Property
Class Notes
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.