human beings are mortal, he will in practice only be able to enjoy them for a limited period, after which the fate of his interest depends on its transmissibility. Again, since human beings are mortal, interests for life, whether of the holder of another, must be regarded as determinate. The notion of an indeterminate interest, in the full sense, therefore requires the notion of transmissibility, but, if the latter were not recognized, there would still be value to the holder in the fact that his interest was not due to determine on a fixed date or on the occurrence of some contingency, like a general election, which is certain to occur sooner or later.
On inspection it will be found that what I have called indeterminate interests are really determinable. The rules of legal systems always provide some contingencies such as bankruptcy, sale in execution, or state expropriation on which the holder of an interest may lose it. It is true that in most of these cases the interest is technically said to be transmitted to a successor (e.g. a trustee in bankruptcy), whereas in the case of determinable interests the interest is not so transmitted. Yet, the substance of the matter is that the present holder may lose his interest in certain events. It is never, therefore, certain that, if the present holder and his successors so choose, the interest will never determine as long as the thing remains in existence. The notion of indeterminate interests can only be saved by regarding the purchaser in insolvency or execution, or the state, as succeeding to the same interest as that had by the previous holder. This is an implausible way of looking at the matter, because the expropriability and executability of a thing is not an incident of value to the owner, but a restriction on the owner's rights imposed in the social interest. It seems better, therefore, to deny the existence of indeterminate interests and to classify those which are not determinate according to the number and character of the contingencies on which they will determine. This affords a justification for speaking of a ‘determinable fee’, of ‘fiduciary ownership’ etc., for these do not differ essentially from ‘full ownership’, determinable on bankruptcy or expropriation. [123]
(9) The prohibition of harmful use
An owner's liberty to use and manage the thing owned as he chooses is in mature systems of law, as in primitive systems, subject to the condition that uses harmful to other members of society are forbidden. There may, indeed, be much dispute over what is to count as ‘harm’ and to what extent give and take demands that minor inconvenience between neighbours shall be tolerated. Nevertheless, at least for material objects, one can always point to abuses which a legal system will not allow.
I may use my car freely but not in order to run my neighbour down, or to demolish his gate, or even to go on his land if he protests; nor may I drive uninsured. I may build on my land as I choose, but not in such a way that my building collapses on my neighbour's land. I may let off fireworks on Guy Fawkes night, but not in such a way as to set fire to my neighbour's house. These and similar limitations on the use of things are so familiar and so obviously essential to the existence of an orderly community that they are not often thought of as incidents of ownership; yet, without them ‘ownership’ would be a destructive force.
(10) Liability to execution
Of a somewhat similar character is the liability of the owner's interest to be taken away from him for debt, either by execution of a judgment debt or on insolvency. Without such a general liability the growth of credit would be impeded and ownership would, again, be an instrument by which the owner could defraud his creditors. This incident, therefore, which may be called executability, seems to constitute one of the standard ingredients of the liberal idea of ownership.
It is a question whether any other limitations on ownership imposed in the social interest should be regarded as among its standard incidents. A good case can certainly be made for listing liability to tax and expropriability by the state as such. Although it is often convenient to contrast taxes on property with taxes on persons, all tax must ultimately be taken from [124] something owned, whether a material object or a fund or a chose in action. A general rule exempting the owners of things from paying tax from those things would therefore make taxation impracticable. But it may be thought that to state the matter in this way is to obliterate the useful contrast between taxes on what is owned and taxes on what is earned. Although, therefore, a society could not continue to exist without taxation, and although the amount of tax is commonly dependent on what the taxpayer owns or earns, and must be paid from his assets, I should not wish to press the case for the inclusion of liability to tax as a standard incident of ownership. Much the same will hold good of expropriability; for though some state or public expropriation takes place in every society, and though it is not easy to see how administration could continue without it, it tends to be restricted to special classes of property. We are left with the thought that it is, perhaps, a characteristic of ownership that the owner's claims are ultimately postponed to the claims of the public authority, even if only indirectly, in that the thing owned may, within defined limits, be taken from the owner in order to pay the expenses of running the state or to provide it with essential facilities.
Ownership and lesser interests
The interest of which the standard incidents have been depicted is usually described as the greatest interest in a thing recognized by the law and is contrasted with lesser interests (casements, short leases, licences, special property, mere detention). It is worthwhile looking a little more closely at this distinction, for it partly depends on a point that the foregoing analysis has not brought to light.
I must emphasize that we are not now concerned with the topic of split ownership – cases where the standard incidents are so divided, as to raise a doubt which of two or more persons interested should be called owner. We are dealing with those simpler cases in which the existence of B's interest in a thing, though it restricts A's rights, does not call in question A's ownership of the thing. [125]
The first point that strikes us is that each of the standard incidents of ownership can apply to the holder of a lesser interest in property. The bailee has possession of, and often the right to possess, the goods bailed. The managing director of a company has the right of managing it. The life tenant or usufructuary of a house is entitled to the income from it. The donee of a power of appointment is entitled to dispose of the capital subject to the power. The holder of an easement has a transmissible and non-determinate right in the land subject to the easement. Yet, without more, we feel no temptation to say that the bailee owns the thing, the managing director the company, the life tenant the house, the donee the capital, or the easement holder the land. What criteria do we use in designating these as ‘lesser interests’?
One suggested view is that the rights of the holder of a lesser interest can be enumerated while the ‘owner's’ cannot.Footnote 26 This rests on a fallacy about enumeration. The privileges, for instance, exercisable over a thing do not together constitute a finite number of permissible actions. The ‘owner’ and the lessee alike may do an indefinite number and variety of actions, viz. any action not forbidden by a rule of the legal system.
A second view is that the criterion used is the fact that, at least as regards some incidents, the holder of the lesser interest has more restricted rights than the owner. The lessee's interest is determinate, the ‘owner's’ merely determinable. But, conversely, the lessee has the right to possess and manage the property and take its income; in these respects the ‘owner's’ interest is, for the time being, more restricted than his own. Nor will it help to say that the ‘owner's’ rights are more extensive than those of the holder of a lesser interest as regards most of the incidents listed, for, in such cases as lease, this would lead to the conclusion that the lessee has as much claim to be called owner as the reversioner.
A third suggestion is that some one incident is taken as the criterion. It is possible, however, for all the listed rights, to put [126] examples which would lead to the opposite result from that sanctioned by usage. If A lets B a car on hire, B possesses it but A ‘owns’ it. The holder of a life interest or usufruct manages and takes the income of the thing, but the dominus or reversioner ‘owns’ it. When trust property is subject to a power of appointment, the donee of the power can dispose of it but the trustee ‘owns’ it. When property is subject to a fideicommissum, the fiduciary has no transmissible right (unless the fideicommissum fails), yet he is ‘owner’ while the fideicommissary may, exceptionally, have such a right. A person who holds an interest in them may ‘own’, while one who has a potentially indeterminate interest ex die does not as yet do so.
Besides these examples, where any of the suggested criteria would give a result at variance with actual lay and legal usage, there are many others where the rights in question apply to both or neither of the persons holding an interest in the thing. For instance, some writers appear to treat ‘duration’Footnote 27 as the criterion for distinguishing between ownership and lesser interests. Yet the holder of an easement, like the ‘owner’ of land, has a transmissible and indeterminate right over it, while, per contra, neither the ‘owner’ nor the licensee of a copyright has an indeterminate right.
It would be easy but tedious to list examples for the other rights; clearly, if a criterion is to be found, it must be sought elsewhere. A hopeful avenue of inquiry seems to be the following: what happens on the determination of the various interests in the thing under consideration? This brings us to a further standard incident of ownership, viz. its residuary character.
(11) Residuary character
A legal system might recognize interests in things less than ownership and might have a rule that, on the determination of such interests, the rights in question lapsed and could be exercised by no one, or by the first person to exercise them after their lapse. There might be leases and easements; yet, on their [127] extinction, no one would be entitled to exercise rights similar to those of the former lessee or of the holder of the easement. This would be unlike any system known to us and I think we should be driven to say that in such a system the institution of ownership did not extend to any thing in which limited interests existed. In such things there would, paradoxically, be interests less than ownership but no ownership.
This fantasy is intended to bring out the point that it is characteristic of ownership than an owner has a residuary right in the thing owned. In practice, legal systems have rules providing that on the lapse of an interest rights, including liberties, analogous to the rights formerly vested in the holder of the interest, vest in or are exercisable by someone else, who may be said to acquire the ‘corresponding rights’. Of course, the ‘corresponding rights’ are not the same rights as were formerly vested in the holder of the interest. The easement holder had a right to exclude the owner; now the owner has a right to exclude the easement holder. The latter right is not identical with, but corresponds to, the former.
It is true that corresponding rights do not always arise when an interest is determined. Sometimes, when ownership is abandoned, no corresponding right vests in another; the thing is simply res derelicta. Sometimes, on the other hand, when ownership is abandoned, a new ownership vests in the state, as is the case in South Africa when land has been abandoned.
It seems, however, a safe generalization that, whenever an interest less than ownership terminates, legal systems always provide for corresponding rights to vest in another. When easements terminate, the ‘owner’ can exercise the corresponding rights, and when bailments terminate, the same is true. It looks as if we have found a simple explanation of the usage we are investigating, but this turns out to be but another deceptive short cut. For it is not a sufficient condition of A's being the owner of a thing that, on the determination of B's interest in it, corresponding rights vest in or are exercisable by A. On the determination of a sub-lease, the rights in question become exercisable by the lessee, not by the ‘owner’ of the property. [128]
Can we then say that the ‘owner’ is the ultimate residuary? When the sub-lessee's interest determines the lessee acquires the corresponding rights; but when the lessee's right determines the ‘owner’ acquires these rights. Hence, the ‘owner’ appears to be identified as the ultimate residuary. The difficulty is that the series may be continued, for on the determination of the ‘owner's’ interest the state may acquire the corresponding rights; is the state's interest ownership or a mere expectancy?
A warning is here necessary. We are approaching the troubled waters of split ownership. Puzzles about the location of ownership are often generated by the fact that an ultimate residuary right is not coupled with present alienability or with the other standard incidents we have listed. Was the feudal lord's right of escheat ownership or merely an expectancy? When land was given in emphyteusis, was the emphyteuta or the reversioner owner? Other puzzles are created by cases of cross-residuarity. When property is held subject to a fideicommissum in the modern law, the fideicommissary benefits from the lapse of the fiduciary's rights and vice versa; so which is really residuary?
We are of course here concerned not with the puzzles of split ownership but with simple cases in which the existence of B's lesser interest in a thing is clearly consistent with A's owning it. To explain the usage in such cases, it is helpful to point out that it is a necessary but not sufficient condition of A's being owner that, either immediately or ultimately, the extinction of other interests would enure for his benefit. In the end, it turns out that residuarity is merely one of the standard incidents of ownership, important no doubt, but not entitled to any special status.
The thing owned
‘To own’ is transitive; the object of ownership is always spoken of as a ‘thing’ in the legal sense, a res. There is, clearly, a close connection between the idea of ownership and the idea of things owned, as is shown by the use of words such as ‘property’ to designate both. We ought, apparently, to be able to throw some light on ownership by investigating ‘things’. [129]
Outside the law, external material objects are thought of as the prime examples of things and, in this sense, things are contrasted with persons. But, in a wide sense, any object of discourse may be called a thing – events, states, emotions, actions, processes are all things. The extra-legal use of ‘thing’ is therefore not likely to help us in finding out what can be owned.
In the law we find the following position. As regards external material objects, it is natural to speak of ownership. A person ‘owns’ a book, house, or car. The terminology of ownership is also extended to some things other than material objects. A person may ‘own’ a copyright, leasehold property, goodwill, a business, patent rights. In these cases, the analogy with the incidents of the ownership of external material objects is a close one.
In other cases, the holder of a right is said to ‘have’ rather than own the interest in question. Thus, one ‘has’ an easement or a chose in action or a reputation. Here the analogy with the ownership of material objects is less strong or, as in the case of easements, the alternative expression is adopted to avoid confusion with the ownership of the material object to which the right relates.
In other cases again, we speak not of ‘having’ a thing but of ‘having a right’ to or in something. Thus, a person does not either ‘own’ or ‘have’ his body or liberty. He has a right to bodily security or liberty. Here the analogy with the ownership of a thing is tenuous; thus, these rights are inalienable. Finally, there are interests which the law refuses to recognize: one does not own, have or have a right to them. An example in English law is privacy.
In any viable society we shall expect certain interests (having a house, clothes, food, preserving one's body from harm) to be protected, but, as regards many other interests (copyright, reputation, privacy, shares) there will be nothing absurd in a system which does not protect them, though it may be an inconvenient system. There will be no way of telling, apart from knowing the details of a system, whether such interests are protected and, a fortiori, no way of telling whether they are con[130]ceived as consisting in the ownership of things. Apart from the basic interests mentioned, protection of an interest is not merely the recognition of a social necessity. The meaning of the words ‘right’ or ‘thing’ will not help one to guess what the decision has been or is likely to be.
Much the same may be said of the difference between simple rights and interests conceived in terms of ownership. A person is not, in most systems, regarded as owning his body, reputation, skill, honour, or dignity. At most he has a simple right to these things, which are therefore not legally ‘things’. By a ‘simple right’, I mean one which is protected by law but is not alienable or transmissible. Now it may be that the doctrine that one does not own one's body, etc., is influenced by the linguistic fact that such aspects of one's person do not fall within the prime class of things, external material objects. But a more likely explanation is simply that it has been thought undesirable that a person should alienate his body, skill, or reputation, as this would be to interfere with human freedom. When human beings were regarded as alienable and ownable they were, of course, also regarded as being legally things: and it is quite easy to conceive arrangements under which one could, for instance, lease one's reputation or one's skill for a term of years, so that the lessee could sue for infringements of the lessor's good name or for the fruits of his work. It may, indeed, be argued that contracts for the assignment of goodwill and contracts of service are examples of at least partial alienations of these interests.
However that may be, it is clear that to stare at the meaning of the word ‘thing’ will not tell us which protected interests are conceived in terms of ownership. When the legislature or courts think that an interest should be alienable and transmissible they will rei-fy it and say that it can be owned, that it is property. They will not say that it can be owned and is a res because of a prior conviction that it falls within the appropriate definition of ‘thing’. The investigation of ‘things’ seems to peter out in a false trail.
A more promising approach is to try to classify the things [131] that can be owned. An obvious classification is into material objects and things that are not material objects (incorporeals). According to one school of thought, this division is so important that only corporeals can really be owned; according to another, it is so unimportant that we ought always to speak of owning rights over material objects, never of owning the objects themselves; in this way we shall keep in mind the parallel with the ownership of incorporeal rights.
Both schools propose a departure from lay and legal usage which stands in need of justification. The former has little to commend it. Consider the difference between ‘owning’ land and ‘owning’ (having) an easement over land. The first counts as the ownership of a material object, the second of an incorporeal. Yet their incidents are in every way similar and, in both cases, include the right to exclude others from interfering with or obstructing a particular physical thing, a right which at first sight might seem to differentiate the ownership of material objects from the ownership of incorporeals. It is true that, when we come to consider claims, we find cases in which there is either no right to exclude others or no right to exclude them from a particular physical thing.
Copyright is an example of one type of claim. It involves the right to prevent others publishing, etc., one's written work without consent, and hence a sort of right to exclude others; but this right does not relate to a particular physical thing, a particular book. It relates to all material objects which have certain characteristics, viz. that they are copies of the work in question. Again, it is not clear that the incident of prohibition of harmful use applies in a straightforward way to copyrights: on the other hand, convincing analogues of the other standard incidents are to be found. Thus, it may be said that the notion of ownership applies to copyrights in an extended and somewhat weaker sense than that in which it applies to material objects and interests in them.
Debts due and other choses in action present an example of another type of claim. Here the claim is to the performance of some positive act. No right to exclude others is involved, and, [132] as in the case of copyrights, no question of harmful use arises. On the other hand, incidents such as alienability (nowadays) and transmissibility do apply to choses in action. Hence, the ownership of choses in action is to be understood in a still weaker sense than that of copyrights.
It seems, therefore, as if a more useful classification of things owned than that into corporeals and incorporeals would be into material objects and rights in them, claims, and collections of objects and claims. Slightly expanding this, we get the following list:
(1) Material objects and interests in material objects;
(2) Claims and interests in claims;
(3) Fixed collections of material objects, claims, or both;
(4) Variable collections of material objects, claims, or both;
(5) Funds.
The list is self-explanatory, ‘claims’ being understood to exclude such claims as amount to interests in material objects. The introduction of fixed and variable collections is necessary in order to accommodate the ownership of estates, businesses, etc. either frozen at a point of time (fixed collection) such as the date of a person's death, or varying from time to time, as in the case of the spouses’ ‘ownership’ of a joint estate when they are married in community of property. A ‘fund’ is the monetary equivalent of a collection of things or claims or both.
It is a commonplace that the ownership of funds has become of great importance in the 20th century. With this development, a new twist has been given to the notion of ownership, and one which is inherent in the notion of owning a variable collection of things.
A variable collection of things may be owned and managed like a particular thing but, as a matter of convenience, lesser interests in and claims to the collection are not construed as giving the holder powers of management or security against the alienation of particular items in the collection. Such claims are in effect claims to the income and/or capital of a fund which may vary in value and will in any case be composed of varying [133] items. They are claims on the fund, not claims on the items, and they may well be divorced from what in any case is notionally separable, the management of the individual items.
The modern world presents us with many examples where the ownership of property consists in claims on a variable collection or fund. Of the former the interest of a wife married in community of property is a striking instance. She has no power of managing the community assets and her claim is restricted to whatever items may be found in the collection of community assets on the dissolution of the marriage. Another example is the ownership by members of an unincorporated association of the association's assets. Prominent instances of the latter are the ownership of shares, the ownership of interests in trust funds and floating charges: all the instances of Gesamthandseigentum in German law fall into one of these classes.Footnote 28
Such claims on collections and funds present a still remoter analogy with the ownership of interests in material objects than the simple claims previously considered. The incidents of possession, management, and the prohibition of harmful use apply, if at all, in a sketchy form. Alienability, transmissibility, income, and (sometimes) capital rights remain. Since, among forms of property holding, claims on collections and funds are now of outstanding importance economically, we might say that, over a wide field, either the character of things owned has altered or the character of ownership has altered. I see no reason for preferring one form of expression to the other; our investigation has revealed, what we began by suspecting, that the notions of ownership and of the thing owned are interdependent. We are left not with an inclination to adopt a terminology which confines ownership to material objects, but with an understanding of a certain shift in meaning as ownership is applied to different classes of things owned.
It remains to consider the view that the thing owned should always be spoken of as a right. This is certainly an odd-looking proposal, since ‘owning’ in ordinary use involves ‘having certain rights to’ a thing. If, therefore, we are to substitute for [134] ‘owning a pen’ ‘owning certain rights in a pen’, it would seem to follow the owner should correctly be said to have certain rights in certain rights in a pen; but why stop at the second order of rights?
Of course, the force of the proposal is a protest against the habit of thinking of the ownership of a thing, particularly a material object, as if it consisted only in a relation between a person and a thing, and not at all in relations between the owner and other persons. Yet to speak always of owning rights rather than things would be doubly misleading. Ownership, as we have seen, is not just a bundle of rights, as it is no help towards understanding our society to speak as if it were. Secondly, the idiom which directly couples the owner with the thing owned is far from pointless; where the right to exclude others exists, there is indeed (legally) a very special relation between the holder of the right and the thing, and this is a rational way of marking it.Footnote 29
2. Title
It is not enough for a legal system to recognize the possibility of people owning things. There must be rules laying down how ownership is acquired and lost and how claims to a thing are to rank inter se. This brings us to the notion of title, a word which is used in two main senses. First, it refers to the conditions of fact which must be fulfilled in order that a person may acquire a claim to a thing. In this sense, delivery, registration, seizure, and succession on death may be titles to the ownership of property. ‘Mode of acquisition’ or ‘mode of loss’ will do as well for this meaning as ‘title’; so I use ‘title’ in the second sense.
This is the sense in which a title to a thing is a claim, valid against persons generally though not necessarily against everyone, to the possession of the thing. It is true that in ordinary legal usage ‘title’ involves a great deal more than this; it implies, for instance, a power of alienating the holder's interest and the transmissibility of that interest. The restricted sense I have given to ‘title’ is, however, adequate for the present discussion. [135]
Clearly, every owner has a title to the thing owned, provided that the thing admits of being possessed; even if it does not admit of this, there will be prior and posterior claims to the thing, as in the case of choses in action, and the owner will have such a claim. It is also clear that several persons may have titles to the same thing; thus, a mere possessor has, under some systems of law, a better right to possess than any later possessor of the thing not deriving title from an earlier possessor. Taking possession is regarded under such systems as a mode of acquiring a right to possess, valid against persons generally, not merely against a trespasser or disseisor. Hence, there may be problems of priority of title. What is not, at first sight, clear is whether the name ‘owner’ should be confined to the person with the best title to a thing out of all possible claimants (the title, a good title) or whether we should in such cases speak of two or more ‘owners’ of the thing ranking in a certain order.
Modes of acquisition
These obviously vary from system to system. It is often thought that light can be thrown on the concept of possession by a study of the conditions for acquiring possession; ought not the same procedure to be fruitful in the study of ownership? Holmes, following a general theory about the analysis of legal concepts, approaches the matter in this way,Footnote 30 but without yielding more than a catalogue of modes of acquisition. On the other hand, some writers who wish to justify the institution of ownership as a fair one, in spite of the apparent injustice involved in excluding all save the owner from the thing owned, argue that, though there are various modes of derivative acquisition, there is only one mode of original acquisition, namely taking possessions.Footnote 31 They go on to say that the labour involved in taking or making the thing justifies the taker in retaining it against subsequent claimants and transmitting it to others.
The argument is certainly not, apart from its other defects, consistent with positive law. Thus, in South Africa, land cannot be acquired by occupatio but only (apart from irrelevant [136] exceptions) by Government grant, statute, or 30 years’ prescription. The truth is that modes of acquisition, original and derivative, are many and various; one of the functions of expressions such as ‘he is owner’ is precisely to draw similar legal conclusions from varying states of fact.Footnote 32
If, therefore, we are to seek moral reasons why particular persons ought to own particular things, we shall need different reasons for different modes of acquisition; and derivative modes of acquisition stand in need of justification as much as original. There are in fact good reasons why the commonest modes of original acquisition (making and taking) and of derivative acquisition (consent and debt) should be recognized. If these are thought morally satisfactory, we have arrived at a justification for the adoption by a legal system of certain modes of acquisition; what we have not found is a justification for the institution of ownership. I do not, of course, wish to imply that none can be found.
Modes of loss
Once derivative modes of acquisition are recognized, modes of loss or extinction must also be recognized. These give little difficulty when the loss is with the consent of the previous owner or through his debt, but a good deal when the system admits, as many systems do, the possibility of acquiring title or barring a prior title by lapse of time or, as in English land law, of acquiring a ‘title’ in the sense defined above, albeit imperfect, by the simple act of squatting or dispossessing the present holder.
In such cases, the later acquisition may have the effect either of divesting the earlier or of creating a second, concurrent title: in the latter event, the two titles may continue indefinitely to run concurrently, or the earlier may lapse or become unenforceable after a period of time.
One or many titles
This is a convenient point at which to try to classify legal systems according to the number of independent titles which [137] they permit. By ‘independent’ I mean ‘not derived from a common source’.
In the simplest type of system only a single independent title is possible. Such a system may be called unititular. Under it, if the title to a thing is in A, no title to it can be acquired (independently) by B, except by a process which divests A. There is only one ‘root of title’ for each thing, and the present title can ultimately be traced back to that root.
In some ways a unititular system is simple, but it may seem to leave unprotected persons whose interests are deserving of protection. It does not provide for the grading of claims to a thing; it proceeds on the view that only one claim is worthy of protection against persons generally, and that other claims need not be recognized, save, perhaps, that a person in possession may be protected against a trespasser or disseisor, a fact which, as we have seen, does not by itself give the possessor a title. A unititular system may be conservative in its working, if acquisition without the consent of the previous owner is made difficult, or may be ‘active’ and may favour enterprise, or even banditry, if acquisition without the consent of the previous owner is easy.
Classical Roman law at first sight approximates to the ‘active’ unititular system, Justinian's law to the ‘conservative’ version, since the period for acquiring by usucapion or prescription and so divesting the previous owner was increased in the latter case. But on a closer examination, the Roman system looks conservative at all periods; the mere thief or trespasser and their successors are never favoured, because nothing stolen or taken by force can be acquired in this way, and the owner of such things can never be divested against his will.Footnote 33
It may be thought that the statement that Roman law was substantially unititular is inconsistent with the distinction between Quiritary and ‘bonitary’ ownership. This is true only so far as ‘defeasible’ bonitary owners are concerned. The Quiritary and bonitary ‘owners’ did not hold by independent titles where the ‘bonitary’ ownership was indefeasible. The [138] praetorian, ‘bonitary’ owner derived title from the Quiritary owner. The division between the two is a case of split ownership, not of independent titles. The bona fide possessor in via usucapiendi also had a title, a type of ‘bonitary’ ownership, defeasible only by the true owner; this is, perhaps, the only exception in Roman law to the rule that there was only one title. When the periods of usucapion were short, it was not an exception of much importance; after a year or two there was, once again, only a single title. As the periods were increased the exception grew in importance. Roman law held to the theory that, in such cases, there was only one dominos.
Under a unititular system, one way of ascertaining the true owner is by tracing title to the original acquirer. With land, especially, this is seldom practicable. The remedy may lie in rules either of substance or procedure. A substantive rule creating a mode of acquisition which has a divesting effect may meet the need, especially if the period is fairly short. A ruthless form of divesting is found in French law, where the maxim that possession of movables is equivalent to title is interpreted to mean that if a bailee of goods delivers them by way of sale, gift, etc., to another, he thereby divests the title of the bailor, leaving him to his action for damages against the bailee.
In Roman law, given the rule that theft or violent dispossession was a bar to acquisition running with the thing, it was theoretically necessary to trace title to the original source in order to see whether a ‘vice’ affected the property. If therefore the difficulty of proof of title is, as Hargreaves asserts,Footnote 34 a reason against adopting the terminology of ownership, his argument would apply with as much force to Roman and modern civil law as to English law.
In practice, in modern systems based on Roman law, rules of evidence help to overcome the practical difficulties. Possession, unless otherwise explained, is regarded as evidence of ownership and an earlier possession is regarded as better evidence of ownership than a later, independent possession. Registration of [139] title is really an evidentiary device of the same order. In most systems registration does not have a divesting effect;Footnote 35 the register may be rectified at the instance of the true owner (or, in a multititular system, someone with a better title than the registered owner). The register merely makes it possible to discover without difficulty who is presumptively owner.
With unititular systems we may contrast multititular systems. As we have seen, these turn on the possibility of acquiring title without the consent of the present owner of a thing by a process which does not have a divesting effect. Such systems may take either a ‘conservative’ or an ‘active’ form. In the former, the earlier titles continue to be valid indefinitely or for a very long time. In the latter, either the right or the remedy is barred after a relatively short period. Again, if the title of a thief or trespasser is recognized, the system is thereby rendered more ‘active’.
The English system as regards both land and chattels falls into the multititular category. As regards land, a title could and can be acquired without the consent of the previous owner by mere disseisin or dispossession.Footnote 36 It was a principle of the medieval law that a disseisor ipso facto acquired an estate in fee, albeit a tortious estate. ‘Every fee simple is not legitimum, for a disseisor, abator, intruder, usurper, etc. have a fee simple, but it is not a lawful fee’.Footnote 37 In the modern law it seems that a dispossession adverse to the present holder gives the trespasser or squatter an estate in fee simple;Footnote 38 despite Holdsworth,Footnote 39 every adverse possession is a root of title,Footnote 40 though the title may lapse on abandonment.Footnote 41
Such ease of acquisition is consistent with a unititular system. Thus, in the early land law, disseisin had a divesting effect; the disseisee had a mere right of entry, which might be tolled, [140] and was inalienable. Since the 19th-century reforms, the disseisee or his modern equivalent can alienate his interest inter vivos or on death and it descends to his personal representatives.Footnote 42 Hence, as Megarry and Wade say, when S dispossesses O, ‘S’s possession gives all the rights and powers of ownership: S has, in fact, a legal estate, a fee simple absolute in possession. But so also has O, until such time as his title is extinguished by limitation. There is no absurdity of speaking of two or more adverse estates in the land, for their validity is relative.’Footnote 43
If, then, S and O both have fees simple, shall we say that both are owners of the land? Or shall we call S, the present possessor, alone owner but say that his ownership may be divested; or, again, that O, since his claim is ultimately entitled to prevail, is alone owner? One cannot expect clear criteria for answering such questions. S, however, has every incident of ownership except security against divesting, while O has every such incident except present enjoyment. There is much to be said, therefore, for treating them as independent owners rather than as persons sharing a single, split ownership.
On the other hand, it may be argued that, in view of such puzzles, it would be better not to speak of the ownership of land in English law at all. This argument ignores the many straightforward cases in which there is a single tenant in fee simple and no competing title.
Hargreaves, who argues against speaking of ‘ownership’ in English land law, relies on the fact that in actions for the recovery of land the plaintiff need only prove a better title than the defendant not that his title is the best of all possible titles.Footnote 44 Now a multititular system must have rules for enabling the holders of titles to recover possession and for regulating priorities between the holders of competing titles. There will not, therefore, be any procedural need in such a system to provide a special remedy (e.g. a vindicatio) for the person with the best title. The holder of the best title can make use of the remedies [141] (e.g. ejectment) available to those with a title. The point of such a system is that proof of any title will suffice except against a person who can show a better. But, of course, if priorities are regulated, someone must have top priority; maius ius implies maximum ius. Surely the holder of maximum ius, at least, cannot be denied the title of owner? It will, however, be never necessary, though always sufficient, when he claims the possession of land, for him to prove that he has maximum ius.
English land law exhibits a highly ‘active’ system of regulating title, owing to the relatively short period of limitation coupled with the recognition of the disseisor's title. Sociological writers may detect in this the mores of the Germanic tribes who invaded Britain; but as the 12-year period of limitation is a modern innovation, the system has not always been as ‘active’ as it now is.
The English law of title to chattels is also multititular. It is not clear, however, that a thief acquires title except against a later wrongdoer;Footnote 45 hence, the rules for chattels are in some ways less ‘active’ than for land. Divesting may, however, take place either by limitation or by certain consensual dispositions (sale in market overt, sale by factors). The Sale of Goods Act makes a sharp distinction between the holder of the title, who can give a ‘good title’ to the goods and the holders of lesser titles.Footnote 46 Only the former can make a valid disposition of the thing by way of sale. Hence, there is no temptation to speak of goods as having more than one independent owner.
From what has been said, it emerges that multititular systems are more flexible than unititular systems, though they are not necessarily more ‘active’. The difference between these two ways of regulating title has often been construed as a difference between two conceptions of ownership. This, I suggest, is a mistake. The only difference of importance between the place of ownership in the two schemes is procedural: what has to be proved in an action. But whether a plaintiff must prove that he is owner, and what is to be understood by ownership, are entirely distinct questions. [142]
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Antony (Tony) M. Honoré was born in London in 1921 but was brought up in South Africa. He served in the British Army during the Second World War and was severely wounded in the Battle of El Alamein in 1942. After the war, he continued his studies at New College, Oxford, and he has lived and taught in Oxford for well over half a century, holding fellowships at several Oxford colleges. From 1971 to 1988, he was Regius Professor of Civil Law and a Fellow of All Souls College in Oxford. He is internationally known for his work on ownership, legal causation, and Roman law.
Honoré worked closely with the Oxford legal theorist Herbert L. A. Hart (1907–92), writing a joint book on Causation in the Law (Hart and Honoré, Reference Hart and Honoré1959). Honoré also had some influence on Hart's (Reference Hart1961) classic The Concept of Law. Honoré's contributions to legal philosophy include 16 books and more than a hundred articles, including Making Law Bind (Reference Honoré1987) and Responsibility and Fault (Reference Honoré1999). Honoré is an honorary QC and a member of the British Academy. In South Africa, where he made a contribution to the establishment of the post-apartheid Constitutional Court in 1995, his standing has been recognized by the award of several honorary degrees.
The Honoré (Reference Honoré and Guest1961) text below is a classic statement on the concept of ownership.1 Most of the ideas within it are familiar to legal theorists but much less to social scientists. Constant confusions arise because of failures to distinguish between different types of property rights. Several of the demarcations owe their origin to Roman law, and Honoré distinguishes between 11 ‘leading incidents’ or types of rights. They include the right to use a tangible or intangible asset (usus), the right to appropriate the returns from the asset (usus fructus), the right to change a good in substance or location (abusus), the right to the capital derived from the use of the good as collateral, the right to sell a good (alienation), and several other rights or limitations.
The terms ‘ownership’ and ‘property’ are often treated as synonymous. In some legal accounts, ‘property’ refers to both the bundle of rights and to the object(s) over which the bundle is exercised, while the term ‘ownership’ denotes only the former. Honoré sees ownership as the full complement of property rights and liabilities, and a property right as one of several possible constitutive elements in ownership. There are multiple different nuances of terminology and the reader has to take careful account of them.
Writers who claim that property rights are ‘confused’ or ‘unclear’ in particular situations, from medieval Europe to modern China, are sometimes unaware that there are different types of property rights, and in principle they can be in the hands of different legal persons. For example, since the Communist revolution the land in China has been owned by the state. So the state alone retains abusus and alienation rights. But since the early 1980s there has been a major distribution of usus and usus fructus rights from collectives to peasant farmers, leading to huge increases in agricultural productivity and launching China's 30-year growth explosion.
But some commentators muddy the water here. For example, Zhu and Jiang (Reference Zhu and Jiang1993, p. 447), addressing China after the early 1980s reforms, claimed that ‘no one in the community is a real owner of land’ and referred to this ‘vagueness in the land ownership’. Despite the approval of leading Chinese scholar Nolan (Reference Nolan1993, p. 74), this description is at best a half truth. Farmers in China do have usus and usus fructus rights, but they are not saleable. The farmers lack other property rights and in some areas even their existing rights are subject to compulsory purchase with little compensation. The greater problems lie with the security of some property rights, rather than with their vagueness.
Notwithstanding these problems, China's rural growth has been stimulated by the devolution of partially insecure but largely viable property rights (Oi, Reference Oi1999). The position in China is complex, but we need clear concepts to understand it. Any good argument that clear property rights matter less than their proponents claim cannot be based on unclear or conflated notions of what property rights are. It is necessary to distinguish between possible imperfections of practical legal definition by the authorities, imperfections of allocation, and imperfections of enforcement.
Honoré (Reference Honoré and Guest1961) also gives ownership a refined meaning that differs from that provided by many prominent economists. For example, Alchian (Reference Alchian and Brunner1977, p. 238) defined the ‘property rights’ of a person as ‘the probability that his decision about demarcated uses of the resource will determine the use’. The upshot of this definition is that if a thief manages to keep stolen goods then she acquires a substantial property right in them. Alchian's definition of property neglects the concept of rightful ownership. It denotes possession rather than property. Similarly, the prominent property rights economist Barzel (Reference Barzel1994, p. 394) defines property as
an individual's net valuation, in expected terms, of the ability to directly consume the services of the asset, or to consume it indirectly through exchange . . . the definition is concerned not with what people are legally entitled to do but with what they believe they can do.
This removes the question of legal title from the definition of property. There is no distinction in these two cases between property and mere possession. As Pipes (Reference Pipes1999, p. xv) insists, ‘Possession refers to the physical control of assets, material or incorporeal, without formal title to them: it is ownership de facto not de jure’.
Honoré (Reference Honoré and Guest1961, p. 115) writes in the essay below: ‘To have worked out the notion of “having a right to” as distinct from merely “having” . . . was a major intellectual achievement. Without it society would have been impossible’. As he further (p. 134) argues: ‘It is not enough for a legal system to recognize the possibility of people owning things. There must be rules laying down how ownership is acquired and lost and how claims to a thing are to rank inter se’. The legal title to an object of property refers to the conditions that must be fulfilled in order that a person may acquire a claim to a thing.
Hence, the role of the legal system is crucial. As Commons (Reference Commons1924, p. 87) quipped long ago, the exchange of property involves not two parties but three, where the third is the state or a ‘superior authority’. Property is an instituted social relation involving rights, benefits, and duties (Hallowell, Reference Hallowell1943). The essence of the right of ownership of a resource is its acknowledgement of that right by others, through mechanisms of institutional accreditation and legitimation.
Honoré's article is not the last word on the topic. His stance is described as a ‘bundle of rights’ view of property and this has been a matter for critical discussion (Penner, Reference Penner1996, Reference Penner1997). But Honoré also emphasizes the role of the legal environment. As with all key concepts, we never get to the end of the matter. But we have to make our way through the thicket the best we can.
Understanding the nature and role of property is vital to understand capitalism. Crucially for the functioning of the modern capitalist system, and unlike objects of mere possession, durable property can be used by its owner as collateral and can involve legal encumbrances (Arner et al., Reference Arner, Booth, Lejot and Hsu2007; Steiger, Reference Steiger2008). The registration of durable property and its consequent use as collateral for debt is arguably a crucial institutional mechanism for economic development (Arruñada, Reference Arruñada2012; De Soto, Reference De Soto2000).
Clearly, there are major differences between the conceptions of property right offered by some highly influential economists, on the one hand, and leading legal theorists such as Honoré. They cannot both be correct, and extensive discussion by economists of key contributions by legal theorists – both in regard to property and other prominent concepts such as the firm (Gindis, Reference Gindis2009; Hodgson Reference Hodgson2002) – is long overdue.
Ownership is one of the characteristic institutions of human society. A people to whom ownership was unknown, or who accorded it a minor place in their arrangements, who meant by meum and tuum no more than ‘what I (or you) presently hold’ would live in a world that is not our world. Yet to see why their world would be different, and to assess the plausibility of vaguely conceived schemes to replace ‘ownership’ by ‘public administration’, or of vaguely stated claims that the importance of ownership has declined or its character changed in the 20th century, we need first to have a clear idea of what ownership is.
I propose, therefore, to begin by giving an account of the standard incidents of ownership: i.e. those legal rights, duties, and other incidents which apply, in the ordinary case, to the person who has the greatest interest in a thing admitted by a mature legal system. To do so will be to analyse the concept of ownership, by which I mean the ‘liberal’ concept of ‘full’ individual ownership, rather than any more restricted notion to which the same label may be attached in certain contexts.
Secondly, I propose to say something about the notion of title, about the types of rule which legal systems adopt in order to decide who is to own a thing and, if two or more persons have claims to a thing, how priority between them is to be settled. Thirdly, I touch briefly on some instances of split ownership, in which the standard incidents are divided between two or more persons. Last comes the topic of the restriction of ownership in the social interest and the relation between ownership and public administration. This order of treatment should have the following advantage: once the standard case of full ownership has been [108] depicted, the variants and possible alternatives stand out more clearly in contrast, and are easier to understand and assess. On the other hand, this treatment is not meant to prejudge the issue, how far private ownership should stretch and to what extent it should be modified in the public interest. That issue, though it lies outside the scope of this essay, can be understood only with the help of an adequate analysis of the concept of ownership.
1. The liberal concept of ownership
If ownership is provisionally defined as the greatest possible interest in a thing which a mature system of law recognizes, then it follows that, since all mature systems admit the existence of ‘interests’ in ‘things’, all mature systems have, in a sense, a concept of ownership. Indeed, even primitive systems, like that of the Trobriand islanders, have rules by which certain persons, such as the ‘owners’ of canoes, have greater interests in certain things than anyone else.Footnote 2
For mature legal systems, it is possible to make a larger claim. In them, certain important legal incidents are found, which are common to different systems. If it were not so, ‘He owns that umbrella’, said in a purely English context, would mean something different from ‘He owns that umbrella’, preferred as a translation of ‘Ce paraplui est à lui’. Yet, as we know, they mean the same. There is indeed a substantial similarity in the position of one who ‘owns’ an umbrella in England, France, Russia, China, and any other modern country one may care to mention. Everywhere the ‘owner’ can, in the simple uncomplicated case, in which no other person has an interest in the thing, use it, stop others using it, lend it, sell it, or leave it by will. Nowhere may he use it to poke his neighbour in the ribs or to knock over his vase. Ownership, dominium, propriété, Eigentum, and similar words stand not merely for the greatest interest in things in particular systems but for a type of interest with common features transcending particular systems. It must surely be important to know what these common features are? [109]
In stressing the importance of such common features, I do not wish to go beyond the claim that these resemblances exist de facto and can be explained by the common needs of mankind and the common conditions of human life. It would be rash to assert that the features discussed are necessarily common to different mature systems, or that their range and ubiquity proves that what is called ‘general jurisprudence’ is a reputable pursuit. These assertions may indeed be true, but for my purposes it is enough to show that the standard incidents of ownership do not vary from system to system in the erratic, unpredictable way implied by some writers but, on the contrary, have a tendency to remain constant from place to place and age to age.
Nor must the present thesis be confused with the claim that all systems attach an equal importance to ownership (in the full, liberal sense) or regard the same things as capable of being owned. The latter claim would be patently false. In the Soviet Union, for instance, important assets such as land, businesses, and collective farms are in general withdrawn from ‘personal ownership’ (viz. the liberal type of ownership) and subjected to ‘government’ or ‘collective’ ownership, which is a different, though related institution.Footnote 3 The notion of things ‘outside commerce’, not subject to private ownership but to special regulation by the state or public authorities, is an ancient one and has retained its importance in modern continental law.Footnote 4 Again, there is a case for saying that, in the early middle ages, land in England could not plausibly be said to be ‘owned’ because the standard incidents of which I shall speak were so divided between lord and tenant that the position of neither presented a sufficient analogy with the paradigm case of owning a thing.Footnote 5
Indeed, in nearly all systems there will be some things to which not all the standard incidents apply, some things which cannot be sold or left by will, some interests which cannot endure beyond a lifetime, some things (flick knives, Colorado [110] beetles) which it is forbidden to use or to use in certain ways. If the differences between these cases and the paradigm case are striking enough, we shall be tempted to say that the things in question are not or cannot be owned, but it would be a mistake to conclude that the legal systems in which these cases occur do not recognize ownership. Whether a system recognizes ownership, and to what extent it permits ownership (who may own, what may be owned), are widely differing questions. No doubt liberal societies are more inclined than socialist societies to extend the list of items that can be owned, but it does not follow that, when a socialist system permits ownership, or ‘personal ownership’, it is permitting something different from what is permitted in the corresponding case in a liberal society. It may well be – and all the evidence indeed supports the view – that socialist societies recognize the ‘liberal’ notion of ‘full’ ownership, but limit the range of things that can be owned. Perhaps definitions of ownership contained in codes are not a safe guide. Still, it is striking that the French civil code, enacted in an atmosphere of liberal individualism, defines ownership as ‘the right of enjoying and disposing of things in the most absolute manner, provided that one abstains from any use forbidden by statute or subordinate legislation’;Footnote 6 while the Soviet civil code, framed in a socialist context, provides, in very similar language, that ‘within the limits laid down by law, the owner has the right to possess, to use and to dispose of his property’.Footnote 7 Obviously much here depends on what limits are laid down by law in each system; in fact, so far as articles subject to ‘personal ownership’ are concerned, the limits in the two systems hardly differ.
One further caveat. I set out to describe the incidents of ownership in the simple cases in which one would not hesitate to say ‘X owns that thing, that is X's book or house’, even though T may have borrowed it, or r may be X's tenant. In doing this, I do not lose sight of the existence of more complicated cases in which layman and lawyer alike may be puzzled to know which, of two or more persons interested in a thing, to call owner, or whether to say, on the other hand, that neither or [111] none is owner. Just as the rules of a system may so restrict the permissible ways of dealing with certain types of things that we are inclined to say that such things are not capable of being owned in that system, or can be owned only a sense different from the full, liberal sense we are to investigate, so the rules of a system may provide for the splitting of interests in a type of thing which, in general, is admittedly capable of being owned. Houses can be owned, and there is no conceptual difficulty in locating the ownership of a house let on a short lease. But if A lets B a house on a lease for 2,000 years, it may be very unclear, at least to the layman, whether A or B or neither should be called owner. (In this case, legal usage designates A owner despite the tenuous character of his reversionary right.) Again, can a mortgagor be said to ‘own’ a house which is mortgaged? (Legal usage here refuses to designate the mortgagee owner despite the potentially indeterminate character of his interest.) No obvious linguistic convention governs the answer to such problems, and, if the rules of a legal system demand an answer, it must be sought in positive law, in the comparative strength of competing analogies with the paradigm case and in the light shed on the problem by the social context.
The fact that there are such cases of split ownership and that they present baffling problems to one who is compelled to fix on one interested person as the owner of the thing does not make it worthless to try to delineate the incidents present in the ordinary, uncomplicated case. On the contrary, such a delineation is essential in order that it may be possible to assess the strength of the analogies in the peripheral cases. What must, however, be recognized at the outset is that the actual use of ‘owner’ and ‘ownership’ extends beyond the standard case now to be described and that to delineate the standard case is here, as with most legal notions, not to provide a code for the use of the word. For instance, the 16 or so pages of Burrows’ Words and Phrases Judicially Defined,Footnote 8 concerned with the interpretation of the word ‘owner’ in various statutes, amply reveal how the courts have wrestled with provisions extending the [112] legal meaning of ‘owner’ beyond the standard cases. But it is important to see that the very existence of such problems of statutory interpretation presupposes that there are paradigm cases in which the interpretation of ‘owner’ is clear.
Thus, where a statute providedFootnote 9 that ‘“owner” in relation to land, includes every person who jointly or severally whether at law or in equity, is entitled’ to the profits of the land etc., Griffith C. J. pointed out that the term ‘owner’ ‘Prima facie connotes entire dominion. Section 3 [the definition section] extends the meaning so as to take in certain persons who possess some, but not all, of the rights of absolute owners. Although, therefore, the language of the definition is in form inclusive, and not exhaustive, it must be read as if the words “besides the absolute owner” were inserted after “includes”’.Footnote 10 This presupposes that we know, without the help of an interpretation clause, what is meant by ‘absolute owner’. Again, when Jessel M. R. said in a case on the interpretation of the Highways Act, 1835, ‘I am clearly of the opinion that the term “owner” means the man in occupation, who may be either the actual owner or else only the occupying tenant’,Footnote 11 he could not meaningfully have said this unless there were available criteria for the identification of the interest called ‘ownership’ and so of the ‘actual owner’ in the majority of cases.
The standard incidents
I now list what appear to be the standard incidents of ownership. They may be regarded as necessary ingredients in the notion of ownership, in the sense that, if a system did not admit them, and did not provide for them to be united in a single person, we would conclude that it did not know the liberal concept of ownership, though it might still have a modified version of ownership, either of a primitive or sophisticated sort. But the listed incidents are not individually necessary, though they may be together sufficient, conditions for the person [113] of inherence to be designated ‘owner’ of a particular thing in a given system. As we have seen, the use of ‘owner’ will extend to cases in which not all the listed incidents are present.
Ownership comprises the right to possess, the right to use, the right to manage, the right to the income of the thing, the right to the capital, the right to security, the rights or incidents of transmissibility and absence of term, the prohibition of harmful use, liability to execution, and the incident of residuarity: this makes 11 leading incidents. Obviously, there are alternative ways of classifying the incidents; moreover, it is fashionable to speak of ownership as if it were just a bundle of rights, in which case at least two items in the list would have to be omitted.
No doubt the concentration in the same person of the right (liberty)Footnote 12 of using as one wishes, the right to exclude others, the power of alienating and an immunity from expropriation is a cardinal feature of the institution. Yet it would be a distortion – and one of which the 18th century, with its overemphasis on subjective rights, was patently guilty – to speak as if this concentration of patiently garnered rights was the only legally or socially important characteristic of the owner's position. The present analysis, by emphasizing that the owner is subject to characteristic prohibitions and limitations, and that ownership comprises at least one important incident independent of the owner's choice, is an attempt to redress the balance.
(1) The right to possess
The right to possess, viz. to have exclusive physical control of a thing, or to have such control as the nature of the thing admits, is the foundation on which the whole superstructure of ownership rests. It may be divided into two aspects, the right (claim) to be put in exclusive control of a thing and the right to remain in control, viz. the claim that others should not without permission, interfere. Unless a legal system provides some rules and procedures for attaining these ends, it cannot be said to protect ownership. [114]
It is of the essence of the right to possess that it is in rem in the sense of availing against persons generally. This does not, of course, mean that an owner is necessarily entitled to exclude everyone from his property. We happily speak of the ownership of land, yet a largish number of officials have the right of entering on private land without the owner's consent, for some limited period and purpose. On the other hand, a general licence so to enter on the ‘property’ of others would put an end to the institution of landowning as we now know it.
The protection of the right to possess (still using ‘possess’ in the convenient, though oversimple, sense of ‘have exclusive physical control’) should be sharply marked off from the protection of mere present possession. To exclude others from what one presently holds is an instinct found in babies and even, as Holmes points out,Footnote 13 in animals, of which the seal gives a striking example. To sustain this instinct by legal rules is to protect possession but not, as such, to protect the right to possess and so not to protect ownership. If dispossession without the possessor's consent is, in general, forbidden, the possessor is given a right in rem, valid against persons generally, to remain undisturbed, but he has no right to possess in rem unless he is entitled to recover from persons generally what he has lost or had taken from him, and to obtain from them what is due to him but not yet handed over. Admittedly, there may be borderline cases in which the right to possess is partially recognized, e.g. where a thief is entitled to recover from those who oust him and all claiming under them, but not from others.
The protection of the right to possess, and so of one essential clement in ownership, is achieved only when there are rules allotting exclusive physical control to one person rather than another, and that not merely on the basis that the person who has such control at the moment is entitled to continue in control. When children understand that Christmas presents go not to the finder but to the child whose name is written on the outside of the parcel, when a primitive tribe has a rule that a dead man's things go not to the first taker but to his son or his sister's [115] son, we know that they have at least an embryonic idea of ownership.
To have worked out the notion of ‘having a right to’ as distinct from merely ‘having’, or, if that is too subjective a way of putting it, of rules allocating things to people as opposed to rules merely forbidding forcible taking, was a major intellectual achievement. Without it society would have been impossible. Yet the distinction is apt to be overlooked by English lawyers, who are accustomed to the rule that every adverse possession is a root of title, i.e. gives rise to a right to possess,Footnote 14 or at least that ‘de facto possession is prima facie evidence of seisin in fee and right to possession’.Footnote 15
The owner, then, has characteristically a battery of remedies in order to obtain, keep and, if necessary, get back the thing owned. Remedies such as the actions for ejectment and wrongful detention and the vindicatio are designed to enable the plaintiff either to obtain or to get back a thing, or at least to put some pressure on the defendant to hand it over. Others, such as the actions for trespass to land and goods, the Roman possessory interdicts, and their modern counterparts are primarily directed towards enabling a present possessor to keep possession. Few of the remedies mentioned are confined to the owner; most of them are available also to persons with a right to possess falling short of ownership, and some to mere possessors. Conversely, there will be cases in which they are not available to the owner, for instance because he has voluntarily parted with possession for a temporary purpose, as by hiring the thing out. The availability of such remedies is clearly not a necessary and sufficient condition of owning a thing; what is necessary, in order that there may be ownership of things at all, is that such remedies shall be available to the owner in the usual case in which no other person has a right to exclude him from the thing. [116]
(2) The right to use
The present incident and the next two overlap. On a wide interpretation of ‘use’, management and income fall within use. On a narrow interpretation, ‘use’ refers to the owner's personal use and enjoyment of the thing owned. On this interpretation it excludes management and income.
The right (liberty) to use at one's discretion has rightly been recognized as a cardinal feature of ownership, and the fact that, as we shall see, certain limitations on use also fall within the standard incidents of ownership does not detract from its importance, since the standard limitations are, in general, rather precisely defined, while the permissible types of use constitute an open list.
(3) The right to manage
The right to manage is the right to decide how and by whom the thing owned shall be used. This right depends, legally, on a cluster of powers, chiefly powers of licensing acts which would otherwise be unlawful and powers of contracting: the power to admit others to one's land, to permit others to use one's things, to define the limits of such permission, and to contract effectively in regard to the use (in the literal sense) and exploitation of the thing owned. An owner may not merely sit in his own deck chair but may validly license others to sit in it, lend it, impose conditions on the borrower, direct how it is to be painted or cleaned, contract for it to be mended in a particular way. This is the sphere of management in relation to a simple object like a deck chair. When we consider more complex cases, like the ownership of a business, the complex of powers which make up the right to manage seems still more prominent. The power to direct how resources are to be used and exploited is one of the cardinal types of economic and political power; the owner's legal powers of management are one, but only one possible basis for it. Many observers have drawn attention to the growth of managerial power divorced from legal ownership; in such cases, it may be that we should [117] speak of split ownership or redefine our notion of the thing owned. This does not affect the fact that the right to manage is an important element in the notion of ownership; indeed, the fact that we feel doubts in these cases whether the ‘legal owner’ really owns is a testimony to its importance.
Management often takes the form of making contracts relating to the thing owned, whether with servants or agents or independent contractors. This fact, and the growing relative importance of management in comparison with personal use, at least in regard to some types of thing such as businesses, has led some observers to the neat conclusion that, over a wide sphere, obligatio has swallowed up res.Footnote 16 Even if the contrast were an apt one (and, after all, an obligatio is a res, a chose in action a chose), the sentiment would be exaggerated because many powers of management are exercised otherwise than by way of contract, not to mention powers of alienation. The point would be better made by saying that, in the owner's battery of rights, powers have increased in calibre while liberties have declined.
(4) The right to the income
To use or occupy a thing may be regarded as the simplest way of deriving an income from it, of enjoying it. It is, for instance, expressly contemplated by the English income tax legislation that the rent-free use or occupation of a house is a form of income, and only the inconvenience of assessing and collecting the tax presumably prevents the extension of this principle to movables.
Income in the more ordinary sense (fruits, rents, profits) may be thought of as a surrogate of use, a benefit derived from forgoing personal use of a thing and allowing others to use it for reward; as a reward for work done in exploiting the thing; or as the brute product of a thing, made by nature or by other persons. Obviously the line to be drawn between the earned and unearned income from a thing cannot be firmly drawn.
The owner's right to the income, which has always, under one name or another, bulked large in an analysis of his rights, [118] has assumed still greater significance with the increased importance of income relative to capital. Legally, it takes the form of a claim sometimes in rem, sometimes in personam to the income. When the latter is in the form of money, the claim before receipt of the money is in personam; and since the income from many forms of property, such as shares and trust funds, is in this form, there is another opportunity for introducing the apophthegm that obligatio has swallowed up res.
(5) The right to the capital
The right to the capital consists in the power to alienate the thing and the liberty to consume, waste, or destroy the whole or part of it: clearly it has an important economic aspect. The latter liberty need not be regarded as unrestricted; but a general provision requiring things to be conserved in the public interest, so far as not consumed by use in the ordinary way, would perhaps be inconsistent with the liberal idea of ownership.
Most people do not wilfully destroy permanent assets; hence, the power of alienation is the more important aspect of the owner's right to the capital of the thing owned. This comprises the power to alienate during life or on death, by way of sale, mortgage, gift, or other mode, to alienate a part of the thing and partially to alienate it. The power to alienate may be subdivided into the power to make a valid disposition of the thing and the power to transfer the holder's title (or occasionally a better title) to it. The two usually concur but may be separated, as when A has a power of appointment over property held by B in trust.Footnote 17 Again, in some systems, a sale, mortgage, bequest, etc. may be regarded as valid though the seller or mortgagor cannot give a good title. By giving a good title is meant transferring to the transferee the rights of the owner including his power of alienation.
An owner normally has both the power of disposition and the power of transferring title. Disposition on death is not permitted in many primitive societies but seems to form an essential [119] element in the mature notion of ownership. The tenacity of the right of testation once it has been recognized is shown by the Soviet experience. The earliest writers were hostile to inheritance, but gradually Soviet law has come to admit that citizens may dispose freely of their ‘personal property’ on death, subject to limits not unlike those known elsewhere.Footnote 18
(6) The right to security
An important aspect of the owner's position is that he should be able to look forward to remaining owner indefinitely if he so chooses and he remains solvent. His right to do so may be called the right to security. Legally, this is in effect an immunity from expropriation, based on rules which provide that, apart from bankruptcy and execution for debt, the transmission of ownership is consensual.
However, a general right to security, availing against others, is consistent with the existence of a power to expropriate or divest in the state or public authorities. From the point of view of security of property, it is important that when expropriation takes place, adequate compensation should be paid; but a general power to expropriate subject to paying compensation would be fatal to the institution of ownership as we know it. Holmes’ paradox, that where specific restitution of goods is not a normal remedy,Footnote 19 expropriation and wrongful conversion are equivalent, obscures the vital distinction between acts which a legal system permits as rightful and those which it reprobates as wrongful: but if wrongful conversion were general and went unchecked, ownership as we know it would disappear, though damages were regularly paid.
In some systems, as (semble) English law, a private individual may destroy another's property without compensation when this is necessary in order to protect his own person or property from a greater danger.Footnote 20 Such a rule is consistent with security of property only because of its exceptional character. Again, [120] the state's (or local authority's) power of expropriation is usually limited to certain classes of things and certain limited purposes. A general power to expropriate any property for any purpose would be inconsistent with the institution of ownership. If, under such a system, compensation were regularly paid, we might say either that ownership was not recognized in that system, or that money alone could be owned, ‘money’ here meaning a strictly fungible claim on the resources on the community. As we shall see, ‘ownership’ of such claims is not identical with the ownership of material objects and simple claims.
(7) The incident of transmissibility
It is often said that one of the main characteristics of the owner's interest is its ‘duration’. In England, at least, the doctrine of estates made lawyers familiar with the notion of the ‘duration’ of an interest and Maitland, in a luminous metaphor, spoke of estates as ‘projected upon the plane of time’.Footnote 21
Yet this notion is by no means as simple as it seems. What is called ‘unlimited’ duration (perpétuité)Footnote 22 comprises at least two elements (i) that the interest can be transmitted to the holder's successors and so on ad infinitum (the fact that in medieval land law all interests were considered ‘temporary’Footnote 23 is one reason why the terminology of ownership failed to take root, with consequences which have endured long after the cause has disappeared); (ii) that it is not certain to determine at a future date. These two elements may be called ‘transmissibility’ and ‘absence of term’, respectively. We are here concerned with the former.
No one, as Austin points out,Footnote 24 can enjoy a thing after he is dead (except vicariously) so that, in a sense, no interest can outlast death. But an interest which is transmissible to the holder's successors (persons designated by or closely related to the holder who obtain the property after him) is more valuable than one which stops with his death. This is so both because on alienation the alienee or, if transmissibility is generally [121] recognized, the alienee's successors, are thereby enabled to enjoy the thing after the alienor's death so that a better price can be obtained for the thing, and because, even if alienation were not recognized, the present holder would by the very fact of transmissibility be dispensed pro tanto from making provision for his intestate heirs. Hence, for example, the moment when the tenant in fee acquired a heritable (though not yet fully alienable) right was a crucial moment in the evolution of the fee simple. Heritability by the state would not, of course, amount to transmissibility in the present sense: it is assumed that the transmission is in some sense advantageous to the transmitter.
Transmissibility can, of course, be admitted, yet stop short at the first, second, or third generation of transmittees. The owner's interest is characterized by indefinite transmissibility, no limit being placed on the possible number of transmissions, though the nature of the thing may well limit the actual number.
In deference to the conventional view that the exercise of a right must depend on the choice of the holder,Footnote 25 I have refrained from calling transmissibility a right. It is, however, clearly something in which the holder has an economic interest, and it may be that the notion of a right requires revision in order to take account of incidents not depending on the holder's choice which are nevertheless of value to him.
(8) The incident of absence of term
This is the second part of what is vaguely called ‘duration’. The rules of a legal system usually seem to provide for determinate, indeterminate, and determinable interests. The first are certain to determine at a future date or on the occurrence of a future event which is certain to occur. In this class come leases for however long a term, copyrights, etc. Indeterminate interests are those, such as ownership and casements, to which no term is set. Should the holder live for ever, he would, in the ordinary way, be able to continue in the enjoyment of them for [122] ever. Since human beings are mortal, he will in practice only be able to enjoy them for a limited period, after which the fate of his interest depends on its transmissibility. Again, since human beings are mortal, interests for life, whether of the holder of another, must be regarded as determinate. The notion of an indeterminate interest, in the full sense, therefore requires the notion of transmissibility, but, if the latter were not recognized, there would still be value to the holder in the fact that his interest was not due to determine on a fixed date or on the occurrence of some contingency, like a general election, which is certain to occur sooner or later.
On inspection it will be found that what I have called indeterminate interests are really determinable. The rules of legal systems always provide some contingencies such as bankruptcy, sale in execution, or state expropriation on which the holder of an interest may lose it. It is true that in most of these cases the interest is technically said to be transmitted to a successor (e.g. a trustee in bankruptcy), whereas in the case of determinable interests the interest is not so transmitted. Yet, the substance of the matter is that the present holder may lose his interest in certain events. It is never, therefore, certain that, if the present holder and his successors so choose, the interest will never determine as long as the thing remains in existence. The notion of indeterminate interests can only be saved by regarding the purchaser in insolvency or execution, or the state, as succeeding to the same interest as that had by the previous holder. This is an implausible way of looking at the matter, because the expropriability and executability of a thing is not an incident of value to the owner, but a restriction on the owner's rights imposed in the social interest. It seems better, therefore, to deny the existence of indeterminate interests and to classify those which are not determinate according to the number and character of the contingencies on which they will determine. This affords a justification for speaking of a ‘determinable fee’, of ‘fiduciary ownership’ etc., for these do not differ essentially from ‘full ownership’, determinable on bankruptcy or expropriation. [123]
(9) The prohibition of harmful use
An owner's liberty to use and manage the thing owned as he chooses is in mature systems of law, as in primitive systems, subject to the condition that uses harmful to other members of society are forbidden. There may, indeed, be much dispute over what is to count as ‘harm’ and to what extent give and take demands that minor inconvenience between neighbours shall be tolerated. Nevertheless, at least for material objects, one can always point to abuses which a legal system will not allow.
I may use my car freely but not in order to run my neighbour down, or to demolish his gate, or even to go on his land if he protests; nor may I drive uninsured. I may build on my land as I choose, but not in such a way that my building collapses on my neighbour's land. I may let off fireworks on Guy Fawkes night, but not in such a way as to set fire to my neighbour's house. These and similar limitations on the use of things are so familiar and so obviously essential to the existence of an orderly community that they are not often thought of as incidents of ownership; yet, without them ‘ownership’ would be a destructive force.
(10) Liability to execution
Of a somewhat similar character is the liability of the owner's interest to be taken away from him for debt, either by execution of a judgment debt or on insolvency. Without such a general liability the growth of credit would be impeded and ownership would, again, be an instrument by which the owner could defraud his creditors. This incident, therefore, which may be called executability, seems to constitute one of the standard ingredients of the liberal idea of ownership.
It is a question whether any other limitations on ownership imposed in the social interest should be regarded as among its standard incidents. A good case can certainly be made for listing liability to tax and expropriability by the state as such. Although it is often convenient to contrast taxes on property with taxes on persons, all tax must ultimately be taken from [124] something owned, whether a material object or a fund or a chose in action. A general rule exempting the owners of things from paying tax from those things would therefore make taxation impracticable. But it may be thought that to state the matter in this way is to obliterate the useful contrast between taxes on what is owned and taxes on what is earned. Although, therefore, a society could not continue to exist without taxation, and although the amount of tax is commonly dependent on what the taxpayer owns or earns, and must be paid from his assets, I should not wish to press the case for the inclusion of liability to tax as a standard incident of ownership. Much the same will hold good of expropriability; for though some state or public expropriation takes place in every society, and though it is not easy to see how administration could continue without it, it tends to be restricted to special classes of property. We are left with the thought that it is, perhaps, a characteristic of ownership that the owner's claims are ultimately postponed to the claims of the public authority, even if only indirectly, in that the thing owned may, within defined limits, be taken from the owner in order to pay the expenses of running the state or to provide it with essential facilities.
Ownership and lesser interests
The interest of which the standard incidents have been depicted is usually described as the greatest interest in a thing recognized by the law and is contrasted with lesser interests (casements, short leases, licences, special property, mere detention). It is worthwhile looking a little more closely at this distinction, for it partly depends on a point that the foregoing analysis has not brought to light.
I must emphasize that we are not now concerned with the topic of split ownership – cases where the standard incidents are so divided, as to raise a doubt which of two or more persons interested should be called owner. We are dealing with those simpler cases in which the existence of B's interest in a thing, though it restricts A's rights, does not call in question A's ownership of the thing. [125]
The first point that strikes us is that each of the standard incidents of ownership can apply to the holder of a lesser interest in property. The bailee has possession of, and often the right to possess, the goods bailed. The managing director of a company has the right of managing it. The life tenant or usufructuary of a house is entitled to the income from it. The donee of a power of appointment is entitled to dispose of the capital subject to the power. The holder of an easement has a transmissible and non-determinate right in the land subject to the easement. Yet, without more, we feel no temptation to say that the bailee owns the thing, the managing director the company, the life tenant the house, the donee the capital, or the easement holder the land. What criteria do we use in designating these as ‘lesser interests’?
One suggested view is that the rights of the holder of a lesser interest can be enumerated while the ‘owner's’ cannot.Footnote 26 This rests on a fallacy about enumeration. The privileges, for instance, exercisable over a thing do not together constitute a finite number of permissible actions. The ‘owner’ and the lessee alike may do an indefinite number and variety of actions, viz. any action not forbidden by a rule of the legal system.
A second view is that the criterion used is the fact that, at least as regards some incidents, the holder of the lesser interest has more restricted rights than the owner. The lessee's interest is determinate, the ‘owner's’ merely determinable. But, conversely, the lessee has the right to possess and manage the property and take its income; in these respects the ‘owner's’ interest is, for the time being, more restricted than his own. Nor will it help to say that the ‘owner's’ rights are more extensive than those of the holder of a lesser interest as regards most of the incidents listed, for, in such cases as lease, this would lead to the conclusion that the lessee has as much claim to be called owner as the reversioner.
A third suggestion is that some one incident is taken as the criterion. It is possible, however, for all the listed rights, to put [126] examples which would lead to the opposite result from that sanctioned by usage. If A lets B a car on hire, B possesses it but A ‘owns’ it. The holder of a life interest or usufruct manages and takes the income of the thing, but the dominus or reversioner ‘owns’ it. When trust property is subject to a power of appointment, the donee of the power can dispose of it but the trustee ‘owns’ it. When property is subject to a fideicommissum, the fiduciary has no transmissible right (unless the fideicommissum fails), yet he is ‘owner’ while the fideicommissary may, exceptionally, have such a right. A person who holds an interest in them may ‘own’, while one who has a potentially indeterminate interest ex die does not as yet do so.
Besides these examples, where any of the suggested criteria would give a result at variance with actual lay and legal usage, there are many others where the rights in question apply to both or neither of the persons holding an interest in the thing. For instance, some writers appear to treat ‘duration’Footnote 27 as the criterion for distinguishing between ownership and lesser interests. Yet the holder of an easement, like the ‘owner’ of land, has a transmissible and indeterminate right over it, while, per contra, neither the ‘owner’ nor the licensee of a copyright has an indeterminate right.
It would be easy but tedious to list examples for the other rights; clearly, if a criterion is to be found, it must be sought elsewhere. A hopeful avenue of inquiry seems to be the following: what happens on the determination of the various interests in the thing under consideration? This brings us to a further standard incident of ownership, viz. its residuary character.
(11) Residuary character
A legal system might recognize interests in things less than ownership and might have a rule that, on the determination of such interests, the rights in question lapsed and could be exercised by no one, or by the first person to exercise them after their lapse. There might be leases and easements; yet, on their [127] extinction, no one would be entitled to exercise rights similar to those of the former lessee or of the holder of the easement. This would be unlike any system known to us and I think we should be driven to say that in such a system the institution of ownership did not extend to any thing in which limited interests existed. In such things there would, paradoxically, be interests less than ownership but no ownership.
This fantasy is intended to bring out the point that it is characteristic of ownership than an owner has a residuary right in the thing owned. In practice, legal systems have rules providing that on the lapse of an interest rights, including liberties, analogous to the rights formerly vested in the holder of the interest, vest in or are exercisable by someone else, who may be said to acquire the ‘corresponding rights’. Of course, the ‘corresponding rights’ are not the same rights as were formerly vested in the holder of the interest. The easement holder had a right to exclude the owner; now the owner has a right to exclude the easement holder. The latter right is not identical with, but corresponds to, the former.
It is true that corresponding rights do not always arise when an interest is determined. Sometimes, when ownership is abandoned, no corresponding right vests in another; the thing is simply res derelicta. Sometimes, on the other hand, when ownership is abandoned, a new ownership vests in the state, as is the case in South Africa when land has been abandoned.
It seems, however, a safe generalization that, whenever an interest less than ownership terminates, legal systems always provide for corresponding rights to vest in another. When easements terminate, the ‘owner’ can exercise the corresponding rights, and when bailments terminate, the same is true. It looks as if we have found a simple explanation of the usage we are investigating, but this turns out to be but another deceptive short cut. For it is not a sufficient condition of A's being the owner of a thing that, on the determination of B's interest in it, corresponding rights vest in or are exercisable by A. On the determination of a sub-lease, the rights in question become exercisable by the lessee, not by the ‘owner’ of the property. [128]
Can we then say that the ‘owner’ is the ultimate residuary? When the sub-lessee's interest determines the lessee acquires the corresponding rights; but when the lessee's right determines the ‘owner’ acquires these rights. Hence, the ‘owner’ appears to be identified as the ultimate residuary. The difficulty is that the series may be continued, for on the determination of the ‘owner's’ interest the state may acquire the corresponding rights; is the state's interest ownership or a mere expectancy?
A warning is here necessary. We are approaching the troubled waters of split ownership. Puzzles about the location of ownership are often generated by the fact that an ultimate residuary right is not coupled with present alienability or with the other standard incidents we have listed. Was the feudal lord's right of escheat ownership or merely an expectancy? When land was given in emphyteusis, was the emphyteuta or the reversioner owner? Other puzzles are created by cases of cross-residuarity. When property is held subject to a fideicommissum in the modern law, the fideicommissary benefits from the lapse of the fiduciary's rights and vice versa; so which is really residuary?
We are of course here concerned not with the puzzles of split ownership but with simple cases in which the existence of B's lesser interest in a thing is clearly consistent with A's owning it. To explain the usage in such cases, it is helpful to point out that it is a necessary but not sufficient condition of A's being owner that, either immediately or ultimately, the extinction of other interests would enure for his benefit. In the end, it turns out that residuarity is merely one of the standard incidents of ownership, important no doubt, but not entitled to any special status.
The thing owned
‘To own’ is transitive; the object of ownership is always spoken of as a ‘thing’ in the legal sense, a res. There is, clearly, a close connection between the idea of ownership and the idea of things owned, as is shown by the use of words such as ‘property’ to designate both. We ought, apparently, to be able to throw some light on ownership by investigating ‘things’. [129]
Outside the law, external material objects are thought of as the prime examples of things and, in this sense, things are contrasted with persons. But, in a wide sense, any object of discourse may be called a thing – events, states, emotions, actions, processes are all things. The extra-legal use of ‘thing’ is therefore not likely to help us in finding out what can be owned.
In the law we find the following position. As regards external material objects, it is natural to speak of ownership. A person ‘owns’ a book, house, or car. The terminology of ownership is also extended to some things other than material objects. A person may ‘own’ a copyright, leasehold property, goodwill, a business, patent rights. In these cases, the analogy with the incidents of the ownership of external material objects is a close one.
In other cases, the holder of a right is said to ‘have’ rather than own the interest in question. Thus, one ‘has’ an easement or a chose in action or a reputation. Here the analogy with the ownership of material objects is less strong or, as in the case of easements, the alternative expression is adopted to avoid confusion with the ownership of the material object to which the right relates.
In other cases again, we speak not of ‘having’ a thing but of ‘having a right’ to or in something. Thus, a person does not either ‘own’ or ‘have’ his body or liberty. He has a right to bodily security or liberty. Here the analogy with the ownership of a thing is tenuous; thus, these rights are inalienable. Finally, there are interests which the law refuses to recognize: one does not own, have or have a right to them. An example in English law is privacy.
In any viable society we shall expect certain interests (having a house, clothes, food, preserving one's body from harm) to be protected, but, as regards many other interests (copyright, reputation, privacy, shares) there will be nothing absurd in a system which does not protect them, though it may be an inconvenient system. There will be no way of telling, apart from knowing the details of a system, whether such interests are protected and, a fortiori, no way of telling whether they are con[130]ceived as consisting in the ownership of things. Apart from the basic interests mentioned, protection of an interest is not merely the recognition of a social necessity. The meaning of the words ‘right’ or ‘thing’ will not help one to guess what the decision has been or is likely to be.
Much the same may be said of the difference between simple rights and interests conceived in terms of ownership. A person is not, in most systems, regarded as owning his body, reputation, skill, honour, or dignity. At most he has a simple right to these things, which are therefore not legally ‘things’. By a ‘simple right’, I mean one which is protected by law but is not alienable or transmissible. Now it may be that the doctrine that one does not own one's body, etc., is influenced by the linguistic fact that such aspects of one's person do not fall within the prime class of things, external material objects. But a more likely explanation is simply that it has been thought undesirable that a person should alienate his body, skill, or reputation, as this would be to interfere with human freedom. When human beings were regarded as alienable and ownable they were, of course, also regarded as being legally things: and it is quite easy to conceive arrangements under which one could, for instance, lease one's reputation or one's skill for a term of years, so that the lessee could sue for infringements of the lessor's good name or for the fruits of his work. It may, indeed, be argued that contracts for the assignment of goodwill and contracts of service are examples of at least partial alienations of these interests.
However that may be, it is clear that to stare at the meaning of the word ‘thing’ will not tell us which protected interests are conceived in terms of ownership. When the legislature or courts think that an interest should be alienable and transmissible they will rei-fy it and say that it can be owned, that it is property. They will not say that it can be owned and is a res because of a prior conviction that it falls within the appropriate definition of ‘thing’. The investigation of ‘things’ seems to peter out in a false trail.
A more promising approach is to try to classify the things [131] that can be owned. An obvious classification is into material objects and things that are not material objects (incorporeals). According to one school of thought, this division is so important that only corporeals can really be owned; according to another, it is so unimportant that we ought always to speak of owning rights over material objects, never of owning the objects themselves; in this way we shall keep in mind the parallel with the ownership of incorporeal rights.
Both schools propose a departure from lay and legal usage which stands in need of justification. The former has little to commend it. Consider the difference between ‘owning’ land and ‘owning’ (having) an easement over land. The first counts as the ownership of a material object, the second of an incorporeal. Yet their incidents are in every way similar and, in both cases, include the right to exclude others from interfering with or obstructing a particular physical thing, a right which at first sight might seem to differentiate the ownership of material objects from the ownership of incorporeals. It is true that, when we come to consider claims, we find cases in which there is either no right to exclude others or no right to exclude them from a particular physical thing.
Copyright is an example of one type of claim. It involves the right to prevent others publishing, etc., one's written work without consent, and hence a sort of right to exclude others; but this right does not relate to a particular physical thing, a particular book. It relates to all material objects which have certain characteristics, viz. that they are copies of the work in question. Again, it is not clear that the incident of prohibition of harmful use applies in a straightforward way to copyrights: on the other hand, convincing analogues of the other standard incidents are to be found. Thus, it may be said that the notion of ownership applies to copyrights in an extended and somewhat weaker sense than that in which it applies to material objects and interests in them.
Debts due and other choses in action present an example of another type of claim. Here the claim is to the performance of some positive act. No right to exclude others is involved, and, [132] as in the case of copyrights, no question of harmful use arises. On the other hand, incidents such as alienability (nowadays) and transmissibility do apply to choses in action. Hence, the ownership of choses in action is to be understood in a still weaker sense than that of copyrights.
It seems, therefore, as if a more useful classification of things owned than that into corporeals and incorporeals would be into material objects and rights in them, claims, and collections of objects and claims. Slightly expanding this, we get the following list:
(1) Material objects and interests in material objects;
(2) Claims and interests in claims;
(3) Fixed collections of material objects, claims, or both;
(4) Variable collections of material objects, claims, or both;
(5) Funds.
The list is self-explanatory, ‘claims’ being understood to exclude such claims as amount to interests in material objects. The introduction of fixed and variable collections is necessary in order to accommodate the ownership of estates, businesses, etc. either frozen at a point of time (fixed collection) such as the date of a person's death, or varying from time to time, as in the case of the spouses’ ‘ownership’ of a joint estate when they are married in community of property. A ‘fund’ is the monetary equivalent of a collection of things or claims or both.
It is a commonplace that the ownership of funds has become of great importance in the 20th century. With this development, a new twist has been given to the notion of ownership, and one which is inherent in the notion of owning a variable collection of things.
A variable collection of things may be owned and managed like a particular thing but, as a matter of convenience, lesser interests in and claims to the collection are not construed as giving the holder powers of management or security against the alienation of particular items in the collection. Such claims are in effect claims to the income and/or capital of a fund which may vary in value and will in any case be composed of varying [133] items. They are claims on the fund, not claims on the items, and they may well be divorced from what in any case is notionally separable, the management of the individual items.
The modern world presents us with many examples where the ownership of property consists in claims on a variable collection or fund. Of the former the interest of a wife married in community of property is a striking instance. She has no power of managing the community assets and her claim is restricted to whatever items may be found in the collection of community assets on the dissolution of the marriage. Another example is the ownership by members of an unincorporated association of the association's assets. Prominent instances of the latter are the ownership of shares, the ownership of interests in trust funds and floating charges: all the instances of Gesamthandseigentum in German law fall into one of these classes.Footnote 28
Such claims on collections and funds present a still remoter analogy with the ownership of interests in material objects than the simple claims previously considered. The incidents of possession, management, and the prohibition of harmful use apply, if at all, in a sketchy form. Alienability, transmissibility, income, and (sometimes) capital rights remain. Since, among forms of property holding, claims on collections and funds are now of outstanding importance economically, we might say that, over a wide field, either the character of things owned has altered or the character of ownership has altered. I see no reason for preferring one form of expression to the other; our investigation has revealed, what we began by suspecting, that the notions of ownership and of the thing owned are interdependent. We are left not with an inclination to adopt a terminology which confines ownership to material objects, but with an understanding of a certain shift in meaning as ownership is applied to different classes of things owned.
It remains to consider the view that the thing owned should always be spoken of as a right. This is certainly an odd-looking proposal, since ‘owning’ in ordinary use involves ‘having certain rights to’ a thing. If, therefore, we are to substitute for [134] ‘owning a pen’ ‘owning certain rights in a pen’, it would seem to follow the owner should correctly be said to have certain rights in certain rights in a pen; but why stop at the second order of rights?
Of course, the force of the proposal is a protest against the habit of thinking of the ownership of a thing, particularly a material object, as if it consisted only in a relation between a person and a thing, and not at all in relations between the owner and other persons. Yet to speak always of owning rights rather than things would be doubly misleading. Ownership, as we have seen, is not just a bundle of rights, as it is no help towards understanding our society to speak as if it were. Secondly, the idiom which directly couples the owner with the thing owned is far from pointless; where the right to exclude others exists, there is indeed (legally) a very special relation between the holder of the right and the thing, and this is a rational way of marking it.Footnote 29
2. Title
It is not enough for a legal system to recognize the possibility of people owning things. There must be rules laying down how ownership is acquired and lost and how claims to a thing are to rank inter se. This brings us to the notion of title, a word which is used in two main senses. First, it refers to the conditions of fact which must be fulfilled in order that a person may acquire a claim to a thing. In this sense, delivery, registration, seizure, and succession on death may be titles to the ownership of property. ‘Mode of acquisition’ or ‘mode of loss’ will do as well for this meaning as ‘title’; so I use ‘title’ in the second sense.
This is the sense in which a title to a thing is a claim, valid against persons generally though not necessarily against everyone, to the possession of the thing. It is true that in ordinary legal usage ‘title’ involves a great deal more than this; it implies, for instance, a power of alienating the holder's interest and the transmissibility of that interest. The restricted sense I have given to ‘title’ is, however, adequate for the present discussion. [135]
Clearly, every owner has a title to the thing owned, provided that the thing admits of being possessed; even if it does not admit of this, there will be prior and posterior claims to the thing, as in the case of choses in action, and the owner will have such a claim. It is also clear that several persons may have titles to the same thing; thus, a mere possessor has, under some systems of law, a better right to possess than any later possessor of the thing not deriving title from an earlier possessor. Taking possession is regarded under such systems as a mode of acquiring a right to possess, valid against persons generally, not merely against a trespasser or disseisor. Hence, there may be problems of priority of title. What is not, at first sight, clear is whether the name ‘owner’ should be confined to the person with the best title to a thing out of all possible claimants (the title, a good title) or whether we should in such cases speak of two or more ‘owners’ of the thing ranking in a certain order.
Modes of acquisition
These obviously vary from system to system. It is often thought that light can be thrown on the concept of possession by a study of the conditions for acquiring possession; ought not the same procedure to be fruitful in the study of ownership? Holmes, following a general theory about the analysis of legal concepts, approaches the matter in this way,Footnote 30 but without yielding more than a catalogue of modes of acquisition. On the other hand, some writers who wish to justify the institution of ownership as a fair one, in spite of the apparent injustice involved in excluding all save the owner from the thing owned, argue that, though there are various modes of derivative acquisition, there is only one mode of original acquisition, namely taking possessions.Footnote 31 They go on to say that the labour involved in taking or making the thing justifies the taker in retaining it against subsequent claimants and transmitting it to others.
The argument is certainly not, apart from its other defects, consistent with positive law. Thus, in South Africa, land cannot be acquired by occupatio but only (apart from irrelevant [136] exceptions) by Government grant, statute, or 30 years’ prescription. The truth is that modes of acquisition, original and derivative, are many and various; one of the functions of expressions such as ‘he is owner’ is precisely to draw similar legal conclusions from varying states of fact.Footnote 32
If, therefore, we are to seek moral reasons why particular persons ought to own particular things, we shall need different reasons for different modes of acquisition; and derivative modes of acquisition stand in need of justification as much as original. There are in fact good reasons why the commonest modes of original acquisition (making and taking) and of derivative acquisition (consent and debt) should be recognized. If these are thought morally satisfactory, we have arrived at a justification for the adoption by a legal system of certain modes of acquisition; what we have not found is a justification for the institution of ownership. I do not, of course, wish to imply that none can be found.
Modes of loss
Once derivative modes of acquisition are recognized, modes of loss or extinction must also be recognized. These give little difficulty when the loss is with the consent of the previous owner or through his debt, but a good deal when the system admits, as many systems do, the possibility of acquiring title or barring a prior title by lapse of time or, as in English land law, of acquiring a ‘title’ in the sense defined above, albeit imperfect, by the simple act of squatting or dispossessing the present holder.
In such cases, the later acquisition may have the effect either of divesting the earlier or of creating a second, concurrent title: in the latter event, the two titles may continue indefinitely to run concurrently, or the earlier may lapse or become unenforceable after a period of time.
One or many titles
This is a convenient point at which to try to classify legal systems according to the number of independent titles which [137] they permit. By ‘independent’ I mean ‘not derived from a common source’.
In the simplest type of system only a single independent title is possible. Such a system may be called unititular. Under it, if the title to a thing is in A, no title to it can be acquired (independently) by B, except by a process which divests A. There is only one ‘root of title’ for each thing, and the present title can ultimately be traced back to that root.
In some ways a unititular system is simple, but it may seem to leave unprotected persons whose interests are deserving of protection. It does not provide for the grading of claims to a thing; it proceeds on the view that only one claim is worthy of protection against persons generally, and that other claims need not be recognized, save, perhaps, that a person in possession may be protected against a trespasser or disseisor, a fact which, as we have seen, does not by itself give the possessor a title. A unititular system may be conservative in its working, if acquisition without the consent of the previous owner is made difficult, or may be ‘active’ and may favour enterprise, or even banditry, if acquisition without the consent of the previous owner is easy.
Classical Roman law at first sight approximates to the ‘active’ unititular system, Justinian's law to the ‘conservative’ version, since the period for acquiring by usucapion or prescription and so divesting the previous owner was increased in the latter case. But on a closer examination, the Roman system looks conservative at all periods; the mere thief or trespasser and their successors are never favoured, because nothing stolen or taken by force can be acquired in this way, and the owner of such things can never be divested against his will.Footnote 33
It may be thought that the statement that Roman law was substantially unititular is inconsistent with the distinction between Quiritary and ‘bonitary’ ownership. This is true only so far as ‘defeasible’ bonitary owners are concerned. The Quiritary and bonitary ‘owners’ did not hold by independent titles where the ‘bonitary’ ownership was indefeasible. The [138] praetorian, ‘bonitary’ owner derived title from the Quiritary owner. The division between the two is a case of split ownership, not of independent titles. The bona fide possessor in via usucapiendi also had a title, a type of ‘bonitary’ ownership, defeasible only by the true owner; this is, perhaps, the only exception in Roman law to the rule that there was only one title. When the periods of usucapion were short, it was not an exception of much importance; after a year or two there was, once again, only a single title. As the periods were increased the exception grew in importance. Roman law held to the theory that, in such cases, there was only one dominos.
Under a unititular system, one way of ascertaining the true owner is by tracing title to the original acquirer. With land, especially, this is seldom practicable. The remedy may lie in rules either of substance or procedure. A substantive rule creating a mode of acquisition which has a divesting effect may meet the need, especially if the period is fairly short. A ruthless form of divesting is found in French law, where the maxim that possession of movables is equivalent to title is interpreted to mean that if a bailee of goods delivers them by way of sale, gift, etc., to another, he thereby divests the title of the bailor, leaving him to his action for damages against the bailee.
In Roman law, given the rule that theft or violent dispossession was a bar to acquisition running with the thing, it was theoretically necessary to trace title to the original source in order to see whether a ‘vice’ affected the property. If therefore the difficulty of proof of title is, as Hargreaves asserts,Footnote 34 a reason against adopting the terminology of ownership, his argument would apply with as much force to Roman and modern civil law as to English law.
In practice, in modern systems based on Roman law, rules of evidence help to overcome the practical difficulties. Possession, unless otherwise explained, is regarded as evidence of ownership and an earlier possession is regarded as better evidence of ownership than a later, independent possession. Registration of [139] title is really an evidentiary device of the same order. In most systems registration does not have a divesting effect;Footnote 35 the register may be rectified at the instance of the true owner (or, in a multititular system, someone with a better title than the registered owner). The register merely makes it possible to discover without difficulty who is presumptively owner.
With unititular systems we may contrast multititular systems. As we have seen, these turn on the possibility of acquiring title without the consent of the present owner of a thing by a process which does not have a divesting effect. Such systems may take either a ‘conservative’ or an ‘active’ form. In the former, the earlier titles continue to be valid indefinitely or for a very long time. In the latter, either the right or the remedy is barred after a relatively short period. Again, if the title of a thief or trespasser is recognized, the system is thereby rendered more ‘active’.
The English system as regards both land and chattels falls into the multititular category. As regards land, a title could and can be acquired without the consent of the previous owner by mere disseisin or dispossession.Footnote 36 It was a principle of the medieval law that a disseisor ipso facto acquired an estate in fee, albeit a tortious estate. ‘Every fee simple is not legitimum, for a disseisor, abator, intruder, usurper, etc. have a fee simple, but it is not a lawful fee’.Footnote 37 In the modern law it seems that a dispossession adverse to the present holder gives the trespasser or squatter an estate in fee simple;Footnote 38 despite Holdsworth,Footnote 39 every adverse possession is a root of title,Footnote 40 though the title may lapse on abandonment.Footnote 41
Such ease of acquisition is consistent with a unititular system. Thus, in the early land law, disseisin had a divesting effect; the disseisee had a mere right of entry, which might be tolled, [140] and was inalienable. Since the 19th-century reforms, the disseisee or his modern equivalent can alienate his interest inter vivos or on death and it descends to his personal representatives.Footnote 42 Hence, as Megarry and Wade say, when S dispossesses O, ‘S’s possession gives all the rights and powers of ownership: S has, in fact, a legal estate, a fee simple absolute in possession. But so also has O, until such time as his title is extinguished by limitation. There is no absurdity of speaking of two or more adverse estates in the land, for their validity is relative.’Footnote 43
If, then, S and O both have fees simple, shall we say that both are owners of the land? Or shall we call S, the present possessor, alone owner but say that his ownership may be divested; or, again, that O, since his claim is ultimately entitled to prevail, is alone owner? One cannot expect clear criteria for answering such questions. S, however, has every incident of ownership except security against divesting, while O has every such incident except present enjoyment. There is much to be said, therefore, for treating them as independent owners rather than as persons sharing a single, split ownership.
On the other hand, it may be argued that, in view of such puzzles, it would be better not to speak of the ownership of land in English law at all. This argument ignores the many straightforward cases in which there is a single tenant in fee simple and no competing title.
Hargreaves, who argues against speaking of ‘ownership’ in English land law, relies on the fact that in actions for the recovery of land the plaintiff need only prove a better title than the defendant not that his title is the best of all possible titles.Footnote 44 Now a multititular system must have rules for enabling the holders of titles to recover possession and for regulating priorities between the holders of competing titles. There will not, therefore, be any procedural need in such a system to provide a special remedy (e.g. a vindicatio) for the person with the best title. The holder of the best title can make use of the remedies [141] (e.g. ejectment) available to those with a title. The point of such a system is that proof of any title will suffice except against a person who can show a better. But, of course, if priorities are regulated, someone must have top priority; maius ius implies maximum ius. Surely the holder of maximum ius, at least, cannot be denied the title of owner? It will, however, be never necessary, though always sufficient, when he claims the possession of land, for him to prove that he has maximum ius.
English land law exhibits a highly ‘active’ system of regulating title, owing to the relatively short period of limitation coupled with the recognition of the disseisor's title. Sociological writers may detect in this the mores of the Germanic tribes who invaded Britain; but as the 12-year period of limitation is a modern innovation, the system has not always been as ‘active’ as it now is.
The English law of title to chattels is also multititular. It is not clear, however, that a thief acquires title except against a later wrongdoer;Footnote 45 hence, the rules for chattels are in some ways less ‘active’ than for land. Divesting may, however, take place either by limitation or by certain consensual dispositions (sale in market overt, sale by factors). The Sale of Goods Act makes a sharp distinction between the holder of the title, who can give a ‘good title’ to the goods and the holders of lesser titles.Footnote 46 Only the former can make a valid disposition of the thing by way of sale. Hence, there is no temptation to speak of goods as having more than one independent owner.
From what has been said, it emerges that multititular systems are more flexible than unititular systems, though they are not necessarily more ‘active’. The difference between these two ways of regulating title has often been construed as a difference between two conceptions of ownership. This, I suggest, is a mistake. The only difference of importance between the place of ownership in the two schemes is procedural: what has to be proved in an action. But whether a plaintiff must prove that he is owner, and what is to be understood by ownership, are entirely distinct questions. [142]
3. Split ownership
Space does not permit more than a few brief remarks on the subject of split ownership and the fragments (Eigentumssplitter) created by splitting. Historically, there have been many reasons for separating the standard incidents into two or more parcels; indeed, historically speaking, the metaphor of ‘splitting’ may mislead, for in some cases full ownership has been built up from the fragments, not vice versa. Thus, the alienable, heritable, and indefeasible fee simple was evolved from the inalienable and intransmissible tenancy in fee, subject to onerous incidents of tenure.
But looked at from the point of view of their social function, the various cases of splitting fall into two main classes. Many of them are directed towards maintaining intact a physical thing or collection or, in more modern times, a fund, in order that this asset may serve a family or a businessFootnote 47 or an association over a substantial period. In this class fall such examples of splitting as concurrent interests in property (joint tenancy, tenancy in common, co-ownership, the interest of spouses in a community estate, the interest of members of an unincorporated association in the property of the association); and the ownership of property by juristic persons (corporations sole, Stiftungen, the state, joint stock companies). Secondly, splitting may serve the purpose of specialization, by separating management from the enjoyment of income and/or disposition of the capital; the beneficiary obtains the advantage of expert management of the property but also runs some risk. In this second class fall such devices as trusts, the Dutch bewind (administration), and incorporated companies.
Most of these institutions have been carefully analysed by specialist writers. Some of them present problems to a lawyer who has to work with a rule that every thing must have one and only one independent ‘owner’. Ought we, for instance, to speak of ‘equitable ownership’ or only of ‘equitable interests’? In answer to such questions generalities are unhelpful. If the [143] context is one in which stress is laid on income rights, we may be tempted to speak of ‘equitable ownership’ but, if powers of alienation are in question, the holder of the legal estate will alone qualify (if anyone) to be called owner.
There is, however, one device, formerly used mainly to keep a thing or fund in a family over a period, which has not been analysed as carefully as it deserves. This is the device of the estate. Its originality has been exaggerated by some, minimized by others. Considering it in its mature form, it provides for the present alienability of an indefinite number of successive interests in a thing, of which, however, not more than one may be a fee simple. Only one of these, obviously, can be presently vested in possession. It further provides for the creation of limited interests which may extend beyond a lifetime, such as estates tail. Finally, it provides for certain rules of descent to regulate the devolution of the thing in the cases where the interest is regarded as extending beyond a lifetime, e.g. again in the case of an entail. These are interesting devices, though not in every way successful. For instance, the freedom thereby given to property owners to impose fetters on future generations turned out to be excessive, and counteracting devices such as the barring of entails were found desirable to redress the balance.
It is important, however, to see that to speak of the ownership of estates, of ‘many things each with its owner’,Footnote 48 rather than the ownership of land or funds does not of itself constitute an original contribution to our legal resources. It would be quite possible, indeed, to reproduce all the important features of the doctrine of estates in the terminology of Roman and civilian systems. We have only to think of a set of rules whereby (i) all usufructs and other iura in re aliena are freely alienable; (ii) an indefinite number of successive vested usufructs may co-exist (as regards all but one, dies cedit sed nondum venit); (iii) multiple usufructs extending beyond a lifetime may be created; and (iv) these are of various types, to which names are given, and for each a particular mode of devolution and termination is prescribed. Such a scheme would incorporate all the innovations [144] introduced by the doctrine of estates. Would there, however, be any point, if it were introduced, in continuing to distinguish between dominium and iura in re aliena?
Clearly there would. The distinction would still neatly fit a vast mass of cases, in which the complexities of successive and multiple usufructs were absent, and also most cases in which they were present. But when multiple usufructs were introduced which might extend to an indefinite succession of usufructuaries (corresponding to entails), it would come to seem rather pointless to continue to call the ultimate reversioner dominos, because of the uncertainty that he would ever come into possession. There would, indeed, be an inclination to call the ‘usufructuary-in-tail’ dominos. But, obviously, at this limit, it would be clearer to abandon the terminology of ownership and speak simply of A as having a ‘usufruct-in-tail’, and of B as having a ‘reversion’. Only at this limit, however, would the contrast between dominum and iura in re aliena fade and its utility disappear.
There does not, then, seem any good reason why the introduction of the doctrine of estates should lead us to abandon the terminology of ownership; the puzzles it presents in peripheral cases are like those presented by other forms of split ownership in such cases, and may, of course, lead a lawyer, very reasonably, not to use the contrast of ownership with lesser interests in those cases.
4. Social control
‘Absolute’ is perhaps the most ambiguous word met in discussions of ownership. Sometimes it is used to deny the ‘temporary’ (intransmissible or determinate) character of an interest,Footnote 49 sometimes to deny its defeasible character (liable to be divested by another, liable to escheat or forfeiture),Footnote 50 sometimes to emphasize its exemption from social control.
In the last sense, ownership has never been absolute. Even in the most individualistic ages of Rome and the United States, it [145] has had a social aspect. This has usually been expressed in such incidents of ownership as the prohibition of harmful use, liability to execution for debt, to taxation, and to expropriation by the public authority.
Emphasis on the social aspect of ownership has, however, varied from age to age. Those ‘sacred and inviolable’ rights, which, according to the Declaration of the Rights of Man, no one could be forced to cede except for public necessity Footnote 51 have become, in French law, liable to expropriation on grounds of public utilityFootnote 52 and subject to a general doctrine forbidding ‘abuse’. According to the liberal conception of ownership, there is a sharp distinction between government and ownership, imperium and dominium. Though, in a loose sense, the state may be said to have an ‘eminent domain’ over at least the land comprising its territory, this does not carry with it rights to possess, enjoy, or alienate it, so that the sense in which the state is owner is very loose indeed. The interest of the state, according to this conception, is confined to powers of expropriation and a minimum of restrictive regulation, together with the expectancy of acquiring property as bona vacantia or by escheat in a few rather remote contingencies.
Socialism has led to a revised view of the relation between government and ownership, at least as regards some important types of property,Footnote 53 such as land and businesses. This means, in practice, that the owner's privileges of using and powers of managing a thing as he wishes have been curtailed and that the social interest in the productive use of things has been affirmed by legislation. Negatively, this process has meant that, in the interests of health and comfort, many substances cannot be used at all or can only be used in certain ways. The sale of drugs is minutely controlled, only smokeless fuel may be used in certain areas, garden hoses may not be used at certain periods. Such instances, multiplied a thousand fold, have come to seem so natural that we hardly realize that the social interest in the use of things, the conservation of resources and in the [146] details of manufacturing processes is a modern, though it is also a primitive, conception.
Positive control by the state shades into prohibition. The positive duty to exploit one's property in a socially beneficial way, as opposed to the prohibition of a harmful exploitation, has not been generally imposed or its implications fully worked out. The British Agriculture Act imposed an obligation on farmers to observe the rules of good husbandry;Footnote 54 the owners of patents can in certain cases be compelled to allow their exploitation.Footnote 55 According to the Russian civil law book of 1944, the state has a general right to order forfeiture of property in case of mismanagement; there is also a general prohibition on the use of property to exploit others.Footnote 56
A different form of state control is exercised by drawing a distinction between different types of ownership. In Russia the ownership of collective farmers, of handicraftsman, and of the government are all treated as differing from ‘personal ownership’ and from one another.Footnote 57 The difference lies, of course, in the right of officials to interfere in the management of the former categories and in state regulation of income rights deriving from the property; also in differing rules about alienation. In this way, the sphere of operation of ownership in the liberal sense is narrowed and a form of state participation in management substituted in the remaining sphere.
A third form of social control consists in the exercise by officials of the management of things in the ‘private’ ownership of the state. Such arrangements present the form but not the substance of ownership in the liberal sense. Management and enjoyment are split, and political control, directly or indirectly, is exercised over the allocation of resources and the uses to which the thing owned is put. The nationalized industries in the United Kingdom follow this pattern of control.
Fourthly, social control may be exercised by a restriction on the type of thing that is subject to ownership by persons other [147] than the state, as in the Russian building lease, where the building is owned by a private individual, the land remaining in state ownership.Footnote 58 In effect, this restricts the privileges of the building owner in the general interest.
It remains to be seen which combination of these techniques will prove most effective and most acceptable to the people who have to operate them. So far, they have not, singly or together, reached the point in any country at which they could be said to have displaced the liberal conception of ownership and replaced it by a social conception. In practice, the two overlap and operate side by side, together with various types of split ownership and ownership of funds which diverge, to a greater or less extent, from the standard instances depicted in the first section. The final picture is that of a set of related institutions of great complexity which are best studied against the background of the basic model – a single human being owning, in the full liberal sense, a single material thing.