FUTURE INTERESTS

2. Holder of less-than-fee-simple:  Even when A holds a less-than-fee-simple interest, he can create a reversion in himself by transferring a still smaller estate. Thus if A held a fee tail, and conveyed “to B for life,” A would have a reversion in fee tail.

a. Two life estates:  Similarly, under the modern view, if A owns a life estate, and conveys to B for B’s life, A has a reversion. In this situation, although it can be argued that one life estate can’t be smaller than another, the fact is that B’s life estate can terminate before A’s, whereas A’s cannot terminate before B’s. See Moynihan, p. 94, n. 2.

3. Transfer of term of years:  At common law, if an owner of a freehold estate created a leasehold interest (i.e., a term of years) in another, the grantor was not said to retain a reversion. Instead, he was regarded as continuing to hold the seisin in the land, and his freehold was merely subject to the terms of years. But in modern parlance, the landlord is said to have a reversion subject to the lease term. C&L, p. 290.

B. Will not necessarily become possessory:  A reversion will not necessarily ever become possessory. If events occur in such a way that it becomes certain that the reversion can never become possessory, it is said to have been divested.

Example:  O conveys Blackacre “to A for life, and then to B and his heirs if B survives A.” O has a reversion which will become possessory when A dies, if B has predeceased A. But if A dies before B, the reversion is divested, since B now holds a fee simple absolute.

C. Distinguishing from possibility of reverter:  It will sometimes be important to distinguish between a reversion and a possibility of reverter (particularly in the context of the doctrine of merger, infra, p. 80). To do this, one must examine the interest given away by the grantor; if he has given away a fee simple determinable, he retains only a possibility of reverter. If he has given away something less than a fee simple, he retains a reversion.

D. Alienability:  Reversions have always been viewed as alienable inter vivos. Moynihan, p. 95. Furthermore, they are devisable and descendible.

1. Possibility of divestment:  However, remember that a reversion may be subject to divestment. Thus suppose that A, who holds a fee simple, conveys to B for life, than to C and his heirs if C survives B. A is free to transfer or devise his reversion to X. But if, following such a transfer or bequest, B dies while C is still living, X takes nothing.

IV. REMAINDERS

A. Definition:  A remainder is a future interest in someone other than the grantor or the grantee of a possessory interest, if the interest can become possessory only upon the expiration of the prior possessory interest, created by the same instrument. That is, for a remainder to exist, the following requirements must be met: