- •Contents
- •Table of Cases
- •List of Contributors
- •Introduction
- •1. Bottom-Up Theories
- •2. The Humean Approach
- •1. Introduction
- •2. The Moral Right to Labour Productively
- •2.1 The intellectual context for Lockean rights
- •2.2. Labour as a moral right
- •3. Property Acquisition in Labour Theory
- •3.1 Extending labour from the person to things
- •3.2 The social character of productive appropriation
- •3.3 Productive use as a limit on labour
- •3.4 The communicative function of productive labour
- •4. Control Rights in Labour Theory
- •5. Accession in Labour Theory
- •6. Lost Opportunities to Capture in Doctrine
- •7. Acquisition in Doctrine
- •7.1 The basic test for capture
- •7.2 Constructive capture
- •7.3 Multiple proprietary claims
- •8. Accession Policy and Ratione Soli Doctrine
- •9. On the Relation between Legal Property and Moral Rights to Labour
- •10. Conclusion
- •3: Property and Necessity
- •1. Some Conceptual Preliminaries
- •2. Winstanley’s Challenge
- •3. Grotius on Property and Necessity
- •4. Three Important Objections
- •5. Saving Property and Public Necessity
- •6. Is the Right of Necessity a Property Right?
- •4: Private Property and Public Welfare
- •1. The Fifth Amendment Paradox
- •2. Why Acquisition?
- •3.1 Physical possession
- •3.3 Exchange
- •4. Property in Civil Society
- •4.1 The origin of welfare entitlements
- •4.2 Civil society as a bifurcated entity
- •5. Property in the Political Community
- •5.1 Property in the totalitarian state
- •5.2 Property in the dialogical state
- •6. Conclusion
- •5: Average Reciprocity of Advantage
- •1. Introduction
- •2. Background
- •2.1 Judicial opinions
- •2.2 Academic commentators
- •3. Sources of Average Reciprocity of Advantage
- •4. The Limits of ‘In-Kind’ Compensation
- •4.1 General reciprocity
- •4.2 Probabilistic compensation
- •4.3 Basic structural problems
- •5. Reciprocity and Respect
- •5.1 Accepting the conclusion
- •5.2 Rejecting the premisses
- •5.3 Partial, ‘objective’ compensation
- •6. Conclusion
- •1. Introduction
- •2. Between Promise and Detachment
- •2.1 The moral principle
- •2.2 The value of LPA
- •3. Legal Enforcement
- •3.1. Encouraging pre-contractual Investment
- •3.2 Building up trust: the role of LPA
- •4. Proprietary Estoppel
- •4.1 Varieties of PE
- •a) Bargain
- •b) Gifts
- •4.2 The remedy
- •5. Conclusion
- •7: Possession and Use
- •1. Possession
- •2. The Priority of Exclusion
- •3. Bringing Actual Use Back In
- •4. Conclusion
- •8: Possession and the Distractions of Philosophy
- •1. Introduction: The Puzzle
- •3. Possession and Title
- •4. The Right of Possession and its Omnilateral Structure
- •5. Possession and the Incidents of Ownership
- •6. A Principled Practice of Property?
- •7. Conclusion
- •9: The Relativity of Title and Causa Possessionis
- •2. Privity, Estoppel, and Rights to Possess outside of Ownership
- •2.1 A public law problem?
- •2.2 Privity: the missing link between property and person
- •2.3 Let the chips fall where they may
- •3. Conclusion
- •1. Introduction
- •2. Setting the Limits of Property Rights
- •2.1 Where A has an undoubted property right
- •a) The ‘right to exclude’
- •b) The ‘right to use’
- •i. Chattels
- •ii. Land
- •c) Conclusion
- •2.2 Determining if B’s right counts as a property right
- •a) Physical things
- •b) Non-physical things
- •c) Equitable property rights
- •3. Conclusion
- •11: On the Very Idea of Transmissible Rights
- •1. Title and Succession
- •2. The Argument against Transfer or Transmissibility Stated: The Hohfeldian3 Individuation Argument
- •3. Why the Hohfeldian Individuation Argument is Wrong
- •4. Justifying Transmissible Rights
- •4.1 The power to authorize what would otherwise be a battery
- •4.2 The right to immediate, exclusive possession of property
- •4.3 The power to license and to give property away
- •4.4 The power to sell or transfer pursuant to an agreement
- •4.5 The liability to execution
- •5. A Last Word on Conventions and Social Contexts
- •12: Psychologies of Property (and Why Property is not a Hawk/Dove Game)
- •1. The Inside Perspective
- •1.1 Identity formation
- •1.2 Identity fashioning
- •1.3 Refuge
- •1.4 Empowerment
- •1.5. Generosity
- •1.6 Economic incentives
- •1.7 An admonitory postscript
- •2. The Outside Perspective
- •2.1. The picture from in rem
- •2.2 Hawks and Doves
- •2.3 The virtues of non-ownership
- •13: Property and Disagreement
- •1. Disagreements Substantive and Verbal
- •1.1 Verbal disagreements
- •1.2 Disagreement that is partly substantive and partly verbal
- •a) Clarifying the disagreement
- •b) The analysis of property
- •c) The metaphysics of property
- •d) What about W2 and W3?
- •3. A Minor Disagreement that is both Substantive and Conceptual
- •4. Penner Redux: A Major Disagreement that is both Substantive and Conceptual
- •4.1 Reservations: of Wittgenstein and Dworkin
- •4.2 Individuation and incomplete understanding
- •5. The Nature of Property
- •5.2 Smith and the architecture of property
- •6. Conclusion
- •Appendix
- •14: Emergent Property
- •1. Intensions and Conceptualism in Property Law
- •2. Formalism versus Contextualism
- •3. Functionalism
- •4. Holism and Emergence
- •5. An Application to in Rem Rights and Duties
- •6. Conclusion
- •References
- •Index
5
Average Reciprocity of Advantage
Brian Angelo Lee*
1. Introduction
Compensation plays an integral role in the system of practices which constitute the institution of property. This role is most obvious in legal requirements that people or organizations who engage in certain activities that adversely affect other people’s property must compensate the owners of the affected property.1 Compensation requirements therefore provide a lens through which one can obtain a clearer view of the scope and nature of property entitlements and obligations.2
In situations where the law says that compensation is owed, three questions immediately arise. One is who should determine the amount of compensation required. Guido Calabresi and Douglas Melamed (1972) famously addressed that issue by distinguishing between ‘property rule’ protection and ‘liability rule’ protection for entitlements, and the later literature on this question, much of it inspired by Calabresi and Melamed, is now vast.3 A second question is what amount of compensation is required. Because the practical outcome of a given case will often depend significantly on specific assessments of the amount of compensation owed, this second question is one which courts and litigants must grapple with routinely.4
* I wish to thank James Penner, Henry Smith, and participants in the 2012 Philosophical Foundations of Property Law conference at University College London for their helpful comments on an earlier draft of this chapter. Any errors are my own. The Brooklyn Law School Dean’s Summer Research Stipend provided financial support for this project.
1These requirements may not be solely legal. There is an extensive literature on the relationship between informal social norms and the institutions of property, and compensation requirements may play a prominent role in those norms. See e.g. Ellickson 1991. Although my discussion here will focus solely on explicitly legal requirements, there may also be connections to these more informal systems of property regulation. Exploring that possibility will have to wait until another day.
2This clarity is possible even if one does not necessarily subscribe to the stronger claim that ‘[o]f course, the so-called remedy defines the nature of the right’. Calabresi 1997, 2205. See also Coleman and Kraus 1986, 1342–3.
3Note that Calabresi and Melamed’s choice of the term ‘property rule’ was not intended to imply that property entitlements necessarily receive protection of that sort, but rather that such protection, when found at all, is typically found in property contexts. Property entitlements often receive only ‘liability rule’ protection. Indeed, that was one of the main focuses of their discussion.
4Answering this question in any given case may require considering a variety of perspectives, including the game-theoretic, the economic, and the moral.
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However, a third basic question has drawn much less sustained attention: what form should that compensation take? The two basic alternatives are monetary compensation and non-monetary compensation. The latter alternative can be further divided into compensation that is of a form essentially similar to the loss for which compensation is being provided—‘in-kind’ compensation—and compensation which lacks that essential similarity. Meanwhile, both monetary and non-monetary compensation can be either explicit or implicit.
Some of these possible forms of compensation are, at least on their face, readily understandable. Explicit monetary compensation, for example, is a familiar part of ordinary life. Other options, however, are less straightforward. Of these, implicit in-kind compensation both has played a prominent role in attempts to justify various governmentally imposed burdens on property owners and is particularly theoretically challenging.5
The basic notion of implicit in-kind compensation goes by various names: ‘average reciprocity of advantage’, ‘reciprocity of advantage’, and ‘implicit in-kind compensation’ are the most common. Although the terms are frequently used, there has been little close analysis of their meanings, and it is not evident that any significant difference exists among the concepts to which they refer. In this chapter, I shall treat them as essentially interchangeable, but I shall typically use the term that first appeared historically, ‘average reciprocity of advantage’.
Although the notion of reciprocal advantage potentially has application in a wide range of contexts, in the United States it typically arises in analyses of the law of eminent domain and of ‘regulatory takings’. When the government exercises its power of eminent domain to confiscate privately owned property for use in some public endeavour, a familiar legal principle requires the government to pay compensation to the owners of the taken property. In the United States, this requirement has been elevated to a constitutional mandate. The Fifth Amendment to the US Constitution explicitly provides, ‘nor shall private property be taken for public use, without just compensation’.6
At first glance, the law governing compensation for physical taking of real property might seem relatively straightforward. Questions quickly arise, however, when property owners assert that a government regulation which affects the use of their property is so restrictive that the regulation’s imposition should be treated as equivalent to a physical confiscation and the government should therefore be required to compensate the owners for the inconvenience caused by that regulation. These claims of alleged ‘regulatory takings’ naturally give rise to two questions: first, whether the governmental action constitutes a ‘taking’,
5The phrase ‘implicit in-kind compensation’ appears to have been first coined by Richard Epstein (1985). Although I shall borrow the term, I do not wish to imply that what I mean here by that term and what Epstein meant are necessarily identical.
6US Const. amend. V. In 1897 the US Supreme Court held that this amendment is binding on state governments as well as the federal government, by virtue of having been ‘incorporated’ in the Fourteenth Amendment. Chicago, B. & Q. R. Co. v Chicago 1897, 236–8. State constitutions themselves typically contain similar language.