Also known as: executory interests
Written by attorneys — see sources below.
A future interest held by a transferee that either divests a prior possessory estate upon a specified event or begins after the natural termination of a preceding estate.
Edward Everett conveyed land to his son Elijah in fee simple conditional. The deed provided that if Elijah died without surviving issue the land would pass to Everest Holdings under an alternative limitation. When Elijah died childless the executory interest in Everest Holdings became possessory and cut off any claim by Elijah's heirs.
Eileen Epstein held a fee simple conditional that would end if she died without issue. The conveyance named Elise Everly as the holder of an executory interest that would take only if no issue survived and no other taker existed. Upon Eileen dying without descendants the executory interest in Elise Everly vested in possession.
Ezra Eastman received land in a fee tail substitute under state statute. The deed created an executory interest in Eastern Electric that would divest the estate if Ezra died without surviving issue. When Ezra died childless the executory interest shifted possession to Eastern Electric.
Eugene Ellsworth held a fee tail substitute. The instrument named a remainderman and then created an executory interest in Echo Systems that would take if the remainderman failed. When no issue survived and the remainderman also failed the executory interest in Echo Systems became possessory.
Elijah Edwards held a fee simple conditional subject to an executory interest in Emerald Enterprises if he died without issue. After his marriage his widow claimed dower but the executory interest remained superior. The court held that the widow's dower was subordinate to the executory interest that had not been destroyed by any prior transfer.
Elise Everly and her spouse held land as joint tenants. To terminate the right of survivorship Elise conveyed her interest to herself in a manner that created a tenancy in common with an executory interest in her heirs. The transaction produced an executory interest that would shift possession upon the death of the surviving joint tenant.
Mr. and Mrs. Riddle purchased a parcel of real estate, taking title as joint tenants. Several months before her death, Mrs. Riddle retained an attorney to plan her estate. After reviewing pertinent documents, he advised her that the property was held in joint tenancy and that, upon her death, the property would pass to her husband. Distressed upon learning this, she requested that the joint tenancy be terminated so that she could dispose of her interest by will. As a result, the attorney prepared a grant deed whereby Mrs. Riddle granted to herself an undivided one-half interest in the subject property. The document also provided that “The purpose of this Grant Deed is to terminate those joint tenancies formerly existing between the Grantor, Frances P. Riddle, and Jack C. Riddle, her husband. ...” He also prepared a will disposing of Mrs. Riddle’s interest in the property. Both the grant deed and will were executed on December 8, 1975. Mrs. Riddle died 20 days later. The trial court refused to sanction her plan to sever the joint tenancy and quieted title to the property in her husband. The executrix of the will of Frances Riddle appeals from that judgment.
View caseAn executory interest divests or cuts short a prior estate while a remainder waits for the natural termination of the preceding estate. The distinction turns on whether the future interest operates by divestment or by succession after natural expiration.
Yes. Executory interests are contingent future interests and therefore subject to the rule. If the interest might vest beyond the perpetuities period it is void and the preceding estate may become absolute.
A shifting executory interest divests an estate held by a transferee. A springing executory interest divests an estate retained by the transferor or springs out of the transferor after a gap in possession.
No. A future interest in a third party that follows a fee simple determinable must be labeled an executory interest because a remainder cannot follow a fee simple. The label follows from the rule that remainders cannot follow vested fees simple.
Footnotes : Civil Code section 683, as amended in 1955, provides in relevant part that: “A joint interest is one owned by two or more persons in equal shares, by a title created by a single will or transfer, when expressly declared in the will or transfer to be a joint tenancy, or by transfer…