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Property: Meaning and Nature of Property Rights!
Property is a very important institution in the economy of societies. The word ‘property’ is used in two senses. According to some writers it includes goods or things owned by an individual or group of individuals. Thus, Anderson and Parker write, “Property consists of goods and services that society gives an individual or group of individuals the exclusive right to possess, use and dispose of.” In this sense property is one’s own, something possessed by him.
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It may be tangible or intangible. Tangible items are those which can be seen and touched. Clothing, ornaments’, weapons, tools, utensils, houses, lands, automobile, animals etc. are tangible items. The intangible property is that which cannot be seen and touched. Such property consists of goodwill, copy rights, trade mark etc. Most of our property consists of tangible items.
In its second sense, property refers to rights. Davis writes, “Property consists of the rights and duties of one person or group as against all other persons and groups with respect to some scarce goods.” It sets off what is mine from what is thine.
Rights and duties are not tangible in a physical sense. In this sense, tangibility or intangibility of the thing owned is of little importance, because what is owned are not the goods but the rights to use these goods. H. T. Mazumdar also writes, “Property is the intangible right to use and disposal of a good, material or non-material, in which ownership rights are affirmed for the group, or a member or a set of members of the group by the folkways and mores.” It may be noted that the idea of property takes its birth only when something is scarce and valuable. If a thing is easily and freely available it cannot be the object of property.
For example, air and light are freely available to every person. Hence they cannot form property, i.e., none can have an exclusive right to their use. In a society there is scarcity of goods. The members have less than they want. Therefore, they want to possess the exclusive right to things in scarcity and here the concept of property acquires significance.
Nature of Property Rights:
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Understood in terms of rights the following are the characteristics of property rights:
(i) Transferability:
Property can be transferred by its owner by way of sale, exchange or gift. A landowner can transfer his land. Physician can sell his automobile. But one cannot transfer one’s skill and so skill is not property.
(ii) Property rights do not necessarily imply actual use and enjoyment of objects by the owner:
Law makes a distinction between ownership and possession. One may own property without actually using it. In other words, possession of property may be in the hands of persons who is not its owner. A tenant is in possession of a house but the house is not his property. It is the property of the landlord.
(iii) Power-aspect:
The possession of property implies the possession of power over other. As said above, property can exercise control over those persons who do not have it. The extent of power which property gives to the owner depends not only upon the definition of his rights but also on the intensity of others’ need and scarcity of the thing.
A man’s ownership of a fountain pen does not give him any control over the illiterate people who do not need it, nor on others because it is abundant in supply. But if a man has ownership of all the clothing factories, his power over others would be great.
(iv) Property refers to a concrete external object:
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It is suggested by some writers that property rights refer to a concrete external object, but as we have seen above such a view limits narrowly the range of property rights. One can have property of intangible thing like goodwill, when one sells the goodwill of one’s business, what he actually sells is not any external object.
The seller of goodwill only agrees not to compete with the buyer by using the name of the product or the name of the company. For example, if the manufacturers of ‘Bajaj’ electrical goods sell their goodwill what they agree to is that they will not thereafter brand their goods by the name of ‘Bajaj’. They do not sell their goods but only the name by which these goods were known in the market. They have sold their property of goodwill.
(v) Property is usually non-human:
This means that the object of property has no rights of its own but is simply the passive object of such rights. The land has no right of its own it only serves the land owner. In other words, human beings cannot be the object of property. A woman cannot be the property of her husband, nor can the children be the property of their parents. Property rights apply only to those things which have no rights of their own.