November 3, 1998

Fee simple determinable v. fee simple subject to condition subsequent

Mahrenholz v. County Board of School Trustees

Fee simple determinable, possibility of reverter – example: to the Hartford school only so long as used for school purposes

Fee simple subject to a condition subsequent – example: to the Hartford School, but if it ceases to be used for school purposes, then grantor has right of entry

• grantor retains right of entry: must act to get this. Need to do act through legal process.

This land to be used for school purposes only; otherwise to revert to the grantor herein.

California does not like – in fact no longer recognizes – fee simple determinable. CA only recognizes fee simple subject to a condition subsequent.

EXAMS: there will be both types of fee simples described above

Restraints on alienation – cannot say things like "I do not want me house sold" usually will be found invalid. The limit on alienability will be struck.

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November 5, 1998

Work through the problems on page 259.

Is there a reversion? Sells property to B. STILL a reversion. O always retains the life estate no matter what.

257. 6 types:

interests in transferor (person that granted the property: GRANTOR):

• reversion – fact that O has retained some interest in the property
• possibility of a reverter – need to have a fee simple determinable
• right of entry (AKA power of termination) – fee simple subject to condition subsequent

interests created in a transferee (persons who are granted land: TRANSFEREES):

• remainder – 2 types

1. vested remainder – created in an ascertained person and not subject to a condition precedent
2. contingent remainder

• executory interest – 2 ways – if there is a gap between when transferee is supposed to get the estate, or divestment from original owner. Can also be springing executory interest – as long as it is divested

Answers to questions in reading Page 258 – 274

Page 258

Example 1 – contingent remainder

Example 2 – grantor has a reversion

Page 259

Problem 1

(a) – no reversion retained. This is a vested remainder

(b) – this is a fee tail, O still has an interest. So this is a still a reversion. B has a vested remainder in fee tail.

(c) – B has a contingent remainder. O still has a reversion. When B reaches 21 O’s reversion interest disappears. B has a vested remainder when reaches 21.

(d) – A has a term of years. O has a reversion. O continues to have a fee simple interest.

Problem 2

A has a vested life estate. O retains a reversion interest in Blackacre. The reversion interest is transferred to C. C has a fee simple absolute so then he gets Blackacre.

Page 261

Problem

– how to tell the difference between a remainder and an executory interest.

Example: A to life, but if B stops smoking immediately to B – this is an executory interest. "But if" shows that B’s interest can cut into and divest A’s interest. This has to be an executory interest. This is springing rather than shifting (see page 274)

ANSWER: B has an executory interest because there is a GAP between the time A dies and the time the funeral is held. If there is any gap, the interest is executory. This is springing rather than shifting.

Page 262

Example 3. B has a vested remainder. Property escheats to the sate. O has nothing

Example 4.

"A to life and then to A’s children and their heirs." The unborn children of A have a contingent remainder. Now have one child B. B has a vested remainder subject to open (or subject to partial divestment). This means additional children can have an interest. Whenever we see a contingent remainder, there is also a reversion to O.

Example 5.

To A for life and then to the heirs of B." If B is still alive, the heirs of B have nothing. They have a property interest called a contingent remainder. Cannot know B’s heirs until B dies. If B dies, the interest of the heirs becomes vested.

Page 263

Example 6.

B has a contingent remainder.

Example 7.

C has a contingent remainder. Called an alternative contingent remainder.

Key is the proceeding estate. It is a "to A for life" A dies, what estate follows? B takes immediately upon As death, otherwise if B is dead C takes it immediately on A’s death. Condition is built in. Therefore it is an alternative contingent remainder.

Problems

1. B’s remainder is vested. (not a contingent, although it is badly drafted). If B conveys interest back to O, O has a remainder still (not a reversion).
2. "A and B to their joint lives, then to their survivor in fee simple." This is contingent because you don’t know who will die first.
3. A to life, then to B for life, then to C and her heirs. B has a vested remainder in a life estate. C also has a vested interest (although C’s remainder is in future, it is still vested). They both take on automatically at the expiration of DIFFERENT estates.
4. This is a contingent remainder. The contingent remainder becomes a vested remainder when the child reaches 21. It is subject to partial divestment when the other children reach 21.

Page 264

Example 8.

"A to life and then to B and her heirs, but if B does not survive, then to C and her heirs." What does C have? C has a shifting executory interest. B has a vested remainder in fee simple.

Page 265

Problems

1. The interest is vested if it cannot be divested. B and C’s interest is vested subject to open. As long as A can have more children it is always subject to open. Property goes to C. E gets nothing.

Exam will ask us to apply concepts, name the interests correctly. Be able to tell which is which.

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November 10, 1998

Software is available in the library.

Can get software from web: rules against perpetuaties.

Look at her web site for past tests and things.

Password for eres is: easement

Executory interests – a fee simple upon the happening of a stated event is automatically divested by an executory interest in a transferee.

Difference between executory interest and a remainder:

EXECUTORY INTEREST - EVERYTHING FUTURE INTEREST CREATED IN A THIRD PERSON THAT IS NOT A REVERSION OR REMAINDER IS AN EXECUTORY INTEREST

-Things that divest an interest in the transferee

-Things that divest the transferor in the future

-Some exceptions with defeasible fees

• an interest created in a third party

right of entry is only retained by grantor

if it is a fee simple it cannot be followed by a remainder.

Difference between executory interest and reverter is that the executory interest goes to transferee and the reverter goes back to O if the condition has been broken.

Example 15 – page 272

Shifting executory interest has B.

Example 16

Springing executory interesty

TERMS TO KNOW:

Fee simple

Fee simple subject to condition subsequent

Fee simple determinable

Fee tail

Right of entry

Reversion

Possibility of reverter

Escheat

Remainder

Shifting

Springing

Executory interest

Vested interest

Non-vested interest

Issue

Interests created in transferor

Interests created in transferee

Contingent remainder

Alternative contingent remainder

Divestment/divested

Problems page 274

1. A has a contingent remainder, B also has an alternative contingent remainder

Rule in Shelley’s Case (will most likely have two questions – one in which it goes one way, and then the other goes the other way)

• the remainder becomes a remainder in fee simple
• merger in life interest into remainder
• to O for life and the to O’s heirs: O would have a fee simple under this rule

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November 12, 1998

Doctrine of worthier title – when there is a conveyance of land by a grantor to a person, with a limitation over to the grantor’s own heirs either by way of remainder or executory interest, no future interest in the heirs is created by a reversion is retained by the grantor.

Trust:

Legal owner

Equitable owner

A remainder in land is destroyed if it does not vest at or before the termination of the preceding freehold estate.

Look for instructions on exam about doctrine of contingent remainders. This is the one are that might be a little tricky. Everything else the year will be 1998.

For test she will say if doctrine of destructibility of contingent remainders applies or not. Need to know the difference between when it does and does not apply.

If the question is was it destroyed

A dies, describe the state of the title. O has a fee simple absolute if doctrine of destructibility applies, if it does not apply, it becomes an executory interest at A’s death.

Springing – take away reversion from Owner

Devise – means writer of will is dead

Conveys – means writer of will is alive