Estate

A freehold estate is a right of title to land that is characterized by two essential elements: immobility, meaning that the property involved is either land or an interest that is attached to or has been derived from land, and indeterminate duration, which means there is no fixed duration of ownership.

There are three kinds of freehold estates: a fee simple, a fee tail, and a life estate.

Fee Simple Absolute A fee simple absolute is the most extensive interest in real property that an individual can possess, since it is limited completely to the individual and his or her heirs and assigns forever, and it is not subject to any limitations or conditions.

For example, an individual might purchase a plot of land for which the deed states that the grantor transfers the property "to grantee and his or her heirs," which would have the legal effect of creating a fee simple absolute. The grantee has the right to immediate and exclusive possession of the land, and he or she can do whatever he or she wants with it, such as grow crops, remove trees, build on it, sell it, or dispose of it by will. This type of estate is deemed to be perpetual. Upon the death of the owner, if no provision has been made for its distribution, the land will automatically be inherited by the owner's heirs.

Fee Simple Determinable A fee simple determinable, which is also referred to as a base fee or qualified fee, is one that continues until the occurrence of a specified event. When such an event occurs, the estate will terminate automatically by operation of law, at which time the ownership reverts to the grantor or his or her heirs.

For example, a grantor makes the following conveyance: "To grantee and his or her heirs so long as it is used for school purposes." The grantor's intent is clearly indicated when he or she creates the estate. When the grantee ceases to use the land for school purposes, the grantor has the right to immediate possession. The grantee's estate is restricted to the period during which the land is used for school purposes.

The interest of the grantor is known as a possibility of reverter. Ordinarily the words until or as long as indicate the creation of a special limitation.

Fee Simple Subject to a Condition Subsequent A fee simple subject to a condition subsequent is an estate that terminates only upon the exercise of the power of termination, or right of reentry, for the violation of a particular condition. It differs from a fee simple determinable in that the latter expires automatically, by operation of law, upon the happening of the event specified. A fee simple subject to a condition subsequent continues even after the occurrence of the event until the grantor divests the estate or ends it through the exercise of his or her power to terminate.

For example, the grantor conveys land "to grantee and his or her heirs, but if the premises are used for commercial purposes other than the sale of antiques, then the grantor has the right to reenter and repossess the property."

The grantor has the power to end the grantee's fee through his or her reentry onto the premises if the condition is violated. Reentry, however, is totally at the option of the grantor. The grantee's estate continues until the grantor either enters the land or brings an action to recover possession. When the grantor does reenter the land, the remaining portion of the grantee's estate is forfeited.

Ordinarily, the words used in conveyance to create an estate subject to a condition subsequent are upon condition that, provided that, or but if, together with a provision for reentry by the grantor.

Fee Simple Subject to Executory Limitation At English COMMON LAW, a grantor was not able to create a freehold estate that was to begin in futuro, at a subsequent time, because LIVERY OF SEISIN (actual possession) was essential. If actual possession of the land was given to the grantee, the estate would be immediately effective, contrary to the grantor's intent. The only manner in which an estate that was to begin in the future could be created was through the use of a remainder. For example, if a grantor wished to give the grantee a future interest in the land, he might make the following conveyance,"to transferee for life, remainder to grantee and his or her heirs." Livery of seisin was thereby made to the transferee, who held the estate for life, and upon the transferee's death the seisin passed to the grantee.

In 1535, however, the STATUTE OF USES was passed, which allowed the creation, by deed, of springing interests, or executory interests. A grantor could, thereby, give the grantee a present right to the future interest in the land. The grantor might, for example, convey the land "to grantee and his heirs, grantee's interest to commence five years from the date of the deed."

A grantor can also convey an estate subject to a shifting interest. For example, the grantor might make the following conveyance: "To grantee and his or her heirs, but in the event that grantee dies without issue upon his or her death, then to transferee and his or her heirs." The grantee is thereby given a fee simple subject to an executory limitation, which is the interest of the transferee.

Fee Tail A fee tail is an estate subject to limitations concerning who may inherit the property, which is ordinarily created by a deed or a will.

Two significant historical developments were instrumental in the creation of this type of freehold estate. The first was recognition by the court of the fee simple conditional, and the second was the passing of the Statute De Donis Conditionalibus, commonly known as the Statute De Donis, in 1285 by Parliament.

Prior to 1285, the provision "to grantee and the heirs of his body" was interpreted by the courts as providing the grantee with the power to convey a fee simple in the property if and when he sired a child. An estate of this nature was referred to as a fee simple conditional, since it was a fee simple contingent upon offspring being born to the grantee. The grantee was thereby able to terminate any rights that the heirs of his body might have in the land. In addition, he was able to terminate the possibility of reverter which the grantor had in the land.

The Statute De Donis was subsequently passed in order to keep family land in a family, provided there was a family or issue. A grantee could not convey land in such manner as to terminate the right of heirs of his body to inherit the land upon his death nor could he convey so as to terminate the grantor's reversionary interest. If the grantee conveyed property "to transferee and his heirs," and then died, leaving a child, the child could take the land from the transferee. If the grantee died with no surviving heirs of the body, the grantor could take the land away from the transferee.

The grantor of a fee tail was permitted to limit the inheritance to a specific group of lineal descendants of the grantee. He could create a fee tail general, for example, to transferee and "the heirs of his body begotten," regardless of the number of wives by whom the transferee had children. Alternatively, he could create a fee tail special, to transferee and "the heirs of his body on Ann, his now wife, to be begotten," which specifies that only issue of the marriage of the transferee and Ann, and no other marriage, could inherit. A grant to a man and his male bodily heirs, for example, created a fee tail male while a fee tail female restricted transfer of land to the transferee and the female heirs of his or her body only.

Life Estate A life estate is an interest in property that does not amount to ownership, since it is limited by a term of life, either of the individual in whom the right is vested or some other person. It may also last only until the occurrence or nonoccurrence of an uncertain event. A life estate pur autre vie is an estate that the grantee holds for the life of another person.

A life estate is generally created by deed but can be created by lease. No special language is required provided the grantor's intent to create such an estate is clear. The grantee of a life estate is called the life tenant.

A life tenant can use the land, take any fruits stemming from the land (i.e., crops), and dispose of his or her interest to another person. The power to dispose includes the right to mortgage the property, and to create liens, EASEMENTS,or other rights in the property, provided they do not extend beyond the period of the tenant's life.

The holder of a life estate cannot do anything that would injure the property or cause waste, or in any way interfere with the reversionary interest of the grantee. The life tenant has the right to exclusive possession subject to the rights of the grantor to (1) enter the property to ascertain whether or not waste has been committed or is in the process of being committed; (2) collect any rent that is due; (3) come upon the property to make any necessary repairs; (4) move timber that has been severed and belongs to him or her; and (5) do any acts that will prevent the termination of his or her reversion.

The life tenant is permitted to use the property in the same manner as the owner of a fee simple, except that he or she must leave the property in reasonably good condition for the individual who will succeed to the possession. The life tenant has an obligation to maintain the property in good repair and must pay taxes and interest on any mortgage on the premises when the life estate begins. The life tenant has the right to the issues and profits from the land, and any crop planted prior to the termination of the life estate can be harvested by the tenant's PERSONAL REPRESENTATIVE. In addition, any fixtures placed on the ground by the tenant can be removed by him or her. If the property is harmed, the life tenant can obtain a recovery for the injury to his or her interest.

In a typical life estate for the life of an individual other than the tenant, the grantor conveys the property "to grantee for the life of A." The grantee is thereby given an estate for the life span of another person. In this type of conveyance, A is the measuring life. At common law, if the grantee died before the individual whose life measured the estate, the property was regarded as being without an owner. The first individual to obtain possession, known as the common occupant, was entitled to the estate until the death of the person whose life measured the duration of the estate. An estate pur autre vie could not be inherited by the heirs of the deceased grantee, nor could it be reclaimed by the grantor since he or she had conveyed his or her interest for the life of another person who was still living. No one had the right to evict the common occupant.

Some grantors made conveyances that provided for the heirs of the grantee. For example, "to grantee and his heirs for the life of A." If the grantee died during A's lifetime, an heir of the grantee would take as a special occupant rather than by descent. Some modern statutes have made the property interest between the death of the grantee and the measuring life a chattel real, making the provision that the grantee's personal representative takes the property as personal property.

A life estate is alienable, and therefore, the life tenant can convey his or her estate. The grantee of the life tenant would thereby be given an estate pur autre vie. The life tenant is unable, however, to convey an estate that is greater than his or her own.