Pg 43

Question 1

In order to avoid being nullified by RAP, what must a gift to a class of people do?

Answer 1

The class must close and all conditions precedent must be met within the perpetuities period.

Question 2

If a class gift involves one grandchild in the class existing at creation, what does that child have?

Answer 2

A vested interest subject to open. His remainder is vested, but the class can be reopened and his interest will be subject to partial divestiture which would make the gift void, since it isn’t certain to vest or fail since more grandchildren can be born outside of the perpetuities.

Question 3

Is a remainder that is subject to open considered to be vested for RAP?

Answer 3

No, the class must be closed before a remainder in the class is vested. But you can use the rule of convenience to save some of the gifts here

Question 4

How does the rule of convenience save gifts under RAP?

Answer 4

This is a way to stop an interest from being void. The rule of convenience only applies when a gift would be lost because of the rule against perpetuities in a class. This will save the gift by saying that as soon as any member of the class is entitled to immediate possession, the class closes. This rule is only triggered when an interest would be void under RAP, then it saves the gift. This closes the class and any later-born members of the class get nothing.

Question 5

What are two major limits on RAP that involve classes?

Answer 5

– gifts to sub classes
- gifts of specific amounts to each class member

Question 6

What is a gift to a sub-class and how is it a limit on RAP?

Answer 6

The life in being is the second life tenant, and on her death, the class of kids closes. The gift to the sub-class is similar to a normal class gift because the class of kids and the sub-class of grandkids of the second life tenant are specifically determined on the death of the second life tenant.

Question 7

What is involved in a gift of specific amounts to each class member that is a limit on RAP?

Answer 7

Each specified sum is treated as a separate gift for RAP. Ie: if a testator bequeaths $1000 each to his nephews and nieces, whether they are born before or after his death. At the time he is survived by his parents, his sister A, and her daughter B. After his death, his parents have another kid C, and A has another kid D. Then 20 years later C married and has a kid E.

Each gift’s validity is judged separately since each gift is fixed at $1000 and cannot increase or decrease depending on the number of recipients:
- B gets $1000 because her gift vested at T‘s death
- D gets $1000 because at T’s death, D’s gift would definitely vest during the life of A
– E doesn’t get $1000 because her gift would not vest during the life of a person in being

Question 8

If O transfers money in trust “to pay income to A for life, then to A’s kids for their lives, then principle to B.” If A has no kids, what happens?

Answer 8

• A’s life estate vests on creation
  – the remainder to A’s kids vests or fails, if she never has kids, on her death
  – B’s remainder vests on creation

So all interests are valid

Question 9

What is involved in the situation of a fertile octogenarian?

Answer 9

This usually comes up in two generation trusts. T bequeaths a trust for A [80] for life, then to A’s kids for their lives, then distributes the trust assets to A’s descendants that are then-living.

The law presumes that A is able to have more kids even though she’s super old. So the remainder to her kids may include an after-born kid, and the remainder to her descendants might vest on the death of this after-born kid, which would be too remote. Thus the remainder to the descendants is void

Question 10

What is involved in the situation of an unborn widow with relation to RAP?

Answer 10

A gift to an unnamed widow/widower must fail because the life in being might live for decades after the life of the donor, and may marry someone late in life that wasn’t alive when the interest was created. The younger spouse could live for 40-50 years after the death of the measuring life, so then the gift will not necessarily vest or fail within the 21 year period, which makes it void. But gifts to named spouses or widows are fine because they are alive at the time that they are named

Question 11

What is an example of an unborn widow situation?

Answer 11

T bequeaths a trust to H for life, then to H’s widow for life, then remainder to H’s surviving descendants. If H is married to wife1 at T’s death, it is possible that the marriage will end and H will remarry someone that wasn’t born before T‘s death. Then the remainder to H’s descendants wouldn’t vest until the death of the second wife, which could be more than 21 years after the death of all lives in being at the testator‘s death.

Question 12

What is involved in a slothful executor situation under RAP?

Answer 12

If a testator devises property to his descendants then-living “on distribution of his estate,” because his estate may not be distributed for many years, which could be after all of his surviving descendants are dead, the gift to his descendants living at distribution may be held void. Courts are moving away from considering delays in settling the estate and just treating it as a postponement of possession as long as there is no express survival requirement at issue. You cannot say, “heir must survive completion of probate“. Courts generally will not void an interest just because of delays in probate

Question 13

What is involved in the magic gravel pit?

Answer 13

If a testator devises his gravel pit to his trustees to work until the pits are exhausted, then sell and divide the proceeds among his descendants that are then-living, it is possible that the pits will produce for hundreds of years, so the gift to the descendants is void

Question 14

What is involved in the situation that involves a war that never ends under RAP?

Answer 14

If during World War II a testator devises $20,000 to her husband’s family in Germany “that survive the war“ this devise is void because the war might not have ended within lives in being +21 years.

Question 15

What is involved in the situation of a birthday present that blows up under RAP?

Answer 15

If the testator devises a trust for A for life, then to his kids that reach 21, at common law you reach 21 at the first moment of the day before your 21st birthday since the person was in existence on the day of his birth, so on the day before his first birthday, one year is done and the birthday is actually the first day of his second year

Question 16

How would you work through the following situation on an essay?

O set up a trust saying, “property is transferred to T to be held in trust. At my death, the annual income goes to A for his life, then when he dies, the income goes to his kids for their lives, then when the last of his kids die, the principle goes to B.”

Answer 16

– STEP 1: identify the operative point in time to see if it’s possible for the interest to vest more than 21 years after a life in being. At O's death, the trust becomes irrevocable, so that is the operative point in time
– STEP 2: who counts as a “life in being“ at the operative time? If A is alive at O's death, he could be a life in being. The class of A's kids doesn’t count because even though A could have had some kids born before O died, it is possible that he will have more kids after O dies, so you can’t say that his kids as a group will be lives in being at O's death. If B is also alive at O's death, he can be a life in being, but that isn’t useful because his interest is the last to vest in possession and no one else's interest will vest after his, so he is not a good measuring life. A is the measuring life 
- STEP 3: can anyone’s interest vest more than 21 years after a life in being?
* A's kids: entitled to take the property at O's death, so their interest vests in possession at O's death. If A dies without kids, the interest held by the class of his kids will fail on his death. Regardless, we will know for sure about whether A has kids or doesn’t have kids within a life in being +21 years
* B's interest: it’s possible that he will have a kid after O dies and that kid could live longer than 21 years after A’s death, so B wouldn’t get the principle until more than 21 years after the end of the life in being, but this is a trick because even though B's right to possession might not vest until 21+ years, he is alive now and his interests vest now. So as soon as the trust document becomes operative at O’s death, because he was alive, his interest vested. He may have to outlive all of A's kids to enjoy the property, but the interest vests on O's death.

No RAP problem here!