Perpetuity

Question 1

What are the two different sets of perpetuity rules?

Answer 1

· The rule against remoteness of vesting.

· The rule against inalienability.

Question 2

What is the rule against remoteness of vesting?

Answer 2

The rule against remoteness of vesting is a statutory rule which requires that a person (or charity) must obtain a vested interest in the trust property within a recognised ‘perpetuity period’. By s 5(1) Perpetuities and Accumulations Act 2009 this period is 125 years although it is possible for a trust instrument to limit the duration of the trust to a shorter period.

Question 3

Rule against inalienability?

Answer 3

This rule provides that assets cannot be tied up on trust for longer than the common law perpetuity period of a specified life in being plus 21 years (or just 21 years if no life in being is specified).

Question 4

Perpetuity rule for Non-charitable purpose trusts?

Answer 4

Rule against inalienability

Question 5

Perpetuity rule for Trusts with beneficiaries or charitable purposes as objects?

Answer 5

Rule against remoteness of vesting