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The rule against perpetuities serves a number of purposes. First, English courts have long recognized that allowing owners to attach long-lasting contingencies to their property harms the ability of future generations to freely buy and sell the property, since few people would be willing to buy property that had unresolved issues regarding its ownership hanging over it.
The Rule in Shelley's Case is a rule of law that may apply to certain future interests in real property and trusts created in common law jurisdictions. [1]: 181 It was applied as early as 1366 in The Provost of Beverly's Case [1]: 182 [2] but in its present form is derived from Shelley's Case (1581), [3] in which counsel stated the rule as follows:
The clause became part of contractual drafting in response to common law rule developed by the courts known as the rule against perpetuities. [note 1] That rule provided that any future disposition of property must vest within "a life in being plus 21 years". The rule generally affects two types of transactions: trusts and options to
In a person's making of their own trusts, provisions and settlements, to newly proposed founded bodies or groups of persons, there are commonly still laws against perpetuities, preventing their "dead hand" from prevailing more than, for example, 80 years away and there is the common law rule in Saunders v Vautier enabling all of the adult ...
Uniform Statutory Rule Against Perpetuities: 1986, 1990 Uniform Supervision of Trustees for Charitable Purposes Act: 1954 Uniform Surface Use and Mineral Development Accommodation Act: 1990 Uniform Tod Security Registration Act: 1989 Uniform Testamentary Additions to Trusts Act: 1960, 1991 Uniform Trade Secrets Act: 1979, 1985
[2] [3] Discretionary trusts must not be indefinite and are subject to 'the rule against perpetuities'. In New South Wales, the time prescribed is a statutory period of 80 years from the date the disposition takes effect. [4] Charitable trusts
In the United States the rule against perpetuities, where it is in effect, applies to both legal and equitable interests, created in trust. [50] The rule 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 ...
Executory interests are subject to the rule against perpetuities, which disqualifies any interest that can vest more than twenty-one years after the death of every party who was living at the time the interest was created. However, if all of the potential vesting beneficiaries are named, the rule will never be violated.