Footnotes (100)



A Uniform Perpetuities Reform Act

Scott Andrew Shepard

The John Marshall Law School

16 New York University Journal of Legislation and Public Policy 89 (2013)

For centuries the Rule Against Perpetuities provided protection against a pair of dangers: that important stocks of property would become, effectively, permanently inalienable as a result of perpetual conditional gifts; and that the dead would be permitted to control the destinies of the living by placing permanent conditions on the fixed stock of available wealth (i.e., land wealth). In recent decades, though, the states have increasingly abandoned the Rule and its protections. As of 2011 all states have migrated, at least in part, beyond the traditional “21-years-plus-life-in-being” Rule, and more than half have actually or effectively abolished their Rules, at least insofar as applied to grants made in trust form.

This migration is, in the main, quite sensible. The traditional Rule was complicated, hard to apply, inefficient, and unsupple. Even the ninety-year wait-and-see variation, which has come mostly to supplant the traditional Rule, cannot differentiate between wise and beneficent gifts that should survive beyond the ninety-year threshold and problematic gifts that should not. The danger of inalienability can be dealt with by transmuting legal interests into equitable interests at some date certain, and by granting trustees of those equitable interests the power of alienation as a matter of law as of the same date. The dangers of dead-hand control have already largely dissipated because wealth is not primarily, today, held in the form of a limited and social-and-political-power-soaked stock such as land, but rather in a variety of highly mutable forms, none of which carry with them overarching political or social overtones. Remaining concerns about the small category of problematic dead-hand incentives can be resolved by targeted adjustments to well-established aspects of property and trust law that carry none of the disadvantages of the Rule Against Perpetuities in any of its forms.

In short, then, the states have no good reason to revive their Rules Against Perpetuities, and it should not be imagined that they will. Abolition of those Rules does, however, raise some few legitimate concerns about alienability and dead-hand incentives, concerns best and most efficiently resolved by a few careful amendments to state trust and property law. This article proposes and explains a Uniform Perpetuities Reform Act with which Rule-abolishing states can make these targeted changes.

Number of Pages in PDF File: 42

Keywords: trusts, estates, real property, rule against perpetuities, perpetuities reform, conditional gifts, dead hand, elder law, estate and gift tax

Open PDF in Browser Download This Paper

Date posted: April 4, 2012 ; Last revised: April 19, 2013

Suggested Citation

Shepard, Scott Andrew, A Uniform Perpetuities Reform Act. 16 New York University Journal of Legislation and Public Policy 89 (2013). Available at SSRN: http://ssrn.com/abstract=2034437

Contact Information

Scott Andrew Shepard (Contact Author)
The John Marshall Law School ( email )
315 S. Plymouth Court
Chicago, IL 60604
United States
Feedback to SSRN

Paper statistics
Abstract Views: 755
Downloads: 98
Download Rank: 189,317
Footnotes:  100

© 2016 Social Science Electronic Publishing, Inc. All Rights Reserved.  FAQ   Terms of Use   Privacy Policy   Copyright   Contact Us
This page was processed by apollobot1 in 0.234 seconds