Rule Against Perpetuity
What is a “vested” interest? (Sec. 19, TPA)
Idea: The right is already created in favour of the transferee; only enjoyment may be postponed. If the transferee dies before taking possession, the interest passes to his heirs/representatives.
When does it vest?
If the transfer says it takes effect immediately, or on an event that must happen (e.g., on A’s death), and there is no condition precedent.
Postponement of possession or determination of prior interest does not prevent vesting.
Key features (mnemonic: “PINE”)
Passes to heirs if transferee dies before enjoyment.
Immunity from failure due to lapse of time (unless divested).
No condition precedent (or the condition is merely as to time/event that must occur).
Enjoyment may be postponed.
Illustrations
“To B for life, then to C.” C’s remainder is vested; C (or C’s heirs) will take whenever B’s life interest ends.
“To C on A’s death.” A’s death is certain; C’s interest is vested, though possession is postponed.
Authorities commonly cited
Saunders v. Vautier (1841): once a beneficiary’s interest is absolutely vested and the beneficiary is sui juris, he can call for the property (principle used by Indian courts to mark the difference between postponement of enjoyment vs. postponement of vesting).
Privy Council trend: gifts taking effect on events certain to occur (e.g., termination of a prior life estate) are vested remainders, not contingent.
What is a “contingent” interest? (Sec. 21, TPA)
Idea: The right is dependent on a condition precedent—an uncertain event. Until the condition happens, there is no vested right; if the event never happens or becomes impossible, the interest fails.
When is it contingent?
Where the transfer is conditional “if/when X happens” and X may or may not happen (uncertain).
The condition is precedent to the creation of the interest.
Key features (mnemonic: “FAIL”)
Falls if the condition does not occur or becomes impossible.
Absent vesting until the condition is fulfilled.
Interest is merely an expectation before the condition.
Lapses on impossibility/illegality (see TPA rules on impossible/illegal conditions).
Illustrations
“To C if C marries D.” Marriage to D is uncertain; C’s interest is contingent. If D dies/unmarriageable or C never marries D, it fails.
“To C on his attaining 21.” Attaining 21 is uncertain (C might die earlier); until then C has a contingent interest.
Authorities commonly cited
Leake v. Robinson (1817): classic rule—where a gift is to a class/persons who attain a specified age, the interest is contingent until the age is reached.
Privy Council line: gifts “if” or “provided that” a condition occurs are contingent till fulfillment.
Conditions: “precedent” vs “subsequent”
Condition precedent → creates a contingent interest; the condition must be fulfilled before any vesting.
Condition subsequent (Sec. 25, read with general principles) → interest vests first but may be divested on the happening of a specified event.
Illustrations
Precedent (contingent): “To C if C becomes a doctor.”
Subsequent (vested, but defeasible): “To C, but if C leaves India permanently, to D.” C has a vested interest, liable to be divested.
Section 20 (unborn person)
If property is transferred to an unborn person (through a prior life interest), on birth the child takes a vested interest (subject to postponement of enjoyment), unless a condition precedent is attached. This shows vesting can occur even though enjoyment is future.
Vested vs Contingent — quick contrasts
| Point | Vested | Contingent |
|---|---|---|
| Nature | Present, certain right (enjoyment may be future) | Uncertain right; depends on condition precedent |
| Death of transferee before enjoyment | Passes to heirs | Fails (unless and until condition is fulfilled) |
| Event triggering enjoyment | Event must happen (e.g., end of life estate) | Event may or may not happen |
| Drafting words | “on A’s death”, “after B’s life” | “if C does…”, “provided that…”, “on condition that…” |
| Remedy/control | Beneficiary with absolute vesting can often call for conveyance (Saunders v Vautier principle) | Cannot demand until condition fulfilled |
Common exam traps (and how to handle)
Postponement ≠ contingency: If enjoyment is merely postponed (e.g., after B’s life estate), the remainder is usually vested, not contingent.
Age conditions: “To C who attains 21” is contingent till 21 (Leake v. Robinson).
Words matter: “If / provided that / on condition that” → usually precedent (contingent). “But if / so long as / until” → often subsequent (vested but defeasible).
Impossibility/illegality: A void condition precedent may leave the transfer as absolute (or fail, depending on structure). Always analyse whether the transferor intended vesting independent of the condition.
Short model answers (you can copy in exams)
(A) Define & distinguish
A vested interest (Sec. 19) arises when the transfer creates a present right in the transferee, though enjoyment may be postponed; it survives the transferee’s death and descends to heirs. A contingent interest (Sec. 21) depends on a condition precedent—an uncertain event; until fulfillment there is no vesting, and failure/impossibility defeats it. Saunders v. Vautier illustrates that postponement of enjoyment does not prevent vesting. Leake v. Robinson shows gifts to those “who attain” a certain age are contingent until attainment.
(B) Apply to a problem
“to B for life, then to C if C marries D; if not, to E.” C’s is contingent on marrying D; if D dies or C never marries D, C’s interest fails and E takes. If it were “to B for life, then to C,” C’s interest is vested remainder; it passes to C’s heirs even if C dies during B’s life.
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