ESTATES AND FUTURE INTERESTS Flashcards
For Support- Questions to ask yourself
- What is the language needed to create the estate?
- what are the estates defining characteristics
a. duration
b. alienable? transferable during the holder’s lifetime (aka intervivos)
c. devisable? can it pass by will? - What future interest is the Estate capable of?
Three Main Ways to Transfer Real Property
- Transfer by Deed
- Transfer by Will
- Transfer by Interstate Succession
Deed
A living person can transfer property by deed.
- conveyance or grant- completed transfer by deed.
Will
the property of a descendant may be transferred by a will
- devise- completed transfer of real property by will
Interstate succession
if a person dies without a will, her property will be distributed according to state statutes, usually to e
what are the three terms of how property can be distributed
- freely alienable
- devisable
- descendible
freely alienable
it can be sold or given away during the owner’s lifetime
devisable
it can be transferred by will at death
descendible
it can pass by the laws of interstate succession if the owner dies without a will
- think descendants
For Support- What are the types of Freehold Estates (don’t need to memorize this- it is on the chart)
- Fee Simple Absolute
- Life Estate
- Fee Tail
- Fee Simple Determinable (Defeasible)
- Fee Simple Subject to a Condition Subsequent (Defeasible)
- Fee Simple Subject to an Executory Limitation (Defeasible)
Fee Simple Absolute
“To A in fee simple”
- this is the most straightforward type of fee simple ownership. It is a form of freehold, meaning that the grantee holds ownership over the land with no restrictions- which means that they may use the land as they desire.
Fee Simple Determinable
“To A as long as”
- fee simple estate that automatically ends when a certain event or condition occurs, giving the right of possession to the transferor.
- duration of the fee simple will be cit short if the event or condition happens.
- ^^ gets taken away when the thing happens.
Fee Simple subject to Condition Subsequent
“To A, provided that” “on condition that “ “but if”
- created in a transfere that may be terminated if a condition is met or if an event occurs, this means that the estate holder mat or may not lose the right to land.
- However, this differs from fee simple determinable because the transfer of right is not uautomatic and the state holder here would be able to continue ownership until the right is asserted.
Fee Simple Subject to an Executory Limitation
- To A, as long as… while…”
- this is just a fee simple determinable or a dee simple subject to condition sub but just where the future interest is held by a 3rd party.
- basically this is when there is a third party involved where the future interest is held by a 3p.
- EXAMPLE- O conveys to the First Baptist Church provided that the land issued as a church and then
Fee Tail
“To A and the heirs of his body”
- property is transferred depending on the lives of the lineal descendants of a particular person. Keeps land within the family, therefore guarding the wealth and prestige.
Life Estate
“To A, for life” “To A, until he dies”
- Alienable doctrine of waste
- imposes a duty on life tenant to use property in a way that does not injure the rights of future interest holders.
- SUBJECT TO WASTE- KNOW THE KINDS OF WASTE!!!
Life Estate - pur auto view
For the life of another
- O can give B a life estate “for the life of C”
- when C dies, B’s estate ends.
Terms of years
- “To A, for 20 years,
- SUBJECT TO WASTE
Types of Waste
- Voluntary
- Permissive
- Ameloriorative
Type of Waste 1- Voluntary
voluntary- affirmative act that significant reduces the value of the property
(sometime called affirmative waste)
Type of Waste 2 - Permissive
results from failure to take reasonable care to protect the estate
(failing to make minor repairs to to pay property taxes)
Type of Waste 3- Ameliorative
affirmative act that leads to a substantial change in the property and increased its value
NEED NOT MEMORIZE
**Future Interests - Retained by Transferor
- Reversion
- Possibility of Reverter
- Right of Entry
NEED NOT MEMORIZE
Future Interests- Created in Transferee
- Remainder
- Executory Interests
- Remainders
Future interest in trasnferee that
1. is capable of becoming possessory immediately upon the expeirantion of the prior estate
2. does not divest any interest in a prior transferee
(may follow a life estate, fee simple absolute, fee tail =, term of year
Kinds of remainders
- vested
* indefesibly
* subject to divestment
* subject to open - contingent
Vested Remainder
* Indeafeasibly vested
- created in an ascertainable person
- Not subject to a condition precendent other than natural termination of prior estate
Vested Remainder
* Subject to divestment
- created in an ascertainable person and
- is nit subject to a confition precedent, BUT
- is subject to a condition subsequent
- example- O conveys to B for life, then to D, but if D does nor survive B, then to E - If D dies before B his interest will be terminated
Vested Remainder
* Subject to open
- Created in an ascertainable person but that class may be enlarged in the future
* ex- O conveys to B for life, then to D’s children- if D only has two children at the time. - Not subject to a condition precedent
Contingent Remainder
Either (1) given to an unascertainable person, and (2) subject to a condition precedent
- Ex: to B for life, then to D if D becomes president
- ex: to B for life, then to D’s children who attain age 18.
- Executory Interests
must divest (cut short) another estate/interest to become possessory.
- There are two kiinds of executory interests (covered in later cards)
Executory Interest 1 - Springing
Follows an interest in the transferor- follows a gap in time
* eg- O conveyed to A for lide, then one year after A’s death to B and his heirs.
note this does not divest interest from A but it does divest possessory interest from O following A’s death.
Executory Interest 2- Shifting
Follows an interest in a transferee.
- Ex: O conveyed to A and his heirs, but if A uses the land for commericial purposes, then immediately to B and his heirs.
Reversion
A transferor retains a reverson when she conveys a smaller vested estate than the one she has.
* this is when the original grantor of the original conveyance retains the righ to future possession of the property.
* A common example of this is in a leasehold esttae, in which the lessee has the right to use and occupy the property for a specified period of time, when the lease terms ends, teh property reverts to the lessor.
* basically the right to resume possession of ownership of a peorperty after a period of time has elapsed or certain events have occurred.
- ex: O ownes a fee simple absolute in Greenacre and conveys Greenacre to “B for life” Fee simpl
Possibility of Reverter
The future interest retained by the transfeor who holds a fee simple absolute, but conveys a fee simple determinable
Right of Entry
The future interest retained by the transferor who holds a fee simple absolute, but conveys a fee simple subject to a condition subsequent.
- Ex: O conveys Greenace to “B and her heirs, provided that if b fails to use it as a farm, then O may re-enter and reclaim the property.”
- so basic ally, O’s right of entry does not become possessory until and unless O takes affirmative steps to regain possession.
