MBE Rules · Real Property
Future interests in grantor
The rule
Reversion (held in default): grantor transfers less than fee. Possibility of reverter (after fee simple determinable): automatic. Right of re-entry / power of termination (after FS subject to condition subsequent): must exercise.
In plain English
When a property owner gives away less than full ownership, they might get the property back later. This can happen automatically or they might have to take action to reclaim it.
Worked example
If Sam gives Alex a piece of land to use as long as it's a park, and Alex builds a mall instead, Sam can choose to take back the land because the condition was violated.
Memory hook
Grantor's Future: Revert, Possibility, Right. Reversion by default, possibility automatic, right needs action.
The trap
Students think: Reversion requires action. Wrong, because reversion is automatic unless otherwise stated. The actual test is if the grantor transfers less than a fee simple.
How examiners test it
The MBE loves: grantor gives fee simple determinable or subject to condition subsequent. Trap: students confuse automatic (possibility of reverter) with needing action (right of re-entry).
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