Property Quick Tip: The Rule Against Perpetuities
The Traditional RAP
A Useful Paraphrase
Why RAP at All?
Who Takes the RAP?
There are 2 notable exceptions to the RAP. The first is a lease with an option for the tenant to buy the property, no matter how long the lease is. The second is the charity-to-charity exception, which exempts future interests that would transfer property from one charity to another.
The RAP doesn’t apply to vested interests because we don’t have to worry about when those might vest. The RAP also doesn’t apply to any interest retained by a grantor, such as a reversion, a possibility of reverter, or a right of entry.
Tips and Tricks
Tip #1: Identify the measuring lives
Theoretically, the lives in being could be every person in the world. But as a practical matter, we need some group of lives that we can reasonably verify as both existing and ending. As a rule of thumb, a measuring life is anyone who both (1) is alive when the interest is created and (2) might have something to do with whether the interest vests. In other words, the measuring lives should be people who are somehow relevant to the conveyance.
It’s possible for lawyers to get fancy and specify measuring lives who have nothing to do with the conveyance, like the king of England (unless you’re a royal). But that’s not normal, and we won’t worry about that here.
Incidentally, someone who’s in vitro at the time of the conveyance can be a measuring life. Examiners sometimes like to pull that trick, so keep it in mind.
For example, let’s say Arthur conveys land “to my wife, Bertha, for life, then to my first-born grandchild.” At the time, Arthur has two children, Clyde and Darla, but no grandchildren. The measuring lives are Arthur, the grantor; Bertha, who has to die before the remainder can vest; and Clyde and Darla, either of whom might produce Arthur’s first-born grandchild. Notice that Clyde and Darla can be measuring lives even though they aren’t named in the conveyance.
Tip #2: Ask whether late vesting is possible
Tip #3: Let your imagination run wild
That’s a slight exaggeration, but the RAP doesn’t play by life’s normal rules. In the world of the RAP, anyone can die at any moment, anyone can have children at any age, and anyone can get married at any time. As we’ll see, matters of life, death, marriage, and birth can be especially important under the RAP.
Example #1: An easy case
No, there isn’t. Let’s assume Arthur dies the day after the conveyance. That leaves Bertha, and there’s no way she could have a child more than 21 years after her death. Therefore, it’s impossible for this contingent remainder to vest outside the 21-year period, and the remainder doesn’t violate the RAP.
By the way, even though anything can happen, the RAP hasn’t caught up with modern reproductive technologies. So we’ll ignore the possibility that Bertha’s child could be born from a frozen egg or embryo long after Bertha dies.
Example #2: The slothful executor
Arthur conveyed “to Bertha for life, then to Bertha’s oldest child then living after Bertha’s will is probated.” Could this remainder vest too late?
Yes, it could. Let’s again say Arthur dies the day after the conveyance. Two years later, Bertha has her only child, Clyde. Bertha dies 30 years later, and her will is admitted to probate. So far, so good. But let’s say Bertha’s executor is the 27-year-old Darla, who wasn’t alive when Arthur conveyed to Bertha. Darla is so lazy and incompetent that it takes her 25 years to probate the will. Clyde’s interest then would vest 25 years after Bertha’s death, in violation of the RAP. It’s all highly unlikely, but remember, anything can happen.
Example #3: A fertile octogenarian
Arthur conveys land “to my wife, Bertha, for life, then to my first-born grandchild.” At the time, Arthur is 60 years old and has 2 adult children, Clyde and Darla, but no grandchildren. Is there any way the remainder could vest more than 21 years after Arthur, Bertha, Clyde, and Darla are dead?
Let’s find out. Imagine that Bertha, Clyde, and Darla all die in a car crash the day after the conveyance. Now Arthur is still alive, and he still has no grandchildren. (We’ll assume that the contingent remainder isn’t destroyed.) One year later, Arthur’s future wife, Ella, is born. Twenty years later, Arthur and Ella get married. Notice that Ella can’t be a measuring life because she wasn’t alive when Arthur conveyed to Bertha.
Arthur is now 81 years old, but he and Ella manage to have one child, Francis. Arthur dies when Francis is one year old. Now all the measuring lives have ended.
Francis goes on to have his first child at age 30. Arthur finally has his first grandchild, but it’s now 29 years after all the measuring lives are over. We’ve concocted a scenario in which the remainder to Arthur’s first-born grandchild vests too late and violates the RAP. Remember, anything can happen!
For example, Arthur conveys land “to Bertha for life, then to Bertha’s first child to reach age 25.” The age-25 condition violates the RAP because it allows for vesting more than 21 years after Arthur and Bertha are dead. But a court might conclude that Arthur’s intent was to give the land to Bertha’s oldest child. The court therefore might revise the conveyance to change the age-25 condition to age 21. Now the RAP is satisfied because there’s no way Bertha’s child could turn 21 more than 21 years after Bertha’s death.
Wait and see
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