Estates in Land Flashcards
Defeasible fees
A fee simple estate of potentially infinite duration that can be terminated upon the occurrence of some specified event
* I.e. present fee estate vested in some person, who many lose the fee interest upon the occurrence of some event
* Language: requires clear words of intent for the fee estate to be forfeited
-Words of desire, hope, or aspiration are insufficient
Three types:
1) Fee simple determinable
2) Fee simple subject to condition subsequent
3) Fee simple subject to an executory interest
Fee simple determinable
A fee simple estate (property) that automatically terminates and reverts back to the grantor upon the happening of a given event or condition
-E.g. “to A for so long as he practices law”
-If A stops practicing law, property automatically reverts back to grantor
Fee simple subject to condition subsequent
A fee simple in which grantor retains the power to terminate grantee’s estate upon the happening of a given event or condition -Grantor must take action to terminate; does not occur automatically
-E.g. “to A, but if he wins the lottery, grantor reserves the right to reenter and retake”
Fee simple subject to an executory interest
A fee simple (property) that automatically transfers to a third party (i.e. someone other than grantor) upon the happening of a given event or condition
-E.g. “To A, but if A is ever arrested then to B”
Fee simple determinable-Characteristics
- Automatic forfeiture: upon occurrence of the given event or condition, the grantee automatically forfeits the estate
- Potentially infinite: duration can be infinite so long as the event or condition does not occur
- Transferable: the fee estate is alienable, devisable, and descendible subject to the condition
Fee simple determinable-Creation
Requires clear durational language
-Phrases such as “for so long as,” “while,” “during,” “until,” etc.
-Words of desire, hope, or aspiration are insufficient
Fee simple determinable-Accompanying future interest
- Accompanying future interest = possibility of reverter
- Grantor retains a possibility of reverter
-I.e. the property may revert back to grantor, but only if the event or condition occurs - Transferability: grantor’s possibility of reverter is transferable inter vivos, devisable by will, and descendible to grantor’s intestate heirs
Fee simple subject to condition subsequent-Characteristics
- Forfeiture not automatic: if the event or condition occurs, grantee still retains title until grantor exercises his reentry right
-This is what distinguishes fee simple subject to condition subsequent from a fee simple determinable - Potentially infinite: duration can be infinite so long as the event or condition does not occue
- Transferable: alienable, devisable, and descendible, subject to the occurrence of the given event or condition
Fee simple subject to condition subsequent-Creation
- Clear durational language must carve out a right of reentry for grantor
- I.e. it must be explicit that grantor has the right to retake upon the occurrence of the event or condition
- Words of desire, hope, or aspiration are insufficient
Fee simple subject to condition subsequent-Accompanying future interest
- Accompanying future interest = right of reentry
- Grantor retains right of reentry
- Transferability: in most states, grantor’s right of entry is not transferable inter vivos but devisable by will and descendible to grantor’s intestate heirs
Fee simple subject to an executory interest-Characteristics
- Automatic forfeiture: upon occurence of the event or condition, estate automatically transfers to a third person
-Similar to a fee simple determinable, but ownership automatically transfers to a third person, NOT grantor - Potentially infinite: duration can be infinite so long as the event or condition does not occur
- Transferable: alienable, devisable, and descindible, subject to the occurrence of the event or condition
-Absolute restraints on alienation are void
Fee simple subject to an executory interest-Creation
- Clear durational language is required
- E.g. “To A, but if A gets married, then to B”
- Words of desire, hope, or aspiration are insufficient
Fee simple subject to an executory interest-Accompanying future interest
- Accompanying future interest = shifting executory interest
- The third party holds the shifting executory interest
- Transferable: third party’s interest is alienable, devisable, and descendible
Life estate
An interest that lasts only for the life of the interest holder
* E.g. O grants “to A for life”; A has a life estate and is the life tenant (LT) until she dies
* Defeasibility: can be defeasible like fee estates (e.g. determinable, subject to condition or executory interest) or indefeasible
* LT has all ownership rights but must maintain property and make reasonable repairs; LT cannot commit waste
Life estate-Accompanying future interest
Reversion or remainder
* Reversion: future interest in grantor when a life estate does not provide for disposition of property to a third party
-E.g. O “to A for life”; A is the LT, O has a reversion (i.e. property reverts back to O when A dies)
* Remainder: future interest following a life estate that identifies a third person (i.e. the third party has a remainder)
-E.g. O “to A for life, then to B”; A is the LT, B has a remainder (i.e. when A dies, property goes to B)
Life estate pur autre vie (p.a.v.)
A life estate measured by the life of someone other than LT
* E.g. O grants “to A for the life of B”; A is the LT, holding the property until B dies, at which point property reverts back to O
* Transfer of life estate: creates a life estate p.v. held by transferee (e.g. LT transfers life estate to B; B holds a life estate that reverts to the grantor O when LT dies)
Doctrine of waste
A life tenant cannot commit acts that constitute an unreasonable use of land and/or injure the interests of a future interest holder
-Doing so constitutes waste, of which there are 3 types
Aff mative (voluntary) waste
LT cannot consume or exploit natural resources on the land except:
a) Where necessary for repairs or maintenance of land,
b) When grant expressly gives the right to exploit, or
c) If land was used for exploitation of resources prior to the grant
-Open mines doctrine: if exploitation occurred before the life estate, LT may only extract from the already-open mines
Permissive waste
Harm to property due to LT neglect
* LT has a duty to repair/maintain property up to the extent of income or profits derived from the land or its rental value
* Includes paying taxes, interest on encumberances, etc.
* Future interests holders who assume LT’s obligations are entitled to reimbursement
Ameliorative waste
LT acts that economically benefit the land
-prohibited under common law, but now usually permitted in most modern jurisdictions
Remainder
A future interest in a third person (other than grantor) that arises immediately upon the termination of a preceding life estate
-E.g. “to A for life, then to B”; A has a life estate, B has a remainder
Remainder-Characteristics
- Creation: expressly created in the same conveyance in which the preceding estate is created
- Transferable: alienable, devisable, and descendible
- Cannot cut off or divest an interest held by a prior transferee
Vested remainder
- A remainder that automatically becomes possessory upon the natural expiration of the preceding estate
- Limitations: vested remainders cannot:
a) Be subject to any condition precedent, or
b) Vest in an unknown or unascertained person - Three types:
1) Indefeasibly vested remainders
2) Vested remainder subject to total divestment
3) Vested remainder subject to open (class gift)
Indefeasibly vested remainder
Becomes possessory immediately upon termination of the prior estate
-E.g. “to A for life, then to B”
Vested remainder subject to total divestment
Subject to some condition subsequent, such that the raminderman could be divested after taking possession
-E.g. “to A for life, remainder to B; but if B weds, to C”
Vested remainder subject to open (class gift)
Remainder vested in a described class of takers, at least one of whom is capable of taking possession (i.e. by virtue of being alive)
* E.g. “to A for life, remainder to children of B and their heirs”
* B has one child, who has a vested remainder subject to open (because B may have more children)
* Open vs closed class: class stays open to allow for future members and closes when no new members can be created
* Rule of convenience: class closes whenever any member can call for distribution of her share; after born class members get nothing
Contingent remainder
A remainder will be contingent if it is either:
a) Subject to a condition precendent, or
b) Created in favor of an unascertained or unborn person
Contingent remainder-subject to a condition precedent
Remainder’s taking is contingent on the prior occurrence of some event or condition
* Once the event or condition occurs, the interest automatically becomes an indefeasibly vested remainder
* E.g. “to A for life, then to B and his heirs when B gets married”
-If B is unmarried at the time of the conveyance, A has a life estate, B has a contingent remainder (because marriage is a condition precedent) and grantor has a reversion in case B is not married when A dies; if B gets married he has an indefeasibly vested remainder
Contingent remainder-subject to unborn or unascertained persons
A remainder created in favor of unborn or unascertained persons
* I.e. remainder is contingent on grantee being born or ascertained
* E.g. “to A for life, then to B’s heirs”
-If B, remainder is contingent b/c heirs of B cannot be ascertained until B dies
Rule of destructibility
At common law, a contingent remainder is destroyed if it remains contingent (i.e. the condition is not satisfied) when the preceding estate ends
* E.g. O grants “to A for life, then the B once he goes to law school”; A dies and B has not gone to law school
-At common law, B gets nothing upon A’s death
* Modern rule: gives a reversion to grantor or grantor’s estate until grantee satisfies the condition
Merger (Shelley’s Rule)
Arises when a conveyance attempts to give a life estate to grantee with a remainder to grantee’s intestate heirs
* At common law, the two estates merge
* E.g. O grants “to A for life, then to A’s heirs” and A is alive; at common law, remainder merges and A has a fee simple absolute
* Modern rule: A has a life estate and his heirs have contingent remainders; O has a reversion because A could die without heirs
Doctrine of worthier title
Arises when grantor creates a life estate in another but creats a future interest in grantor’s heirs
* E.g. O grants “to A for life, then to O’s heirs”
* Under the doctrine, the contingent remainder in O’s heirs is void; A instead has a life estate and O has a reversion
Executory interest
A future interest in a third party that takes effect by cutting short some interest–two types: shifting and springing
* Includes any future interest that is not a remainder
* Look for: indicated by phrases like “but if,” “then to,” “for so long as,” etc.
* Executory interest holders lack standing to sue for waste
* Transferability: devisable, descendible, and usually transferable
Shifting executory interest
Always follows a defeasible fee or vested remainder subject to total divestment
* Cuts short someone other than the grantor
* E.g. “to A, so long as the property is used for storage. But if used for any other purpose, to B”
-A has a fee simple subject to an executory interest
-B has a shifting executory interest, if A stops using the property for storage, A’s interest is cut short (not grantor’s)
Springing executory interest
Cuts short a present interest held by the grantor or grantor’s estate
* E.g. “to A, if and when he gets married”
-A has an executory interest
-Grantor has a fee simple subject to an executory interest; if A gets married, possession springs from grantor to A
Rule Against Perpetuities
No property interest is valid unless it must vest, if at all, no later than 21 years after the death of a life in being at the time the interest was created
* I.e. a future interest is void if there is any possibility, no matter how remote, that it will vest more than 21 years after the death of the measuring life
* Measuring life = a life “in being” when the interest was created whose actions during life, at death, or within 21 years after death determine whether a future interest satisfies RAP
Note: many states have reformed the common law RAP, providing for an alternative vesting period greater than 21 years
-Unless instructed otherwise, apply the common law RAP
Analyzing a conveyance subject to the RAP
1) Determine the interest being granted
2) Apply RAP to any future interest that is a contingent remainder, an open class gift, or an executory interest
3) If conveyance violates RAP, strike only the violating future interest
-What remains = the new conveyance
Rights of first refusal and RAP
Contingent interests in property (i.e. options and rights of first refusal) violate RAP if they could possibly be exercised outside the time period allowed by RAP
Class gifts and RAP
For class gifts to satisfy RAP, class must be closed with all conditions precedent satisfied for every member
-Rules of convenience for class gifts may save a class conveyance that would otherwise violate RAP
Examples of RAP violations
1) Age contingency beyond 21: a conveyance to an open class is contingent on members reaching an age over 21
-Void under RAP because it cannot vest within 21 years of a life being at the time of creation
2) Fertile octogenarian: presumption that any woman is capable of giving birth, regardless of her age or condition
-E.g. grantor conveys “to A for life, then to A’s children who reach age 30.” A is 80, her son is 40. Conveyance violates RAP, as A’s don could die, she could have a daughter at 81, then die when she’s 82. The remaining daughter’s interest will not vest for another 28 years.
Charity to charity RAP exception
RAP does not apply to conveyances from one charity to another
