Rule Against Perpetuities Flashcards
generally, what is the rule against perpetuities? (RAP)
certain kinds of future interests are void if there is any possibility, however remote, that the interest might vest more than 21 years after a person alive at the time of the grant (measuring life) has died
to what future interests does the RAP apply?
(first 3 most common)
executory interests
contingent remainders
vested remainders subject to open
options to purchase
rights of first refusal
are grantor future interests (reversions, possibilities of reverter, etc) subject to the rule?
NO (grantor future interests are safe from RAP)
when does the perpetuities period begin to run for interests granted by will?
runs from the date of the testator’s death
when does perpetuities period begin to run for interests granted by deed?
runs from the date of delivery
when does the perpetuities period begin to run for interests granted by irrevocable trust?
runs from the date the trust is created
when does the perpetuities period begin to run for interests granted by revocable trust?
runs from the date it becomes irrevocable
when does an interest “vest” for purposes of RAP?
when either…
1) the interest becomes possessory, or
2) the interest becomes an indefeasibly vested remainder or a vested remainder subject to total divestment
what is a measuring life?
unless otherwise specified, it is one connected with/relevant to the vesting of the interest used
what are two main exceptions to RAP?
charity to charity interests AND options to purchase held by a CURRENT tenant
what is the consequence of violating RAP?
destroys only the offending interest (stricken from the grant)
what is the 4 step process to RAP?
1) determine what interests have been created and whether RAP applies to them
2) determine what has to happen for the future interest holder to take
3) look for ppl alive at the date of conveyance whose life/death is relevant to what has to happen for future interest holders to take
4) determine whether we’ll know for sure within 21 years of the death of the measuring life if the future interest will vest or not
must the future interest vest to satisfy RAP?
NO (need only be certain that it will vest or not – answer can be that it for sure won’t vest)
what 2 situations always violate RAP?
1) an executory interest with NO time limit on when it must vest (ie – to A for as long as no liquor is on the land)
2) a gift to an open class conditioned on members surviving beyond age 21
what must happen for a class gift to vest?
class must be CLOSED and all conditions precedent must be satisfied
**NOTE: “bad as to one, bad as to all” = if any one member’s interest vests too remotely, the WHOLE class gift fails
