Also known as: fee simple subject to an executory interest · FSSEI · fee simple defeasible
Written by attorneys · grounded in primary & secondary sources — see below
An estate in fee simple that is subject to divestment by an executory limitation upon the occurrence of a stated event. The limitation automatically shifts title to a third party rather than returning it to the grantor.
Summit Malls conveyed an outparcel to Horizon Outfitters by deed stating that the parcel would pass automatically to ClearAir Foundation if Horizon ever sold tobacco products. When Horizon later leased space to a vape kiosk selling nicotine, ClearAir asserted ownership. Horizon's estate ended automatically and title moved directly to ClearAir because the deed created a fee simple subject to executory interest in Horizon with an executory limitation in ClearAir.
Ann conveyed land to Bob with the limitation that if liquor was ever sold on the premises the land would pass to Cathy. When Bob sold liquor, Cathy's executory interest became possessory and automatically divested Bob's estate. Bob therefore held only a fee simple subject to executory interest that terminated upon the triggering event.
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A fee simple subject to executory interest ends automatically upon the stated event and shifts title to a third party. A fee simple subject to condition subsequent requires the grantor to exercise a right of entry and does not shift title to a third party.
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Language such as so long as combined with an automatic shift of title to a named third party creates the estate. The words of duration limit the fee and the executory limitation directs title away from the grantor.
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No action is required. The estate ends automatically upon the triggering event and title passes directly to the holder of the executory interest.
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Yes. The Restatement permits concurrent ownership of a fee simple defeasible in any form allowed for a fee simple absolute, provided the limitation creating the defeasible estate also conforms to the rules for concurrent estates.
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