Future Trusts 163. When the right of the cestui que trust is limited to arise at some time in the future, there is a future equitable interest, properly called a future trust. The terms executory devise, remainder, or springing or shifting use, are not, accurately speaking, applicable. The language of the judges is very loose, and these technical terms are used interchangeably with great freedom. It is important, however, to bear in mind the exact distinction between them. An equitable estate is continuous just as a legal estate is. The right of the cestui que trust is to be referred to the beginning of the interest, and to be regarded as an integral whole, notwithstanding the fact that there is a continuing duty on the part of the trustee. so long as the estate lasts. It seems an unnecessary refinement to split up the estate and give the cestui que trust separate, distinct rights, predicated on each performance of duty by the trustee, even though an arbitrary division of the estate into one-year periods is adopted.2 2 A suggestion to this effect is made by Mr. Gray, Rule Perp., 2 ed. (1906), $249b, n. 4, and Gray, Restraints on Alien., 2 ed. (1895), §272a, discussed §376, post. PART II THE RULE FORBIDDING THE CREATION OF RESTRAINTS ON ALIENATION Chap. 8. Restraints on Alienation Defined and Analyzed. LEGAL INTERESTS Chap. 9. Absolute Interests. Voluntary Alienation. Chap. 10. Absolute Interests. Involuntary Alienation. Chap. 11. Estates for life. Voluntary and Involuntary Alienation. EQUITABLE INTERESTS Chap. 12. Absolute Interests. Voluntary and Involuntary Alienation. Chap. 13. Estates for Life. Involuntary Alienation. (Spendthrift Trusts.) Chap. 14. Estates for Life. Voluntary Alienation. CHAPTER 8 RESTRAINTS ON ALIENATION DEFINED AND ANALYZED The rule forbidding the creation of restraints on alienation.... Restraints on alienation classified...... Restraint does not affect quantum of estate. 8171 §172 8173 $174 $175 The Rule Forbidding the Creation of Restraints on Alienation 171. We have already noticed sufficiently the history of alienation1 and the and the principle of public policy which is opposed to the creation of restraints on alienation.2 We therefore begin this part of the discussion with the general rule that the donor may not restrict the alienabilty of the subject matter of the gift in the hands of the donee. This principle of law may be called the rule forbidding the creation of restraints on alienation. We shall in this chapter define and analyze the restraints on alienation, and indicate the order in which the subject will be treated. Alienation Defined and Analyzed 172. Alienation is the transfer of the title to property from one person to another, and may take place by the act of the party holding the title, in which case it is called voluntary alienation, or it may take place in pursuance of law, without or against the consent of the party holding the title, in which case it is called involuntary alienation. Voluntary alienation occurs by the act of the holder of the title. 1 1 Generally at §7, ante; as to real estate, 18, 19, 20, ante; as to personal prop erty, $90, ante. 2 §§11, 12, 13, 14, ante. Involuntary alienation can take place only under some legal process, which may be (1) proceedings in bankruptcy; (2) execution, legal or equitable, to satisfy some decree of the court; (3) under eminent domain proceedings. Restraints on Alienation Classified 173. The restraint on alienation may be sought to be imposed by a proviso (1) that the title shall go over to a third person upon alienation; (2) that it shall revert to the donor or his heirs on alienation; (3) by a simple prohibition against alienation, in which latter case the title remains in the owner if the prohibition is valid, and he cannot get rid of it nor it be taken away from him, notwithstanding an attempted alienation. The first two cases produce a forfeiture of the title when the proviso is violated. It is immaterial, for the purposes of this discussion, whether the title goes over to a third person or reverts to the grantor.3 The important distinction is between the clause of forfeiture and the clause of prohibition. The first two cases will therefore be hereafter referred to under the term clause of forfeiture.1 A clause of forfeiture or prohibition upon involuntary alienation has no effect whatever upon voluntary alienation, for the holder may dispose of the title before the involuntary alienation occurs, and thus prevent the proviso from taking effect. In like manner, where the restraint is upon voluntary alienation, the title is subject to involuntary alienation before the voluntary alienation takes place." Restraint Does Not Affect the Quantum of the Estate 174. The restraint on alienation, however, does not affect the quantum of the estate. In a number of cases, however, where the question was as to the quantum of the estate the 3 See $183, post. 4 The clause of forfeiture is very rare in Pennsylvania. For an attempt to impose such a clause, see Pepper's App., 120 Pa. 235 (1888). 5 Stuckert v. Harvey, 1 Miles, 247 (1836). It is possible to word a clause so that it would take effect, if at all, as to all holders of the title. No such case appears to have arisen in practice, and it is not likely that its validity would be sustained if it arose. The discussion in the text is limited to the case where a restraint applies to the particular holder of the title. 6 Dictum, Woodward, J., in Hill v. Hill, 43 Pa. 528 at 531 (1862). |