Definition
In property law, a future interest is the right to possess property in the future.
Overview
A future interest is in direct contrast with a present right to property, also referred to as a possessory estate. A future interest may be conditioned upon the occurrence of a certain condition or event, or it can also be unconditional.
Future interests are created at the formation of a defeasible estate. The future interest will either take effect following the natural termination of the prior estate, or will cut short the prior estate.
Life Estate
A life estate is a future interest that will result in ownership of the property only after the present possessory estate has run its course.
Cutting Short a Prior Life Estate
When a life estate is assigned, there are certain interests that may force the life estate to end early, which will shorten the life estate.
Executory Interest
An executory interest is a future interest in property that will be triggered on the happening of a stated event, and will pass the property to a third party.
Non-Executory Interest
Executory interests will pass the property to a third party, however there are future interests that will return the property to the grantor upon the triggering of a certain condition. There are two kinds of these interests:
- Right of Entry (aka "power of termination")
- If the condition is violated, the grantor has the voluntary right to reclaim the estate
- Possibility of Reverter
- If the condition is violated, the estate is automatically restored to the grantor
Further Reading
For more on future interests, see this Washington and Lee Law Review article, this Seattle University Law Review article, and this Florida State University Law Review article.