Future Interest Rules

Question 1

Rule Against Perpetuities

Answer 1

A future interest is not valid unless it must vest, if at all, within 21 years after some life in being at the time the interest is created.

Interests subject to the rule:

• Executory Interests
• Contingent Remainders
• Trusts

Function of rule: the rule voids any interest unless it will absolutely vest before the period expires.

Question 2

When is a remainder vested?

Answer 2

When the prior estate terminated and the remainder holders are known

(Look for a condition that must be satisfied before possession can occur)

Question 3

Doctrine of Destructibility

Answer 3

Applies only to contingent remainders

If a possessory estate and the reversion are ever held by the same party, they merge and all contingent remainders are destroyed

Abolished in most jurisdictions

Question 4

Rule in Shelley’s Case

Answer 4

When a person takes an estate of freehold, legally or equitably, under a deed, will, or other writing, and in the same instrument, there is a limitation, by way of remainder, either with or without interposition of another estate, of an interest of the same legal or equitable quality, to his heirs, or the heirs off his body, as a class of persons, to take in succession, from generation to generation, the limitation to the heirs entitles the ancestor to the whole estate.

Question 5

Doctrine of Worthier Title

Answer 5

Applies anytime an inter vivos transfer of a remainder interest is made to the grantor’s heirs

Devisee named then takes reversion over heirs interes