future interests

Question 1

how many future interest are there

Answer 1

6

Question 2

how many future interests that are capable of creation in grantor

Answer 2

3)

Question 3

Future interests capable of creation in the grantor

Answer 3

1) possibility of reverter
2) right of entry
3) reversion

Question 4

what does the possibility of reverter accompanied by

Answer 4

fee simple determinable

Question 5

what does the right of entry accompanied by

Answer 5

fee simple subject to condition subsequent

- NOT AUTOMATIC

Question 6

the 3 future interests in transferees

Answer 6

1) vested remainder
2) contingent remainder OR
3) executory interest (2 types
(a) shifting
(b) springing

Question 7

what do remainder interests follow?

Answer 7

life estates or term of years

- remainderman always accompanies a preceding estate of fixed duration

Question 8

what does a remainder never follow

Answer 8

a defeasible fee

Question 9

what if the present estate is a defeasible fee, what type of future interest will it be if held by 3rd party

Answer 9

executory interest

Question 10

when is a remainder VESTED

Answer 10

if BOTH

1) ascertained person (KNOWN) AND
2) NOT subject to any condition PRECEDENT

Question 11

when is a remainder CONTINGENT

Answer 11

if it is created in either

1) UNKNOWN person (unascertained person) OR
2) IS subject to condition PRECEDENT or both

Question 12

contingent remainders and RULE OF DESTRUCTIBILITY OF CONTINGENT REMAINDERS

Answer 12

at CL a contingent remainder was DESTROYED if it was

1) CONTINGENT at the time of
2) PRECEDING ESTATE ended

Question 13

ML for destructibility

Answer 13

has been abolished. O or O’s heirs would hold the estate subject to B’s springing executory interest

Question 14

has IL abolished the Rule in Shelley’s case

Answer 14

YES
- Thus, today when O conveys “To A for life, then to A’s heirs”
A has: life estate
A’s not yet known heirs: contingent remainder
O: has reversion

Question 15

doctrine of Worthier Title (also known as rule against a remainder in grantor’s heirs)

Answer 15

(still applies in most states today) applies when
O who is ALIVE, tries to create a future interest in her heirs
- O , who is alive, conveys to “A for life, then to O’s heirs” if doctrine of WORTHIER TITLE DID NOT APPLY
A: life estate
O heirs: contingent remainder

if did apply
A: life estate
O: reversion

Question 16

is doctrine of worthier title abolished in IL

Answer 16

YES

Question 17

is the Doctrine of Worthier Title a rule of construction?

Answer 17

YES, not a rule of law

- Grantor’s intent controls. If grantor intends to create a contingent remainder in his heirs, that intent is binding

Question 18

3 types of VESTED remainders

Answer 18

1) indefeasibly vested remainder
2) vested remainder subject to total divestment
3) vested remainder subject to open

Question 19

what is the indefeasibly vested remainder

Answer 19

holder of the remainder is CERTAIN to acquire an estate in future with NO STRINGS ATTACHED

Question 20

what makes a vested remainder subject to total divestment

Answer 20

no condition precedent but CONDITION SUBSEQUENT that could cut estate

Question 21

what is the comma rule for vested remainder subject to total divestment

Answer 21

when conditional language in a transfer follows language that, taken alone and set off by commas, would create a vested remainder, the condition is a condition subsequent

Question 22

when is a vested remainder subject to open

Answer 22

when at least ONE group of takers is qualified to take BUT
2) each class members share is subject to partial diminution b/c additional members can still join

Question 23

when is a class open

Answer 23

if others can join

Question 24

when is a class closed

Answer 24

when others cannot join

Question 25

when is a class closed at CL (rule of convenience)

Answer 25

class closes w/e any member CAN DEMAND POSSESSION

Question 26

x/c to rule of convenience (when a class is closed at CL)

Answer 26

the womb rule, if a child is in child at death of parent, will share with other children who can demand possession

Question 27

what is an executory interest

Answer 27

a future interest created in transferee (a 3rd party) which is not a remainder and which takes effect by either cutting short some interest in another person (shifting) or in the grantor or heirs (springing)

Question 28

what must a SHIFTING executory interest follow

Answer 28

defeasible fee

Question 29

what does a SHIFTING executory interest cut short (whoms interest)

Answer 29

a THIRD PARTIES interest

- NEVER GRANTOR’S

Question 30

what rule to always think of with executory interests

Answer 30

RAP rules against perpetuates

Question 31

what does a SPRINGING executory interest cut shot (whoms interest)

Answer 31

GRANTOR’S rights

Question 32

the rule against perpetuties (RAP)

Answer 32

any interest MUST vest or MUST fail within a life in being plus 21 years.

Question 33

what are the only future interests that RAP applies to

Answer 33

1) contingent remainders
2) executory interests
3) certain vested remainders subject to open

Question 34

what rights does RAP NOT apply to

Answer 34

1) any future interests to grantor or heirs
2) indefeasible vested remainders
3) vested remainders subject to total divestment

Question 35

4 steps for RAP

Answer 35

1) classify future interest
2) Identify conditions precedent to the vesting of suspect future interest
3) find all possible measuring life (alive at time of conveyance)
4) ask if we will know in 21 years of death of measuring life if can take or will fail

Question 36

2 bright line rules for RAP

Answer 36

1) a gift to an OPEN class that is conditioned on the members surviving to an age BEYOND 21 violates CL RAP
2) many SHIFTING executory interests violate RAP. An executory interest with no limit on the time w/i which it must vest violates RAP

Question 37

what happens if violates rap

Answer 37

entire conditional clause is stricken

Question 38

charity- charity X/C rap

Answer 38

a gift from one charity to another charity does NOT violate rap
- To red cross, so long as the premises are used for Red cross purposes, and if they cease to be so used, then to YMCA

Question 39

wait and see or second look doctrine for RAP

Answer 39

majority reform, future interest is determined on the basis of the facts as they now exist AT END OF MEASURING LIFE

Question 40

uniform statutory rule against perpeutities (USRAP)

Answer 40

90 year waiting period

Question 41

cr pres doctrine

Answer 41

as near as possible

- if violates RAP a court may reform it in a way that most closely matches grantors intent, while complying with the RAP

Question 42

what is the IL approach for rap

Answer 42

the reduction of any offensive agent contingency is reduced to 21 years

Question 43

is language in a deed “for the purpose of” constitute a fee simple determinable

Answer 43

NO. MERELY expresses the grantors MOTIVE fro conveying the property. Not express.
- need words like “for so long as” or “until” to create

Question 44

what does a life tenant have to pay on the mortgage

Answer 44

pay the interest on any encumbrances on the land, but does not pay anything on the principal of the debt; reversioners or remainderman must pay the principal

Question 45

if future interests can be transferred voluntary can they also be reached involuntary by creditors

Answer 45

YES.

- all vested remainders fully transferable during life.