Bar Exam-Estates in Land

Springing Executory Interest

Cuts short the interest of the grantor or his heirs "to A, if and when he gets married" A has an executory interest Grantor has a springing FSSEC

Fee Simple Determinable (FSD)

Fee simple estate that automatically terminates and reverts back to the grantor upon the happening of a given event or condition "To A for so long as he practices law"

Fee Simple Subject to Condition Subsequent (FSSCS)

Grantor retains power to terminate grantee's estate upon the happening of a given event or condition (grantor must take action to terminate; does not actually occur automatically) "to A, but if he wins the lottery, Grantor reserves the right to reenter and retake"

Ameliorative Waste

LT acts that economically benefit the land prohibited under common law, but now usually permitted in most modern jurisdictions

Affirmative Waste

LT cannot consume or exploit natural resources on the land except: 1. where necessary for repairs or maintenance of land, 2. when grant expressly gives the right to exploit, or 3. if land was used for exploitation of resources prior to the grant

Rule Against Perpetuities (RAP)

No property interest is valid unless it must vest, if at all, no later than 21 years after the death of a life in being (measuring life) at the time the interest was created

Accompanying future interest for a Fee Simple Determinable

Possibility of Reverter (retained by grantor) but only if the event or condition occurs

Charity to Charity Exception to RAP

RAP does not apply to conveyances from one charity to another

Creation of FSD

Requires clear durational language "for so long as" "while" "During" "until" desire, hope or aspiration are insufficient

Accompanying future interest for a Fee Simple Subject to Condition Subsequent

Right of Reentry (retained by Grantor)

Accompanying future interest for a Fee Simple Subject to an Executory Interest

Shifting Executory Interest retained by the third person

Examples of RAP Class Gift Violations

1. Age contingency beyond 21 2. Fertile Octogeneration-presumption any women is capable of giving birth regardless of age or condition

FSD Characteristics

1. Automatic Forfeiture upon the occurrence of event or condition 2. Potentially Infinite in duration 3. Transferable, alienable, devisable, and descendible subject to the occurrence of the given event

Analyzing a Conveyance Subject to the RAP

1. Determine the interest being granted 2. Apply RAP to any Interest for Which RAP Applies 3. If conveyance violates RAP, strike only the violating portion; what remains=the new conveyance

Three Types of Defeasible Fees

1. Fee Simple Determinable 2. Fee Simple Subject to Condition Subsequent 3. Fee Simple Subject to an Executory Interest

Three types of vested remainders

1. Indefeasibly Vested Remainders 2. Vested Remainder Subject to Total Divestment 3. Vested Remainder Subject to Open (Class Gift

Two Types of Executory Interests

1. Shifting 2. Springing

Characteristics of FSSCS

1. forfeiture not automatic, grantor must exercise reentry right 2. Potentially infinite 3. Transferable subject to occurrence of event or condition

Defeasible Fees

A fee simple estate of potentially infinite duration that can be terminated upon the occurrence of some specified event i.e., estate with a remainder vested in some person who may lose the vested interest upon the occurrence of some event

Fee Simple Subject to an Executory Interest (FSSEI)

A fee simple where property automatically transfers to a third person upon the happening of a given event "To A, but if A is ever arrested, then to B"

Executory Interest

A future interest in a third party that takes effect by cutting short some interest Includes any future interest that is not a remainder "but if" "then to" "for so long as" No standing to sue for waste

Characteristics of a FSSEI

Automatic Forfeiture to a third person Potentially Infinite Transferable

Remainder

a future interest in a third person (not grantor) that arises immediately upon the termination of the preceding estate

Life Estate Pur Autre Vie

a life estate measured by the life of someone other than the LT "to A for the life of B"

Doctrine of Waste

a life tenant (LT) cannot commit acts that constitute an unreasonable use of land and/or injure the interests of a future interest-holder Doing so constitutes waste, of which there are three types

Subject to unborn or unascertained persons

a remainder created in favor of unborn or unascertained persons remainder is contingent on grantee being born or ascertained "to A for life, then to B's heirs"

Vested Remainder

a remainder that automatically becomes possessory upon the natural expiration of the preceding estate

Contingent Remainder

a remainder will be contingent if it is either: 1. Subject to a condition precedent, or 2. created in favor of an unascertained or unborn person

Remainder Transferable

alienable, devisable, and descendible Cannot cut off or divest an interest held by a prior transferee

Shifting Executory Interest

always follows a defeasible fee Cuts short someone other than the grantor "To A, so long as the property is used for storage. But if used for any other purpose, to B"

Life Estate

an interest that lasts only for the life of the interest holder O grants "to A for life" Life tenant (LT) has all ownership rights but must maintain property and make reasonable repairs; LT cannot commit waste

Merger (Shelley's Rule)

arises when a conveyance attempts to give a life estate to grantee with a remainder to grantee's heirs "to A for life, then to A's heirs" At common law, the two estates merge Modern Rule: A has a life estate and his heirs have contingent remainders. O has a reversion b/c A could die without heirs

Doctrine of Worthier Title

arises when grantor creates a life estate in another but creates a future interest in grantor's heirs "to A for life, then to O's heirs" Under the doctrine, the contingent remainder in O's heirs is void; A instead has a life estate and O has a reversion

Rule of Destructibility

at common law, a contingent remainder is destroyed if it remains contingent (i.e., the condition is not satisfied) when the preceding estate ends "to A for life, then to B once he goes to law school" A dies and B has not gone to law school CL: B gets nothing Modern Rule: Reverts to grantor until B satisfies condition

Indefeasibly Vested Remainder

becomes possessory immediately upon termination of the prior estate "To A for life, the to B"

Rule of Convenience

class closes whenever any member can call for distribution of her share

Creation of FSSCS

clear durational language must carve out a right of reentry for grantor i.e., it must be explicit that grantor has the right to retake upon occurrence of the event or condition words of desire, hope, or aspiration are insufficient

Rights of First Refusal and RAP

contingent interests in property (options and rights of first refusal) violate RAP if they could possibly be exercised outside the time period allowed by RAP

Remainder Creation

expressly created in the same conveyance in which the preceding estate is created

Class Gifts and RAP

for class gifts to satisfy RAP, class must be closed with all conditions precedent satisfied for every member Rule of Convenience for class gifts may save a class conveyance that would otherwise violate RAP

Reversion

future interest in grantor when a life estate does not provide for disposition of property to a third party

Permissive Waste

harm to property due to LT neglect LT has a duty to repair/maintain property up to the extent of income/profits derived from the land or the rental value of the land. Failure to do so=permissive waste

Open Mines Doctrine

if exploitation occurred before the life estate, LT may only extract from already-open mines

Vested Remainder Subject to Open (Class Gift)

remainder vested in a described class of takers, at least one of whom is capable of taking possession (i.e., by virtue of being alive) "To A for life, remainder to children of B and their heirs" B has one child, who has a vested remainder subject to open b/c B may have more children

Subject to Condition precedent

remainder's taking is contingent on the occurrence of some event or condition Once the event or condition occurs, the interest automatically becomes an indefeasibly vested remainder "to A for life, then to B and his heirs when B gets married"

Language for Defeasible Fee

requires clear words of intent for remainder to vest words of desire, hope, or aspiration are insufficient

Accompanying Life Estate Future Interst

reversion or remainder

Vested Remainder Subject to Total Divestment

subject to some condition subsequent, such that the remainderman could be divested after taking possession "To A for life, remainder to B, but if B weds, to C"

Vested Remainder Limits

vested remainders cannot: 1. be subject to any condition precedent; or 2. vest in an unknown or unascertained person

Three types of waste

Affirmative Permissive Ameliorative

Open vs. Closed Class

Class stays open to allow for future members and closes when no new members can be created (e.g., life tenant dies)

Creation of a FSSEI

Clear durational language required "To A, but if A gets married, then to B" aspiration, desire, or hope are insufficient

Categories of Remainders

Vested Remainder Contingent Remainder