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Acquiring Property – The Rule of First Possession

Cite this article as: Jason Mance Gordon, "Acquiring Property – The Rule of First Possession," in The Business Professor, updated January 8, 2015, last accessed April 9, 2020, https://thebusinessprofessor.com/knowledge-base/acquiring-property-the-rule-of-first-possession/.
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Acquiring Property through First Possession
This video explains how one can acquire property through first possession.

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Acquiring Resources Through Possession

Rule of First Possession – The first person to reduce previously un-owned things to her possession becomes its owner. In reality, there are few things that have never been previously possessed or owned.

  • Example: An individual may obtain ownership of real property through “original entry” or “title by occupancy”. This is where the government grants ownership rights in land to individuals willing to settle or claim a stake in the land. This rule was important during the founding and colonizing of the United States.

Discussion: How do you feel about the principle that the first possessor of property owns it? What are the benefits of this principle? What are the negative aspects of the principle?

Practice Question: Ernest is walking down the street when he sees a flash of light and a large object fall from the sky. Ernest immediately recognizes that a meteor has hit the earth. He runs over to where the meteor landed and finds that the meteor contains a large chunk of precious metal. He picks up the precious metal and takes it home. Does Ernest own the metal?

Proposed Answer

  • The theory of first possession of property allows that a person holds or takes possession and ownership of something and is justified simply by the fact that they came to have the property before anybody else. Also this theory says that if the person claims the right to first occupancy or original entry. This rule grants on ownership claim to the party that gains control before other potential claimants. First possession is also a powerful norm in many societies, where it is better known as “finders keepers”. In the practice question, Ernest has a right to claim first ownership on the precious metal he collected following the meteorite impact as he was the first person to take possession of it.

Academic Research

Lueck, Dean, First Possession. The New Palgrave Dictionary of Economics and the Law (Peter Newman, Ed., May 1998). Available at SSRN: https://ssrn.com/abstract=60957

Oliar, Dotan and Stern, James, Right on Time: First Possession in Property and Intellectual Property (February 25, 2019). Boston University Law Review, Forthcoming. Available at SSRN: https://ssrn.com/abstract=3341635

Friedman, Ori and Neary, Karen, First Possession Beyond the Law: Adults’ and Young Children’s Intuitions About Ownership (March 14, 2009). Tulane Law Review, Vol. 83, 2009. Available at SSRN: https://ssrn.com/abstract=1359453

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