Individuals who own real property maintain a number of rights with regard to that ownership. One of these rights is to convey what is known as a life estate to another person. A life estate is created by the person owning the property (sometimes known as the “grantor”), given to the recipient (“grantee”).
Typically, the property is given for the remainder of the grantee’s lifetime. When the grantee dies, the property reverts back to the grantor.
The requirements for life estate creation are simple. The grantor must create a written document. In the document, the grantor indicates they are conveying the property for the length of someone else’s life. Generally, the writing takes the form of the following language: “I, Smith, convey my real property to Jones for life.” The writing, whose exact language requirements may differ between states, is typically contained in a deed or a will.
The most common type of life estate (the one created by word such as “To Jones for life,”) is measured by the recipient’s life. When Jones (the life tenant) dies, Smith has the right of reversion. That is, upon Jones’ death, the property reverts back to Smith. If, at that point, Smith is dead, the property goes to Smith’s heirs.
Some life estates are known as life estates pur autre vie. “Pur autre vie” means “by someone else’s life.” These life estates are created, again, by a grantor conveying the property to another, i.e., “To A,” but A’s lifetime is not the “measuring stick” for how long A holds the life estate. Rather, another person’s lifetime is. A life estate pur autre vie typically reads, “I, Smith, convey the property to Jones for the life of Green.”
Therefore, it is when Green dies, not when Jones dies, that Jones’ life estate terminates. At that time, the property reverts to Smith. Green, in this scenario, is referred to as the “measuring life,” because Green’s life serves as the measurement of the duration of Jones’ life estate.
A life tenant, during the duration of the life estate, is generally entitled to all uses and profits from the land. Since, however, the life tenant does not have any rights to transfer the property when the life tenant dies, the life tenant may not commit waste. There are three kinds of waste. The first is referred to as voluntary or affirmative waste . This is any act that causes the property to lose value.
A life tenant may also generally not commit “permissive waste”. That is, the life tenant may not neglect the obligation to keep the premises in reasonably good repair.
There is a third type of waste, known as “ameliorative waste”. To commit ameliorative waste is to engage in acts that will enhance the property’s value. The rules on ameliorative waste differ between states. Some states require that any property changes may only be made with the consent of the grantor or anyone else who may have an interest in the property.
Other states are more lenient. In these states, the life tenant can make reasonable improvements, provided the grantor or anyone else with an interest in the estate (“remaindermen”) do not object.
In addition to the duties to not commit waste, the life tenant has other duties. Generally, these duties include ensuring all ordinary taxes on the land are paid, to the extent of income or profits from the land. The life tenant’s duties also include ensuring that real estate taxes are paid, and protecting the property from liens or other encumbrances. These obligations exist so that the rights of those who will own the property subsequent to the life tenant’s ownership, are not impaired.
A life estate can be terminated upon the death of the tenant. In a pur autre vie life estate, the estate terminates upon the death of the measuring life.
Life estates can also be cut short. This can happen in several ways, such as:
- The life tenant commits impermissible waste;
- The life tenant violates a condition attached to the life estate. Grantors may attach written conditions to the conveyance of a life estate, provided the conditions are not unlawful. For example, a life estate conveyance may read, “To Jones for life, provided Jones keeps the inground swimming pool located on the premises in good repair.” Here, Joe has a life estate, and will maintain that life estate, so long as Jones abides by the condition.
An experienced estate lawyer can advise you as to how to create a life estate by helping to draft the needed documents. The lawyer can also advise you if you are a life tenant, as to your rights and obligations with respect to the property.