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Arruñada, Benito --- "Property Titling and Conveyancing" [2011] ELECD 156; in Ayotte, Kenneth; Smith, E. Henry (eds), "Research Handbook on the Economics of Property Law" (Edward Elgar Publishing, 2011)

Book Title: Research Handbook on the Economics of Property Law

Editor(s): Ayotte, Kenneth; Smith, E. Henry

Publisher: Edward Elgar Publishing

ISBN (hard cover): 9781847209795

Section: Chapter 12

Section Title: Property Titling and Conveyancing

Author(s): Arruñada, Benito

Number of pages: 20

Extract:

12 Property titling and conveyancing
Benito Arruñada*


I. ENFORCEMENT BENEFITS VS. `CONSENT' COSTS

Rights to land and many other assets can be enforced as property rights, iura in rem,
claimable against the asset itself and therefore valid against all persons, erga omnes.1
These property rights are said to `run with the land,' meaning that they survive unal-
tered through all kinds of transactions and transformations dealing with other rights on
the same parcel of land or on a neighboring parcel. For example, the mortgagee keeps
the same claim on the land even after the mortgagor sells it. Property rights oblige all
people: the new owner who has purchased the land is obliged to respect both the mort-
gage and, in particular, the right to foreclose in case the guaranteed debt is not paid.
Enforcement of a property right is independent of who holds other rights on the same
asset. Alternatively, rights on assets can be contract rights, enforceable against a specific
person, inter partes. To clarify the difference between property and contract rights, con-
sider what happens in the case of a lease of land, this being a right that in many jurisdic-
tions may be structured as either a contractual or a property right. Assume that the land
is sold during the life of the lease. If the lease is a contract right, the lessee loses the right
of occupation, and gains instead a contract right against the lessor. However, if the lease
is a property right, ...


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