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  1. trustee
    • person in whome grantor has confidence
    • has power to invest the trust principal and discretion to pay appropriate amount to beneficiaries
    • during term of trust, this person holds legal title to trust assets in fee simple subject (FSS) to beneficial interests of beneficiaries (253)
  2. future interests
    • confer rights to enjoyment of property at a future time
    • best way to implement is through a trust
  3. how can testator control inheritance ?
    by creating future interest (not only at own death, but others' death)
  4. future interests retained by the transferor are known as...
    • reversion
    • possibility of reverter
    • right of entry (also known as power of termination)
  5. future interests created in a transferee are known as...
    • vested remained (VR)
    • contingent remained (CR)
    • executory interest (EI)
  6. a future interest is a presently existing interest that may become possessory in the future, but it does NOT...
    entitle owner to present possession
  7. reversion (p. 255)
    • interest left in an owner when he carves out of his estate a lesser estate and doesn't provide who is to take the property when the lesser estate expires
    • in the words of Professor Lewis Simes: "interest remaining in the grantor or in the successor in interest of a testator, who transfers vested estate of a lesser quantum than that of the vested estate which he has"
    • remnant of an estate that has not entirely passed aware from transferor
  8. the hierarchy of estates determines what is a lesser estate...list the hierarchy from least to greatest (p. 255)
    leasehold estate < life estate < fee tail < fee simple

    (so in order from greatest to least: fee simple > fee tail > life estate > leasehold estate)
  9. TRUE or FALSE: there is no such interest as a "possibility of reservsion," and you should never use that phrase (p. 256)
  10. possibility of reverter (p. 256)
    • arises when an owner carves out of his estate a determinable estate of the same quantum
    • theoretically, it can be retained when a life tenant conveys his life estate to another, determinable on the happening of an event, but the cases, almost without exception, deal with carving a fee simple determinable (FSD) out of a fee simple absolute (FSA)
    • future interest remaining in the transferor or his heirs when a fee simple determinable (FSD) is created
  11. right of entry (p. 257)
    when an owner transfers an estate subject to condition subsequent and retains power to cut short or terminate the estate
  12. can remainders be transferred back to grantors? (p. 258)
  13. Can executory interests be transferred back to grantors? (p. 258)
  14. vested remainder (p. 258)
    transferor decides at outset who takes property when life tenant dies
  15. contingent remainder (p. 258)
    permits the transferor to let future events determine this question (who takes property upon the life tenant's death?)
  16. remainder (p. 258)
    • future interest that waits politely until the termination of the preceding possessory estate, at which time the remainder moves into possession if it is then vested
    • future interest that is capable of becoming possessory at the termination of the prior estate
  17. why did the executory interest develop? (p. 258)
    to do what a remainder cannot do: divest or cut short the preceding interest
  18. executory interest (p. 259)
    future interest in a transferee that can take effect only by divesting another interest
  19. What is the difference between a remainder and a exectory interest? (p. 259)
    • remainder takes interest at end of other's estate
    • executory interest divests the prior estate (cuts short)
  20. A remainder is vested if... (p. 259)
    • (1) it is given to an ascertained person
    • (2) it is not subject to a condition precedent (other than the natural termination of the preceding estates)

    OR (in other words) if it is created in an ascertained person and is ready to become possesssory whenever and however all preceding estates expire
  21. A remainder is contingent if... (p. 259)
    • (1) it is given to an unascertained person or
    • (2) itis made contingent upon some event occuring other than the natural termination of the preceding states
  22. contingent remainder (p. 259)
    • given to unascertained person
    • made contingent upon some event occurring other than natural termination of preceding estates
    • subject to condition precedent
  23. indefeasibly vested (p. 259)
    • remainder certain of becoming possessory in the future
    • CANNOT be divested
  24. "Remainder" tell us... (p. 260)
    the kind of future interest
  25. "in fee simple absolute" tells us... (p. 260)
    the kind of estate held as a remainder (and what kind of possessory estate the remainder will become when it becomes possessory)
  26. The remainder is vested subject to open or vested subject to partial divestment if.... (p. 260)
    later-born children are entitled to share in the gift
  27. TRUE or FALSE: living people have heirs (p. 260)
    FALSE - we don't know who someone's heirs are until they die
  28. TRUE or FALSE: A contingent remainder is uncertain of possession. (p. 261)
  29. 5 types of future interest
    • remainders
    • executory interests
    • reversions
    • possibilities are reverter
    • rights of entry

    All referred to as "future interests" by 3rd Restatement
  30. The 3rd Restatement defines a contingent future interest as...
    "if, for any reason, it might not take effect in possession or enjoyment" (p. 272)
  31. Looking at the language, if the condition is in the description, the remainder is... (p. 262)
  32. Looking at the language, if after the word giving a vested interest, a clause is added divesting it, the remainder is... (p. 262)
  33. RULE: If the 1st future interest is vested remainder in fee simple, the 2nd future interest will be.... (p. 262)
    divested executory interest
  34. RULE: If 1st future interest created is a contingent remainder in fee simple, the 2nd future interest in transferee will be...
    contingent remainder (also)
  35. 4 differences between vested and contingent remainders (p. 263)
    - vested remainder accelerates into possession whenever and however the preceding estate ends.....
  36. real property
    • - property that cannot be moved
    • - land, items attached to land, items associated with land
  37. personal property
    • - movable
    • - usually consists of personal possessions and items that are not real property
  38. How can personal property be acquired?
    • capture
    • creation
    • conversion
    • discovery
    • adverse possession
    • accession
    • confusion
    • gift
  39. How can ownership be lost?
    • abandonment
    • fraud
    • or one of the methods acquiring ownership
    • lost by an owner who loses or misplaces it
  40. discovery rule
    the person who discovers real or personal property has the best title to property
  41. doctrine of adverse possession
    allows ownership to be granted to a person who exercises exclusive physical possession of a piece of property for a certain amount of tiem
  42. elements of adverse possession
    • (CHOA)
    • continuous
    • open and notorious
    • actual
    • hostile
  43. continuous
    • uninterrupted for a period of time as defined by statute (20 years at common law)
    • seasonal or infrequent use may be sufficient if it is consistent with the type of property that is being possessed (e.g., summer home)
  44. tacking
    • an adverse possessor may tack on his predecessor's time in order to satisfy a statutory period, as long as there is privity
    • not allowed when there is actual, wrongful exclusion of a party entitled to possession from the property (ouster)
  45. disability of owner
    • the statute of limitations will not run against a true owner who is afflicted with a disability at the inception of the adverse possession
    • insanity
    • infancy
    • imprisonment
  46. hostile
    • without the owner's permission
    • with the intent to claim the land as his own against the claims of others
    • MAJORITY - grant title to possessor who in good faith thought he had a right to possess (believed he owned the property or that it was unowned)
    • MINORITY - require the possessor to know that the land belongs to another
  47. Fee Simple Absolute (FSA)
    • most common form of property ownership
    • potentially infinite duration
    • freely alienable (easily bought or sold)
    • no accompanying future interest
    • present estate that does not terminate unless the owner dies intestate without heirs - then it would escheat to the state
  48. defeasible fees
    • like FSA, ownership is potentially infinite, BUT unlike FSA, it may be terminated by the occurence of an event
    • types include: FSD, FSSCS, FSSEL
  49. Fee Simple Determinable (FSD)
    • present fee simple estate that is limited by specific durational language (so long as, while, during, until)
    • terminates automatically upon the happening of a stated condition
    • freely alienable, devisable, and descendible, but always subject to stated conidition
  50. Possibility of Reverter (POR)
    • upon the occurrence of the stated condition, the estate automatically reverts back to the grantor
    • ex: A conveys Blackacre "to B and his heirs, until B gets married"
  51. Fee Simple Subject to Condition Subsequent (FSSCS)
    • present fee simple that is limited in duration by specific conditional language (provided that, on condition that, but if....)
    • unlike a FSD, termination is not automatic
    • will terminate only if the grantor affirmatively demonstrates intant to terminate
    • ex: A conveys Blackacre "to B and his heirs, but if B gets married, then A can reenter Blackacre"
  52. Fee Simple Subject to Executory Interest (FSSEI)
    • present fee simple estate that is limited in duration by either conditional language, such that it will terminate upon the occurrence of the specified condition and title will pass to a third party (someone other than the third party)
    • upon occurrence of stated conidition, the present Fee Simple terminates automatically
    • future interest held by the third part is an executory interest
    • ex: A conveys Blackacre "to B for as long as the property is used as a hospital, then to C"
  53. Fee Tail
    • freehold estate that limits the estate to the grantee's lineal blood descendants by specific words of limitation ("heirs of the body")
    • has been eliminated in most states because it is treated as a FSA
  54. Life Estate
    • present possessory estate that is limited in duration by a life
    • language must be clear, and the duration must be measured in terms of a life, not a number of years ("to A for life")
    • upon the end of the measuring life, title reverts to the grantor or specified remainderman
    • Ex: A conveys Blackacre "to B for the life of B"
    • Ex: A conveys Blackacre "to B for B's life and then to C" (C has a remainder)
    • not subject to RAP
  55. reversion
    • future interest held by the grantor who grants a life estate or estate for years but does not convey the remaining future interest to a third party
    • not subject to the RAP
  56. possibility of reverter
    automatically retained by a grantor when a FSD is conveyed
  57. right of reentry
    • AKA power of termination, right of entry
    • future interest held by the grantor after a FS on condition subsequent is granted
  58. remainder
    • future interest created in a grantee that can become possessory upon the expiration of a prior possessory estate of known fixed duration that is created in the same conveyance
    • can either be vested or contingent
    • MAJORITY - contingency applies at the termination of the interest that precedes distribution of the remainder
    • MINORITY - interprets a survivorship contingency to require surviving only the testator and not the life tenant
  59. vested remainder
    • interest that is not subject to any conditions precedent and is created in an ascertainable grantee
    • Ex: A conveys Blackacre "to B for life, and then to C and his heirs"
    • C, the grantee, is ascertaingable
  60. vested remainder - subject to open
    • if a conveyance grants a remainder to a class of grantees and at least one of the grantees receives a vested remainder at the time of the conveyance, that vested remainder is subject to open (property interest becomes uncertain bc other grantees become vested and able to share in the frant)
    • Ex: A conveys "to B for life, and then to B's children as they turn 18"
  61. vested remainder - subject to compelte divestment
    • vested remainder subject to complete divestment indicates that the occurence of a condition subsequent will completely divest the remainder interest
    • Ex: A conveys "to B for life, and then to C; but if C has no children, then to D's children"
  62. contingent remainder
    • created in a grantee that is unascertainable, or if it is subject to an express condition precedent to a grantee's taking
    • normally occurs when (1) the property cannot vest bc the beneficiary is unknown or (2) the property cannot vest bc the known benefiticary is subject to a a condition precedent that has not yet occurred
    • Ex: A conveys "to B for life, remainder to C's heirs" - if C is alive, the heirs are not ascerntainable and the remainder is contingent
    • were destroyed at common loaw if they had not vested by the time the preceding estate terminated
  63. executory interest
    • future interest in a third party that is not a remainder and that cuts the prior estate short upon the occurrence of a specified condition
    • transferrable and subject to RAP
    • 2 TYPES: springing and shifting
  64. shifting executory interest
    • divests the interest of the grantee by cutting short a prior estate created in the same conveyance
    • the estate "shifts" from one grantee to another on the happening of the condition
    • Ex: A conveys "to B and his heirs, but if C returns from Paris, then to C" (FSSEL in B, shifting executory interest in C)
  65. springing executory interest
    • divests the interest of the grantor or fills a gap in possession in which the estate reverts to grantor
    • Ex: A conveys "to B for life, and one year after B's death to C and his heirs" (life estate in B, one year reversion in A in FSSEL, and a springing executory interest in C)
  66. Rule Against Perpetuities (RAP)
    specific future interests are valid only if they must vest or fail by the end of a life in being, plus 21 years
  67. common RAP violations
    • class transfers - if the class is open
    • fertile octogenarian - anyone is deemed capable of having children, but some states have a set a limit (55 years old)
    • unborn spouse - if an interest following a widow's life estate cannot vest until the widow dies, it violates the rule
    • when estate is conveyed to someone unknown
    • defeasible fee followed by an executory interest
    • conditional passage of interest
  68. concurrent estate
    • AKA co-tenancy
    • ownership or possession of real property by two or more persons simultaneously
    • most common - tenancy in common, joint tenancy, and tenancy by the entirety
  69. tenancy in common
    • any tenancy with 2 or more grantees
    • "default" or "catch all" co-tenancy when joint tenancy and tenancy by the entirety do not exist
    • each co-tenant holds an undivided interest with unrestricted rights to possess the whole property, regardless of the size of the interest
  70. joint tenancy
    • when 2 or more indivs own property with the right of survivorship (i.e., upon the death of a joint tenant, the interest terminates and automatically goes to the surviving joint tenants)
    • look for survivorship language
  71. 4 unities of a joint tenancy
    • PITT
    • possession - equal right to use or possess the property
    • interest - each interest equal to the others
    • time - at the same time
    • title - with the same instrument
  72. severance
    although an interest in tenancy cannot be devised, joint tenants convey all or part of their individual interests during their lifetimes (inter vivos) to a third party, thereby severingthe joint tenancy
  73. if a joint tenancy is transferred inter vivo, the right of survivorship to that interest is...
    destroyed and converted to a tenancy in common
  74. tenancy by the entirety
    • joint tenancy btn married persons with a rights of survivorship
    • same rules as joint tenacy apply
    • must be married when the deed is executed or the conveyance occurs
    • neither party can alienante or encumber the property without the consent of the other
  75. ouster
    when a co-tenant refuses to allow another co-tenant access to the property
Card Set:
2012-04-24 07:45:23
Rutgers Law School Property Professor Carrier

flashcards for Professor Carrier's class
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