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Saturday, February 23, 2013

Productive Saturday -- Future Interest --- Bah!

My pen of choice 14 years ago when I was studying biochemistry

I finally conquered future interest. It is a nightmarish subject. It's all rather simple but nitpicky. What do I mean? It is about owning land. There's the PRESENT possessory owners. Basically, there are six types:

1. Fee Simple Absolute [FSA --- O (owner) owns the land forever
-----Ex: O -> to A & his heirs, usually means it's FSA. Modern trend does not require "& his heirs" but around 1700, it must be said, or you only own the land until you die, i.e. LE.

2. Fee Tail [FT] --- that's why we have Pride and Prejudice and Downtown Abbey (although my property professor said, if the oldest daughter could have waited just five more years, FT would have gone away.
-----Ex: O -> to A & the male heirs of his body. This is not allowed in the US today.

3. Fee Simple Determinable [FSD] --- the 1st of the three defeasible fees (could still own the land forever until). It just means that you own the land until you breach the condition, in which case, the land automatically reverts to O.
-----Ex: O -> to A & heirs of his body, as long as land is used as a farm.

4. Fee Simple Subject on Condition Subsequent [FSCS] --- the 2nd of the three defeasible. It means that if grantee (the person occupying the land) breach whatever it is he's not supposed to, then O gets the land back, but only if he claims the land back.
-----Ex: O -> to A & his heirs, on the condition that alcohol is not serve on the premises, otherwise, grantor reserve the right to enter and terminate premises.

5. Fee Simple Subject to Executory Limitations [FSEL] --- meant that there's condition to the ownership. If grantee breach condition, then ownership goes to a 3rd person, neither of which is O or grantee.
-----Ex: O -> to A & his heirs, so long as democrat is the president, then to C & his heirs.

6. Life Estate [LE] --- means the land is owned by someone until they die. It could also be conditional, in which case, you have LE determinable or LE on Condition Subsequent, or LE on Executory Limitation.
-----Ex: O -> to A for life.

Then, there are FUTURE possessory interest. It just means that if O conveyed a lesser estate than FSA, these future interest [FI] account for the rest of the land. It's like math, everything must be accounted for. So, FI's are:
1. Reversion [RV] --- it means that grantor gets the land if an owner of LE dies, for example.
-----RV goes with anything that ends naturally, like LE, or FT, or tenancy of years

2. Possibility of Reverter [PR] --- goes with FSD above.

3. Right of Entry/ Power of Termination [RE/PT] --- goes with FSCS

4. Executory Interest [EI] --- goes with FSEL, and usually future interest that cuts off preceding estate

5. Remainder [Rem] --- sort of like RV, but it goes to a 3rd person, neither O or grantee. It does not cut off, it waits patiently for the preceding estate to end.

Remainder has 4 kinds.
1. Vested Remainder [VR] --- means the person owning the FI is ascertained, born, and ownership is not subject to any condition.
-----Ex: O -> to A for life, then to B & his heirs. (A = LE, B = VR in FSA, meaning B gets it forever when it's his turn. O gets nothing because FSA is all inclusive, nothing left over.

2. Vested Remainder Subject to Open/or partial divestment [VRO] --- means recipient is a class of people (children for example), one is at least ascertained or born, and it has a possibility of growing more.
-----Ex: O -> to A for life, then to A's children & their heirs (at time of grant, A is 25yo and has 1 child, X) X = VRO

3. Vested Remainder Subject to Complete Divestment [VRD] --- at least one ascertained person, but subject to condition subsequent [CS]. CS means that something has to happen before FI holder gets the property.
-----Ex: O -> to A for life, and on A's death, to B, but if B predeceases A, on A's death, to C. Here, B's taking the land is subject to CS, or contingent on his surviving A--expressed as condition subsequent.

4. Contingent remainder [CR] --- means that FI hold is unascertain, and subject to CP
-----Ex: O -> to A for life, and on A's death to B if B survives A, O gets reversion here because if B dies first, then there is no FI for him, O has to get the land back.

EI has two forms:
1. Springing Executory Interest --- follows a gap, or divest a transferor (or O)
-----Ex: O -> to A when and if A marries B. B's FI is not remainder because if A's interest becomes present interest, it will divest O's FSA (O at time of grant has FSEL).

2. Shifting Executory Interest --- Divests a tranferee, not a remainder because (a) preceding estate is not LE, and (b) it is capable of cutting short the preceding estate.
-----Ex: O -> to A & her heirs; but if B returns from Philippines, then and in that event to B & his heirs. Here, A has FSEL, and since FI is created in a transferee, it has to be either Rem or EI. Since, on B's return, it cuts off A's estate, then it is shifting EI

So, if I can keep them straight in 24 multiple choice question for an hour, then I will get good grades. This is the very gets worse. Then there's pre-1700, then there's modern, then there's leases. It's not so boring.

On that note, so thankful for PENTEL RSVP RT pens. They make taking MC practices fun. I only found them after trying on close to a hundred pens.

my pen of choice now, that I'm studying to be a lawyer

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