(Start with slide waprelic – Sect 3 – Beginning)
LIFE ESTATES
The Legal Life Estate is allowable in a few Appalachia States. It pertains to one's legal right to gain use
and possession of property at the death of the first spouse. Usually the husband dies first. He would pass
the land onto his son(s). The wife had the legal right to live on the land for life; hence she had a Legal
Life Estate.
Legal Life Estate - This is created by law at the death of spouse. The implication of legal right is
established during life of a married couple. The surviving spouse does not have the right to pass the
property to someone at his or her death. They only have a Legal Life Estate of use and possession.
1. Dower - Dower pertains to the "father-sided" part of the land. The wife's right, known
as her Dower (her share of the assets), allows her to live on the land for life. She cannot
sell the land. She can only use and possess the land for life. At her death, the property and
the use and possession right would go to the son.
2. Curtsey - Curtsey pertains to the "mother-sided" part of the property. The husband's
right, known as his Curtsey (his share of the assets), allows him to live on the land for
life. He cannot sell the land. He can only use and possess the land for life. At his death,
the property and the use and possession right would go to the daughter.
Inchoate Interest - An inchoate (possible) interest requires a specific event to occur in order for the
interest to be received by an individual. If the event doesn't occur, the interest is never granted to that
person.
Wife's Inchoate Interest - Determination is incomplete pending a future event that may not happen. If
the wife died before the husband there would be no dower. The Legal Life Estate would not go into
effect.
(On the next page put slides waprelic – Sect 3 – page 001 and 001A)
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CONVENTIONAL LIFE ESTATES
These are allowable in most States. It has nothing to do with the husband and wife relationship. It is
simply a created estate between the grantor (owner of the property) and the grantee (the person granted
the life estate).
1. Granted to Any Legal PERSON - It is created by some form of agreement between the involved
parties of the agreement by "grant". It could be an owner granting a Life Estate to his/her parents. It
could be the granting of a Life Estate to a friend. The grantee, recipient, could be any legal person.
2. Ends at the Death of the Grantee/Person - The Life Estate ends at death of Life Estate holder
(grantee) or may be based on another person's life such as the spouse of the grantee. The point of a Life
Estate is that it ends at death of the grantee.
 Example: Bob "grants" a life estate for use of his summer home to an old time recording artist. Upon
the artist's death, the estate/possession is to revert back to Bob. Bob has reversionary interest.
3. Rights of a Recording Artist/Holder - The holder of a Life Estate/possession for the property has all
the following rights during his/her lifetime. He/she is entitled to income, profits, and may lease,
mortgage, or sell his/her lifetime interest/possession to others.
 Example: The grantee/recording artist can lease part of the land to tenants and receive the rental
income.
a. Can't Lease Beyond His/Her Lifetime - He/she cannot create any interest that exceeds his/her
lifetime. He/she lacks the right of inheritance. He/she cannot pass on/devise his/her rights to others at
his/her death. It reverts to the original owner (reversionary interest) or a 3rd party (remainderman).
b. No Waste - With his/her life estate he/she cannot create waste (damage property). He/she must make
ordinary repairs to the property. He/she can take wood for personal use (estovers), but he/she cannot sell
the timber on the land. He/she must keep debts, taxes, and assessments paid up during his/her lifetime.
c. Death - When he/she dies, his/her Life Estate/possession will pass to the grantor/original owner
(reversionary interest) or a specified third party by the grantor (the remainderman). Any existing tenant
(lessee) or estate purchaser must move off the property immediately.
(On the next page put slides waprelic – Sect 3 – page 002 and 002A)
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REVERSIONARY INTEREST
When an owner or landlord (grantor) grants a Leasehold Estate to another, this is a Non-Freehold Estate
(less than a lifetime). A life estate is a Freehold Estate (for a lifetime). Both can have a Reversionary
Interest. That is, the grantor can obtain the "use and possession" of the property at a later date. This is
known as the grantor's Reversionary Interest.
Reversionary Interest includes:
1. Rental Property - When an owner/landlord leases property to another it creates a
Non-Freehold Estate (Rental/Leasehold Estate) for the tenant. The landlord retains the
ownership of the property during the lease period. The tenant/leasee gains the right to
receive the "Use and Possession" stick during the lease period, but the landlord/lessor
will receive this right back in the future. During the leasing period the owner/landlord is
free to sell the property, but the sale or death of either party does not terminate the lease
or the Non-Freehold Estate.
2. Freehold Estate (Life Estate) - When an owner/grantor grants a Life Estate/Freehold
Estate to another, he/she can attach a reversionary interest. He/she can gain the "Use and
Possession" of the property at the death of the grantee. Again, usually a son or daughter
(grantor) grants a life estate to a parent (grantee) and at the death of the parent, the son or
daughter gains the "Use and Possession" of the property. This is called a Reversionary
Interest.
Reverts Back, BUT No Interference - In either case, when a Rental Estate or a Life Estate is granted,
the grantor may not interfere with grantee's contractual rights or their personal property rights. This is
why these are sometimes called a Chattel Real Estate; a personal property estate. The lease itself
becomes personal property. The tenant/grantee does not own the land. Only the right of Use and
Possession.
(On the next page put slides waprelic – Sect 3 – page 003 and 003A)
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REVIEW - NON-FREEHOLD ESTATE
A tenant/landlord arrangement is a Non-Freehold estate. It is also known as a less than freehold, chattel
real, or rental estate. The lease agreement becomes a personal property estate of tenant. He/she has the
right to use, sell, possesses, estovers, etc. under the lease unless the lease agreement that he/she signed
precludes these rights.
1. Leased Possession - The tenant/grantee holds the "Use and Possession" stick by contract until one of
the following occurs:
2. Term Ends - The end of lease term has been attained. If he/she continues use and possession of the
property, his/her tenancy becomes an illegal holdover. This is known as "At Sufferance."
3. Eviction - Actual eviction and is enforced by the landlord. If the tenant does not move out, the
landlord can go through the courts and enforce the eviction through an "unlawful detainers."
4. Constructive Eviction - The landlord takes away "Quiet Enjoyment" of the tenant.
 Example: The landlord doesn't fix problems with the power, heat, and/or water to the leased property.
This is a form of eviction in that the tenant can no longer enjoy the use of the property.
5. Passive Eviction - If the landlord turns off the water or power, it is passive eviction. This is illegal in
most States.
(On the next page put slides waprelic – Sect 3 – page 004 and 004A)
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Tenancy Means Possession of Property
Forms of Possession - There are many forms of possession/estates to property. It is important to
understand the form of tenancy/possession because it denotes who has the right to occupy the property.
 Example: - A person has a life estate on the property. This means the life estate holder cannot sell or
mortgage "the property". He/she can only sell or mortgage "the estate/possession" rights.
Only the title holder/grantor can sell or mortgage the property.
(On the next page put slides waprelic – Sect 3 – page 005 and 005A)
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(On the next page put slides waprelic – Sect 3 – page 006 )
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REVIEW
An Estate - An estate is the right to use and possess real property.
Hold Title - A person who holds title to real property, owns the real property.
Majority of Owners - 99% of people who hold title to land, have the right to possess the land. This is
where the confusion comes in when we talk about someone who holds title, but not an estate. Confusion
also reigns when a person does not have title to the land, but has the right to possess the land; an estate.
Obviously, this is only about 1% of the time, but it is something you might have to contend with on the
State Examination or in a real life situation.
Title Only - A person could hold title to property and not have the right of possession. They would not
have an estate in the property.
 Example: A remainderman holds title to a parcel, but he/she cannot gain the right to possess the land.
 Example: - A father grants his daughter as remainderman and his brother with a life estate. She will
not gain possession until the brother (her uncle) dies. Her uncle would be holding a life estate and she
would be the remainderman.
Estate Only - A person could have an estate and possess the property, but does not hold title to the
property. They could not sell the property or devise it (pass it on) to their heirs.
 Example: A father has the right to possess property until death (a life estate), but does not hold title to
the property. His son was granted title to the property and he is the remainderman when the father dies.
The son has a remainderman "interest" in the estate in that he will gain possession when the father dies.
1. Situation - You are talking to someone who wants to sell. 99% of the time, you are going to be
selling title and possession. BUT, you have to make sure that they own the land and not just a life estate.
Lease Only - A person who leases property does not hold title, but has an estate in tenancy for the
length of the lease. When the lease runs out, possession will revert (reversionary interest) back to the
owner of the property.
1. Situation - You are talking to someone who wants to sell property that they are not occupying. Is the
property a rental or is occupied with a grantee under a life estate? In either case, the buyer you work
with will not be able to occupy/possess the property until the lease/life estate runs out.
(On the next page put slides waprelic – Sect 3 – page 007 and 007A )
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REVIEW
An Interest - Any person who has an estate in the property, holds title to the property, or leases the
property, is a remainderman to the property. If a person has any combination of these four, they have an
interest in the property. They benefit from their position in the property. This is called an "interest" in
the property.
 Examples:
1. Title - A person who holds title to the property has an interest in the property in that they can sell it
and devise it (pass it on) to heirs.
2. Estate - A person who has an estate in the property has an interest in the property in that they can sell
their estate, lease their estate, or simply possess the estate. Even though they cannot pass title in a sale or
devise title to their heirs, they have a possession interest in the property.
3. Lease - A person who leases the property has an interest in the property. They "purchase" the right to
possess the land for a specified period or for a lifetime if they signed a lifetime lease. They have a
possession interest. They have a tenant interest in the property.
4. Remainderman - A named person, or entity such as a charity, who is named in a will as a
remainderman will gain title and/or possession of the property when a person dies. This remainderman
has an interest in the specified property.
5. Reversionary Interest - An owner gives a life estate to a person, but retains the right to gain
possession of the land when that person dies. This owner holds title, but granted the possession right to
another until death. When an owner grants a lease of his/her property, he/she will lose the possession
right to the lessee, but has a reversionary interest in that he/she will gain the right of possession when the
lease expires.
6. Mortgage Lien - A lender has an interest in property that it has a lien on for a mortgage loan.
(On the next page put slides waprelic – Sect 3 – page 008 and 008A )
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REVIEW
An Estate - The right to possess and use the land. A person can be granted the use and possession of
land without the right to sell the property (pass title to a buyer) or the right to demise the property (pass
the right to heirs).
Life Estate - A life estate is the right to possess property and use property for a lifetime. The holder of
life estate has several abilities regarding the use and possession of the property in question:
1. Sell the Life Estate - The holder of a life estate cannot sell the property. The holder of a life estate
cannot pass title to another person. The holder of life estate cannot pass on their possession right to
another at their death; they cannot devise that right.
They can sell their "interest" to another.
 Example: A young man has been granted 7 life estates by various relatives around the county.
Obviously, he cannot live in all 7 locations at once, so he decides to SELL four of them. A person who
buys one of these life estates from him (buys an interest) will have the right of possession until he dies.
If he is young and in good health, the buyer might be able to possess the land for a considerable amount
of time.
(On the next page put slides waprelic – Sect 3 – page 009 and 009A )
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Review
Freehold Estate
Freehold Estate - A freehold estate is the right to possess property for a lifetime. 99% of people who
buy property will hold title to the property and have the right of possession for a lifetime. 99% of buyers
have a freehold estate.
1% of property owners do not have the possession right. There are people who are a named
remainderman or hold a reversionary interest in the property. They do not have a "current" freehold
estate in that they do not possess the land. Eventually, they will possess the property when the life estate
holder dies and they will hold title to the property and have a freehold estate as well.
Freehold Estate ONLY - There are people who have an estate in property for a lifetime even though
they do not hold title.
1. Life Estate Holder - A person who has been granted a life estate in property has a freehold
estate. They are allowed to possess the property for a lifetime. They can sell this freehold estate,
lease it, and/or mortgage it. They cannot devise it (pass it on) to heirs.
2. Lifetime Lease Holder - A person who has obtained a lifetime lease on property holds a
freehold estate on the property. They have the right to possess the land for a lifetime. There are
generous people who have granted a lifetime lease to an individual for $1 a year.
These individuals have a lifetime interest in the property. Once they die, their interest is gone and
the named remainderman or the owner with a reversionary interest will acquire their own
freehold estate. They have the right to own and possess the property for a lifetime.
(On the next page put slides waprelic – Sect 3 – page 010 and 010A )
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REVIEW
Non-Freehold Estate
Non-Freehold Estate - A non-freehold estate is the right to possess the property for a period of time,
but NOT for a lifetime. Most people who hold an estate right (only) are those who hold a non-freehold
estate.
Leasing Property - When a person leases an apartment or a house they are gaining a tenancy estate for
a period of time, but not for a lifetime. They enjoy a non-freehold estate. The right to possess the
property, for a fee, but not for a lifetime. The following would be examples of a non-freehold estate:
1. Lease for Years - A lease that has a specific ending date is tenancy for years; even if the ending date
is 4 months later. The lease agreement is for a specified lease period and ends. It could be a 2 year lease
ending on 10/1/2010. This would be a non-freehold estate for years.
2. Periodic Lease - The second most popular lease is a lease with the right of renewal. No specific
ending date. This is a periodic lease. It could be a stay at hotel (pay as go), a month-to-month for an
apartment or year-to-year lease for a commercial tenant in a building. This would be a non-freehold
estate that is periodic.
3. At Will Tenancy - There are owners who grant tenancy to people for an indefinite period of time.
 Example: A property owner grants possession to a rock group while they put their next album
together. The owner can tell the rock group to leave at any time. This would be a non-freehold estate
that is "at the will" of the owner. These are "at will tenancies".
4. At Sufferance - A tenancy at "sufferance" means possession/tenancy without permission. When a
person stops paying rent and lives in the rented facility, this called sufferance. Since they can be evicted
by court action of the property owner, this would be a non-freehold estate.
Demise a Lease - If the holder of a leasehold estate dies before the expiration date, the leasehold estate
holder can demise/pass on the lease right to heirs. The heirs can utilize the lease estate until the
expiration of the lease agreement.
(On the next page put slides waprelic – Sect 3 – page 011 and 011A )
(On the next page put an ending slide )
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