Brief Fact Summary. An action to quiet title to property rests upon the issue of whether the original deed conveyed a fee simple determinable with possibility of reverter or a fee simple subject to condition subsequent with a right of re-entry.
Synopsis of Rule of Law. The common law states future interests in land by possibility of reverter or right of re-entry are inheritable, but are not transferable by will or by inter vivos conveyance. The use of the word “only” in a deed followed by the words for school purpose, demonstrates a limited grant subject to a condition, thus, creating a fee simple determinable. The phrase, “otherwise to revert to grantors herein” coupled with the limiting word of “only” triggers a mandatory return.
Land was deeded to the Trustees of School District No. I, predecessors to the Defendants in this case, the County Board of School Trustees (Defendants), in this case, providing the land was to be used for school purposes only. Otherwise the land was to revert back to the Grantors. Later, the original grantors of the land attempted to convey their reversionary interest in this land to the Jacqmains. The Jacqmains later conveyed this reversionary interest to the Plaintiffs in this case, Herbert L. Mahrenholz and Betty Mahrenholz (Plaintiffs). Hutton, the son of the original grantors of the land later conveyed all of his interest in the land deeded to the school to the Plaintiffs. Prior to this conveyance to the Plaintiffs, Hutton had relinquished all of his rights of reverter or rights of re-entry to the Defendants. The Plaintiffs brought suit to quiet title. The trial court found that the Plaintiff could not have acquired a reversionary interest in the land from the Jacqmains o
r Hutton. The trial court found that the original deed language conveyed a fee simple subject to a condition subsequent followed by a right of re-entry for condition broken, rather than a determinable fee followed by a possibility of reverter. The appeals court determined that the Plaintiffs could not have acquired an future interest from the Jacqmains, as neither interest may be transferred by will or by inter vivos conveyance. The appeals court stated the only possible manner in which the Plaintiffs could have acquired an interest in the land from Hutton was if he had a possibility of reverter in the land and thus owned the school property when it ceased to be used for school purposes.
Issue. Whether the language of a conveyance properly conveyed an interest in real property.
Held. Reversed and remanded. The language in the deed created a fee simple determinable followed by a possibility of reverter.
Discussion. A future interest gives the holder the right or the possibility of an estate. A fee simple determinable conveys a possibility of reverter that automatically reverts to the grantor upon the occurrence of a stated event. A fee simple subject to a condition subsequent conveys a right of entry that is not automatic, but the grantor must exercise his right of entry. The significance of this case is during this time period these future interests could not be conveyed by inter vivos gift or sale, thus the only way the Plaintiffs could have acquired the school land was if the grantor in the case had a present interest in the land to convey.