Transferability of Present & Future Interests - Next Generation Bar Exam
- What is a preemptive right, or right of first refusal?
- A right to purchase property on the same terms as a third-party offer before the owner sells. Reasonable rights of first refusal are generally valid restraints.
- O conveys a fee simple 'to A, but A may never sell the property.' What interest does A hold?
- A fee simple absolute, because the disabling restraint is void. Total restraints on a fee simple are invalid.
- Under the prevailing view, what is the transferability of a right of entry?
- It is inheritable but, in many jurisdictions, not transferable inter vivos. Jurisdictions vary, and some permit free transfer.
- What is the general rule on a landlord's consent clause for lease assignment?
- Under the modern trend, the landlord may not unreasonably withhold consent unless the lease grants absolute discretion. The traditional rule allowed the landlord to refuse for any reason.
- O conveys 'to A for life.' A conveys her interest to B. A then dies. What is B's interest?
- B's interest ends, and the property reverts to O. B held a life estate measured by A's life.
- Under modern law, what is the transferability of vested remainders?
- They are freely transferable during life and by will or intestacy. Vested remainders are fully alienable.
- What is the general rule on the transferability of a fee simple?
- It is freely transferable by deed, will, or intestacy. Unreasonable restraints on alienation of a fee simple are void.
- Under modern law in most jurisdictions, what is the transferability of contingent remainders and executory interests?
- They are transferable during life and by will or intestacy. At common law, they were not transferable inter vivos.
- What is the transferability of a possibility of reverter in most jurisdictions?
- It is transferable and inheritable. It is held by the grantor or the grantor's successors.
- What is the general rule on a life tenant's power to transfer a life estate?
- The life tenant may transfer the life estate, but the transferee holds only for the original life tenant's life. The transferee holds a life estate pur autre vie.
- What is the status of a disabling restraint on a fee simple?
- It is void, because it withholds the power to transfer an estate the law makes freely alienable. The grantee takes a fee simple absolute, as though the restraint had never been written.
- What is the status of a reasonable restraint on alienation of a leasehold?
- It is valid, because a landlord has a legitimate interest in who occupies the premises. Restraints on leaseholds are commonly enforced, such as a clause requiring consent to assign.