Meta Description: The Rule Against Perpetuities (RAP) prevents long-term ‘dead hand’ control over property. Learn the traditional ‘life in being plus 21 years’ rule, the future interests it affects, and modern reforms like the USRAP’s 90-year ‘wait-and-see’ approach essential for estate planning and trusts.
Understanding the Rule Against Perpetuities (RAP)
The Rule Against Perpetuities (RAP) is perhaps one of the most technical and complex doctrines in property and trust law. Its fundamental purpose is to strike a balance between allowing property owners to control the disposition of their assets and ensuring that property remains transferable and productive for future generations. Without this rule, a person could potentially tie up the ownership of land or funds for an indefinite period, a concept commonly referred to as “dead hand control”.
In essence, the RAP imposes a time limit on how long an uncertain future interest in property can remain contingent before it must either “vest” (become certain) or fail. Failing to comply with this rule can void a crucial part of a will, trust, or deed, frustrating the original intent of the property owner. Understanding its core components, from the classic common law test to modern statutory reforms, is vital for anyone involved in long-term estate planning or commercial property law.
I. The Classic Common Law Rule: Certainty is Key
The traditional statement of the Common Law Rule Against Perpetuities, famously formulated by John Chipman Gray, is deceptively simple: “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.”.
Core Components of the Common Law Rule
- The Perpetuity Period: The maximum allowable time is “lives in being plus twenty-one years” (with a period of gestation added for posthumous births).
- Life in Being (or Measuring Lives): This must be an individual or a closed group of individuals who are alive (in existence) when the property interest is created (e.g., the testator’s death or the trust’s creation). They must be relevant to the vesting of the interest.
- The Rule of Certainty: This is the most crucial, and often the harshest, element. At the moment the interest is created, you must look at all possibilities. If there is even a remote possibility, however unlikely, that the interest might vest outside the perpetuities period, the interest is immediately void.
The rule applies strictly to future interests that are contingent, such as a contingent remainder or an executory interest. It does not apply to interests that have already vested or to any interests retained by the grantor (like a possibility of reverter).
Legal Expert Tip: The “What If” Test
To test a clause under the Common Law RAP, a Legal Expert must pose a series of “what if” scenarios. Notorious examples that often fail the rule’s strict certainty requirement include the so-called “fertile octogenarian” rule (a person, regardless of age, is presumed capable of having children) and the “unborn widow” rule (where a current beneficiary’s future, as-yet-unborn spouse is not a life in being). These hypothetical, if absurd, possibilities are enough to render an interest void at common law.
II. Modern Statutory Reforms: The Shift to “Wait-and-See”
Because of the technical harshness and tendency to void reasonable property dispositions based on remote possibilities, the RAP has undergone significant reform in many U.S. states.
Over half of U.S. states have adopted some version of the Uniform Statutory Rule Against Perpetuities (USRAP). The USRAP fundamentally changes the focus of the rule in two key ways:
| Feature | Common Law RAP | USRAP (Modern Reform) |
|---|---|---|
| Test Standard | Possibility of Vesting (Immediate Voidance) | Wait-and-See (Actual Events) |
| Perpetuity Period | Life in Being + 21 Years | A 90-Year Flat Period |
| Judicial Fix | None (Interest is Void) | Statutory instruction for judicial reformation (Cy Pres) |
The Wait-and-See approach grants a 90-year window for the interest to either vest or terminate, focusing on what actually happens rather than what could theoretically happen. If the interest is still unvested at the end of the 90 years, it is then declared invalid. Furthermore, the doctrine of Cy Pres allows a court to rewrite the invalid portion of the instrument to approximate the grantor’s intent as closely as possible, rather than voiding the entire disposition.
Case Insight: The RAP in Commercial Settings
While often associated with estate planning and gifts, the RAP can also apply in commercial arms-length transactions, particularly in areas like real estate or oil and gas. For instance, a clause creating an option to buy property that could potentially be exercised too remotely might violate the rule. However, the USRAP and some state statutes often include exceptions for commercial option contracts to avoid unnecessary invalidation. Always consult with a Legal Expert before structuring long-term commercial real estate agreements.
III. The Ongoing Debate and Dynasty Trusts
The history of the RAP is a reflection of public policy favoring the free transfer of property (alienability) over the desires of previous generations to impose control. However, in recent decades, many states have chosen to dramatically weaken or even abolish the rule entirely for certain types of trusts.
This trend has led to the proliferation of Dynasty Trusts, which are established in states with long or repealed perpetuity periods. These trusts allow property to be passed down and controlled for multiple generations—often for hundreds of years—without incurring generation-skipping transfer taxes. This legislative change reflects an ongoing tension in property law, shifting the focus away from strict transferability and back towards generational wealth preservation.
Important Caution
The application of the RAP is highly jurisdiction-specific. The rule’s exact wording, the adoption of USRAP, and the existence of specific statutory exceptions vary widely from state to state. A provision that is valid in one state may be immediately void in another. Always ensure that an estate plan is drafted and validated according to the specific laws of the controlling jurisdiction.
Summary of the Perpetuity Period
- The Rule Against Perpetuities (RAP) prevents future interests in property from remaining contingent for too long, thus limiting “dead hand control”.
- The traditional Common Law RAP dictates that an interest must vest no later than 21 years after the death of all relevant persons alive at the time the interest was created (lives in being).
- The Common Law rule is notoriously harsh because it voids an interest based on a remote possibility of remote vesting, not the actual outcome.
- Modern reforms, particularly the USRAP, adopt a wait-and-see approach with a flat 90-year vesting period and permit judicial reformation (cy pres) to save the grantor’s intent.
- For complex trusts or property transfers, consultation with a Legal Expert is essential to avoid violating the rule and inadvertently invalidating your estate plan.
Card Summary: Navigating the Rule Against Perpetuities
- ● What It Is: A time limit on future interests in property to ensure alienability of property.
- ● The Time Limit: Common law is Life in Being plus 21 Years; Modern law (USRAP) is 90 Years.
- ● The Risk: If a future interest might vest too remotely, it can be voided, even if the possibility is remote or absurd.
- ● The Solution: Utilizing a wait-and-see approach or a savings clause, and seeking professional counsel to comply with state-specific statutes.
Frequently Asked Questions (FAQ)
Q: What does it mean for an interest to “vest” in the context of the RAP?
A: An interest “vests” when the right to the property becomes certain and belongs to a known, verified individual with no remaining conditions or contingencies. A vested interest is immune from the rule.
Q: Does the RAP apply to a typical will?
A: It applies when a will creates a future interest that is contingent, meaning the eventual owner is not definitely known, or a condition must be met for ownership to transfer in the future. Simple, direct transfers of a present interest are not subject to the rule.
Q: Is the RAP the same in every state?
A: No. The original common law rule still exists in some states, while over half have adopted the USRAP‘s 90-year wait-and-see period. Other states have abolished the rule entirely, making state law critical for complex trusts.
Q: What is a “Measuring Life” and why is it important?
A: A Measuring Life is any individual who is alive when the interest is created and is somehow relevant to when the contingent interest will vest or fail. The entire perpetuities period revolves around the death of the last of these individuals plus 21 years.
Disclaimer
AI Generation Note: This blog post was generated by an artificial intelligence model and is intended for informational and educational purposes only.
No Legal Advice: The information provided regarding the Rule Against Perpetuities (RAP), common law, the USRAP, and related concepts does not constitute legal advice, a legal opinion, or a substitute for the counsel of a licensed attorney. Property law and estate planning are complex and jurisdiction-specific. Consult with a qualified Legal Expert for advice tailored to your specific situation and jurisdiction. We are not responsible for any actions taken or not taken based on the information in this article.
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