The Rule against Perpetuities

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The following is a step-by-step explanation of the Rule against Perpetuities aimed at the more ambitious law student. Please download it below.

Claims that the RAP was violated are typically used by heirs to try and get property outright when it was left in a trust. Most infractions of the rule involve class gifts. The rule is very important in drafting even though reported cases alleging a rule violation are few. Perhaps, because attorneys drafting wills pay attention. This underscores the importance of the knowledge of the rule for an attorney who wishes to specialize in trusts, wills and estates.

Those who only have a superficial acquaintance with the rule tend to use heuristics to avoid traps thereby potentially shortchanging their clients. Examples[1] follow:

  1. “Beware of gifts to grandchildren.” However, gifts to grandchildren very desirable if the trust settlors do not want probably to pause out right to children for tax or other reasons.
  2. “Describe beneficiaries by name rather than by class designation.” This may exclude after born grandchildren, will certainly often not in the interest of the testator.
  3. “Beware of gifts contingent upon the taker attaining an age over 21”. At age 21 many beneficiaries may not be mature enough to administer a large fortune and instead squander it.
  4.  “Avoid gifts conditioned on the survival of the ‘widow’ of a named person”. Naming the current spouse intended by name avoids this trap, however, later spouses of a relative would not be considered.

[1] MacGovern, William M., and Sheldon F. Kurtz. 2017. Wills, trusts and estates: including taxation and future interests.p 506-507

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