The term property is derived from the Latin word ‘propertietat’ and the French equivalent ‘proprious’ which means ‘a thing owned’.
The concept was known to ancient Greeks, Hindus, Romans, Jews etc.
The concept of property occupies an important place in human life because it is virtually impossible to live without the use of material objects which constitute the subject matter of property.
The concept of property and ownership are very closely related to each other. The two are mutually interdependent and correlative. One necessary implies the existence of the other. There can be no property without ownership and no ownership without property.
In modern times, apart from its common use, ‘property’ is used in a wider sense also. In its widest sense, it includes all the rights which a person has. Thus a person’s life, liberty, reputation and all other claims which he might have against other persons is his property.
The term property is used also to denote the proprietary rights of a man as opposed to his personal rights. In this sense, it means a person’s land, house, his shares in a business concern etc.
It is used in a third sense also, that is, to mean proprietary rights in rem. Salmond takes the term in this sense. He says: “The law of property is the law of proprietary right in rem, the law of proprietary rights in personam being distinguished from it as the law of obligations. According to this usage, a freehold or leasehold estate in land, or a patent or copyright is property: but a debt or the benefit of the contract is not.”
There is also a fourth and the narrowest sense in which the term ‘property’ is used. In this sense, property includes nothing more than the corporeal property or the right of ownership in material things. Bentham has preferred to interpret the term property in this sense.
According to Ahrens, property is “a material object subject to the immediate power of a person.”
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Defining the property as a legal concept, the Supreme Court in Guru Dutt Sharma V. State of Bihar, observed that it is a bundle of rights, and in the case of tangible property, it would include the right of possession, the right to enjoy, the right to retain, the right to alienate and the right to destroy.
The Supreme Court has said in Commissioner, Hindu Religious Endowment V. K. Lakshmindra, that there is no reason why the word ‘property’ as used in Article 19(1) (f) of the constitution should not be given a liberal and wide connotation and should not be extended to those well recognised types of interests which have the insignia or characteristic of proprietary rights.
It was due to the reason of giving such a wide meaning to ‘property’ that in one case (Shantabai V. State of Bombay) it was held that a bare contractual right unattended with any interest in property is property.
The modern judicial trend to interpret right to property in the light of Article 21 of the Constitution dealing with personal liberty also deserves mention at this place. The Apex Court in a number of cases has expressed the view that Article 21 in its widest magnitude covers a variety of rights which constitute the personal liberty of a man.
Therefore, despite the fact that the right to property as a fundamental right has been abrogated and repealed, this right may still be interpreted by the Court as an aspect of personal liberty under Article 21.
After the Indian Independence, when the Constitution of India came into force on 26 th January, 1950, the right to property was included as a ‘fundamental right’ under Article 19(1)(f) and Article 31 in Part III, making it an enforceable right.
However, during the first decade of independence era, it was felt that the right to property as a fundamental right was a great impediment in ushering a just socio-economic order and a source of conflict when the State was to acquire private property for public purposes, particularly, expansion of rail, road and industries etc.
In order to get rid of this hurdle, the Supreme Court in the historic case known Fundamental Rights Case held that the right to property is no part of the basic structure of the constitution and therefore, Parliament can acquire or take away private property of persons for concerned good and in the public interest.
Thereafter, Parliament passed the Constitution 44 th Amendment which made right to property an ordinary legal right under Article 300-A.
However, the Supreme Court in one of the cases has made it clear that the executive cannot deprive a person of his right to property without the authority of law. The State can acquire a person’s property for public purpose on payment of compensation, which need not be necessarily just equivalent of the value of the property so acquired, but such compensation must not be illusory and irrationally disproportionate.
The latest position with regard to property in India is well expressed by the Supreme Court of India in Indian Handicraft Emporium v. Union Of India, wherein the Court observed that right to property is a human right as a constitutional right under Article 300-A, but it is not a fundamental right. It is indeed a Statutory right but each and every claim to property would not be property rights.
There are four important modes of the acquisition of property. They are: Possession, Prescription, Agreement, and Inheritance. These four modes may be put in two classes:
Acquisition inter Vivos- As mentioned earlier it includes the possession, prescription, agreement which are discussed as follows:
Possession is the objective realization of ownership. It is prima-facie evidence of ownership.
The property which belongs to no one i.e. res nullius, belongs to the first possessor of it and he acquires a valid title to it as against the world. Thus the fish of the sea and the bird flying in open sky belong to one who first succeeds in obtaining possession of them and acquire an absolute title over them. This mode of acquisition has been called as occupatio in Roman law.
A property which is already in possession of someone else, when acquired by possession, gives a good title to the possessor against all third persons except the true owner. In such a case of adverse possession there are in fact two owners, the ownership of one is absolute and perfect, while that of the other is relative and imperfect and often called as possessory ownership by reason of its origin in possession.
If the person in adverse possession i.e. possessory owner is wrongfully deprived of the thing by a person other than the true owner, that person cannot set up the defence of jus tertii , that is, he cannot plead that the thing does not belong to the possessory owner either.
In other words, a possessory owner’s possession shall be protected against all except the true owner. This rule is justified on the ground of maintenance of peace and order and to prevent misuse of force.
Prescription may be defined as the effect of lapse of time in the creation and extinction of legal rights. It is operation of time as a vestitive fact.
It has two aspects, namely, positive or acquisitive and negative or extinctive.
The creation of a right by the lapse of time is called the positive or acquisitive prescription whereas the extinction of a right by the lapse of time is called extinctive or negative prescription.
For example, the acquisition of right of way by use of it for a prescribed period (in India according to the easement act this period is 20 years) is a positive prescription.
For example, the right to sue for debt is destroyed after a prescribed period (in India it is 3 years). Thus, it is a case of negative prescription. The prescription is based on a conclusive prescription of rightfulness of a long possession, and it is against the person who is not in possession or is not exercising his rights.
The positive prescription is generally based on the ground of possession. Therefore, it would apply on those objects only which admit of possession.
Negative prescription is common to law of property and obligations. According to Salmond, negative or extinctive prescription is of two kinds, namely: Perfect and Imperfect.
Perfect negative prescription results in the destruction of principal right itself whereas imperfect prescription destroys only the right of action not the principal right.
Law of prescription is based on the general principle that law helps the vigilant and not the dormant.
Property may also be acquired by agreement which is enforceable by law.
Paton defines agreement as an expression by two or more persons communicated to each other, of a common intention to affect the legal relations between them. It therefore follows that an agreement has four essential elements, namely:
As a proprietary right in rem, agreement is of two kinds, namely:
An assignment transfers the existing right from one owner to another, e.g., assignment of a subsisting lease-hold from assignor to assignee.
Under a grant, new rights are created by way of encumbrance upon the existing rights of the grantor, e.g., grant of a lease of land is the creation of agreement between grantor and grantee.
Agreements may either be formal or informal. Formal agreements are written and require the formality of registration and attestation of the deed to be completed before they are effective. Informal agreements are verbal and do not require any formality.
The right of inheritance is found on the assumption that property serve as a best means of social security. Security of food, dwelling house and means of living to the members in a joint family was the foremost obligation of the Karta which barred from him alienating the family property except for legal necessity and family benefit or seeking relief from distress.
This in turn conferred right of inheritance to the coparceners which included right to be maintained out of family property and to claim partition as co-owners. Even the illegitimate sons, who were not entitled to inherit property as heirs, were required to be maintained by their father.
Mitakshara rules of succession regulated the law relating to inheritance applying the principle of survivorship. The wife, widowed mother, minor sons and daughters as a child in the mother’s womb (unborn) were entitled to inherit property as successors of the deceased and they could not be deprived of this right by alienation or otherwise.
The death of the owner of property could result in two kinds of rights, namely:
A right is inheritable if it survives its owner and it is un-inheritable if it dies with him.
Proprietary rights are inheritable and most personal rights are un-inheritable.
But there are certain exceptions to this general rule. For example, the right of action survives the death of both parties as a general rule. Proprietary rights may be un-inheritable in case of a lease for the life of the lessee only or in case of joint- ownership.
The rights which a dead man behind him vest in his representatives or successors. But he has also to bear the liability of the deceased. This liability is, however, limited to the amount of property which he has acquired from the deceased. Thus, inheritance is some sort of legal and fictitious continuation of the personality of the dead man.
Succession to the property of a person may be either testate or it may be intestate i.e. by means of will or without a will.
If the deceased had made a will, succession would take place according to the terms of the will.
But if there is no will, then succession would take place by the operation of law which is known as non-testamentary succession. In case there are no heirs of the deceased, his property shall vest in the state.
The power of a person to dispose of his property by testament (will) is subject to the following limitations:
A person cannot dispose of his property by will in such a way as not to vest in any person for a very long time. The property vests in some person within a prescribed time.
In most legal systems, a testator cannot dispose of his entire estate but instead he has to leave a certain portion of it for those to whom he owes a legal duty to support such as wife, children, etc.
In Mohammedan law, a person cannot dispose of more than one-third of his property by will without consent of his heirs. This provision is made so that the dependants and legal heirs of the deceased may not be disappointed. However, this limitation does not exist in all the legal systems, and in some systems the whole property may be willed away.
A person while exercising power of testamentary disposition may provide that his estate may be used by his heirs and successors for the benefit of other persons who survive him.
However, he cannot validly leave any direction in the will which is against public interest, nor can he withdraw the property from the use of the living persons.
For example, he cannot leave a direction in his will that his money be buried in the grave along with his dead-body or thrown into the sea, that his estate or land shall lie waste after his death. Such a testamentary disposition shall be wholly void.
In conclusion it may be stated that the concept of property has a special significance in jurisprudence because the determination of proprietary rights such as ownership, title, etc. is solely based on property.
The concepts of ownership and possession have also originated from the conception of property. Again, rights and duties are also closely related to property. It is for this reason that the law relating to property has been developed as an independent branch of law in jurisprudence. The estate or property for which there is no heir or successor, shall vest in the State.
Jurists have differed in their views regarding the origin of property. They have advanced their own theories in this regard. None of them, however, seems to be wholly correct but there is some truth in each one of them. These theories are discussed below:
This theory is based on the principle of natural reason derived from the nature of things.
According to this theory, property was first acquired by occupation of an ownerless object (i.e. res nullius) as a result of individual labour.
Grotius, Pufendrof, Locke and Blackstone have supported this theory. Kant also upholds this theory in his classic work Philosophy of Law.
As pointed out by Blackstone, “by the law of nature and reason, he who first began to use a thing acquired therein a kind of transient property that lasted so long as he was using it and no longer.”
However, as the population increased, the meaning of property was extended not to the inordinate use only but to the substance of things to be used. Thus the theory of occupancy was the foundation of all property.
This theory has been criticized by Sir Henry Maine and Bentham.
According to Henry Maine, it is erroneous to think that possession gives rise to title for there is no reasonable ground to support this contention.
Bentham holds that property has not originated by first occupation of an ownerless thing, but it is a creation of law. He does not believe in the existence of property without the existence of law.
It is submitted that the natural theory, neither gives a convincing account of the origin of property nor it gives any justification for it. In modern times, this theory is of little practical value.
This theory primarily believes that property can be claimed on the exclusive basis of one’s work, which produced that property. It recognises the role of labour for adequate rewards. When a person acquires property, he is entitled to hold it exclusively.
According to this theory, a thing (res) is the property of the person who produces it or brings it into existence.
However, this view has been criticized by Harold Laski on the ground that labour does not produce property, it is only a means to earn property.
This theory has lost significance in modern times because it has been shown that there may be many situations when property can be acquired without labour, e.g., property obtained by inheritance or under a will.
The labour theory of property is also sometimes called as the positive theory. It was propounded by Spencer who founded it on the fundamental law of equal freedom of individual. He asserted that property is the result of individual labour and therefore, no one has a moral right to property which he has not acquired by his personal labour.
This theory was propounded by Hegel and Kant.
According to Hegel, “property is the objective manifestation of the personality of an individual.”
Kant also supported metaphysical theory of property and justified its existence and need for protection. He observed that law of property does not merely seek to protect possession where there is an actual physical relation between the possessor and object, but it goes beyond it and considers personal will of the individual is more important in the concept of property.
This theory has been criticized on the ground that it is little concerned with realities and is based on theoretical assumptions.
But this theory is not however applicable today because modern tendency of a state is to discourage concentration of property in the hands of the few. Today socialistic states aim at for equitable distribution of wealth and not at concentration of money in one group.
This theory lays down two propositions.
Firstly, the institution of property has developed a process of steady growth, which had three distinct stages.
In the First Stage, a tendency is developed among people to take things into natural possession and exercise control over them independently of the law or the state.
In the Second Stage, the juristic conception of possession gradually developed which meant possession in fact as well as in law.
In the Third and the Last Stage, there was development of ownership which is purely a legal conception having its origin in law. The law guarantees the owner of property, exclusive control and enjoyment of property owned by him.
The Second Proposition is that the idea of individual property developed out of group or collective property. Sir Henry Maine was the chief supporter of the historical theory of the origin of property. He observed that property originally belonged not to individuals, not even to isolated families, but to large societies composed on the patriarchal pattern.
Roscoe Pound also agrees that the earliest form of property was group property which subsequently disintegrated into family property and finally the concept of individual property evolved.
The noted Italian juristic Miraglia has also supported the historical theory of property.
According to this theory, property came into existence on account of the acquisitive tendency of human beings. Everyone desires to own things and keep them in possession and control. The law takes account of this instinct and confers certain rights on individual over the object, which they have acquired.
Bentham also pointed out that property is altogether a conception of mind. It is nothing more than an expectation to derive certain advantages from the object according to one’s capacity. Roscoe Pound also took a similar view.
Also called functional theory, it emphasizes that the concept of property should not only be confined to private rights but it should be considered as a social institution securing maximum interests of the society.
Jenks suggests that no one can be allowed unrestricted use of his property to the detriment of others. In his opinion, the use of property should conform to the rules of reason and welfare of the community.
The theory justifies acquisition of property by law and individual efforts. Its distribution, however, should be on equitable basis.
Laski, a supporter of the theory, observes: “Property is a social fact like any other and it is the character of social facts to alter. It has assumed the most varied aspects and it is capable of yet further changes with the changing norms of the society.”
The functional approach has been emphasized in modern times. This approach says that there should not be any priori theory for the justification of the property. Any theory of property should be, built by an analysis of function and the social effects of property. It will encourage the production of property and will consequently increase the social well being.
According to this theory, the origin of property is to be traced back to the origin of law and the State.
Jenks observed that property and law were born together and would die together. This in other words, means that property came into existence when laws were framed by the state.
In this context Rousseau observed, “It was to convert possession into property and usurpation into a right that law and State were founded.” He asserted that property was the creation of the State and property is nothing but a systematic expression of degrees and forms of control, use and enjoyment of things by person that are recognized and protected by law.
There is, however, little truth in this theory because in fact both the State and property have their origins in the socio-economic forces therefore, one cannot be the source of origin of the other.
Broadly speaking, the objects which are capable of becoming property are those over which a person exercises a right and with reference to which another person owes a duty. These objects may be:
(a) Material objects i.e., physical things such as house, tree, field, horse, table etc.
(b) Intellectual objects which are artificial things such as trademark, copyright, patent, easement rights. These are intangible things, which are treated by law as if they were material objects for the purpose of determination their holder’s right and duty of others against him.
Thus, from above one can say that property is mainly of two kinds, namely, (1) corporeal, and (2) incorporeal.
Corporeal property is the right of ownership in material things whereas incorporeal property is any other proprietary right in rem, e.g., patent right, right of way. Both are, however, valuable rights inasmuch as they are legal rights recognised and enforced by law.
Corporeal property is of two kinds, movable and immovable. Incorporeal property is further divisible into two kinds, namely, (i) jura in re aliena or encumbrances, whether over material or immaterial things, e.g., lease, mortgages and servitude; and (ii) jura in re propria over immaterial things, such as patents, trademarks, copyright etc.
It is called tangible property also, because it has tangible existence. It relates to material things, e.g., land, house, money, ornaments, gold, silver etc. are corporeal property the existence of which will be felt by the sense organs.
In Roman law, corporeal property is termed as res corporalis.
The person who has the right to the aggregate use of an object is called the owner of the object, and the object is called his property. But this right means a right of general use only. It does not mean that the right is absolute or unlimited. Generally, there are two kinds of restrictions on one’s use of his property.
The first kind of restrictions are those that are imposed by law, and it is done in the interests of society. The second kind of restrictions are those that are encumbrances on the property. The right of ownership is general, permanent and heritable.
Corporeal property is of two kinds, movable and immovable.
The division of property into movable and immovable is very important. This division is generally found in all the legal systems, but the basis on which the division is made is not uniform and it is different in different legal systems. A number of incidents and the extent of rights in property depend on its being movable or immovable.
In India, the division is into movable and immovable, but in English law the same is known as chattels and land respectively.
According to Salmond, immovable property (i.e. land) has the following elements:
Immovable property has been defined in the General Clauses Act, 1897 to include land, benefits to arise out of land, and things attached to the earth, or permanently fastened to anything attached to the earth.
The Transfer of Property Act, 1882 excludes standing timber, growing crops and grass from the definition of immovable property.
Movable property, on the other hand, may be defined as any corporeal property which is not immovable property.
Movable property is commonly termed as chattel which has three different meanings:
In every legal system there are generally two different sets of rules which govern and regulate the acquisition and disposal etc. of these two kinds of property.
The Transfer of Property Act, 1882 governs the transfer of immovable property and the Sale of Goods Act, 1930 governs the transfer of movable property.
It is also called intangible property because its existence is neither visible nor tangible e.g. right of easement, copyright, patent, etc.
Incorporeal property is further divisible into two kinds, namely,
Proprietary rights are both in relation to material and immaterial things. Material things are physical objects and all other things which may be subject-matter of a right are immaterial things. They are various immaterial products of human skill and labour. These immaterial forms of property are as follows:
Intellectual rights are a type of incorporeal property. The recognition and protection of this kind of incorporeal property has been of recent origin. The justification in accepting these types of property lies in the fact that what a man produces belongs to him and the immaterial product or a person’s intellect may be valuable as any other material property. Examples of this type of property are patents, literary, artistic, musical and dramatic copyrights and commercial goodwill etc.
The various types of intellectual property are:
The subject-matter of a patent right is an invention such as the idea of a new process, instrument or manufacture. The person by whose skill or labour the invention or a new process or manufacture is ‘introduced’ has the exclusive right of patent in it. This is granted to the inventor by the state.
The Indian Patents & Designs Act provides that a person who has registered a patent gets the exclusive right to make use or sell the patented invention for a period of fourteen years, and any person who, whether with or without the knowledge of the existence of the patent right, infringes the same, may be restrained by injunction and if he knowingly infringes the patents, shall be liable for damages.
The subject-matter of the right is the literary expression of facts or thought. This right may be available to writers, painters, engravers, photographers, musical and dramatic personnel for their outstanding work.
When such a person does some creative work by utilising his intellect, skill and labour, he is entitled to exclusive copyright, which is immaterial form of property. In short, copyright may be literary copyright or artistic copyright or musical and dramatic copyright.
Yet another form of immaterial property is commercial goodwill. The goodwill of commercial business is a valuable right acquired by the owner by his labour and skill. He has exclusive right of use and profit from the business and anyone who seeks to make use of it by falsely representing to the public that he is himself carrying on the business in question, shall be violating this right.
Rights in re aliena are also known as encumbrances. Encumbrances are the rights of specific or particular user as distinguished from ownership which is right of general user. Encumbrances prevent the owner from exercising some definite rights with regard to his property.
The main categories of rights in re aliena or encumbrances are: (1) Leases, (2) Servitudes, (3) Securities, and (4) Trusts.
A lease is that form of encumbrance of property vested in one person by a right to the possession and use of it vested in another. Thus it is transfer of right to the possession and use of property owned by some other person. It is an outcome of the rightful separation of ownership from possession.
A lease may either be for a certain specified period or in perpetuity. It is an encumbrance in which the lessor, i.e., the owner of the property transfers his right of possession to the lessee.
Thus if I own a house which is let out to a tenant, I have created a lease, i.e., I detached my possession from my ownership. I am still the owner of the house but the tenant, i.e., the lessee has possession of it and he can use it so long as the lease subsists.
Lease should be distinguished from a license. The main point of distinction between the two is that the lease creates an interest in property, but the license does not create any estate or interest in favour of the licensee in the property to which it relates.
The lease is not confined to material objects only, but it extends to rights also. All the rights which can be possessed can be leased out.
It is an encumbrance on property which gives a right for the limited use of a piece of land to a person or persons without giving them possession of the land, for e.g., a right of way on the land of another is servitude.
There is no transfer of possession in case of servitude and this distinguishes it from a lease.
Servitudes are of two kinds– Private and Public.
Private– A private servitude is that in which the right to use vests in a determinate individual or individuals. For e.g., a right of way vested in the owner of one piece of land over an adjoining piece of land is a private servitude.
Public– A public servitude is that in which the right is vested in the public at large, in some class of indeterminate individuals. For e.g., where the public has a right of highway over one’s private land, it is a public servitude.
Servitudes are classified in another way also. Under this classification, they are of two kinds – Appurtenant and Gross.
An appurtenant servitude is that servitude which is an encumbrance on one piece of land but is also accessory to another piece of land. It is a right of using one piece of land for the benefit of another piece of land. The servitude runs with the land for whose benefit it exists.
A gross servitude is that servitude which is not so attached to a piece of land. It is not necessary to any dominant tenement for whose benefit it exists.
A security is an encumbrance vested in a creditor over the property of his debtor for the purpose of securing the recovery of the debt. In other words, it may be said to be a right to retain possession of a chattel until the debt is paid.
Security on immovable property is called a mortgage and on movable property it is called a pledge.
A security is an encumbrance the purpose of which is to ensure or facilitate the fulfillment or enjoyment of some other right vested in the same person.
Securities over property are of two kinds– Mortgages and Lien.
Mortgage- Where immovable property is secured to another for consideration, the transaction is called a mortgage. It is called pledge if the property is movable.
A mortgage is in the transfer of interest in specific immovable property for the purpose of securing:
The transferor is called a mortgagor and the transferee a mortgagee. The instrument by which the transfer is effected is called a mortgage- deed.
Mortgage can be of various kinds, such as Simple mortgage, Mortgage by conditional sale, Anomalous mortgage, etc.
A lien is the right to hold property of another person as a security for the performance of an obligation.
Thus, a finder of goods has a right to retain the goods against the owner till he receives from the owner, the compensation for trouble and expenses incurred by him, and also specific reward which the owner may have offered for the return of such goods. The finder is said to have a lien upon the goods so found.
Lien is right to retain possession of goods and does not include right of ownership or sale.
Lien can be – Possessory lien, Agent’s lien, Unpaid Vendor lien, Charge etc.
A trust is an encumbrance in which the ownership of property is limited to deal with it for the benefit of some third person.
In other words, a trust is an obligation annexed to the ownership of property.
It arises out of a confidence reposed in and accepted by the owner. According to Salmond, a trust is ordinarily created for the benefit of unborn persons, infants, minors, lunatics and persons who suffer from some legal disability.
It is also created for the perfection of some disputed property or safeguarding the common interest of several persons. The law relating to trusts in contained in the Indian trusts act, 1882. Thus, in the case of a trust though the property is legally vested in the trustee, he keeps it for the benefit of the beneficiary.
In the Indian context, the constitutional provisions contained in Article 39(b) and (c) clearly reflect the concern of the State against concentration of wealth in the hands of the few to the detriment of social interests.
Fair and equitable distribution of wealth so as to subserve the common interest of all sections of the society has been the guiding principle in regulation of property by the State through the instrumentality of law. The focus has been on the socialization of property rather than adopting a narrow individualistic approach.
The rule against unjust enrichment, doctrine of perpetuity, marshalling, subrogation, part performance etc. are incorporated in the property law with a view to ensuring just and fair enjoyment of property and protecting it against all kinds of exploitation.
None of the theories of property, discussed above, can alone explain ‘origin of property. However, most of them contain some truth, and a perfect and comprehensive theory can be built only by taking into consideration the various aspects of property. Thus a functional approach would be more helpful in understanding, ‘property’.
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