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Applying the Rule Against Perpetuities

Applying the common law Rule Against Perpetuities (RAP) involves systematically reading its core statement, identifying a valid measuring life, and testing a gift to ensure it must vest or fail within 21 years after that life in being. RAP is a common law principle preventing "dead hand" control by limiting the duration of contingent future interests in property, ensuring property remains marketable. Modern statutory reforms like the Uniform Statutory Rule Against Perpetuities (USRAP) often introduce a "wait-and-see" approach or an alternative 90-year period to mitigate the harshness of the common law rule.

Steps for applying the Rule Against Perpetuities.

Concepts · 6

RAP's Core Elements
Definition
Why can't you leave property to 'my descendants forever'?
Just as contract law has statutes of limitations to prevent claims from lingering indefinitely, property law has a rule to prevent ownership from being tied up for an unreasonably long time.
The Rule Against Perpetuities (RAP) prevents property from being tied up indefinitely, ensuring it can eventually be fully owned and transferred. It invalidates certain future interests that might not vest (become certain) within a specific, limited timeframe.
WHAT IT ISThe Rule Against Perpetuities (RAP) is a common law legal principle that limits the duration of contingent future interests in property.
WHAT IT DOESIt dictates that 'no interest is good unless it must vest, if at all, not later than twenty-one years after some life in being at the creation of the interest.' This means a property interest is void from the start if there's any possibility it won't become certain (vest) or fail within the perpetuities period. For instance, a gift 'to my first grandchild to become a lawyer' must be certain to vest or fail within this period, or it's invalid.
WHY IT MATTERSUnderstanding RAP is crucial for drafting wills, trusts, and deeds to ensure property dispositions are legally valid and achieve the grantor's intent. It applies whenever a property owner attempts to control ownership far into the future, particularly with contingent gifts.
RAP's Core Elements
$N o in t er es t i s g oo d u n l ess i t m u s t v es t, i f a t a l l, n o t l a t er t han tw e n t y - o n e y e a r s a f t er so m e l i f e in b e in g a t t h e cr e a t i o n o f t h e in t er es t .$
Not to be confused with: A gift 'to my son John for life, then to my daughter Mary'. - This is not subject to RAP because Mary's interest (a vested remainder) is certain to vest immediately upon John's death, which is a definite event. RAP applies only to contingent future interests, not to vested interests or present interests, which are already certain.
WHY THIS MATTERSRAP prevents 'dead hand' control, ensuring property remains marketable and responsive to current economic needs rather than being perpetually controlled by past generations. This rule is critical for property lawyers and estate planners to avoid invalidating complex trusts and wills.
Identifying the Measuring Life
Process
How do you pick the right person to start the clock for a property gift that might take a long time to finalize?
Just as a contract might specify a person's lifetime as a duration for an agreement, the Rule Against Perpetuities uses a specific 'life in being' to set its time limit.
To apply the Rule Against Perpetuities, you need a specific person whose lifespan anchors the time limit. This measuring life is a real individual whose death helps determine if a future property interest will finalize within the allowed period.
WHAT IT ISA measuring life is a specific individual whose existence at the creation of a property interest is used to define the perpetuities period.
WHAT IT DOESIt sets the 'life in being' component of the common law Rule Against Perpetuities, ensuring that a contingent interest must vest or fail within 21 years after the death of this person. For example, if a gift is 'to my grandchildren who reach 21,' the children of the grantor (who are alive when the gift is made) could serve as measuring lives.
WHY IT MATTERSIdentifying the correct measuring life is crucial for applying the common law Rule Against Perpetuities, as it provides the necessary temporal benchmark to prevent property interests from remaining contingent indefinitely, thus limiting 'dead hand' control over property for future generations.
Process for Identifying a Measuring Life
Artuš Scheiner - Measure for Measure~2 (cropped to remove text).jpg · Artuš Scheiner / Public domain
Walk through an example
A will states: 'To my son, Ben, for life, then to Ben's first child to reach age 25.' The will is created today. Ben is alive and has no children yet.
1. Identify all 'lives in being' at the creation of the interest.
  These are individuals alive when the will takes effect (today). Ben is explicitly named and alive. Other people mentioned or implicitly relevant (like the testator, if still alive, or other family members) are also lives in being. However, only those relevant to the vesting of the interest are useful.
2. Ben as a potential measuring life.
  Ben is alive at the creation of the interest. His death will determine when no more children can be born to him, which is directly relevant to 'Ben's first child'.
3. Test if the contingent interest ('Ben's first child to reach 25') must vest or fail within 21 years of Ben's death.
  If Ben dies, he can no longer have children (or any conceived child will be born within 9 months). Any child of Ben must reach 25 within 25 years of their birth. If Ben is the measuring life, the question is whether the child's interest will vest (reach 25) or fail within 21 years of Ben's death. This is where the 21-year period is crucial. If Ben dies, and his child is 1 year old, they will reach 25 in 24 years, exceeding the 21-year period. Therefore, Ben is NOT the validating life here.
4. Other lives in being (e.g., Ben's potential children, if they were alive).
  If Ben had a child, say Carol, alive at the creation, Carol could be a measuring life. If Carol is the first child, and she is alive, her interest will vest or fail within her lifetime. But the gift is to Ben's first child, which implies a future, currently unascertained person. No other 'life in being' can guarantee that Ben's first child will reach 25 within 21 years of their death.
5. Conclude if a valid measuring life exists for this specific gift.
  No single life in being can guarantee that 'Ben's first child to reach 25' will vest or fail within 21 years of their death. Ben cannot, because a child born shortly before his death might not reach 25 within 21 years of Ben's death. Therefore, this gift likely violates RAP.
So: No valid measuring life can be found to validate the gift 'to Ben's first child to reach 25,' meaning the interest violates the common law Rule Against Perpetuities.
Not to be confused with: Any person alive at the creation of the interest, like the testator's distant cousin, can serve as a measuring life. - This is incorrect; a measuring life is not just any person alive, but a validating life whose death proves the contingent interest will vest or fail within 21 years. A distant cousin unrelated to the beneficiaries or the vesting condition cannot provide this proof, as their death doesn't directly impact the timing of the gift's finalization.
WHY THIS MATTERSSelecting the correct measuring life is the linchpin for determining if a future interest is valid or void under the common law Rule Against Perpetuities. A misidentified measuring life can lead to an incorrect assessment, potentially voiding a property transfer that was intended to be valid, or vice-versa.
TRY IT
For the gift 'to my grandchildren living at the death of my last surviving child,' who would be the measuring lives?
Hint
Focus on the individuals whose deaths directly affect the vesting of the grandchildren's interests.
Vesting and the 21-Year Period
Definition
What makes a future claim to property 'real' and unavoidable, rather than just a possibility?
The Rule Against Perpetuities (RAP) aims to prevent property from being locked up forever. To do this, it focuses on when a future interest becomes absolutely certain.
Vesting makes a future property interest certain, removing any conditions that might prevent its eventual ownership. The 21-year period is the strict deadline imposed by the Rule Against Perpetuities, requiring this certainty to occur within 21 years after the death of a specific person alive when the gift was made.
WHAT IT ISVesting is the process by which a future property interest becomes certain and indefeasible.
WHAT IT DOESIt transforms a contingent interest into one that is either absolutely owned by an ascertainable person or absolutely failed, meaning it can no longer take effect. For example, a gift 'to the first grandchild to graduate college' is contingent until a grandchild graduates, at which point it vests.
WHY IT MATTERSUnderstanding vesting is crucial for applying the common law Rule Against Perpetuities (RAP), which demands that all contingent interests must vest or fail within a specific timeframe to prevent property from being tied up indefinitely. This ensures property remains alienable.
Presumed portrait of Victoire of France as Vestal.png · Attributed to Anne Baptiste Nivelon / Public domain
Not to be confused with: An interest 'vests' when the beneficiary gains physical possession of the property. - Vesting means the interest becomes certain and indefeasible, not that the interest holder gains possession. For example, a remainder interest can vest in a child at birth, but they won't possess the property until the life tenant dies, which could be decades later. Vesting is about certainty of ownership, not immediate enjoyment.
WHY THIS MATTERSThe entire common law RAP hinges on whether a contingent interest will certainly vest or fail within the 'life in being plus 21 years' timeframe. If there's any possibility, no matter how remote, that it won't, the interest is void from the start.
Step-by-Step RAP Application
Process
How do you actually check if a complex property gift will hold up in court, or if it's doomed to fail before it even begins?
Just as a building inspector follows a checklist to ensure a structure is safe and up to code, applying the Rule Against Perpetuities involves a defined sequence of checks to ensure a property interest is legally sound.
The Rule Against Perpetuities (RAP) prevents property from being tied up indefinitely by ensuring future interests vest or fail within a specific timeframe. Applying RAP involves a systematic process to determine if a contingent future interest will certainly resolve within the perpetuities period, thereby preventing remote vesting.
WHAT IT ISApplying the Rule Against Perpetuities is a systematic analytical process.
WHAT IT DOESIt determines if a contingent future interest in property will certainly vest or fail within the perpetuities period, preventing remote vesting. For example, it checks if a gift 'to A for life, then to A's first child to reach 25' is valid. This process ensures that property ownership eventually becomes clear and transferable.
WHY IT MATTERSThis process is crucial for drafting valid wills and trusts, ensuring property doesn't become inalienable for too long. It applies to contingent remainders, executory interests, and some options, protecting against interests that could vest too far in the future.
The four-step process for applying the common law Rule Against Perpetuities.
Walk through an example
A will stating: 'To my son, Ben, for life, then to Ben's first grandchild to reach the age of 25.' Ben has children alive, but no grandchildren yet. The will takes effect today.
1. Step 1: Identify the contingent interest.
  The interest for 'Ben's first grandchild to reach 25' is contingent because it's uncertain if and when a grandchild will exist and reach the specified age. It's not immediately vested.
2. Step 2: Identify the lives in being at the creation of the interest.
  These are individuals alive when the will takes effect (today) who can affect the vesting. This includes Ben and all of Ben's children alive today.
3. Step 3: Select the measuring life.
  The measuring life is the individual (or group) whose death will determine the perpetuities period. Here, Ben's children alive today are the relevant lives because the grandchild's birth and age depend on them.
4. Step 4: Test if the interest must vest or fail within 21 years after the measuring life's death.
  All of Ben's children alive today die. Ben could still have another child (born after the will's creation, but before Ben's death). This 'unborn spouse' scenario allows a grandchild to be born more than 21 years after the death of all current lives in being, and then reach 25 even later. Therefore, the interest might not vest within the period.
So: The gift 'to Ben's first grandchild to reach 25' violates the common law Rule Against Perpetuities because it's possible for the interest to vest too remotely.
Not to be confused with: Confusing the Rule Against Perpetuities with rules against restraints on alienation. - The Rule Against Perpetuities is not primarily concerned with the duration of an interest, but rather with the certainty of its vesting. It ensures that contingent future interests will either vest or fail within a specific period, preventing property from being tied up by uncertain future claims, which is distinct from preventing current owners from selling or transferring their interests.
WHY THIS MATTERSUnderstanding this application process is vital because a gift that violates RAP is void from its creation, meaning the property disposition fails entirely. This can lead to unintended consequences, such as property reverting to the grantor's estate or passing via intestacy, rather than to the intended beneficiaries.
TRY IT
A trust grants property 'to my daughter, Alice, for life, then to her children for their lives, then to Alice's grandchildren who are attending college at the time of the last child's death.' Alice has two children, Bob and Carol, both alive today. Does the gift to the grandchildren violate RAP?
Hint
Focus on the last contingent interest and the lives in being at the trust's creation. Can you construct a scenario where a grandchild attending college vests too remotely?
Perpetuities Saving Clauses
Definition
How do estate planners ensure their clients' wishes for future generations don't get tripped up by an ancient legal rule?
You've learned how the Rule Against Perpetuities can invalidate future interests that might vest too remotely. Perpetuities saving clauses are the legal equivalent of a 'failsafe' button for those interests.
The Rule Against Perpetuities (RAP) can invalidate future interests that might vest too far in the future. Perpetuities saving clauses are a common legal drafting tool, acting as a 'safety net' within wills or trusts to automatically adjust the terms of such interests, ensuring they comply with RAP and the grantor's intent is preserved.
WHAT IT ISA perpetuities saving clause is a provision commonly included in wills, trusts, or other property transfer instruments.
WHAT IT DOESIt automatically modifies the terms of a contingent interest to ensure it vests or fails within the perpetuities period, thereby preventing a common law Rule Against Perpetuities violation. For example, it might state that any trust interest must vest no later than 21 years after the death of the last surviving beneficiary alive when the trust was created.
WHY IT MATTERSPractitioners use these clauses to safeguard complex estate plans from invalidation by the Rule, especially when dealing with long-term trusts or future interests. This proactive measure avoids the harsh consequences of an invalid gift, which would typically revert to the grantor's estate.
Not to be confused with: A poorly drafted trust instrument that simply states 'all provisions are subject to the Rule Against Perpetuities'. - This is not a perpetuities saving clause because it merely acknowledges the Rule without providing specific, automatic modification language. A true saving clause actively reforms the interest to comply, rather than just stating the Rule applies, which could still lead to invalidation.
WHY THIS MATTERSSaving clauses are crucial for preventing the complete invalidation of a grantor's intent for future beneficiaries, which could otherwise lead to unintended distributions or property reverting to the original estate. They provide a vital layer of protection for long-term wealth transfer plans.
Modern Statutory Reforms: USRAP
Comparison
Why did the common law Rule Against Perpetuities, designed to prevent remote vesting, often frustrate grantors' intentions?
The common law Rule Against Perpetuities invalidates interests based on possibilities at creation, often leading to harsh outcomes.
The common law Rule Against Perpetuities (RAP) often invalidated reasonable property interests due to remote theoretical possibilities. To address this harshness, many jurisdictions adopted statutory reforms, most notably the Uniform Statutory Rule Against Perpetuities (USRAP), which introduces a more flexible approach to testing future interests.
WHAT IT ISThe Uniform Statutory Rule Against Perpetuities (USRAP) is a statutory modification to the common law Rule Against Perpetuities.
WHAT IT DOESUSRAP introduces a 'wait-and-see' approach, meaning an interest's validity is determined by what actually happens, not just what might happen at its creation. It also provides an alternative 90-year perpetuities period; for example, if a gift to 'my grandchildren who reach 25' would fail under common law, USRAP allows it to be valid if all conditions are met within 90 years.
WHY IT MATTERSThis reform mitigates the harshness of the common law RAP by validating interests that would otherwise fail on technicalities, thereby reducing accidental violations and better honoring the grantor's intent. It applies in many U.S. jurisdictions, offering a crucial alternative to the strict common law analysis.
Not to be confused with: The common law Rule Against Perpetuities. - The common law Rule invalidates interests at creation if there's any possibility of remote vesting, whereas USRAP employs a 'wait-and-see' approach, allowing interests to be valid if they actually vest within 90 years.
WHY THIS MATTERSUSRAP and similar reforms are crucial because the common law RAP often struck down reasonable estate plans due to technicalities. Not all jurisdictions have abolished the common law Rule; instead, many have adopted USRAP or similar 'wait-and-see' statutes, making it essential to understand both.

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