Also known as: remainder interests · remainder
Written by attorneys · grounded in primary & secondary sources — see below
A future interest in property that becomes possessory upon the termination of a prior estate such as a life estate. The holder receives the property after the intervening interest ends.
Rachel Ramirez conveys land to Raphael Rivera reserving a life estate for herself with remainder interest to a named beneficiary. A court refuses to enforce an unconscionable services clause but upholds the conveyance, leaving the remainder interest intact for the designated beneficiary after Rachel's life estate ends.
Rita Russell creates a trust giving income to her son for life with the remainder interest to her granddaughter. After the son becomes disabled, the court modifies the trust under equitable deviation principles and converts the outright remainder interest into a special needs trust that preserves assets for the granddaughter while fulfilling the settlor's intent.
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Roland Rhodes conveys equipment subject to a security interest and retains a remainder interest in returned collateral. The court strikes an unconscionable warranty disclaimer but enforces the conveyance, so Reed receives the goods while the remainder interest in any returned collateral remains enforceable after the primary obligation ends.
Robert Rivera holds an Indian allotment subject to federal restrictions. Upon his death the remainder interest passes to his heirs. The statute extinguishing certain inheritance rights is challenged because it destroys the economic value of the remainder interest that the heirs expected to receive.
Raven Logistics acquires land subject to a life estate held by a prior owner, with the remainder interest reserved for future development. A municipal zoning ordinance limits building height and thereby reduces the market value of the remainder interest that would otherwise allow commercial construction after the life estate ends.
Regal Apparel holds a remainder interest in commercial real estate leased to a utility subject to a prior leasehold. A state commission order prohibits certain promotional advertising by the utility, lowering the property's income stream and thereby diminishing the present value of the remainder interest that Regal Apparel will receive at the end of the lease term.
A remainder interest passes to a third party after the prior estate ends. A reversion remains with the grantor or the grantor's heirs.
Yes. Under equitable deviation principles a court may convert an outright remainder interest into a special needs trust when unanticipated circumstances arise and the change furthers the settlor's purposes.
Yes. Although possession is postponed, the remainder interest is a presently vested or contingent future interest that can be transferred, devised, or subjected to creditors.
Symbolic delivery such as a letter suffices when the donor retains a life estate. Actual delivery of possession is not required because the donee receives only the future interest.
…Law has deprived them of any gainful use of their “air rights” above the Terminal and that, irrespective of the value of the remainder of their parcel, the city has “taken” their right to this superjacent airspace, thus entitling them to “just compensation” measured by the fair market value of these air rights. Apart from…