Property
Class Notes
We’ve
already talked some about reversions. We’ll
talk about them in more detail now.
Reversions
A reversion
is an future interest retained by the grantor when he
transfers a vested estate(s) and/or a vested future interest of a lesser
quantum than that which he owed.
What
are the quantum of estates?
-
Fee simple
-
Fee tail
-
Life estate
-
Leasehold
This
stuff is based on a lot of fictions and assumptions. We don’t look at the facts. The law is just the law.
Why
do we ignore the fee simple defeasible in this quantum of estate ranking?
Why
does O have a reversion after granting A a life estate? It’s
because he’s given away an estate of a lesser duration than the one he started
with. Whether O started with a fee
simple or a fee tail, he would still retain a reversion because he granted
something less than he had.
What
future interest is retained when you give a fee simple defeasible? You retain the possibility of reverter.
Remainders
This
is not a retained interest. It is
created in a transferee. It doesn’t have to become possessory, but it can become possessory. There can’t be any gaps between the
termination of the previous possessory estate and the remainder. The common law couldn’t tolerate the idea
that ownership was in abeyance. “Who
owns it in the meantime? It can’t be nobody! There can’t
be any gaps!”
The
remainder can become possessory upon the natural termination of the preceding
estate. For example, “To
A for life, and then to B and her heirs.” A gets a life estate and B gets a remainder
which becomes possessory on A’s death.
What
about: “To A for life and then to B if B gives A a proper funeral.” What’s
a proper funeral? You have to wait until
after the person’s dead to have a
funeral. There is a necessary gap
between A’s life estate and when B’s estate becomes possessory.
We
start off with reversions and remainders, and then there are other interests
which the common law simply doesn’t allow.
The one we just did would simply fail as invalid. Later we’ll get the Statute of Uses, which
will validate certain interests that were previously invalid. We’ll call them executory interests.
As
part of the definition of reversion, notice that it says that when the grantor
transfers vested estates, he retains
a reversion.
Contingent remainders
A remainder
is contingent if either or both of two things exist:
1. It is subject to a condition precedent, and/or
2. It is given to an unascertained person.
Notice
with the “and/or” that remainders can be “doubly” contingent.
“To
A for life and then to B if she quits smoking”: O gives a life estate to A and a contingent remainder to B and O has a reversion in fee
simple absolute.
“To
A for life and then to the heirs of A and their heirs”: O gives a life estate
to A and then a contingent remainder to A’s heirs in fee simple absolute. O keeps a reversion. It’s contingent because we don’t know who A’s heirs will be since A isn’t dead yet. No
living person has heirs. Some dead people don’t have heirs either.
Vested remainders
There
are three types of vested remainders:
1. Vested remainders
2. Vested remainders subject to
open (or vested subject to partial divestment) – for example: “To A for life
and then to the children of A and their heirs (if A already has at least one
child)”. If there are more kids, the
existing kids get partially divested.
3. Vested remainders subject to
(complete) divestment – “To A for life, then to B and his heirs, but if B
marries Z, then to C and his heirs.”
Based on a condition subsequent
Remainders
change their name based on changes in the relevant facts.
The
law is antiquated in two respects:
1. It is based on a time when
there was no technology for determining if people can have children.
2. It is based on the
presumption that children have to be conceived during the lifetime of the
husband. If you have frozen embryos or
conception that occurs after the death of the donors, the law won’t know what
to do.
Remainders
stay remainders, and reversions stay reversions. We classify them at the time they are
created. However, remainders can switch between being vested and being
contingent.
O
has a reversion if he has given away a vested remainder of lesser duration than
that which he had. The focus is on vested and not contingent interests.
Future
interests are future because they’re
not yet possessory. They are interests
that the law recognizes. They can be
inherited and devised by will.
A
vested life estate plus a vested remainder in fee simple absolute equals a possessory
interest in fee simple absolute.
A
will has no effect to future interests
while you’re living.
In
order for a remainder to be vested, it can’t be subject to any condition
precedent. But conditions precedent exclude a certain group of things that might
happen. Vested means not subject to a
condition precedent other than the
natural termination of the precedent estate.