Destruction of Contingent Remainders

Question 1

• Destructibility Rule:

Answer 1

Contingent remainder is automatically extinguished at the time the prior estate expired if it was not vested by then
o Ex: “To A for life, then to B’s children,” where B has no children. If at A’s death B is childless, remainder is destroyed and possession reverts to grantor.
o Since destructibility rule has largely been abolished, contingent remainder is instead executory interest (e.g. from example above, if A dies and then B has children, B’s children have springing executory interest)

Question 2

• Merger:

Answer 2

If present estate and reversion are transferred to common owner, component parts merge back into fee simple absolute
o Ex: O to A for life, then to B if B has graduated from law school. B’s remainder can be destroyed by transferring A’s life estate and O’s reversion to the same party.
o Traditionally only had to own all the vested interests; modern rule is that contingent and vested interests must all be owned by same party
o But – merger has largely been abolished

Question 3

• Abo Petroleum Corp. v. Amstutz – NM (1979)

Answer 3

o F: P brings suit against children of J&A Turknett to quiet title (First deed below)
 J&A were fee simple owners, give life estates to Beulah and Ruby followed by remainder interest to each of the daughter’s children (alternate contingent remainder)
 If no children, goes to Ruby and Beulah’s heirs (alternate contingent remainder)
 Reversion to J&A – defeasible b/c no way it was going to go back to J&A
o Second deed: transfers reversion rights from J&A to Beulah and Ruby
 Trad’l rule would result in merger, destroying the contingent remainders
 Beulah & Ruby try to convey FSA to P here (ABO Petrol)
o H: For D (children)
 Destructibilty rule abolished; contingent remainders carry on and Abo did not get FSA (contingent remainders in Ruby and Beulah’s children still exist)

Question 4

• Rule in Shelley’s Case

Answer 4

o If a conveyance creates a life estate in a grantee and a remainder in fee simple in the heirs of the grantee, the words “heirs of…” are treated as words of limitation and the grantee is given a fee simple absolute
o Ex: “To A for life, remainder to the heirs of A.” A has present possessory fee simple absolute and his heirs will have no interest.
o Abolished in most jurisdictions. A gets a life estate, heirs have contingent remainder in fee simple absolute.

Question 5

• Doctrine of Worthier Title

Answer 5

o If a grantor creates a life estate in the grantee and then grants the remainder in fee simple to the grantor’s heirs, the remainder is construed as a reversion in fee simple absolute in the grantor.
 Preference for inheritance (vs. transfer) primarily because that was how taxes were attached
o Modern view treats as mere presumption, rebuttable by evidence of grantor’s actual intent. Some states have abolished.
o Ex: O to A for life then to the heirs of O

Question 6

• Rutherford v. Keith – KY (1969) “Fount Cox”

Answer 6

o Complicated transfer of estate with alternate contingent remainders
o Key takeaway – all future interests can be transferred by deeds or will