Can rights be owned?

LS2008 Property Law

By: Anjan Neupane
The University of Aberdeen
October 2009
Submitted to: Professor CG van der Merwe

1
Roman lawyers’ classified law into different headings, the most important is the distinction
between the law of things (res) and the law of obligations (obligatio).1 According to Gaius,
things (res) include both res corporales and res incorporales.2 To quote Gaius himself,”
Incorporeal things are such as are not tangible, and are those consisting merely of rights...”3
This follows that, things can be owned. If rights are things, then rights can be owned.
However, German Law the position is different, “Only corporeal objects are things as defined
by law.”4 Following this approach, rights cannot be owned. The aim of this work is to try to
reconcile and streamline dogmatic issues with practical problems and investigate which is the
best approach to adapt.

Whichever scheme we choose it will hurt common speech. Legal concepts are rarely made
with common speech in mind. Applying the Gaius approach, it follows that rights can be
owned. We frequently speak of owning company shares, government bonds and patent rights,
it sounds perfect. In the case of some rights it sounds odd to speak of ownership. Normally
we do not say that, we “own” a claim in delict, we “own” a contract or we “own” ownership.
The word “have” or “hold” seems more natural. The word “have” can be used as a
fundamental legal concept, meaning the relation of a person to a right.5 However, there are
many instances where men do harm legal concepts in common speech. Take for example,
anti-war activists calling George Bush a murderer, although, in a legal sense his acts may not
fit the definition of murder. There is nothing wrong if Germans speak of owning shares
although it is not technically possible.

The modern day global economic importance has shifted from corporeals towards rights.
Possession is no longer necessary to be wealthy, legal protection of a right is sufficient. Bill
Gates is not richest man in the world because he owns a billion acres of land but because of
his shares in Microsoft. In the new world economy research, innovation, patent, intellectual
property and stock markets have more importance than car, farmland or rivers. Corporeal
DVD is worthless without the incorporeal software. For a common man owning shares in
more important and practical than having a problem with owning ownership.

The concept of owing right has another limitation depending on the legal system. Supposing
that, A contracts with B to sell his car for £100. A has the real right (owns) to the debt, B now

1
Nicholas, An Introduction to Roman Law (Oxford, 1975), page 98
2
Gaius Institutes II, 12
3
Gaius Institutes II, 13
4
Article 90 of The German Civil Code (Bürgerliches Gesetzbuch)
5
Gretton “Owning Rights and Things” 1997 Stellenbosch Law Review 176

2
has the real right (owns) of a performance under the contract to handover the car. Now, A
disagrees to transfer the car anymore. B has two options, claim for damages or demand
specific implement. In Scots law specific implement is a legal right, 6 in English law it is an
equitable remedy.7 Real right is a relationship between a person and a thing, right enforceable
against the whole world at large (absolute right). The scheme of owning rights does not
necessarily apply to England, because if A does not want to transfer the car he can pay
damages and get away with it. In England, real right (right is contract, if it can be owned) is
not very real (absolute) after all. In Scotland, A can be forced to perform; therefore, the right
to force the transfer of the car is an absolute (real) right. Due to the relative absoluteness of a
personal right in Scots law, it might not be detrimental to have real right in a personal right.

Introducing the concept of patrimony might help us avoid claiming that all contractual rights
are my property. Patrimony is the summation of all real rights and personal rights. 8 In
German law, law of obligations together with property law forms part of civil law proprietary
rights.9 Suppose, you owe a debt of £100,000 to the bank for the mortgage, a friend owes you
£1,000 and the value of the house you own is £150,000. Supposing that you are unemployed,
the value of your patrimony is £51,000 (£150,000+£1,000-£100,000). Gretton claims that this
concept if introduced together with the “have” approach (discussed above) can sharpen the
blurred lines between property and obligation.10 I doubt it. It is very hard to describe the
situation “I owe a debt to the bank” without the owe-own approach. Saying that “My
patrimony is to pay money to the bank and get money from the friend” is a waste of words.
This concept can be used during bankruptcy but not while describing property rights. This
concept further blurs the distinction between real rights and personal rights, melts it in the
same pot.

There are a lot of limitations to describing personal rights in terms of real rights. In many
instances it is misleading, if overdone, can make simple situations complicated. Classifying
rights as things should only be done in one occasion, where there is a dispute on who is the
rightful holder of right.11 For example, if A cedes his debt to B, then fraudulent cedes the
same debt to C. There is a competition between B and C to who holds the right to the debt.
Property law is useful to identify who the owner of the right is. The internal relationship
6
Retail Parks Investments Ltd v Royal Bank of Scotland plc (No 2) 1996 S.C. 227
7
Cooperative Insurance Society Ltd v Argyll Stores (Holdings) Ltd [1998] AC 1
8
Gretton “Owning Rights and Things” 1997 Stellenbosch Law Review 176
9
N Foster, German Law and Legal System (Blackstone, 1993), page 238
10
Gretton “Owning Rights and Things” 1997 Stellenbosch Law Review 176
11
Reid, “Obligations and Property: Exploring the Border” 1997 Acta Juridica 300

3
(between the creditor and the debtor) is governed by the law of obligations while the external
relationship (between the person and his right) is governed by the law of property. There is a
practical importance of this approach and we can draw a clear boundary drawn between real
rights and personal rights.

Rights can be owned. It is useful and also logical that there should and can be real rights over
personal rights because its usefulness when there is a dispute regarding who is the holder of
the right. Alternative concepts of patrimony of a person and the “have-hold” approach also
have its own limitations. Whichever approach we take it is bound to neglect common speech
to certain extent, owning rights does less violence than other the approach. Due to the reality
of new knowledge based global economy it is more relevant to own rights than not.

4
Bibliography

Barry Nicholas, An Introduction to Roman Law (Oxford, 1975)

FS Cohen, “Transcendental Nonsense and the Functional Approach” 35 Columbia Law

Review 809

George G Gretton “Owning Rights and Things” 1997 Stellenbosch Law Review 176

Kenneth GC Reid, The Law of Property in Scotland (Butterworths, 1996)

Kenneth GC Reid, “Obligations and Property: Exploring the Border” 1997 Acta Juridica 300

Nigel Foster, German Law and Legal System, (Blackstone, London 1993)