Present Possessory Estates

Question 1

Estate

Answer 1

an interest in real property that is presently or may become possessory

Question 2

Fee Simple Absolute

Answer 2

largest possible estate in land, denoting all possible rights that a person may have in that parcel of land, including:
(a) unimpeded right to sell or convey all or part of the property; and
(b) unimpeded right to devise the property

Termination: Owner dies without a will or heirs, and property escheats to state; otherwise may last in perpetuity

EG: O conveys “to A and his heirs”

Question 3

Defeasible Estate

Answer 3

an estate that may terminate before its maximum duration has run

Includes: fee simple determinable, fee simple subject to a condition subsequent, fee simple subject to executory interest, fee tail

Question 4

Fee Simple Determinable

Answer 4

terminates automatically on the happening of a named future event

created by durational language: for so long as; during; while; or until

termination: terminates automatically on happening of a named future event

EG: “to A for so long as liquor is not served on the premises”

Question 5

fee simple subject to a condition subsequent

Answer 5

this estate may be cut short of the state is retaken by the grantor on the happening of a named future event

created by conditional language: provided however; however if; but if; on condition that; in the event that

note: if language is ambiguous, courts interpret the grant as an attempt to create a FSSCS

termination: power of termination must be expressly reserved to the grantor

EG: “A to B, provided that in the event the premises are not used for educational purposes, then A has the power to terminate B’s estate”

Question 6

Fee Simple Subject to Executory Interest

Answer 6

estate that is automatically divested in favor of a third person on the happening of a named event

created by either durational or conditional language

subject to the RAP

termination: occurs on the happening of an event that terminates the estate

EG: “A to B so long as B farms the property during his lifetime and, if he does not, then to C.”

Question 7

Fee Tail

Answer 7

an estate that descended to grantee’s children only

common law (disfavored today)

EG: “A to B and the heirs of his body.”

Question 8

Life Estate

Answer 8

last for the duration of the grantee’s life

can be made defeasible

EG: “A to B for life.”

Question 9

Life Estate Pur Autre Vie

Answer 9

duration of the estate is measured by the life of someone other than the grantee

EG: “A to B for the life of C.” As long as C is alive, B owns the property.

Question 10

Non-Freehold Estate

Answer 10

Term Estate. An estate that is limited in duration (basically a landlord-tenant relationship)

EG: “A to B for 50 years”; “A to B for 1 year.”

Question 11

Reversionary Interest

Answer 11

future interest retained by the grantor when the grantor transfers less than a fee interest to a third person

a fee simple determinable automatically creates a possibility of reverter (no special language needed)

EG: “A to B for life.” A has given a life estate to B but has not provided for who is going to own the land after B dies. The property will return to A after B dies.

Question 12

Possibility of Reverter

Answer 12

future interest in the grantor that follows a determinable estate

creation: a fee simple determinable automatically creates a possibility of reverter; no special language needed

not subject to RAP

EG: “A to B so long as B farms the land” creates a possibility of reverter in the grantor.

Question 13

Power of Termination

Answer 13

future interest in the grantor when the grantor attempts to create a FSSCS or a defeasible life estate

creation: not automatic; must be spelled out in the conveyance or it does not exist

not subject to RAP

EG: “A to B, provided that B uses the premises for residential purposes, but if he does not do so, A may retake and re-enter.” If B ever stops using the premises for residential purposes, A or A’s heirs can enter and retake the property.

Question 14

Executory Interest

Answer 14

future interest in a third person that cuts short the previous estate before it would have naturally terminated

subject to RAP

EG: : “A to B so long as liquor is not served on the premises in B’s lifetime. If liquor is served on the premises in B’s lifetime, the property will pass to C.” C has an executory interest.

Question 15

Shifting Executory Interest

Answer 15

interest that cuts short a prior estate created by the same conveyance.

interest passes from one grantee to another

EG: “A to B so long as B completes law school by age 30. If B fails to do so, then to C.” Shifts the property from grantee B to grantee C.

Question 16

Springing Executory Interest

Answer 16

interest that follows a gap in possession or divests the estate of the transferor

interest passes from a grantor to a grantee

EG: “A to B for life. Then 20 years after B’s death, to C.” B has a life estate. When B dies, the property reverts back to the grantor, A. 20 years later, the property transfers to C. A’s reversion would be in fee.

Question 17

Remainder

Answer 17

future interest created in a third person that is intended to take effect after the natural termination of the preceding estate

EG: “A to B for life, then to C.” C has a remainder.

Question 18

Contingent Remainder

Answer 18

any remainder that is not vested

subject to RAP

EG: “A to B for life, then to the oldest child of C then living.” This would be a contingent remainder because we do not know who the oldest child is going to be until B dies.

Question 19

Vested Remainder

Answer 19

vested at the point that it is (1) created in an ascertainable person; and (2) not subject to any condition precedent, other than termination of the preceding estate

Question 20

Vested Remainder Subject to Total Divestment

Answer 20

remainder that is presently vested but may be terminated on the happening of a future event

EG: “A to B for life, remainder to C, so long as liquor is never served on the premises.” C has a vested remainder but could lose it by serving liquor on the premises.

Question 21

Vested Remainder Subject to Open

Answer 21

remainder that has been made to a class and has at least one member who is ascertainable who has satisfied any conditions precedent to vesting, but may have other members join the class later

EG: “A to B for life, then to the children of C.” As soon as C has a child, that child is an ascertainable person and there is no condition to their taking other than the termination of the preceding estate (B’s death). Child would have a vested remainder, but it is subject to open because as other children of C are born, they will also share in the gift.

Question 22

Waste

Answer 22

An act that adversely affects the future interest.

The possessor of a life estate or a leasehold interest has the right to possess, use, and enjoy the property during the duration of his estate. However, he may not do anything that adversely affects the future interest that follows the life estate.

Question 23

Voluntary Waste

Answer 23

life tenant cannot intentionally or negligently damage property. If they do, they are liable for the damage

Question 24

Permissive Waste

Answer 24

life tenant must take reasonable steps to avoid damage. Failure to do so constitutes permissive waste, and the life tenant will be liable

Question 25

Ameliorative Waste

Answer 25

life tenant makes improvements to the land

Modern law: A life tenant is now allowed to commit ameliorative waste if:
* Market value of the remainderman’s interest is not impaired; and
* It is permitted by the remainderman OR a substantial and permanent change in the neighborhood justifies the improvement