Property Law - Seminar 4

SEMINAR 4 - ESTATES Since X is described as owner, X is assumed to have a vested fee simple absolute in possession. It is a right in rem assignable by will. What if X died without next-of-kin and intestate? The estate would have been given "to X and his heirs". If X died intestate and without next-of-kin, then the estate is over because X has no heirs and it has not been assigned. Therefore, under s 72G of the Admin & Probate Act, the fee simple revests in the Crown. A's estate On X's death, A has a:  life estate (A gift of land by will is assumed to be granted in fee simple, unless the contrary appears (s 31 SA Wills Act). The contrary clearly appears here, since the will says "for life")  absolute (no super-added clause cutting the life estate short)  vested (nothing more needs to happen for him to be entitled)  in possession (A is entitled to immediate enjoyment of the land). According to the doctrine of waste, A as life tenant is not liable to the remainderman for permissive waste (damage caused by inaction, eg. lack of repairs) or ameliorating waste (changes that improve the land). So, A is not obliged to upkeep the land. However, A is liable if he commits voluntary waste (active damage to the property) or equitable waste (very severe active damage). B & C's estate On X's death, B & C have a:  joint life estate (because (a) the will expressly says so, and (b) if a fee simple was given away, the rest of the gift would be useless)  absolute (no super-added clause cutting the life estate short)  contingent (B & C must marry each other within 5 years of X's death, in order to be entitled)  in remainder (enjoyment of the estate is postponed to B &C marrying & A dying). So if B & C marry within 5 years of X's death, the gift becomes vested immediately. B & C then obtains possession of it when A dies. As B & C are life tenants, they must not actively cause damage to the land (doctrine of waste). If A were to die before B & C satisfy the contingency , there is a 'gap' when nobody is entitled to possession. Nevertheless the contingent remainder is capable of taking effect, notwithstanding the want of an estate to support it, in the same way as if there were a trust of the land (s 25 LP Act). So the 'gap' is filled with the executor's possession until B & C satisfy the contingency. Also, B & C each have a:  fee simple (because the presumption of a fee simple grant under s 31 SA Wills Act is not displaced - the clause says "absolutely" instead of "for life" this time)  absolute (will says "absolutely")  contingent (B & C must be married at time of death, and one of them must survive)  in remainder (enjoyment of the estate is postponed to the contingency & prior estates). So if B & C are married at time of C's death, the estate becomes vested immediately in B. It goes into B's possession when A dies. As there is now a vested FS in possession, the settlement is over because there is nothing left to give. When B dies, the land passes to B's heirs. G's estate

On X's death, G has a:  fee simple (because X has not said anything to displace the presumption of a fee simple grant under s 31 SA Wills Act)  absolute (no super-added clause cutting short the estate)  contingent (in order to be entitled, (a) G must need the land for educational purposes and (b) the fee simple must not be vested in B or C)  in remainder (enjoyment of the land is postponed to the contingency & the prior estates). Once G certifies that it needs the land for educational purposes, and either B & C do not marry within 5 years of X's death or they are not married at the time of either's death, the estate becomes vested . It goes into possession when A dies. When G gets a vested FS absolute in possession, the settlement is over. X's reversion If the contingencies are not fulfilled, then the fee simple is simply not given away. The fee simple must revert back to X, the grantor. Since X is dead, X's residual beneficiary Y gets the land. Variations in clause Assume that G now has a vested fee simple in possession. i) There is a limiting clause that cuts the fee simple short. The word "until" in the clause is a word of time, which indicates a determinable interest. The clause is not void, as it is not illegal, immoral, manipulative, restrictive of alienation, vague or uncertain. When G ceases to use the land for educational purposes, the determinable fee simple is terminated immediately & automatically reverts to the grantor (or in the case of a will, his executor). The grantor/executor has a possibility of reverter . ii) There is a limiting clause which requires G to use the land for educational purposes. This clause is not void under public policy or uncertainty grounds. The word "provided" in the clause is not a word of time, thus indicating a conditional interest. So if G uses the land for other purposes, it breaches the condition subsequent, and gives the grantor (or in the case of a will, his executor) a right to repossess. The grantor/executor has a right of re- entry . iii) There is a restraint on alienation clause. It is probably void under public policy grounds. The effect of the void clause on the gift depends on whether the fee simple is determinable or conditional. The clause contains the phrase "so long as". This may be interpreted as a phrase of time, thus indicating a determinable fee simple . Since the clause is void under public policy grounds, and a determining limitation is part of the grant itself, the whole fee simple gift fails ( Zapletal v Wright ). On the other hand, "so long as" may not be a phrase of time, thus indicating a fee simple subject to a condition subsequent . According to Zapletal v Wright , a void condition subsequent clause is simply struck out, leaving behind a fee simple absolute. The gift does not fail. Personal notes  No further gift is possible after a vested FS absolute.  Contingent estates must always be in remainder. Watch out for the gap.  Implicit contingency on the fee simple not vesting in others.  A reversion is the grantor's residue interest after he has granted away some lesser interest to another. o It exists when the grantor has not given away his FS  Reversioner always has a vested interest. If contingent, he has technically given it away  not reversioner.  Elaborate on how a contingent & in remainder estate becomes vested & in possession.