While the layperson tends to think of “property” in terms of things, modern legal discourse tends to conceive of property as a “bundle of sticks,” i.e., a collection of rights with respect to land, or to tangible and intangible objects.1 In her new article Property Beyond Exclusion, University of Chicago law professor Lee Anne Fennell has a different take. Fennell focuses not so much on any specific contents of the bundle; rather, her focus is on the changes in their nature.
Professor Fennell’s thesis in Property Beyond Exclusion is that rights generally associated with landed property increasingly should not be structured around physical boundaries. While physical demarcation of parcels of land remains our “workhorse strategy,” it is “becoming less efficacious and more costly” (P. 3).
Professor Fennell questions whether physical boundaries really are most broadly conducive to liberty. Landowners may want to exercise informal control of lands outside their deeded perimeters, in part, because real or metaphorical fences exclude others, for whatever motivation, from resources necessary to complete their own projects.
As she enunciates her theme, “[t]he increased interdependence among properties that has accompanied widespread urbanization raises questions about two central features of an exclusion-centric model of real property: boundary defense as a proxy for resource defense, and the capacity of owners to monopolize unique resources. The first of these features has made boundary exclusion less useful while the second has made it more socially costly” (P. 13).
If the advantages of boundary exclusion are becoming less valuable, Fennell argues that the costs of that strategy are increasing because of the harmful effects of the monopoly powers that it grants parcel owners.
The early part of Professor Fennell’s essay focuses on the decreasing benefits and increasing costs of physical boundaries. She then turns to a general description of the facets of modern life that should lead us to change our conception of property. She writes that “we are seeing a move from enduring lumps of ownership to slices of access on demand.” Fennell gives as an example the diminished need to own a large home if infrequent houseguests could be put up in the spare bedrooms of neighbors (P. 20).
She concedes that sometimes acquiring “slices” of assets instead of “lumps” of bounded property might be impractical. In some instances, an owner might regard access on demand as important, or the good might be one that everyone might want to use at the same time. Thus, rather than a dramatic change, “we are likely observing a transitional phase in resource use. As it becomes increasingly attractive for people to access certain kinds of resources on demand, full-strength ownership of those assets will presumably become less popular” (P. 22).
All of this doesn’t imply that boundary exclusion will become obsolescent; merely that we must consider, in varied situations, whether a better alternative exists. Likewise, zoning and restrictive covenants now feature coarse-grained prohibitions. A “modest move” in transitioning from boundary-based restrictions “would entail focusing more explicitly on actual impacts experienced by neighbors, both positive and negative, rather than on summarily excluding classes of uses” (P. 32).
As Professor Fennell recognizes, her analysis is more a departure point for discussion than a rigorous system. For instance, she notes the question of “whether it is even logically possible for a resource arrangement to diverge from an exclusion model. At least when we are talking about rival resources like real and personal property, it might seem that any affirmative use implies exclusion of all other uses. Isn’t it, then, exclusion all the way down?”
A more fundamental critique of Professor Fennell’s essay is premised on her view that “[p]roperty . . . is best approached as a functional category. As the management of resources becomes increasingly fine-grained . . . resource access can morph from a modality that focuses on stocks to one that focuses on flows” (P. 35).
Property is an important social institution, and one that over time has derived its meaning beyond the utilitarian or functional. As Professor Fennell noted, even the system of boundary exclusion does not prevent extraterritoriality. “For example, homeowners are often territorial about the curb space outside their homes and may attempt to keep others from parking there, even though they do not always need the space for their own uses, and even though they do not actually own the space” (P. 11).
While Professor Fennell pointed that the particularities of objects such as coffee pots and automobiles hinder shared use, “[t]he owner interacts with the thing and suits it to her purposes, perhaps even adorning it with personalizing touches. Sentimental attachments may form as well, though this need not occur in order for temporal economies of scale to exist—it is enough that there are gains from having the same object day to day, even if those gains are practical rather than emotional” (P. 26). The gains, though, are likely both practical and emotional. Moreover, inevitably the sharing of such resources among many people would result in their standardization.
As Professor Fennell recognizes, “[a] life is built up around the home, and to switch homes would disrupt far more than one’s interactions with the residence itself. Some of the reasons may be quite personal in nature, but many are simply practical: knowing where to get the best deals on groceries, perfecting the commuting route, finding one’s regular coffee shops, fitness classes, and dry cleaners” (Pp. 26–27). Again, the balance between a life built upon a web of intimate and neighborly associations, and a transactional life stressing functionality is important. The antithesis of a home with its intimate associations is a residential lot with its market price. Here, Fennell touches upon various proposals that the protection of homeowners’ rights be reduced from a property rule entailing injunctive relief for violations to something akin to eminent domain being exercised by private parties to whom the land presumptively has a greater pecuniary value. Where market value is king, sentimentality is forsaken.
Lee Anne Fennell has written an excellent introduction to the challenges that we will face as technology facilities the sharing of resources. The story of the effects upon human beings of a transition from traditional property to a stream of goods and services flowing by is yet to be written.
- See generally Thomas W. Merrill & Henry E. Smith, What Happened to Property in Law and Economics?, 111 Yale L.J. 357 (2001).