Executory Interests

Question 1

Executory Interests

Answer 1

• Transfer is made with a condition subsequent or limitation that gives rise to possibility of divestment
• Future interest is held not by grantor but by third party
• Regardless of whether condition subsequent or limitation, the interest created implies automatic forfeiture
• When you have executory interest – the estate before it “subject to executory limitation”

Question 2

• Shifting executory interest:

Answer 2

o Ex: O to A, so long as X, then to B
o B holds shifting executory interest
o Always preceded by estate in second party
o Subsequent grantee to potentially be divested

Question 3

• Springing executory interest:

Answer 3

o Ex: O to A in 10 years
o A’s right of possession to take effect in the future
o No intermediate estate holder
o O has FS subject to executory limitation; O herself will be divested
o Ex: O to A, subject to A marrying B
 Estate remains w/ O as fee simple subject to executory limitation
 When A marries B, the estate “springs” to A in FSA