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Flashcards in Freehold Estates (Estates in Land) Deck (26):
1

THE FEE SIMPLE ABSOLUTE

What is a fee simple absolute?

Fee simple absolute =
the ABSOLUTE ownership of potentially infinite duration

1) Language used to create:
"To A" or "To A and his heirs"
A has: Absolute ownership
A's heirs have: Nothing (so long as A is living)


2) Transferability:
a. Alienable (capable of inter vivos transfer)
b. Devisable (can pass by will)
c. Descendible (will pass via statutes of
intestacy if holder has no will)

3) Future Interest:
NO accompanying future interest
***COMMON BAR QUESTION****

Note: A living person has no heirs (BRUCE WILLIS RULE OF PROPERTY). SO if A is alive, A's heirs have NOTHING!

2

THE FEE TAIL

What is a fee tail?

Fee tail =
estate where inheritability is limited to lineal heirs, which lasts as long as there are lineal blood decendants of grantee

NOTE: most jx have ABOLISHED fee tails (it is an elitist notion); an attempt to create a fee tail today leads to fee simple absolute

1) Language used to create:
"To A and the heirs of his body"

2) Transferability:
Passes automatically to grantee's lineal decendants

3) Future Interest:
Reversion to O (if held by grantor)
Remainder to 3rd party (if held by a 3rd party)

3

THE DEFEASIBLE FEES (FEE SIMPLE W/A CATCH)

What are the 3 defeasible fees?

1) Fee Simple Determinable
2) Fee Simple Subject to Condition Subsequent
3) Fee Simple Subject to Executory Limitation

4

THE FEE SIMPLE DETERMINABLE

What is a fee simple determinable?

NOTE: NY Distinction
(FSD is called "FEE ON LIMITATION")

REMEMBER: FSDPOR

Fee simple determinable =
a defeasible fee that terminates upon the occurrence of a stated event and AUTOMATICALLY reverts back to grantor
→ A defeasible fee that AUTOMATICALLY terminates IF a stated event occurs

****NY DISTINCTION: In NY the fee simple determinable is called a FEE ON LIMITATION

1) Language used to create:
"To A...
....for so long as [event...]
....during [event...]
.....while [event...]
....until [event...]

A has: A fee simple determinable
Grantor has: the possibility of reverter

NOTE:
A. words of desire, hope, or intention are INSUFFICIENT to create a defeasible fee
→ THE WORDS MUST BE MORE CERTAIN!
→Grantor MUST provide CLEAR DURATIONAL LANGUAGE
→ IF stated condition is violated, forfeiture is AUTOMATIC

2) Transferability (ALL subject to condition):
a. Alienable (capable of inter vivos transfer)
b. Devisable (can pass by will)
c. Descendible (will pass via statutes of
intestacy if holder has no will)

NOTE: IF "A" transfers to "B" then "B" is also subject to the condition. A may convey less than she started with BUT NOT MORE

NOTE: an absolute (i.e. forever) restraint on alienability as a condition IS **void** (e.g. "To A so long as she never attempts to sell")

3) Future Interest:
Possibility of Reverter

5

FEE SIMPLE SUBJECT TO CONDITION SUBSEQUENT

What is a fee simple subject to condition subsequent?

NOTE: NY Distinction
(Called: "FEE ON CONDITION" in NY and Right of re-entry = right of acquisition)

Fee simple subject to condition subsequent =
a defeasible fee that gives grantor the RIGHT to terminate upon the occurance of a stated event (i.e. must file an ejectment action)
→ A defeasible fee that ALLOWS for / GIVES THE RIGHT to the grantor to terminate at her dersire IF a stated event occurs
→ BOBBY BROWN: "ITS MY PREROGATIVE"

NY DISTINCTION: In NY the fee simple subject to condition subsequent is called a fee on condition

1) Language used to create:
"To A,...
....but if [event...],
....upon condition that [event...],  
....provided that [event...],
....if it happens that [event...]
...grantor reserves the right to reenter and retake"

A has: A fee simple subject to conditions subsequent
Grantor has: The right of entry synonymous w/the power of termination

NOTE: words of desire, hope, or intention are INSUFFICIENT to create a defeasible fee

2) Transferability (ALL subject to condition):
a. Alienable (capable of inter vivos transfer)
b. Devisable (can pass by will)
c. Descendible (will pass via statutes of
intestacy if holder has no will)

NOTE: an absolute (i.e. forever) restraint on alienability as a condition IS **void**
→ e.g. not allowed to say: "To A so long as she never attempts to sell")

3) Future Interest:
Right of entry/power of termination (held by grantor)

NY DISTINCTION: In NY right of reentry is known as right of reaquisition

6

FEE SIMPLE SUBJECT TO EXECUTORY INTEREST

What is a fee simple subject to executory interest?  

Fee simple subject to executory interest =
a defeasible fee that terminates upon a stated event and then passes to a third party (vs. reversion to grantor)

1) Language used to create:
SHIFTING executory interest:
Fee simple subject to SHIFTING executory interest...
"To A,...
.....for so long as [event...],
.....while [event...],  
.....during [event...],
.....until [event...]
...then to B"

A has: A fee simple subject to B's shifting executory interest

B has: A shifting executory interest

SPRINGING executory interest:
Fee simple s/t springing executory interest...
"To A .....if and when [even...]

A has: A springing executory interest
Grantor has: A fee simple subject to A's springing executory interest

NOTE: words of desire, hope, or intention are INSUFFICIENT to create a defeasible fee

2) Transferability (ALL subject to condition):
a. Alienable (capable of inter vivos transfer)
b. Devisable (can pass by will)
c. Descendible (will pass via statutes of
intestacy if holder has no will)
NOTE: an absolute (i.e. forever) restraint on alienability as a condition IS **void** (e.g. "To A so long as she never attempts to sell")

3) Future Interest:
The shifting/springing executory interest (3d party)
[which is subject to the RAP!]

7

THE LIFE ESTATE

What is a life estate?

"The Romantic Estate" 

Life estate =
an estate that is measured by the life of transferee; OR by some other life (pur autre vie) 

1) Language used to create:
a. "To A for life" (simple life estate)
A has: A life Estate (A=life tenant)
O has: A Reversion

b. "To A for the life of B" (life estate pur autre vie)
A has: A life Estate Pur Autre Vie
O has: A Reversion

c. "To A for life, then to B"  
A has: A life Estate (A=life tenant)
B has: An indefeasibly vested remainder

d. "To A for life, but if..., to B"
A has: A life estate
B has: A contingent remainder
O has: a Reversion (if B is not alive and cannot take upon occurrence of condition)

e. “To A for life, and if B has reached the age of
25, to B.”
Assume B is 20:
A has: A life estate
B has: A contingent remainder
O has: a Reversion (If B dies under 25, the estate reverts back to O or O's heirs)
Now: if A dies before B reaches 25 then:
estate reverts to O or O's heirs and who hold it subject to B's Springing Executory Interest

2) Transferability:
IF pur autre vie AND measuring life is still alive:
a. Alienable (capable of inter vivos transfer)
b. Devisable (can pass by will)
c. Descendible (will pass via statutes of
intestacy if holder has no will)
NOTE: an absolute

3) Future Interest:
Reversion (if held by grantor)
Remainder (if held by a 3d party)

8

Life Tenant's Entitlements and Restrictions

What is a life tenant's entitlements and restrictions?  

The life tenant...

1) is entitled to all ORDINARY uses and PROFITS from the land

2) must NOT commit "waste" (i.e. something that hurts the future interest holder's interest)

9

Life Tenancy and Types of Waste

What are the 3 types of waste that a life tenant cannot commit?

NOTE: NY Distinction

3 types of waste...
------------------------------------------------------------------------------------
1) VOLUNTARY OR AFFIRMATIVE WASTE = overt conduct that causes a drop in value (i.e. willful destruction, consumption of natural resource on property)

GENERAL RULE: The life tenant must not consume or exploit natural resources on the property (such as timber, oil, or minerals)

BUT in the following 4 situations, the life tenant DOES NOT have to refrain from consuming natural resources and instead, may PURGE the land

"PU-R-G-E" EXCEPTIONS... (PU) PRIOR USE
the prior use exception allows that IF prior to grant, the land was used for exploitation; then the life tenant can CONTINUE to exploit (unless otherwise agreed) and subject to Open Mines Doctrine
OPEN MINES DOCTRINE = if mining was done on land, the life tenant can mine from existing mines, BUT MUST NOT open new ones

(R) REPAIRS
The repairs exception allows the life tenant to consume natural resources for REPAIRS and MAINTENANCE

(G) GRANT
the grant exception allows the life tenant to exploit if GRANTED that right

(E) EXPLOITATION
the exploitation exception allows exploitation of the land IF it is suitable ONLY to exploit (e.g.a quarry)
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2) Permissive waste or neglect = this occurs when the land falls into disrepair 

The life tenant must simply MAINTAIN the premises in reasonably good repair (e.g. must patch up a leaky roof but no rqmt to replace the entire roof)

MUST pay all ordinary TAXES and INTEREST on mortgage (NOT principal)

NOTE: if the life tenant fails to pay taxes or interest, the gov't/mortgagee can FORECLOSE on the property, which will CUT OFF the interest to the remaindermen
------------------------------------------------------------------------------------
3) Ameliorative waste = the life tenant must not engage in acts that ENHANCE the property value, UNLESS all future interest holders are KNOWN and CONSENT

EXCEPTION: if changed conditions have rendered a piece of property UNIHABITABLE, we will allow a life tenant to tear down that structure and replace (Changed Condition Doctrine)

Policy = protects the sentimental value for future interests

****NY DISTINCTION = In NY via statute, life tenant MAY make reasonable improvements UNLESS remaindermen object

10

FUTURE INTERESTS

What are the 8 types of future interests?

NOTE: NY Distinction

3 FUTURE INTERESTS capable of creation in GRANTOR

1) Possibility of Reverter (ONLY accompanies the fee simple determinable) (FSDPOR)

2) Right of Entry/Power of Termination (ONLY accompanies the fee simple subject to a condition subsequent) (Bobby Brown's Prerogative)

3) Reversion (ONLY accompanies the life estate or term of years/leasehold interest)
e.g. "To A for life" or "To A for 50 years" or "to A for life, then to B for 99 years"  
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5 FUTURE INTERESTS capable of creation in a TRANSFEREE
***********************
4) Indefeasibly Vested Remainder:
The holder of this remainder is certain to acquire an estate in the future, with "No Strings Attached"
→ONLY accompanies the life estate OR term of years
example:
“To A for life, remainder to B”
A is alive. B is alive
A has: a life estate
B has an indefeasibly vested remainder

5) Vested Remainder subject to Complete Defeasance: For the holder of this remainder, His taking is NOT subject to any condition precedent, however, his right to possession could be cut short because of a condition subsequent
→ONLY accompanies the life estate OR term of years

example:
O conveys: “To A for life, remainder to B, provided,
however, that if B dies under the age of 25, to C.” A is
alive. B is 20 years old.
A has a life estate
B has a vested remainder subject to complete defeasance
C has a shifting executory interest
O has a reversion (b/c/ it is possible that A will die before B reaches 25 and that C and C's heirs will also not be alive)

****NOTE: NY DISTINCTION: In New York, this remainder is called a “remainder vested subject to complete defeasance.”

6) Vested Remainder subject to Open: 
Here, a remainder is vested in a group of takers, at least one of whom is qualofied to take. But each class member’s share is subject to partial diminution because additional members can still join
→ ONLY accompanies the life estate OR term of years

example:
“To A for life, then to B’s children”
A is alive. B has two children, C and D
C and D have vested remainders subject to open

7) Contingent Remainder:
A remainder is contingent if it is created in an unascertained person or is subject to a condition precedent, or both
→ ONLY accompanies the life estate OR term of years

example of unascertained person:
“To A for life, then to B’s heirs.” A is alive. B is alive. Because a living person has no heirs, while B is alive his heirs are unknown.

example of condition precedent:
“To A for life, then, if B graduates from college, to B.” A is
alive. B is now in high school. Before B can take, he must
graduate from college. He has not yet satisfied this condition precedent. B therefore has a contingent remainder.

8) Executory Interest
→ ONLY accompanies fee simple subject to executory limitation

11

REMAINDERMAN

What is a remainder AND what are the 4 types?

Remainder = a future interest created in a grantee that is capable of becoming posessory on the natural expiration of the preceeding estate

NOTE: A remainder can NEVER cut short the preceeding estate

ONLY follows a life estate OR a term of years

A remainderman is "sociable, patient, and polite"

"sociable" = NEVER STANDS ALONE
The remainderman always accompanies a preceding estate of known fixed duration that is usually a life estate of a term of years

"patient and polite"= NEVER FOLLOWS DEFEASIBLE FEE
The remainderman cannot cut short or divest a prior transferee so if the present estate is a defeasible fee (of which there are three types (FSD / FSSCP/ FSSEL), your future interest is NOT a remainder. Instead, it will be an executory interest.

TYPES:
(i) contingent remainder;
(ii) indefeasibly vested remainder;
(iii) vested remainder subject to complete defeasance; AND
(iv) vested remainder subject to open

12

CONTINGENT REMAINDER

What is a contingent remainder?

NOTE: NY Distinction

Contingent remainder = a remainder that is created in (i) an UNACERTAINED/UNBORN person; 
(ii) is subject to a CONDITION PRECEDENT;
(iii) or BOTH

Unacertained/unborn e.g. = "To A for life, then to B's first child (TBD)"

Condition precedent e.g. = "To A for life, then, IF B graduates from college, to B" 

If B graduates college while A is alive, then B's contingent remainder BECOMES an indefeasibly vested remainder

If the contigency never occurs, the original GRANTOR has a reversion

NOTE: contingent remaiders are OPEN TO the Rule Against Perpetuties

NY DISTINCTION: NY has abolished the distinction b/t an EXECUTORY INTEREST and a CONTINGENT REMAINDER. Instead BOTH are called remainders s/t a condition precedent

13

DESTRUCTIBILITY OF CONTINGENT REMAINDERS

What is the Rule of Destructibility of Contingent Remainders?  

The Rule of Destructability of Contingent Remainders...

HISTORICALLY at common law: a contingent remainder was DESTROYED if it was still contingent at the time the preceeding estate ended

TODAY: the Rule has been abolished; if a contingent remainder is still contingent at end of the preceding estate, then the grantor (or his heirs) hold the estate subject to a springing executory interest

***the Rule has also been ABOLISHED in NY (NY Follows the above)

14

RULE IN SHELLEY'S CASE

What is the Rule in Shelley's Case?  

NOTE: NY Distinction

The Rule in Shelley's case...

Applies ONLY to this type of contingent remainder:

"To A for life, then, on A's death, to A's heirs" A is alive.

HISTORICALLY at common law: the present and future interests would MERGE giving a fee simple absolute (in order to promote alienability) This rule was applied EVEN IF it went against the grantor's intent b/c it was a rule at law

TODAY: the Rule has been abolished; A would have a life estate and A's heirs would have a contingent remainder

*****NY DISTINCTION: the Rule has been ABOLISHED in NY

15

DOCTRINE OF WORTHIER TITLE

What is the Doctrine of Worthier Title?  

NOTE: NY Distinction

The Doctrine of Worthier Title...

This is also known as the rule against a remainder in grantor's heirs

Applies when: the GRANTOR tries to create a future interest in his OWN heirs

"To A for life, then to O's heirs"

If the Doctrine of Worthier Title did not apply, A has a life estate and O’s heirs have a contingent remainder because O is still alive and a living person has no heirs

The Doctrine would make the contingent remainder in GRANTOR's heirs VOID (i.e. A would have a life estate and O would have a reversion)

BUT, grantor's intent CNTRLS (i.e. if he INTENDED-with a clear stmt-to create a contingent remainder in his heirs, then it shall exist)

****NY DISTINCTION: the Doctrine has been ABOLISHED in NY (for all transfers occurring after Sept 1, 1967)

16

INDEFEASIBLY VESTED REMAINDER

What is a indefeasibly vested remainder?  

The holder of this remainder is CERTAIN to acquire an estate in the future, NO STRINGS ATTACHED

Language used to create
"To A for life, remainder to B" A is alive. B is alive

A has a life estate
B has a indefeasibly vested remainder
Grantor has a reversion

NOTE: If remainder predeceases the life tenant, the future interest passes by will or intestacy

17

VESTED REMAINDER SUBJECT TO COMPLETE DEFEASANCE

What is a vested remainder s/t complete defeasance?   NOTE: NY Distinction

The remainderman exists and is NOT subject to a condition precedent, BUT his possession could be cut short by a CONDITION SUBSEQUENT

Language used to create:
Comma rule = if conditional language appears AFTER language that would (by itself) create a vested remainder, it's a CONDITION SUBSEQUENT; if language appears BEFORE then it's a CONDITION PRECEDENT

"To A for life, remainder to B, PROVIDED, HOWEVER, that if B dies under the age of 25, to C" A is alive. B is 20

A has a life estate

B has a vested remainder s/t complete defeasance (and will take upon A's death)

C has a shifting executory interest

Grantor has a reversion

NY DISTINCTION: in NY it's known as remainder vested s/t complete defeasance

18

VESTED REMAINDER SUBJECT TO OPEN

DISTINGUISHING AN OPEN OR CLOSED CLASS
RULE OF CONVENIENCE and WOMB RULE

vested remainder subject to open:
This is where a remaider is vested in a GROUP of takers, at least ONE OF WHOM is qualified to take, BUT each class member's share is subject to partial diminution b/c ADDITIONAL takers can still join the group

Language to create
"To A for life, then to B's children [OPEN]." A is alive. B has two children, C and D

Distinguishing an Open class vs. closed class
1) Open = others can still join the group
2) Closed = no other can join the group

RULE OF CONVENIENCE:
The class closes WHENEVER any class member can demand possession (i.e A's death OR B's death)

EXCEPTION: under the WOMB RULE, a child of B in the womb @ time of A's death can share w/ C and D

NOTE: vested remaiders s/t open are OPEN TO the Rule Against Perpetuties

19

EXECUTORY INTEREST

What is an executory interest?  

NOTE: NY Distinction

Executory Interest = a future interest created in a transferee (third party), which is NOT a remainder and which takes effect by either CUTTING SHORT
(i) some interest in ANOTHER person ("shifting"); OR
(ii) in the GRANTOR (springing)

1) Shifiting executory interest
Always follows a defeasible fee AND cuts short someone OTHER than grantor

Example:
"To A and her heirs, but if B returns from Canada, to B and his heirs"
A has a fee simple s/t shifting executory interest
B has a shifting executory interest

2) Springing executory interest
Always follows a defeasible fee AND cuts short the GRANTOR

Example:
"To A, if and when he marries" A has a springing executory interest
O has a fee simple s/t executory interest

NOTE: an executory interest is OPEN TO the Rule Against Perpetuties

****NY DISTINCTION:
→ NY has abolished the distinction b/t an EXECUTORY INTEREST and a CONTINGENT REMAINDER.
→ Instead BOTH are called remainders s/t a condition precedent

20

Rule Against Perpetuities

What is the Rule Against Perpetutities (RAP)?

RAP = Certain kinds of FUTURE INTERESTS are VOID if there is ANY POSSIBILITY (no matter how remote) that the given interest may vest more than 21 YEARS after the death of a measuring life

21

4 STEPS TO RAP PROBLEMS

What are the 4 steps to assessing any Rule Against Perpetutities (RAP) issue?

Step 1:
determine which future interest have been created by the conveyance

RAP ONLY applies to:
(i) contingent remainders;
(ii) certain vested remainders subject to open; AND
(iii) executory interests

E.g. "To A for life, then to A's children" A is alive and has NO children
→ A's children have a contingent remainder (contingent on A having/assing children up until her death)

RAP DOES NOT apply to:
(i) any future interest in GRANTOR;
(ii) indefeasibly vested remainders; OR
(iii) vested remainders subject to complete defeasance

Step 2:
identify the conditions precedent to the vesting of the suspect future interest (i.e. what must happen in order for the future interest can take possession)
→ From previous e.g., A must die leaving a children in order for it to take possession

Step 3:
find a measuring life (i.e. a person that is ALIVE at the date of the conveyance whose life/death is RELEVANT to the condition occurrence)  
→From previous e.g., A qualifies as the measuring life

Step 4:
Ask: will we know, with CERTAINTY, within 21 yrs of the death of our measuring life
(A) if our future interest holder(s) CAN or CANNOT take?

Yes? the future interest is VALID → The previous e.g. is valid b/c we'd know at A's death whether or not she'd have children 

No? the future interest is VOID

FOR RAP at common law, must always apply Fertile Octogenarian Rule (you can have a child whenever) and the MOST remote scenarios (i.e parade of horribles)

22

2 SCENARIOS THAT WILL ALWAYS VIOLATE RAP
(ON THE BAR EXAM)

1 SCENARIO THAT WILL NEVER VIOLATE RAP

What are the 3 bright line rules re: common law Rule Against Perpetuties (RAP)?

1. OPEN CLASS GIFT + 21Yrs or more to Take:
A gift to an OPEN CLASS that is conditioned on the members surviving to an age BEYOND 21 violates the common law RAP
→ "Bad as to one, bad as to all" – to be valid, it must be shown that the condition precedent to EVERY class member's taking will OCCUR w/in the 21 yr pd

→ E.g. "To A for life, then to such of A's children as to live to atain the age of 30." A has two children, B and C who are 35 and 40. A is alive >> future interest is VOID (A may have a child a day before he dies) and BECOMES a reversion in O
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2/ EXECUTORY INTEREST w/o VESTING TIME LIMIT
An executory interest with NO TIME LIMIT for vesting violates the common law RAP

→ E.g. "To A and his heirs so long as the land is used for farm purposes, and if the land ceases to be so used to B and his heirs"
→ executory interest violates RAP (as we don't know at A's death whether the condition will be met)
→ This BECOMES a fee simple determinable (with possibility of reverter and no RAP issues in grantors EVER)
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3) A GIFT from one charity to another WILL NOT violate the RAP

E.g. "To the American Red Cross, so long as the premises are used for Red Cross purposes, and if they ceased to be so used, then to the YMCA"

→ normally NOT ok under RAP but OKAY as a matter of PUBLIC POLICY

23

RAP REFORM

What are the 4 reforms to the Rules of Perpetuity (RAP)?

NOTE: NY Distinction

1) "Wait and see" or "second look" doctrine:
Under this reform, the analysis will NOT TAKE PLACE until the end of the measuring life and at that time future interest will be determined/adjudicated (no more parade of horribles).

2) The Uniform Statutory Rule Against Perpetuities: provides an alternative 90 YEAR vesting period under which analysis is performed today

BOTH WAIT AND SEE AND THE USRAP embrace
CY PRES

3) Cy pres doctrine: "as near as possible":
a ct. may reform in such a way that most closely maintains grantor's intent WHILE comporting with the RAP

4) REDUCING OFFENSIVE AGE CONTINGENCIES
In many reform states, any offensive age contingencies will be reduced to 21 yrs

****NY DISTINCTION:

1. the NY reform statute applies the common law RAP and REJECTS the wait and see approach and cy pres (judicial) doctrine EXCEPT for charitable trusts AND pwrs of appointment

2. If an interest is invalid b/c condition requires a person having to attain an age of > 21 yrs, a ct WILL reduce the age to 21

3. The common law Fertile Octogenarian principle is modified providing that women OVER AGE of 55 are presumed to not have any more children

4. The NY "suspension" rule (Trusts and Wills) applies the common law RAP on restrictions of pwr to sell or trnfr
→ An interest is void if it suspends the power to sell or transfer for a period longer than life in being plus 21 years

24

CATEGORIES OF FREEHOLD ESTATES

What are the 4 Categories of Freehold Estates

1) The Fee Simple Absolute

2) The Fee Tail

3) The Defeasible Fees
(i) The Fee Simple Determinable (FSDPOR)
(ii) The Fee Simple Subject to Condition Subsequent
(FSSCS-ROE/POT)
(iii) The Fee Simple Subject to an Executory
Limitation (FSSEL-EI)

4) The Life Estate (LE-RorR)

25

AS CONCERN THE DEFEASIBLE FEES:
NOTE TWO IMPORTANT RULES OF CONSTRUCTION

1) Words of MERE:
(i) DESIRE,
(ii) HOPE, or
(iii) INTENTION
are insufficient to create a defeasible fee

NOTE A DEFEASIBLE FEE:
(i) for the PURPOSE of...
(ii) with the HOPE that...
(iii) with the EXPECTATION that...

2) Absolute restraints on alienation are void
IF an ABSOLUTE restriction is included in the conveyance, it will be stricken but the rest of the conveyance will remain

NOT ALLOWED:
O conveys: “To A so long as she never attempts to sell.”
A has: A FEE SIMPLE ABSOLUTE!
O has: NOTHING!

ALLOWED:
O conveys: “To A so long as she does not attempt to sell
until the year 2015, when clouds on the title will be
resolved.”
A has: A FEE SIMPLE DETERMINABLE
O has: POSSIBILITY OF REVERTER

26

Analyzing Future Interests NOT held by Grantor

If a future interest is held by someone other than the grantor, it has to be either:

1. A VESTED REMANDER: of which there are three species:
(i) the indefeasibly vested remainder,
(ii) the vested remainder subject to complete defeasance (also known as the vested remainder subject to total divestment), and
(iii) the vested remainder subject to open

2. A contingent remainder

3. An executory interest: of which there are two species:

(i) the shifting executory interest, and
(ii) the springing executory interest

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THERE ARE THREE TASKS IN ASSESSING FUTURE INTERESTS IN TRANSFEREES:

FIRST: distinguish all remainders from executory interests.

SECOND: distinguish vested remainders (of which there are three kinds), from contingent remainders

THIRD: distinguish the three kinds of vested remainders from each other