Previously we have discussed that when a person owns something they own a bundle of rights. More specifically, these bundle of rights refer to ownership of a present possessory estate. The estate then is the actual property being owned. Jurisdictions over time have provided rules of how estates can be transferred. A person with a present possession has the estate while a person promised to have possession in the future has a future interest.
The history of estates shape our understanding of how the terms functions today. Historically, the feudal system came from England. Land would be subdivided and payments made for the services of those who owned the land. Incidents were paid to the king to transfer the land to the eldest son. However, over time, these services became obsolete and the incidents become controversial. As a result, tenants were given the right to transfer land without the permission from the lord (ultimately changing the feudal system).
Over time, commercialization grew and there were two recognized estates: freehold and non freehold. Of the freehold estates, there are three categories; fee simple, life estate, and the fee tail. Over time, these rules became simplified to the ones we know today.
Additional Notes
History
William the Conqueror won a war and dealt out land to his supporters. He did so through the “Domesday Book” which was a book outlying the survey of the land. This book really said, “this is who owns what.”
So, this system created a pyramid where the bottom would pay services (knighthood) and incidents (monetary taxes) to the lord above in the chain of command.
Eventually, the services become less valuable, and the incidents increased (causing discontent among lower tenants). Eventually with the Magna Carta, property rights were created so free people could transfer the property without the permission of the king.
When the people transferred land, they had to convey the land by passing dirt or twigs. This was witnessed to confirm the transfer occurred. This was called a deed.
Fee Simple
A fee simple constitutes the largest number of transactions within an estate. Ultimately, a fee simple is the ability of an individual to own an estate for eternity. Once upon a time, the conveyance of this estate needed to have specific words. However, now, it is assumed that a fee simple estate is being conveyed unless other words indicate that there is not a fee simple. This language is vital to get right or else it can lead to disastrous consequences.
A fee simple is alienable (transfer), devisable (through a will), and descendible (by the state if there is no will).
Cole v. Steinlauf
136 A.2d 744 (Sup Ct. Err. Conn. 1957).
The plaintiff lost in trial court and appealed.
Question
Whether the deed conveyed the fee to the grantee without any issues.
Rule
The word heir needs to be included to create a simple fee.
Holding
The word was lacking, no fee simple was created.
Facts
The plaintiff was purchasing real estate from the defendants. The deal was subject to the plaintiff finding that there was no fault in the deed. A 420 deposit was made and the search began. Once the deed was found, the lawyer determined that there was nothing in there about the heirs of the deed, realizing that the chain of title was broken. As such, the plaintiffs claimed that it was a bad title and asked for the deposit plus the 50 dollar fee to search for the title. When the defendant refused, the plaintiffs sued.
Analysis
The deed contained the language in the conveyance “and his assigns forever.” However, it was lacking any terms to transfer the fee to “heirs.” In Connecticut, this language is essential. Leaving it out means that they were only conveyed a life estate, not a fee simple.
Things have changed somewhat since the Cole decision. Now, inclusion of the word “heir” is not necessary. Instead, we simply look to the intention of the conveyance to determine which type of estate was transferred.
Additional Notes
The issue here is that it said “and assigns forever” but needed to say “and her heirs.” There are two parts of the conveyance. First, the words of purchase refer to who the conveyance goes to. Second, the words of limitations refer to what kind of purchase it is (e.g. fee simple).
In the old times, that meant that this was only a life estate. Here, the party did not have a fee simple because the past party only had a life estate. So, even though it said he has a fee simple, the defect means that the chain of title was broken.
“You can only convey what you have.”
However, just because the words “heirs” needed to be included, there is no future interest to the heirs. All the ownership retains with the ownership for forever.
Now, the presumption is that this would be a fee simple. So, if this case was assigned today, it would have been considered a fee simple, not a life estate.
Importantly, if a conveyance is invalid, the property remains with the grantor.
Life Estates
Life estates last for the duration of the owners life. The words to show that a life estate has been conveyed are “for life.” However, other terms denoting that intention may also be acceptable. A life estate gives the individual the right to possess during the life of the owner. Additionally, the owner can alienate a life estate, but it is not devisable or descendible. That means once the owner dies, it returns to the individual to conveyed the estate (unless the owner conveyed a future interest to another individual to take possession at the time of death).
So, if ambiguity arises in the wording, it is assumed that a fee simple is conveyed not a life estate.
White v. Brown
559 S.W.2d 938 (Tenn. 1977).
White is the plaintiff. She lost in trial and appeal before making this appeal.
Question
Did the wording in the will convey a fee simple or life estate?
Rule
If the language is ambiguous, assume that a fee simple is created. A life estate requires certain language of limitation.
Holding
The language here is unclear, the conveyance was for a fee simple.
Facts
Ms. White and her family and was living with Ms. Lide (Ms. White was Ms. Lide’s sister-in-law). Ms. Lide passed away and willed the house to go to Ms. White. However, the language of the will is important. The will stated, “. . . White to have my home to live in and not to be sold.”
Analysis
Ultimately, the question is, what is to be inferred by the limitation of the home not to be sold? Because of the unclarity, it is assumed that a fee simple instead of a life estate should be conferred. If this is a fee simple, then the requirement not to sell the home is an invalid restriction.
However, the dissent argues that the phrase means that the testatrix only intended Ms. White to have the home for life. If that is the case, then the requirement not to sell the hose is completely valid.
Additional Notes
The issue here is whether the language created a life estate or a fee simple (with the restriction of selling).
If this is a life estate, then the property would have gone to the Lide’s heirs.
However, if this is a fee simple, then it goes to Ms. White.
Here, the language is unclear so it is ambiguous and it is assumed that the will made a fee simple. Part of the reason why we choose a fee simple is because it gives the owner more marketable rights and it is likely that more people intend to part all those rights.
Woodrick v. Wood
1994 WL 236287 (Ct. App. Ohio 1994).
Typically, those who have a life estate are expected to treat the property well so that there is no waste for those who have a future interest. This case explores what happens if the party with a life estate increases the value of the property.
Question
“Whether the holder of a remainder interest in a parcel of land may prohibit the life tenant of such property from destroying structures on the land.”
Rule
Waste is an abuse or destructive use of property by someone who has possession of that property. So the test is, “does this action diminish or increase the value of the property.”
Holding
Tearing down the barn is not waste, the payment for the barn is fine. Affirmed.
Facts
Two children of Mr. Wood survived him. His wife was given a life estate and then the children has the future interest in the remainder. However, the mother and one of the kids wanted to remove a barn from the property. The other (Woodrick) objected and sued to obtain an injunction so the barn would not be destroyed.
The barn was valued at 3,200 but was rotting. The removal of the barn would increase the property value. So, is the destruction waste?
Analysis
It is not waste because the destruction actually increases the value of the property. The trial court had order that the parties pay the 3,200 to Woodrick to pay for the value of the barn, but that was not because the destruction was waste. Instead, that was to protect the rights of all parties involved to provide a fair remedy to all involved.
This approach is not the common law approach. Under the common law, the destruction would have been waste because life tenants are not allowed to alter property, even if it increases the value of the property. Most courts follow the Woodrick view.
Additional Notes
As a life tenant, you cannot abuse or destroy the property (waste) because the future interest holders maintain an interest in the land. Under common law, you cannot alter the property even if it significantly benefits the property.
However, because the destruction of the barn increases the value of the property this is allowed.
There are two traditional doctrines of waste:
- Voluntary waste – an action that significantly reduces the value of the property.
- Permissive waste – failing to reasonably care for the estate (e.g. paying property taxes).
Fee Tail
Fee tails are no longer common. In England, they were eradicated in 1925. In the United States, only 4 states recognize a fee tail as valid, Delaware, Maine, Massachusetts, and Rhode Island.
A fee tail is when the possessor passes on the estate to the immediate descendants. So, if A passes on an estate to B “and the heirs of his body” then once B dies, the estate goes onto the descendants. However, if the line of descendants ends, then A has the reversion and will retain the estate in fee simple.
There are two kinds of fee tails. First, one that specify which gender the fee tail passes to (e.g. “and the male heirs of her body.”), called a fee tail male. Second, one that keeps the fee tail in the immediate bloodline of a person (e.g. “and the heirs of her body by C”).
In the states that do not recognize a fee tail, the language of transfer is interpreted to be a fee simple.
Fee Simple Defeasible
A fee simple defeasible is a fee simple that could continue forever or end when a certain event (outlined in the words of duration) occurs. There are three kinds of fee simple defeasible: determinable, subject to a condition subsequent, and subject to an executory limitation.
Fee Simple Determinable
This is when the fee simple defeasible automatically reverts back to a fee simple at the occurrence of an event. For example, “A conveys to B and his heirs so long as the land is used as a farm.” The words “as long as, while, until, and during” are all words that limit the duration of the fee simple. Additionally, a fee simple can be alienable, devisable, and descendable. However, if the event occurs, A maintains a reversion of the estate. In sum, the future interest is a “possibility of Reverter held by the transferor. Both of necessary words, and the future interest are necessary to create a fee simple determinable.
Takeaway: Memorize these terms which outline the duration. The future interest is a possibility of reverter.
- So long as
- While
- Until
- During
Fee Simple Subject to a Condition Subsequent
A fee simple subject to a condition subsequent works like a fee simple determinable except the condition does not automatically revert the estate back to the original owner. Instead, the owner must take an additional step to reclaim possession. The words of duration here include, “provided that, but if, or on condition that.” For example, “A conveys to B and his heirs provided that the land is used as a farm, and if not, then A may re-enter and reclaim.”
This last section of the words of limitation is a statement saying that A has the right to revert ownership, however, they must choose to do so. If not, then B will retain a fee simple in the property, despite the condition occurring.
Words of duration and future interest: Right of entry or power of termination held by transferor.
- Provided that
- But if
- On condition that
- In addition, the conveyance should include the words “Right to re-enter and reclaim.”
Fee Simple Subject to an Executory Limitation
A fee simple subject to an executory limitation has the same words as a fee simple determinable or subject to a condition subsequent. The main difference is that once the event occurs, another party has a future interest in the life estate. For example, “A conveys to B and his heirs as long as the land remains a farm, but if not, then to C.” So instead of A maintaining a reversion, C maintains a remainder. The distinction between the different kinds of fee simple defeasible are essential here, as seen by the following case.
The key factor is to know who holds the future interest.
Any of the key words mentioned in the other methods of creating a fee simple defeasible would be satisfactory to create a fee simple subject to an executory limitation.
If the condition occurs, the estate is automatically forfeited in favor of someone other than the transferor. The person other than the transferor holds a future interest “shifting or springing executory interest held by a third party.”
Fee Simple Defeasible Cases
These cases focus on how the different language alters which type of fee simple defeasible is in application.
Mahrenholz v. County Board of School Trustees of Lawrence County
417 N.E.2d 138 (Ill. App. Ct. 1981).
Mahrenholz are the plaintiffs. Their case was dismissed in trial court and they appealed.
Question
Does the language of the deed convey a fee simple determinable or subject to a condition subsequent?
Rule
A fee simple determinable automatically reverts back to the owner of the estate whereas a s fee simple subject to a condition subsequent requires the person with a possessory interest to reclaim the land.
Holding
The wording of the estate is a fee simple determinable. Reversed and remanded.
Facts
The Huttons’ owned 40 acres of land and created a fee simple defeasible to the school district for 1 and 1/2 acres. The language in the deed was that the land was conveyed for “school purposes only, otherwise to revert to grantors herein.”
The school was originally built for classroom instruction. However, at the time of suit, it was only being used as a storage facility.
The Huttons’ only heir transferred his possessory interest into the school some time later. However, earlier, the Huttons had sold the land (including the tract with the school) to another party who eventually sold to the Mahrenholz.
Analysis
The school is arguing that this deed language is a fee simple subject to a condition subsequent. On the other hand, the plaintiffs are arguing that this is a fee simple determinable. The language here matters because in essence, it determines who has possessory interest in the school.
The court argues that this is a fee simple determinable. Although the language is ambiguous, there was a clear interest that the school was to be limited to “school purposes,” rather than a condition. Consequently, a use other than the one intended would automatically revert to the Hutton’s (who passed interest eventually to the Mahrenholz).
Additional Notes
The Huttons had conveyed the land to the school district and used the following phrase to do so: “This land to be used for school purposes only; otherwise to revert to Grantors herein.” Because this phrase includes a condition, we know that this is a type of fee simple defeasible.
Here, this is a case focusing on the difference between fee simple determinable and a fee simple subject to a condition subsequent (going to the grantors).
The issue here is that the language to determine what type was missing. So, the question really is… which type is this language?
Factual History
- 1941 – Huttons convey the land to the school district
- 1950s – Huttons convey all the land to the Jacqmains (390 Acres)
- 1959 – Jacqmains convey all the land to Mahrenholz
- 1969 – Hotton dies and his only heir is Hutton the Second.
- 1973 – The school stops using the land for school and uses it for storage
- May 1977 – Hutton the Second conveyed all to his interest to Mahrenholz
- September 1977 – Hutton the Second disclaims his interest gives it to the school.
Analysis
If this is a fee simple determinable, Hutton the second had the possibility of reverter when his father died (1969). When he conveys all the land to Mahrenholz by deed, his interest transfers (May 1977). As a result, if this is a fee simple determinable, the Mahrenholz wins.
However, if this is a fee simple subject to a condition subsequent, Hutton the second has the right of entry (1969). When Hutton did not reclaim the land in 1969, then disclaim it in Sept 1977, that possession transfers. As a result, this is a fee simple subject to a condition subsequent and the school wins.
When there is ambiguity, this court argues that the default should be a fee simple determinable. This is different than the norm where any ambiguity benefits a fee simple subject to a condition subsequent.
In today’s law, these future interests are alienable, devisable, and descendable. In today’s law, the Mahrenholz would win either way (conveyance of 1950s).
Metropolitan Park District v. Unknown Heirs of Rigney
399 P.2d 516 (Wash. 1965).
This case discusses what happens when the holder of a fee simple defeasible continues to maintain possession of the land after the condition has been breached.
The metro is the plaintiff who won in trial.
Question
Whether the park can keep possession through adverse passion. If not, whether the park can retain possession because the heirs did not determine their forfeiture within a certain time, thus waiving the right of claim.
Rule
For the first question, when the reversion interest has not forfeited their interest, then the land is not used in adversity. For the second question, after the passing of a reasonable time after breach, the reversion interest loses the ability to retain forfeiture.
Holding
A reasonable time has passed. Affirmed.
Facts
The conveyance here was from Rigney to the city as long as the land was to be maintained as a waterway. If not, it reverts back to the Rigneys.
For some time, it was used as a waterway. However, the city eventually turned it into a park and built tennis courts on the land for public use.
Later, the heirs of Rigney came to reclaim possession. The City sued for quiet title and both parties asked for summary judgment to grant quiet title.
There is no dispute that the language created in the deed created a Fee Simple Subject to Condition Subsequent.
Analysis
Because this is a fee simple subject to condition subsequent, the possessor has the right to retain ownership after breach unless the reverted interest reclaims the property. As such, when there is no forfeiture of the property, there is no way for adverse possession to occur. However, for the purpose of ensuring the most efficient use of the land, the right to reenter the land could be waived. If a reasonable time passes after breach, then the reverted interest no longer maintains that interest.
This is the case here. The city cannot obtain possession through adverse possession. However, they can retain quiet title because the heirs waived their right to reenter the land by not reclaiming within a reasonable time.
Glossary of Terms
General
Estate – Owned Property
Deed – Done by a living person. The verb to issue a deed is a Grant or Convey by Grantor (person selling), Grantee (person receiving).
Will – Done by a person who makes preparations for their death. The verb is Devise. The person who issues the will is the testator to the beneficiary.
Intestate – Death without a will. The verb is to descend to the heir. A person does not have an heir until death. Before death, those individuals are anticipatory heirs (relatives).
Restraint – There are three kinds of restraints. Disabling restraint (can’t do this), forfeiture restraint (if you do this, you loose that), and a promissory restraint (promise you won’t do this).
Freehold Estates
Fee Simple Absolute (Fee Simple) – Property owner had all the property rights and is absolute. These are alienable, devisable, descendible.
The ways to convey a fee simple:
- O conveys to B and his heirs.
- O conveys to B.
- O conveys to B in fee simple absolute.
- O conveys to B for ever and ever.
- O conveys to Inc., its successors, and assigns.
Words of purchase are emphasized and words of limitation are underlined.
Life Estate – A present possessory interest. When that life expires, so does the estate. These are alienable, but not devisable or descendible.
Life tenant – Is the person who has the present possessory interest.
Here are the ways to convey a life estate:
- O conveys to B for life.
- O conveys to B for all of B’s life.
- O conveys to B for as long as B lives.
- O conveys to B for life. B. the conveys the estate to C.
- O conveys to B for life, then C for life.
O conveys to Google for life.
Reversion – Original grantor. The property returns to the original grantor at the end of life.
Remainder – Owned by someone else, life estate. This property goes to someone else at the end of life.
Importantly, a company cannot be issued a life estate.
Disclaimer
The content contained in this article may contain inaccuracies and is not intended to reflect the opinions, views, beliefs, or practices of any academic professor or publication. Instead, this content is a reflection on the author’s understanding of the law and legal practices.
