Property · Future Interests
Clear answer to: Is It Possible To Future Interests in Property? with key cases, examples, and exam tips for law students.
Yes, it is possible to create future interests in property, which are legal rights to possession or income from a property at a future date.
Future interests in property refer to legal rights to ownership or income that will become possessory at a future time. Common types of future interests include remainders and executory interests. Remainders occur when a property interest is given to someone after a life estate or other preceding interest ends, whereas executory interests cut short a prior interest when a specific condition occurs. These concepts are essential for understanding property conveyances and ownership rights in various situations.
The creation of future interests is governed by statutes and common law principles, and they must comply with the Rule Against Perpetuities, which prevents interests from lasting indefinitely. This Rule ensures property doesn’t remain tied up in future interests beyond a certain lifespan. For example, a remainder that vests within 21 years after the death of a measuring life adheres to this rule and is therefore valid. Failure to comply with this rule can render the future interest void.
Notable cases illustrate the application of future interests. For instance, in *Shallenberger v. Torkington* (2017), the court examined the validity of a contingent remainder and applied the Rule Against Perpetuities to determine its enforceability. In *Wood v. Board of Chosen Freeholders of Ocean County* (2009), the court dealt with an executory interest and its impact on a prior life estate.
In practice, future interests can help in estate planning, commercial transactions, and property development, giving individuals and entities strategic ways to manage valuable assets over time. It is crucial to draft conveyances carefully to ensure the intended future interests are valid and enforceable.
A parent conveys property to their child for life, with the remainder to the child's children. Here, the children hold a future interest as remaindermen, which will vest upon the death of the life tenant.
Future interests are frequently tested in property law exams, often requiring students to apply doctrinal rules such as the Rule Against Perpetuities and identify valid future interests.