Rule Against Perpetuities

The Rule Against Perpetuities is a legal doctrine developed in English common law to limit the right of ownership of private property with respect to the use or sale of property in the distant future ("perpetuities"). The theory is that future uses of land should be dictated by free enterprise, not by the desires of an owner in the distant past.

The Rule accomplishes its purpose by prohibiting any future ownership or control of land that does not "vest" or become effective until 21 years after the death of a living person. This Rule allows a parent to grant his property to his future children only upon their reaching adulthood. Planning further in the future for the control of land is blocked by this Rule.

Another way to understand the Rule is this: no one can control any property longer than 21 years after everyone who is alive today has died.

But there are many exceptions to the Rule Against Perpetuities, including reversions, rights of entry and options to purchase held by a current tenant.

State Constitutions

Nine states have rules against perpetuities in their state constitutions, but note that state statutes can extend the cut-off to 300 years or more in these states:

Arizona, Arkansas, Montana, Nevada, North Carolina, Oklahoma, Tennessee, Texas and Wyoming

In 2021, Texas enacted a law extending the rule against perpetuities to 300 years for trusts (HB 654). The Texas Constitution has this provision prohibiting infinite ownership of property: “Perpetuities and monopolies are contrary to the genius of a free government, and shall never be allowed ....” Tex. Const. art. I, § 26.