Uchtorff v. Hanson


FACTS: The decedents second wife and his children from a previous marriage both claimed the right lo trust assets, but the trust itself was ambiguous as to who should get the fund under the circumstances, so the court applied the trust law, granting the assets to the children, and the second wife appealed.

ISSUE: Was Richard's remainder interest vested, such that he could devise it to whomever he pleased?

HOLDING: The Supreme Court, Streit, J., held that:
1) father's remainder interest vested upon grandfather's death, and
2) Trust Code did not apply to render father's remainder interest as contingent.

RULE: A remainder may be vested even if it is postponed until the happening of some certain condition; it is contingent only if Its existence depends on some dubious circumstance through which it may be defeated.

ANALYSIS: Yes. A remainder may be vested even if it is postponed until the happening of some certain condition; it is contingent only if its existence depends on some dubious circumstance through which it may be defeated. A remainder interest is a future interest created in someone other than the transferor that will become a present estate (if ever) immediately upon the expiration of all prior simultaneously created estates relating to the same property. A vested remainder exists when the estate is invariably fixed to remain with certain determinate persons. A contingent remainder, by contrast, exists when the estate in remainder is limited to taking effect either in an uncertain person or upon an uncertain event, so that the remainder may never actually materialize. Vested remainders are devisable and alienable.
Alfred's will clearly gave Richard a remainder interest in the trust\_hd, which interest was a future interest that could become a present estate when Pearls prior interest expired (e.g., by death, remarriage, or renouncement), but only if Richard survived Alfred. At first, Richard's interest was contingent upon surviving Alfred. But once that circumstance materialized, Richard's interest vested, such that, automatically, upon the termination of Pearl's estate, it became an estate in possession. Although some may argue that Richard's interest remained contingent until Pearl died, that is not the case. The expiration of Pearl's estate was inevitable, although the timing may have been uncertain. Only when a condition makes it uncertain that the remainder interest will ever pass does the condition make the interest contingent.