Rule Against Perpetuities Flashcards
Rule Against Perpetuities
No interest is good unless it must vest, if at all, not later than twenty-one years after some life in being at the creation of the interest.
Categories subjected to RAP
Contingent Remainders, Executory Interests, and Class Gifts.
Rule of logical proof
If you can think of a a way that the interest might not vest in the lives in being plus 21 year period, then RAP violated.
T devises property “to my grandchildren who reach 21.” T leaves two children and three grandchildren under 21.
Valid gift.
T deeds property “to my grandchildren who reach 21.” T has two children and three grandchildren under 21.
Executory Interest Void.
T has another child, C; then all of T’s initial children and grandchildren die. C then has a child, X, and then C dies.
Void because resolved more than 21 years after the death of the lives in being at the time of the deed
O conveys “to A for life, then to B if B attains the age of 30.” B is now 2 years old.
Valid: B is the validating life for B’s remainder. If B reaches 30, the remainder will vest; if B dies under 30, the remainder will fail.
O conveys “to A for life, then to A’s children for their lives, then to B if B is then alive, and if B is not alive, to B’s heirs.” A has no children at time of conveyance.
Valid: remainder to A’s children must vest or fail at A’s death; remainder to B also valid, must vest or fail within B’s life; remainder to B’s children will vest, if at all, on B’s death.
O [note, this is O, not EZRA], a teacher of property law, declares that she holds in trust $1,000 “for all members of my present property class who are admitted to the bar.”
Valid: the validating lives are the existing members of the property class.
O [note, this is O, not EZRA], a teacher of property law, declares that she holds in trust $1,000 “for the first child of A who is admitted to the bar”?
Invalid: presently living children could die and then and afterborn child could be admitted to the bar more than 21 years after the death of A.
O conveys “to A for life, then to A’s children who reach 25.” A has a child, B, age 26 living at the time of conveyance.
Invalid: remainder is void. When A dies, A may leave a child under the age of 4 and the gift may vest in that child more than 21 years after A and B die. The class gift must be valid for all children or it is void for all. Remainder is vested in B, subject to open; but for RAP purposes, it is not vested and because it may vest in one child too remotely, it is void. NOTE: strike out all of the void conveyance, leaving A with a life estate and O with a reversion
O conveys “to A for life, then to A’s widow, if any, for life, then to A’s issue then living.”
Widow’s life estate good: vests on A’s death.
Remainder to A’s issue bad: will not vest until A dies and she may be a woman not yet alive (could be more than 21 years after A’s death) .
Problem of the “unborn widow”
T devises property “to A for life, and on A’s death to A’s children for their lives, and upon the death of A and A’s children, to B if A dies childless.” A and B survive T.
Valid.
T devises property “to A for life, and on A’s death to A’s children for their lives, and upon the death of A and A’s children, to B if A has no grandchildren then living.” A and B survive T.
Invalid: may not vest in interest until death of A’s children so cannot ascertain whether the condition precedent will be met until then and this is too remote so void.
T devises property “to A for life, and on A’s death to A’s children for their lives, and upon the death of A and A’s children, to B’s children.” A and B survive T.
Valid: remainder to B’s children will vest in interest at B’s death, at which point all of B’s children will be ascertained, so valid.
T devises property “to A for life, and on A’s death to A’s children for their lives, and upon the death of A and A’s children, to B’s children then living.” A and B survive T.
Remainder to B’s children is void: though the class of takers is ascertained at B’s death, the condition precedent, surviving A and A’s children, won’t necessarily happen in 21 years after B or A’s death.
T devises property “to A for life, and on A’s death to A’s children for their lives, and upon the death of A and A’s children, to A’s grandchildren.” A and B survive T.
Remainder to A’s grandchildren is void. Takers not ascertained until death of A’s children and A’s last surviving child might be an afterborn child.
T devises property “to A for life, and on A’s death to A’s children for their lives, and upon the death of A and A’s children, to T’s grandchildren.” A and B survive T.
Remainder to T’s grandchildren is valid. T is dead. All of T’s children are lives in being and all grandchildren will be ascertained at the death of T’s children, at that point the gift will vest in interest (may not yet in possession).
O conveys Blackacre “to the School Board so long as it is used for a school, then to A and her heirs.”
A’s Executory Interest Violates RAP.
O has a possibility of reverter, School Board has a FSD
O conveys Blackacre “to the School Board, but if it ceases to use Blackacre for school purposes to A and her heirs.”
A’s Executory Interest Violates RAP.
School Board has fee simple
Limitations to the RAP
Wait and See; Cy Pres; USRAP
Wait and See
“Wait and See” – determined based on whether RAP actually violated rather than whether at conveyance hypothetically could be violated (not a logical proof rule).
If no common law RAP violation, no need to wait.
Statutory Repairs: solving “fertile octogenarian” and “unborn spouse”
Cy Pres
court determined fixes that accord with transferor’s intent.
USRAP
90 year “permissible vesting period.”
½ of states use USRAP
Not needed if a properly drafted savings clause was included in the conveyance.
Dead Hand Control
Deceased “earned,” kept control, did not lose, or otherwise had the money to “give” to the living.
Incentive to earn would be harmed if society did not allow inheritance, or more to the point here, did not allow the deceased to exercise control over the inheritance.
Can tie up land
Prevents present possessor from being able to fully enjoy their present rights.
(Problem of First-Generation Monopoly)
Prevents property from being allocated through the market to most efficient use.
(Problem of Inalienability)
Partial SOLUTION: Trust control splitting legal and equitable ownership.
