present estates and future interests Flashcards
present posessory estates
Estates in land are possessory interests in land.
These interests may be possessory now (present estates), or they may become possessory in the future (future interests).
devisable
capable of passing by will
descendible
capable of passing by intestacy (no will)
alienable
capable of transfer inter vivos
fee simple absolute
Devisable, descendible, alienable
defeasible fees
fee simple with condition addition
If proscribed stated violation is violated/betrayed, forfeiture (defeasance) is automatic
words of mere desire, hope, aspiration, or expecation, or motivation are insufficient to render an estate a defeasible fee
fee simple determinable, fee simple subject to condition subsequent, fee simple subject to an excutory interest
fee simple determinable
termiantes automatically on happening of stated event
Created by clear durational language: “so long as,” “while,” “during,” “until”
devisable, descendible, alienable
* but condition follows
paired with Possibility Of Reverter: held by. grantor, automatic
Fee Simple Determinable Possibility Of Reverter aka Frank Sinatra Didn’t Prefer Orville Redenbacher
fee simple subject to condition subsequent
Use of condition language + explicit right to re-enter (power of termination) if condition is betrayed
no automatic termiantion, grantor’s perogative
fee simple subject to an executory interest
“To A, but if X event occurs, then B”
* Third party, not grantor, takes if condition betrayed
life estate
“to A for life”
A life tenant can transfer the life estate to anyone, and the holder of the future interest has no say in the matter
* they are then on hook for LT’s obligations
O has a reversion but if 3P holds future interest, remainder
absolute restraints on alienation (power to sell or transfer)
void if lack durational language
effect: language of condition is striken; grantor retains
life estate “pur autre vie”
measured by a life other than the grantee’s (for example, “to A for the life of B”)
waste
LTs cannot commit waste (hurt future interest holders)
voluntary waste
actual overt conduct causing drop in value
Natural resources: gen a LT cannot consume or exploit natural resources on the property (like timber, minerals, or oil)
* but open mines doctrine: if mining was done on site before the life tenancy began, the LT may continue to mine but is limited to mines already formed
permissive waste
neglect; failure to take reasonable measures to protect land
* Have to keep the land and structures in reasonable state of repair
* and pay ordinary taxes and interest on mortgages
ameliorative waste
unilateral change that enhances value
LT can alter or even demolish existing buildings if:
* market value of future interests is not diminished AND either
* the remaindermen do not object; or
* substantial and permeant change in the neighborhood conditions has deprived the property in its current form of reasonable productivity of usefulness
possibility of reverter
future interest in transferor
accompanies FSD
alienable: can be sold or given away
right of entry/power of termination
transferor interest
accompanies FSSCS
reversion
transferor interest
accompanies when grantor conveys estate of lesser duration
remainder
3P/transferee future interst
becomes possessory upon natural expiration of preceding estate: tag along waiting until natural end of other term
usually attached to life estate or term of years e.g. “to A for life, then to B”
must be expressly created
vested remainder
three types: indefeasibly vested remainder, Vested remainder subject to complete defeasance (aka total divestment), and Vested remainder subject to open
contingent remainder
A remainder is contingent if: (1) it’s created in unborn or unascertained persons, or (2) it’s subject to a condition precedent, or both.
* cond precednet = must do this in order to succeed in taking posession
In other words, a remainder may be contingent as to person or as to event.
(1) e.g. “to A for life, then to B’s first child”
(2) e.g. “to A for life, then, if B graduates from college, to B”
indefeasibly vested remainder
certain to acquire, no strings/conditions attached e.g. “to A for life, remainder to B”
not subject to divestment or diminution
Vested remainder subject to complete defeasance (aka total divestment)
Subject to condition subsequent
Comma rule: 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, and you have a vested remainder subject to complete defeasance
* “To A for life, then to B” –> VR
* “provided, however, that if B dies under the age of 25, to C.” –> B has VRSCD
Vested remainder subject to open
Creates in class of takers, at least one already qualified to take but subject to diminution
“to A for life, then to B’s children” –> part of the class is sitll open
class closes whenever some member of the class can demand possession/distribution of their shares– rule of convenience
e.g. class closes at A’s death or B’s death –> If more children are born after B dies, they do not get anything (late arrival)
executory interest
cutting short prior taker
shifting EI: follows defeasible fee, cuts short someone other than grantor
* e.g. “to A, but if B returns from Canada, to B and his heirs”
springing EI: cuts short grantor
* e.g. “to A, if and when she becomes a lawyer”
rule against perpetuities
Certain kinds of future interests are void if there’s any possibility they might vest more than 21 years after a person alive at the time of the grant has died
steps:
1. determine future interest: only applies to contingent remainders, exec interests, and certain vested remainders subject to open (does not apply to any future interest capable of creation in the grantor or IVR, VRSTD)
2. what has to happen for future interest holder to take?
3. find measuring life: Look for a person alive at the date of the conveyance whose life and/or death is relevant to what has to happen for future interest holder to be able to take
4. Will we know for sure within 21 years of the death of that relevant measuring lifetime if that future interest holder can take or not
* if yes –> conveyance is good
* if no –> future interest is void under RAP
executory interest w/o time limit
void under RAP
effect: strike the offensive language re EI and then RAP doesn’t apply to future interests capable of creation in the grantor
Reform of RAP
- wait and see: validity determined per facts as they come to be
- Uniform Statutory RAP: provides alternative 90-year vesting period
- Cy Pres: court can redraft “as near as possible” to grantor’s intent
