Review of Hanoch Dagan, A Liberal Theory of Property

I read A Liberal Theory of Property through the lens of my own area of expertise – multi-owned housing – and I felt my heart lift as many of Dagan’s arguments unfolded. Dagan’s three-pillared liberal theory of property creates a profound and practical tool for ensuring that multi-owned properties manifest as their best, not worst, selves. In this review, I accept Dagan’s invitation to use his book ‘to examine the performance of existing property systems’ against his liberal theory, with a view to accurately identifying the source of problems and finding a clear path to reform (Dagan, 2021, p. 68). The rise of multi-owned properties is the most significant change in modern property landscapes in a century. I do not necessarily mean US-style common-interest communities, which, while important, have limited popularity in countries that lack a strong tradition of small-group autonomy and/or segregation. I mean condominiums. While people have long lived in apartment buildings, without modern engineering, those buildings were human-scale; load-bearing walls cannot go higher than twelve storeys. The invention of steel frames and curtain walls revolutionised our use of land, allowing owners to exploit vast tracts of airspace. High-rise residential buildings now soar 150 storeys into the air; include complex plant, equipment and facilities; and house hundreds of residents. Not only are modern buildings of a scale unknown in human history; the relationships between residents has radically altered. In the past, buildings were typically owned by a single landlord and occupied by tenants. The dominant legal relationship was vertical, and although clearly open to the interpersonal domination that Dagan rightly identifies as inherent to property, the landlord–tenant relationship is relatively easy to regulate with the right political will and/or is inherently limited if its conception is based on Dagan’s third pillar of relational justice. However, in the post-World War II period, countries around the world recognised that (1) increasing numbers of citizens were going to live in mediumor high-rise buildings, (2) that it was ideal for citizens to own their own home and so (3) legal mechanisms would be needed to facilitate this. In most of the common law world – with the notable exception of the US, Israel and Scotland – positive obligations (or ‘real covenants’) on freehold land are still impermissible. This is a fundamental impediment to creating freehold fee-simple titles to apartments, because those titles must be coupled with a necessary positive obligation to maintain the building. As a result, many jurisdictions needed legislation to overcome this prohibition. That legislation is variously called strata title, unit title, sectional title, community title, commonhold or condominiums. It can subdivide buildings or land, creating highor low-rise communities, and its fundamental purpose is to create fees simple coupled with positive obligations and restrictions. It is the legal equivalent of US condominiums and common-interest communities. Regardless of jurisdiction, all these legal structures radically change the legal relations inside a building. Whereas tenants have minimal control over each other through nuisance law or enforcement of the covenant for quiet enjoyment against a common landlord, a condominium structure grants private citizens enormous power over their neighbours’ lives. Control is exerted not simply over collectively owned spaces, but also over privately owned homes. Further, the creation of a separate governing body corporate or association, initially controlled by the developer, creates the potential