2. Future Estates (RAP) Flashcards
What is a future estate?
Grantor gives to Grantee interest including the right to ‘future’ ‘possession’
- ‘Present’ legally protected right
- NOT expectancy
What is a reversionary interest?
Grantor’s future interest reverted back from Grantee to Grantor
What are the types of reversionary interests?
Right of entry
- Fee simple subject to condition subsequent
- Life estate subject to condition subsequent
Reversion (Possibility of reverter)
- Fee simple determinable
- Life estate determinable
- Grantor conveys estate (lesser duration) to Grantee
- Grantee reverts estate (greater duration) to Grantor upon termination of specified event
- By operation of law (NO need to be expressly stated)
What are the rights of a reversion holder?
Sue TP for damages (tort)
Sue Life Tenant for waste
Is a reversionary interest transferrable?
Conveyance
- NOT right of entry
Devise (by will)
Descend (by NO will)
Is a reversionary interest subject to Rule Against Perpetuities?
NO
- Vested interest (Grantor’s reversionary interest + specified event are certain)
What is a remainder?
1) Transferee’s future interest
2) Upon ‘natural’ termination of preceding estate
- Grantor => Grantee
3) In same disposition as preceding estate
- Grantor => Grantee => Transferee
- Otherwise if (Grantor => Grantee) then (Grantor => Transferee) => Transferee becomes Holder of reversionary interest
4) Expressly created
What is the difference between a reversionary interest and a remainder?
Reversionary interest
- NO need to be expressly created (by operation of law)
Remainder
- Must be expressly created
What type of present estates can a remainder be included in?
Defeasible fees
- Naturally terminates upon specified event
Life estates
- Naturally terminates upon end of one’s life
NOT fee simple
- NOT naturally terminate (indefinite duration)
- Cannot cut short preceding estate
- Cannot transfer without a time gap
What is an indefeasibly vested remainder?
1) Ascertained persons
2) NO condition precedent
3) NO divestment/diminuition
What happens if the Transferee of the indefeasibly vested remainder dies before the Grantee?
Indefeasibly vested remainder passes to;
- Transferee’s devisees (by will)
- Transferee’s heirs (by NO will)
What is a vested remainder subject to open (partial divestment)?
1) NOT ascertained remaindermen
- Class gift
- Survivorship
2) Diminuition
- By others in class who will become entitled to share in remainder (tenants in common - equal shares)
When does a vested remainder subject to open become an indefeasibly vested remainder?
When class closes (becomes ascertainable) once;
- Someone calls for distribution
- Class of persons no longer possible
What happens to the interest of a remainderman who holds a vested remainder subject to open if he dies before the class closed?
Remainderman’s share => Either;
- Remainderman’s devisees (by will)
- Remainderman’s heirs (by NO will)
What interests do remaindermen possess in an open class?
Ascertained remaindermen
- Vested remainder subject to open (possessory upon natural termination of preceding estate when Parent dies)
NOT ascertained remaindermen
- Contingent remainer (NOT possessory upon natural termination of preceding estate - Not sure if ascertainable before Parent dies)