The Concept of Property Rights: An Analysis from the Perspective of Contracts

Author: Zhao Lianhui
Publisher:
Publish Date: 2005-09-01
Features: This book takes contracts as the starting point and tool for analyzing property rights, studying the constituent elements and operational mechanisms of property rights, and focusing on the numerous intermediate states within the traditional dualistic legal concept of real property and creditor rights. It attempts to establish a more refined scale for classifying property rights and provides a rational justification for what was once considered self-evident principles of property rights. It offers valuable references for the ongoing legislative process of property law in China. The book is based on the author's doctoral dissertation and has been adapted and revised. Traditional property rights works generally start their arguments from the perspective of ownership (real property), with only occasional introductions and discussions of concepts and systems from common law. However, there is a lack of theoretical and mechanistic exploration. This book attempts to break out of this theoretical framework and seek new perspectives for researching property law issues. Although the book references many common law documents, its purpose is not to introduce specific systems but to discover common principles in property law and provide a deeper legitimacy argument for the basic institutions of property rights. In addition to the introduction and conclusion, the book is divided into four parts.
Chapter 1: Conceptual Analysis of Property Rights
Section 1: Conceptual Analysis of Property Rights
This section argues the connections between common law and Roman law, noting their similarities in emphasizing reality and specific points rather than abstract concepts. The concept of real property in Roman law corresponds to the broader concept of property rights in the civil law system.
Section 2: The Relationship Between Common Law and Roman Law
This section clarifies the basic concepts of property rights through a comparative analysis of relevant concepts in common law. It primarily examines the general concept of property rights, the relationship between real property and personal property, the relationship between the division of property rights and remedies, the relationship between property rights and real estate, the relationship between legal property rights and equitable property rights, and the relationship between property rights and ownership.
Section 3: The Role of the Division Between Rights in Person and Rights in Thing in Forming Property Rights Mechanisms
This section analyzes the mechanisms of forming rights through rights in person and rights in thing to better understand how the legal system adopts different structures of rights and obligations based on different circumstances, thereby organizing the internal division of property rights and attempting to break the mindset brought by the dualistic division of creditor rights and real property rights. We first organize the concepts of rights in person and rights in thing. Then, we analyze the characteristics of rights in person and rights in thing, summarizing the impact of different subject quantity factors on the division of rights. Next, we explore the different strategies adopted by rights in person and rights in thing in controlling information costs: the strategy of rights in person can be called the "governance strategy for determining who has the right to use resources"; the strategy of rights in thing can be called the "exclusion strategy for determining who has the right to use resources." Finally, we examine the relevant legal rules for different models of rights.
Chapter 2: Analysis of the Elements of Property Rights Structure—With Discussion of the Theory of Property Rights Division
This chapter analyzes the human and material factors in the structure of property rights. Property rights, due to differences in human and material factors, form an internal division that cannot be simply described by the dualistic division of creditor rights and real property rights. These internal divisions of property rights achieve unity under the standard of valuation.
Section 1: Material Factors in Property Rights (Objects of Property Rights)
There are two types of objects:
(1) Material objects, which are the objects of narrow property rights, particularly in the German legal sense. Through an examination of the objects of real property, it is found that the mechanisms adopted by real property have the following characteristics: (1) The material meaning of the object determines the physical boundaries of the right; (2) the main means of protection is the protection of the object itself; (3) the object plays an important role in the formation of the value of the right; (4) real property is more fully reflected on non-substitutable objects; (5) once the right-guaranteeing function of the object itself is lost, at least the real property has deviated from its standard form.
(2) Legal objects, including debts, intellectual property, goodwill, and bills of exchange. This section preliminarily establishes a reasoning logic for determining the type of right based on the characteristics of the object.
Section 2: Human Factors in Property Rights Structure (Subjects of Property Rights)
First, the theory of property rights division is introduced, along with mechanisms in common law countries to prevent excessive division of property rights. Then, the model of the relationship between the subject and the object is introduced. It is argued that a single subject can establish a typical narrow concept of property rights—individual property rights. State ownership, collective ownership, and co-ownership are essentially alienations of the typical individual ownership concept. Contractual creditor rights, other forms of real property rights, equity, trusts, and inheritance rights are all arrangements of rights structures aimed at realizing ownership.
Section 3: A Unified Concept of Property Rights Based on Valuation
First, the general theory of property valuation—pricing theory—is introduced. The idea here is that property rights are constantly forming, and the value of property rights needs to be continuously discovered. Multiple subjects, including legislators, parties, courts, and markets, participate in this process. The issue of pricing raises questions of power division and the legitimacy of rights. Next, the sources of value and the significance of valuation are discussed. Property rights valuation help form unified standards, enabling people to participate in the same social process. The characteristics and valuation of real property and creditor rights are discussed separately, as are the advantages and disadvantages of the valuation of creditor rights and real property. Finally, it is argued that valuation, on the one hand, unifies real property and creditor rights, and on the other hand, causes both to deviate to varying degrees from their traditional images and characteristics, gradually dissolving the strict boundaries between them.
Conclusion: Property rights (legal relationships) are a structure with human, material, and value as the basic constituent elements.
Chapter 3: Analysis of Property Rights Rules
Section 1: We describe the manifestation of property rights rules in the constitution, property rights law, creditor rights law, company law, and remedy law, establishing a unified system of broad property rights rules.
Section 2: Re-examining the Concept of Statutory Real Property and Discussing the Negotiability of Narrow Property Rights
We first argue that the statutory nature of real property does not exist only in the civil law system. Then, we enumerate the functions of the statutory real property principle. The author generally agrees with the understanding of scholars in common law countries, namely: (1) preventing excessive division of property rights; (2) reducing information costs by standardizing rights. At the end of this section, the issue of statutory real property is transformed into the negotiability of narrow property rights, and arguments are made separately from the fields of narrow property law (especially real property law), company law, and trust and other legal fields. The conclusion is that the issue of statutory real property can be transformed into a problem of contract effectiveness in most cases.
Section 3: The Mandatory Nature of Contract Law Norms from the Dualistic Opposition of Mandatory and Authoritative Norms
This section first discusses three reasons for state intervention in contract law, then examines the complex stratification of contract norms from the perspective of different natures of mandatory exclusionary norms. Finally, it summarizes the types of mandatory norms in contract law.
Section 4: The Balance Between Mandatory and Authoritative Norms in Property Law—The Role of the Judiciary
This section first discusses the role and limitations of norms themselves and the comparison between the roles of the judiciary and the legislature. It largely supports the view that, in certain cases, case law rules (judge-made rules) may promote efficiency, while rules made by legislatures may lead to inefficiency. The judiciary plays a certain role in areas where the legislature, the free agreement of parties, and market mechanisms are not effective. A certain degree of judicial initiative is a necessary supplement to contractual freedom.
Chapter 4: Analysis of Property Rights Remedies—From the Perspective of English Contract Law
Section 1: The Relationship Between Property Rights and Remedies
This section analyzes the relationship between property rights and remedies, arguing that remedies are inherent in rights and play an important role in the formation of property rights.
Section 2: Introduction to Remedies in English Contract Law
Remedies in common law are primarily abstracted into two types: (1) Damages. It is a monetary or value-based form of remedy. Damages are sometimes carefully tailored to achieve purposes similar to those of specific performance. (2) Specific Performance. Common law applies specific performance considering many factors.
Section 3: Introduction to Different Remedial Concepts for Different Rights in the United States
This section introduces the different remedial concepts for different rights proposed by American scholars, pointing out that damages are roughly equivalent to remedies under liability law rules, while specific performance is roughly equivalent to remedies under property law rules. The concept of efficient breach takes the remedial concept of damages to an extreme, essentially granting the breaching party a choice rather than the non-breaching party; and crucially, it overlooks the subjective purposes of the parties to the contract, replacing the parties' judgment with the "neutral" and "objective" ex post judgment of the court, which does not align with the legal concept of respecting property rights.
Section 4: Analyzing Property Rights Stratification Through Contract Remedies
The author first examines the impact of remedies on the stratification of property rights: (1) Common law provides the primary remedy for breach of contract as damages. Of course, damages are carefully tailored to achieve purposes similar to those of specific performance. (2) Equitable remedies, where judges use concepts of fairness and justice to ensure that the purposes set by the parties through the contract are realized, thereby creating a right similar to real property rights. Then, through the analysis of virtual cases, the author attempts to apply the concepts in this book.
Conclusion: The book summarizes its findings, arriving at the basic characteristics of the concept of property rights.