Reframing Ameliorative Waste
69 Pages Posted: 3 Dec 2015 Last revised: 9 Dec 2015
Date Written: December 1, 2015
Tension arises when two individuals have a property interest in the same thing, particularly when those interests span different time periods. Divided ownership gives rise to the possibility that individuals with different interests will have different opinions regarding how that property should be used. Property law must thus determine which interest holder’s preferences should be honored. The doctrine of waste is one means by which the law attempts to govern multiple interest holders’ rights.
This article addresses the most controversial form of waste — ameliorative waste — which occurs when the current interest holder, without the consent of the future interest holder, makes a material alteration to the property and that alteration increases the market value of the property. Most modern American commentators and courts examine ameliorative waste from an economic perspective, focusing on changes in the property’s valuation. In stark contrast, the analytical framework for similar questions under Roman law, early common law, and modern civil law systems centers around the type of alteration involved. Each side of this dichotomous analysis views its rule as applying to all waste-creating situations, assuming that a one-size fits all approach creates just results for the many scenarios in which ameliorative waste arises.
This article compares and critiques both the value-based and the alteration-based approaches, and evaluates the merits of both frameworks. The article concludes that both approaches have substantial shortcomings and proposes an alternative framework that balances decision-making authority between the two interest-holding parties based on the particular context of their situation.
Keywords: property law; comparative law; civil law; common law; Roman law; equity; default rules; law and economics
JEL Classification: K11
Suggested Citation: Suggested Citation