United States Rule Against Perpetuities
In the United States the Rule Against Perpetuities, where it is in effect, applies to both legal and equitable interests, created in trust. The Rule Against Perpetuities varies from state to state. The common law rule may be stated, "No interest is good unless it must vest, if at all, not later than twenty-one years after some life in being at the date of the creation of the interest." Vesting indicates a right to an interest in the trust. The rule is directed entirely against remoteness in vesting. An identification of the person whose interest is defined by the trust, must either vest or fail in s specified time. Any interest which may remain contingent beyond the period of the rule is invalid. A beneficiary must be an identifiable person born within the time span of the trust, and vest in it. All interests in a charitable trust, are subject to the rule with a few exceptions. A charitable trust which gives a gift from the first charity to a second charity on a condition precedent is not void by reason of the fact tha the condition may not occur without the period of the Rule. (See Example 2 below.) Property transferred from a non-charity and then left over to a second charity on a remote contingency is void. (See Example 3 below.)
Read more about this topic: Cestui Que
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