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Week 6 Alienability of Proprietary Interests and Perpetuities - Coggle…

- - - - Common law - aka as the modern rule against perpetuities
        
        common law position
        
        Nemisis case
        
        ‘24 As pointed out by the Queensland Law Reform Commission in its 1971 report entitled “On the Law relating to Perpetuities and Accumulations”, the rule against perpetuities performs a useful social function in limiting the power of members of generations past from tying up property in such a form as to prevent it being freely disposed of in the present or the future.’
        
        Air Jamaica Ltd v Charlton [1999] 1 WLR 1399 at 1408-1409
        
        • ‘No interest is good unless it must vest, if it vests at all, within a period of life in being, the date of the gift plus 21 years. A gift is defeated if, by any possibility, however remote, it may vest outside the perpetuity period. It is not saved by the fact that, in the event, it vests inside the period.’
        
        Certainty of vesting: ‘Must vest, if at all’
        
        note: in tutorial Victoria said she is not too concerned about this one so she passed over it
        
        Lives in being
        
        A human life
        
        In existence the date the instrument starts operating
        
        Capable of ascertainment upon the date the instrument comes into operation
        
        Perpetuity period according to common law: 21 years
        
        Vesting of interests and presumptions
        
        if the interest vests at a time that is not too remote then the rule has no application
        The rule is not concerned with duration, it relates to the vesting of a future interest that is not too remote
        So there must be a future interest involved
        (contingent remainder or future, executory interest)
        The most obvious example is if the interest vests when it is created then the rule has no role. (e.g. inter vivos gift which applies immediately upon execution of deed of gift instrument)
        
        At the creation of the interest – the date the interest was created this is usually evidenced by way of a deed/instrument. It could be a gift (inter vivos) or it is a will.
      - 80 years or less – s 209(1) PLA
    - - Steps
        
        “Determine whether there is a future interest involved in the conveyance [instrument] that falls under the rule (contingent remainder or executory interest).
        
        If there is such a future interest, is there any limitation on when the person holding that interest can actually get the property? If there is no such limitation (it can vest any time between now and eternity), the conveyance violates the rule and it is void.
        
        If there is a limitation, determine which person or people are relevant in deciding when the future interest vests. These people are called the “measuring lives”. [Life in Being]
        
        Finally, determine whether it is possible that the interest vests more than 21 years after the deaths of all of the people who are currently alive and who are relevant to the vesting of the future interest.”
        
        See https://lawshelf.com/coursewarecontentview/rule-against-perpetuities/
        
        If outside the perpetuity period explained in point 4 then not valid as it infringes the rule
  - - - Property Law Act 1974 (Qld) - ss 210(4) and 209(1)
        
        Certainty of Vesting: Wait-and-See rule under PLA
        
        S 210 PLA institutes a wait-and-see system
        ‘Sections 212 and 214 provide for presumptions as to future parenthood and to overcome the unborn widow(er) situation.’
        
        S 210 and the common law position was critically analysed in the Nemisis case as follows by Tamberlin J
        
        80 years or less
  - - - An executory interest is a type of future interest in property, held by a third-party transferee which extinguishes another’s interest, or commences after the natural termination of a preceding estate. An executory interest is any future interest held by a person other than the transferor which cannot be classified as a remainder.
    - - A contingent remainder is an interest in real estate property, which will go to a person or entity only upon the existence of a certain set of circumstances at the time the title-holder dies
- - - - ‘The rule applicable to class gifts is known [under the common law] as the “all or nothing” rule…the precise portion of the gift which is to vest to each member of the class…must be sure to be known within the perpetuity period.’
  - - - ‘The rule allows the closure of a class of people at the date when the first member of the class becomes entitled to take, irrespective of whether the class is capable of further growth.’