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will sell to me and a duty to buy from you, both at that price. The constituents of my interest are different from what they were at Stage 2 and my interest accordingly is given a different name: I no longer have an option to purchase, I now have an estate contract. But notice that you have still not yet lost your power to sell to someone else. You still have the ability to transfer ownership to anyone else in the world. If at this stage you do in fact sell ownership to P for £3 m, the question of whether my estate contract is enforceable against him (i.e. whether his ownership is subject to a duty to sell ownership on to me for £2m) will again depend on whether the legal system chooses to classify estate contracts as property interests or purely personal interests. (In our jurisdiction, as we see in Chapter 12, options to purchase and estate contracts are property interests, but the legal system imposes a further condition before they become enforceable against someone who has purchased ownership: they must have been registered in a public register – for reasons which are obvious.)

2.1.6. Property rights, property interests and ownership

This brings us on to our final introductory point. It will now be apparent that, in many property relationships each party holds a complex of rights, privileges, duties, liabilities etc. in respect of the thing in question. Despite Hohfeld’s strictures, each of the constituent rights, privileges, powers and immunities can loosely but conveniently be called a ‘property right’ in the relevant thing. The whole complex of rights, duties etc. held by each party is a ‘property interest’ in the thing. Property interests are, therefore, complexes of rights, duties etc. held by a person in respect of a thing. In Chapter 1 we noted that the number of different ways in which rights, duties etc. in relation to things can be combined to form property interests is strictly limited. In our jurisdiction there is a relatively short list of recognised property interests, ranging from ownership (which is the most extensive) to such lesser interests as mortgages, easements and charges. The list is exhaustive but expandable: it is always open to Parliament to add a new type of property interest at any time, and on occasions the courts will do so too, either overtly or in the guise of ‘discovering’ that a claimed type of interest was there on the list all along. We look at this process again in Chapter 9.

Extract 2.1 W. N. Hohfeld, ‘Fundamental Legal Conceptions as Applied in Judicial Reasoning’ (1913) 23 Yale Law Journal 16

F U N D A M E N T A L J U R A L R E L A T I O N S C O N T R A S T E D W I T H O N E A N O T H E R

One of the greatest hindrances to the clear understanding, the incisive statement, and the true solution of legal problems frequently arises from the express or tacit assumption that all legal relations may be reduced to ‘rights’ and ‘duties’, and that these latter categories are therefore adequate for the purpose of analyzing even the most complex legal interests, such as trusts, options, escrows, ‘future’ interests, corporate interests,

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claim that Y, the other man, should stay off the land, he himself has the privilege of entering on the land; or, in equivalent words, X does not have a duty to stay off. The privilege of entering is the negation of a duty to stay off. As indicated by this case, some caution is necessary at this point; for, always, when it is said that a given privilege is the mere negation of a duty, what is meant, of course, is a duty having a content or tenor precisely opposite to that of the privilege in question. Thus, if, for some special reason, X has contracted with Y to go on the former’s own land, it is obvious that X has, as regards Y, both the privilege of entering and the duty of entering. The privilege is perfectly consistent with this sort of duty, for the latter is of the same content or tenor as the privilege; but it still holds good that, as regards Y, X’s privilege of entering is the precise negation of a duty to stay off. Similarly, if A has not contracted with B to perform certain work for the latter, A’s privilege of not doing so is the very negation of a duty of doing so. Here again the duty contrasted is of a content or tenor exactly opposite to that of the privilege.

Passing now to the question of ‘correlatives’, it will be remembered, of course, that a duty is the invariable correlative of that legal relation which is most properly called a right or claim. That being so, if further evidence be needed as to the fundamental and important difference between a right (or claim) and a privilege, surely it is found in the fact that the correlative of the latter relation is a ‘no-right’, there being no single term available to express the latter conception. Thus, the correlative of X’s right that Y shall not enter on the land is Y’s duty not to enter; but the correlative of X’s privilege of entering himself is manifestly Y’s ‘no-right’ that X shall not enter.

In view of the considerations thus far emphasized, the importance of keeping the conception of a right (or claim) and the conception of a privilege quite distinct from each other seems evident; and, more than that, it is equally clear that there should be a separate term to represent the latter relation. No doubt, as already indicated, it is very common to use the term ‘right’ indiscriminately, even when the relation designated is really that of privilege; and only too often this identity of terms has involved for the particular speaker or writer a confusion or blurring of ideas. Thus, Professor Holland, in his work on Jurisprudence, referring to a different and well-known sort of ambiguity inherent in the Latin ‘Ius’, the German ‘Recht’, the Italian ‘Diritto’, and the French ‘Droit’ – terms to express not only ‘a right’, but also ‘Law’ in the abstract – very aptly observes:

If the expression of widely different ideas by one and the same term resulted only in the necessity for . . . clumsy paraphrases, or obviously inaccurate paraphrases, no great harm would be done; but unfortunately the identity of terms seems irresistibly to suggest an identity between the ideas expressed by them.

Curiously enough, however, in the very chapter where this appears – the chapter on ‘Rights’ – the notions of right, privilege, and power seem to be blended, and that too, although the learned author states that ‘the correlative of . . . legal right is legal duty’, and that ‘these pairs of terms express . . . in each case the same state of facts viewed from opposite sides’. While the whole chapter must be read in order to appreciate the seriousness of this lack of discrimination, a single passage must suffice by way of example:

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case, where a union leader threatened industrial action against one of the customers of a butcher, to persuade the customer to stop doing business with the butcher, because the butcher refused to sack all his non-union employees and employ union members instead; the butcher sued the union leader] is deserving of comment:

The plaintiff [the butcher] had the ordinary rights of the British subject. He was at liberty to earn his living in his own way, provided he did not violate some special law prohibiting him from so doing, and provided he did not infringe the rights of other people. This liberty involved the liberty to deal with other persons who were willing to deal with him. This liberty is a right recognized by law; its correlative is the general duty of every one not to prevent the free exercise of this liberty except so far as his own liberty of action may justify him in so doing. But a person’s liberty or right to deal with others is nugatory unless they are at liberty to deal with him if they choose to do so. Any interference with their liberty to deal with him affects him.

A ‘liberty’ considered as a legal relation (or ‘right’ in the loose and generic sense of that term) must mean, if it have any definite content at all, precisely the same thing as privilege; and certainly that is the fair connotation of the term as used the first three times in the passage quoted. It is equally clear, as already indicated, that such a privilege or liberty to deal with others at will might very conceivably exist without any peculiar concomitant rights against ‘third parties’ as regards certain kinds of interference. Whether there should be such concomitant rights (or claims) is ultimately a question of justice and policy; and it should be considered, as such, on its merits. The only correlative logically implied by the privileges or liberties in question are the ‘no-rights’ of ‘third parties’. It would therefore be a non sequitur to conclude from the mere existence of such liberties that ‘third parties’ are under a duty not to interfere, etc. Yet, in the middle of the above passage from Lord Lindley’s opinion there is a sudden and question-begging shift in the use of terms. First, the ‘liberty’ in question is transmuted into a ‘right’; and then, possibly under the seductive influence of the latter work, it is assumed that the ‘correlative’ must be ‘the general duty of every one not to prevent’, etc.

Another interesting and instructive example may be taken from Lord Bowen’s oftquoted opinion in Mogul Steamship Co. v. McGregor (1889) 23 QBD 59:

We are presented in this case with an apparent conflict or antinomy between two rights that are equally regarded by the law – the right of the plaintiffs to be protected in the legitimate exercise of their trade, and the right of the defendants to carry on their business as seems best to them, provided they commit no wrong to others.

As the learned judge states, the conflict or antinomy is only apparent; but this fact seems to be obscured by the very indefinite and rapidly shifting meanings with which the term ‘right’ is used in the above quoted language. Construing the passage as a whole, it seems plain enough that by ‘the right of the plaintiffs’ in relation to the defendants a legal right or claim in the strict sense must be meant; whereas by ‘the right of the defendants’ in relation to the plaintiffs a legal privilege must be intended. That

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This second class of cases – powers in the technical sense – must now be further considered. The nearest synonym for any ordinary case seems to be (legal) ‘ability’ – the latter being obviously the opposite of ‘inability’, or ‘disability’. The term ‘right’, so frequently and loosely used in the present connection is an unfortunate term for the purpose – a not unusual result being confusion of thought as well as ambiguity of expression. The term ‘capacity’ is equally unfortunate; for, as we have already seen, when used with discrimination, this word denotes a particular group of operative facts, and not a legal relation of any kind.

Many examples of legal powers may readily be given. Thus, X, the owner of ordinary personal property ‘in a tangible object’ has the power to extinguish his own legal interest (rights, powers, immunities, etc.) through that totality of operative facts known as abandonment; and – simultaneously and correlatively – to create in other persons privileges and powers relating to the abandoned object – e.g. the power to acquire title to the latter by appropriating it. Similarly, X has the power to transfer his interest to Y – that is, to extinguish his own interest and concomitantly create in Y a new and corresponding interest. So also X has the power to create contractual obligations of various kinds. Agency cases are likewise instructive . . . The creation of an agency relation involves, inter alia, the grant of legal powers to the so-called agent, and the creation of correlative liabilities in the principal. That is to say, one party, P, has the power to create agency powers in another party, A – for example, the power to convey P’s property, the power to impose (so-called) contractual obligations on P, the power to discharge a debt owing to P, the power to ‘receive’ title to property so that it shall vest in P, and so forth . . .

Essentially similar to the powers of agents are powers of appointment in relation to property interests. So, too, the powers of public officers are, intrinsically considered, comparable to those of agents – for example, the power of a sheriff to sell property under a writ of execution. The power of a donor, in a gift causa mortis, to revoke the gift and divest the title of the donee is another clear example of the legal quantities now being considered; also a pledgee’s statutory power of sale.

As regards all the ‘legal powers’ thus far considered, possibly some caution is necessary. If, for example, we consider the ordinary property owner’s power of alienation, it is necessary to distinguish carefully between the legal power, the physical power to do the things necessary for the ‘exercise’ of the legal power, and, finally, the privilege of doing these things – that is, if such privilege does really exist. It may or may not. Thus, if X, a landowner, has contracted with Y that the former will not alienate to Z, the acts of X necessary to exercise the power of alienating to Z are privileged as between X and every party other than Y; but, obviously, as between X and Y, the former has no privilege of doing the necessary acts; or conversely, he is under a duty to Y not to do what is necessary to exercise the power.

In view of what has already been said, very little may suffice concerning a liability as such. The latter, as we have seen, is the correlative of power, and the opposite of immunity (or exemption). While no doubt the term ‘liability’ is often loosely used as a synonym for ‘duty’, or ‘obligation’, it is believed, from an extensive survey of judicial precedents, that the connotation already adopted as most appropriate to the word in