Research Handbook on the Economics of Property Law

Research Handbook on the Economics of Property Law

Research Handbooks in Law and Economics series

Edited by Kenneth Ayotte and Henry E. Smith

Leading scholars in the field of law and economics contribute their original theoretical and empirical research to this major Handbook. Each chapter analyzes the basic architecture and important features of the institutions of property law from an economic point of view, while also providing an introduction to the issues and literature.

Chapter 6: Unilateral Relinquishment of Property

Lior Jacob Strahilevitz

Subjects: economics and finance, law and economics, law - academic, law and economics

Extract

Lior Jacob Strahilevitz* Suppose you have property that you would like to get rid of. There are five basic avenues for doing so. Sale is probably the first option that springs to mind, and this can be effectuated through a voluntary transfer (at a flea market, say), or involuntary transfer (as when the government exercises eminent domain). Donation is another obvious means of parting with a resource. Less obviously, but no less critically, you can get rid of property through sheer passivity: if a trespasser settles on your land and uses it as a normal person would for years, the trespasser eventually becomes its owner through adverse possession. These three mechanisms for losing title to property have been covered at great length in the legal literature. Rather little has been said about the two other mechanisms for relinquishing property: abandonment and destruction. They will be the subject of this chapter. The important commonality between abandonment and destruction is their unilateral nature. Sales, gifts, and adverse possession all require bilateral interactions, but abandonment and destruction permit the owner of a resource to relinquish it without requiring any action by a third party. These two avenues for losing property turn out to be common, important, widely practiced, and largely undertheorized. Perhaps as a result of that last attribute, the law of abandonment and destruction is poorly thought through and in need of reform. I. ABANDONMENT On an ordinary Wednesday in August of 2008, there were 77 separate listings in the ‘Free Stuff’...

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