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Defeasible Fee Estate in Real Estate


Definition: When the rights of ownership in real estate are dependent on the occurrence or non-occurrence of a certain event, it is known as a defeasible fee estate.

If a transfer of real estate is qualified by a "condition subsequent", such as the new owner cannot do something, the former owner would retain the right to initiate legal action to retake the property if the new owner does indeed do the prohibited thing. An example might be a prohibition of using the property for hunting on a ranch transfer. Should the new owner allow hunting on the property in the future, the previous owner could initiate legal action to retake it.

A defeasible fee estate may also be qualified by a "special limitation". Here we have a situation where the rights of the new owner are automatically terminated and ownership reverts to the previous owner if a certain limitation is violated. Note that no legal action is required to retake the property in this case. By using the phrases "so long as" or "while or during" this estate is created. Using our ranch example, should the property be transferred to the new owner "so long as it is used only for the raising of cattle", using it for any other purpose would trigger the previous owner's right of reentry and the property ownership would revert.

Also Known As: fee simple defeasible, fee simple determinable

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