Estates & future interests

Rights of first refusal do not violate the rule against perpetuities if they must be exercised during the holder's lifetime

New York retains a version of the traditional rule against perpetuities. Like most states, it has classified options to purchase and rights of first refusal as "executory interests" subject to the rule against perpetuities. They therefore must vest (if at all) within 21 years of their creation, or within 21 years of the death of a named person in the conveyance or during the lifetime of a named person. The latter was the case in...

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Proceeds of partition by sale divided according to ownership interests without any credit given to co-owner whose funds were used to buy the property

Because the Texas partition statute requires the proceeds of a partition sale to be divided "according to [the owners'] just rights therein," joint tenants were entitled to 50% of the sale proceeds even though one of the co-owners had used his own funds to purchase the property. ...

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"Condition" language creates executory interest, but new executory interests banned unless held by public or charitable entities

In White v. Auger,2019 N.H. LEXIS 4 (N.H. 2019), the grantor conveyed property to a grantee "on condition that" the grantee build on it (or on adjacent land) and live there (within 10 years) created a fee simple subject to executory limitation. State statutes abolished possibilities of reverter, rights of entry, and...

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Possibility of reverter or right of entry cut off after 30 years

Massachusetts law sets a thirty year limit to possibilities of reverter following a fee simple determinable or rights of entry following a free simple subject to condition subsequent. Mass. Gen. Laws ch. 184A, §7. This contrasts with the 90 year limit for executory interests. Mass. Gen. Laws ch. 190B, § 2-901. The 30 year limitation was recently applied in ... Read more about Possibility of reverter or right of entry cut off after 30 years

Permanent rights of refusal for tenancy in common interests owned by family members held void as unreasonable restraints on alienation

A Massachusetts court has held that permanent rights of refusal applying to tenancy-in-common interests were void as unreasonable restraints on alienation. DiSchino v. Delanson Circle Holding, 2018 Mass. Super. LEXIS 67 (Mass. Super. Ct. 2018).

The court noted that the state had a...

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