Present Estates and Future Interests Flashcards
estates in land are…
- possessory interests in land
- these interests can be possessory now (present estates) or in the future (future interests)
3 categories of PRESENT possessory freehold estates
- fee simple absolute
- defeasible fee (3 types)
- life estate
*remember that concurrent and leasehold estates are also present estates!
fee simple absolute
- to A and his heirs, to A
- absolute ownership of possibly INFINITE duration
- freely transferable, devisable by will, and descendible through intestacy
defeasible fees
- fee simple estates that can be terminated upon happening of an event
- think of it as three types of fee simple (to A… with a catch – a condition attached)
fee simple determinable (and possibility of reverter)
- fee simple determinable terminates upon happening of stated event and automatically goes back to grantor
- “to A for so long as…”; “to A during…”
- transferable, devisable by will, and descendible through intestacy (but always subject to condition)
- estate automatically reverts back to grantor upon happening of event
NOTE: reasonable person would not buy property with where there’s a possibility of reverter
fee simple subject to condition subsequent (and right of entry)
- estate in which grantor reserves right to terminate estate upon happening of stated event (doesn’t automatically terminate – grantor has to take action)
- look for conditional words –> “upon condition that”; “if it happens that”
- look for explicit statement of grantor’s right to re-enter
- most courts hold that rights of entry are not transferable
e.g., to A but if X event occurs, grantor reserves right to re-enter and re-take
fee simple subject to executory interest
- if fee simple estate ends [upon happening of stated event] and then passes to third party (rather than reverting to grantor or giving grantor right to terminate), 3rd party has executory interest
- to A, but if X event occurs, then to B
*the shifting executory interest accompanies the fee simple subject to an executory interest
rules of construction for defeasible fees
- words of hope, desire, is not enough to render estate a defeasible fee
restraints on alienation of fee simple
- VOID
- example: “I give my house in the city to my son, but if he ever tries to sell it while he’s alive, I want it taken away from him and given to my grandson” (grandson gets nothing!)
fee tail
- estate where inheritability is limited to heirs
- example: “to A and the heirs of his body”
life estate
- life estate is one measured by life or lives of one or more persons
- “to A for life”; “to A for the life of B”
- life tenant is entitled to all ordinary uses and profits from land (life tenant cannot commit waste)
- renunciation of life estate: if a life tenant who gets estate by will or intestacy renounces their interest, future interest following life estate is accelearted so it becomes immediately possessory
future interest
- gives its holder right/possibility of FUTURE possession of an estate (it’s a present, legally protected right in prop)
- six categories
if future interest is held by grantor, it must be
- possibility of reverter (grantor transfers a fee simple determinable)
- right of entry (grant of an estate subject to condition subsequent)
- reversion (occurs when granted estate is absolutely vested in grantor; O grants Blackacre to A for life; A is going to die eventually, at which point Blackacre will return to O)
if future interest is held by a third party, it’s called a remainder!
reversion occurs when a finite estate ends, and there are no other grantees with a future interest in the property
if future interest is held by someone OTHER THAN grantor, it must be
- contingent remainder
- vested remainder (3 types)
- executory interest (2 types)
remainders
- remainder is a future interest in 3rd person that can become possessory on natural expiration of preceding estate (remainder won’t take until present life estate/term of years comes to its end)
- remainder must be expressly created in the instrument creating preceding possessory estate (can be vested or contingent)
- alienable, devisable, and descendible
contingent remainder
(SUBJECT TO RAP)
remainder is contingent if:
1) it’s created in unborn/unascertained persons (until remainderman is figured out, no one is ready to take possession if preceding estate ends; example: to “A for life, then to B’s first child”), or
2) subject to a condition precedent (a condition is precedent if it must be fulfilled before remainderman has right to possession; example: to “A for life, then, if B graduates from college, to B”) –> remainderman must do something in order to succeed in taking possession
or both 1 and 2
doctrine of worthier title
remainder in grantor’s heirs is invalid
e.g., “to A for life, then to O’s heirs”