Property Class Notes 3/3/04


With the Rule Against Perpetuities, we are worried about contingent remainders and executory interests, plus vested remainders subject to open, which we’ll treat as contingent for the purposes of the Rule.


The hard part of all this is to determine what life in being validates the gift.  You want to pick a life in being who has something to do with the condition that the contingent remainder or executory interest hinges on.


More problems on the Rule Against Perpetuities


“O devises property ‘To my grandchildren who reach the age of 21.’  O’s children are alive and there are two grandchildren 15 and 17 years old”: The lives in being that are at issue are the children.  The grandchildren won’t be useful as lives in being for the law.  The grandchildren could croak.  More than 21 years after those grandchildren’s death, “new” grandchildren can be born by the other children.  Then if the children croak right after the conception of a grandchild, the “new” grandchild would make it in just under the wire.  Notice that O can’t have more children because he’s dead at the time of the creation of the interest.  So he can have more grandchildren, but not more children.  The gift to the grandchildren is fine, and the children will work as the lives in being.  Either they won’t have any grandchildren and they will all die, or they will have grandchildren and they’ll reach 21 within 21 years after the death of the parent.


On the other hand, if the devise above said: “To my grandchildren who reach the age of 22”, then the gift would fail.  We might well ask if this is absurd.


It appears that the big question about any lives in being that we’re considering is what happens if they have kids.


Here is a hint that will help: in this problem, at the time of the gift, O is dead.  Thus, we’re only talking about two generations.  You’re more likely to run into a problem when you have three generations.


“O makes an inter vivos gift ‘To my grandchildren who reach the age of 21.’  O’s children are alive and there are two grandchildren 15 and 17 years old”: Is this different than the previous problem.  O isn’t dead.  There’s no life in being that will work!  The problem is that O can have another child and then die.  Say all the lives in being at the time of the gift die.  That child can hang around as long as you want and can have all the children (O’s grandchildren) you want.  That could clearly violate the Rule Against Perpetuities.


Notice how in this problem there are three generations at issue: O’s generation, his children’s generation, and his grandchildren’s generation.  The key here is that O can have more children and then everyone else can croak.


There is no way in the problem before this that a grandchild can reach the age of 21 years more than 21 years after the death of the last life in being.  But in the present problem, there is every way in the world for a grandchild to reach 21 years more than 21 years after the death of the last life in being.


Notice that if you name the member of the class, like: “To the grandchildren of A, B, and C”, then the Rule Against Perpetuities is not violated.  In reality, it may be the case that O is like 99 years old and won’t have any more children.  Thus, O can avoid the legal fiction of the “fertile nonagenarian” by naming the children.


Here’s an inter vivos gift that would work: “To my grandchildren who reach the age of 21 who are alive on the date of this gift or who are born within the lifetime of child A, B, or C”.


Your children have to be born during your lifetime.  The earliest you can die is when your child is zero.


“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 then alive to B’s heirs and their heirs”: A has a life estate.  A’s children have a contingent remainder or vested remainder subject to open for life.  B would have a contingent remainder in fee simple absolute.  B’s heirs would have a contingent remainder in fee simple absolute.  Is there a Rule Against Perpetuities problem?  The contingent remainder to A’s children is okay because it will vest or fail within A’s lifetime.  What about the contingent remainder to B?  It will vest or fail within B’s lifetime.  That one is okay too.  What about the interest to B’s heirs?  No problem.  B’s heirs will be ascertained as soon as B dies.  Is it okay to use more than one measuring life?  Sure!  All you have to do is find a life in being that will work for the particular gift you’re talking about.  If there is more than one interest created, it doesn’t have to be the same life in being.  A works for A’s children, and B works for B’s heirs.  A’s children will be identified at A’s death, and B’s heirs will be identified at B’s death.


What else is funny about this gift?  It looks like it might violate the Rule in Shelley’s Case, but it doesn’t.  If it said “then to B for life and then to B’s heirs”, then the Rule in Shelley’s Case would kick in: if you have a life estate in B with a remainder in someone identified in B’s heirs, then you have a problem.  In this case, we have alternative contingent remainders in fee simple absolute rather than a remainder for life followed by a remainder in fee simple absolute.


“To A for life and then to B on her 75th birthday”: B is ten years old.  This is a springing executory interest.  This is good, because we can measure by B.  B has to either get to age 75 or die within her lifetime.


“To A for life and then to A’s first child who reaches the age of 75”: Let’s say A doesn’t have any children.  This gift fails because A’s child is not a life in being.  So this gift could stay contingent for more than 21.  You can’t use A’s child because A’s child isn’t alive yet.  You can’t use A because A could die with A’s child not yet 75 (or more properly 54).  You know what I mean.


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