I. [RESERVED.]

II. DECISIONS UNDER PRIOR LAW.

Seal. - Neither § 55-57 nor § 55-48 contain seal requirements that § 55-51 operates to suspend, and neither of these statutes imposes a seal requirement on deeds, which the common law and the Statute of Conveyances, have already accomplished; these provisions only offer recommended language, purely permissive, not mandatory, for deeds already required to be under seal, and the presence or absence of either statute has no effect on the seal requirement. Game Place, L.L.C. v. Fredericksburg 35, LLC, 295 Va. 396 , 813 S.E.2d 312, 2018 Va. LEXIS 54 (2018).

By its plain terms, the saving statute only saves deeds that fail to take effect by virtue of this chapter, and this saving statute appears in Chapter 4 of Title 55, but nowhere in that chapter is there a statutory requirement that deeds be under seal; that requirement comes from the common law and is incorporated into the definition of "deed" in the Statute of Conveyances, neither of which can be found in Chapter 4 of Title 55. Game Place, L.L.C. v. Fredericksburg 35, LLC, 295 Va. 396 , 813 S.E.2d 312, 2018 Va. LEXIS 54 (2018).

I. [RESERVED.]

II. DECIDED UNDER PRIOR LAW.

A. CONVEYANCE OF ESTATES.

For history of this section, see Yancey v. Radford, 86 Va. 638 , 10 S.E. 972 (1890).

In general. - Under this section no estate of inheritance or freehold or for a term of more than five years in lands shall be conveyed unless by deed or will. Smith v. Plaster, 151 Va. 252 , 144 S.E. 417 (1928).

Seal. - One of the essential requisites of a deed is that it have a seal affixed thereto. Smith v. Plaster, 151 Va. 252 , 144 S.E. 417 (1928).

Fifteen-year lease did not include a seal of any kind, and thus, it failed to satisfy the common-law seal requirement embedded in the definition of "deed" under the Statute of Conveyances, nor did the lease include any specific seal substitutes recognized in § 11-3 ; because rent was received on a monthly basis, the occupation of the premises and the monthly payment of rent implied a month-to-month tenancy, which was paid for through the last month of occupancy. Game Place, L.L.C. v. Fredericksburg 35, LLC, 295 Va. 396 , 813 S.E.2d 312, 2018 Va. LEXIS 54 (2018).

Neither § 55-57 nor § 55-48 contain seal requirements that § 55-51 operates to suspend, and neither of these statutes imposes a seal requirement on deeds, which the common law and the Statute of Conveyances, have already accomplished; these provisions only offer recommended language, purely permissive, not mandatory, for deeds already required to be under seal, and the presence or absence of either statute has no effect on the seal requirement. Game Place, L.L.C. v. Fredericksburg 35, LLC, 295 Va. 396 , 813 S.E.2d 312, 2018 Va. LEXIS 54 (2018).

Common-law seal requirement antedated the General Assembly's existence, and the legislative antecedent to the Statute of Conveyances made its first appearance in the Code of Virginia in 1705; so, even if Chapter 4 of Title 55 never existed, the seal requirement would nevertheless govern deeds of lease with a term exceeding five years. Game Place, L.L.C. v. Fredericksburg 35, LLC, 295 Va. 396 , 813 S.E.2d 312, 2018 Va. LEXIS 54 (2018).

By its plain terms, the saving statute only saves deeds that fail to take effect by virtue of this chapter, and this saving statute appears in Chapter 4 of Title 55, but nowhere in that chapter is there a statutory requirement that deeds be under seal; that requirement comes from the common law and is incorporated into the definition of "deed" in the Statute of Conveyances, neither of which can be found in Chapter 4 of Title 55. Game Place, L.L.C. v. Fredericksburg 35, LLC, 295 Va. 396 , 813 S.E.2d 312, 2018 Va. LEXIS 54 (2018).

General Assembly has engaged the common-law seal requirement but has never abolished it altogether for deeds governed by the Statute of Conveyances. Game Place, L.L.C. v. Fredericksburg 35, LLC, 295 Va. 396 , 813 S.E.2d 312, 2018 Va. LEXIS 54 (2018).

Virginia law requires deed to transfer legal title to real property. However, this rule does not change the fact that petitioners possessed neither a legal nor an equitable interest in the property once the auctioneer's hammer fell and the memorandum of sale was signed. At this point, and before settlement, the trustee retains legal title to the property, while the purchaser possesses the right to enforce the sale in equity. Abdelhaq v. Pflug, 82 Bankr. 807 (E.D. Va. 1988).

Legal title to property can be conveyed only by deed or will, and in this case the deed of trust did not convey the title to the property. FDIC v. Hish, 76 F.3d 620 (4th Cir. 1996).

Not applicable to easements. - Although § 55-2 was inapplicable to the conveyance of easements because an easement was not an estate, the circuit court's judgment was reversed; the deeds at issue, along with a plat incorporated therein for descriptive purposes, did not contain operative words manifesting an intention to grant an easement. Considering the particular circumstances of the two deeds and the plat at issue, and resolving any doubt against the establishment of an easement, there was no conveyance of an express easement across the property owner's two parcels for the benefit of the limited liability company's parcel. Burdette v. Brush Mt. Estates, LLC, 278 Va. 286 , 682 S.E.2d 549, 2009 Va. LEXIS 91 (2009).

Under this section leases for more than five years must be by deed, but there is no statutory provision in this State which in terms declares that other actual leases must be in writing. If the situation is covered at all, it must fall under either the sixth or seventh clause of the statute of frauds. Smith v. Payne, 153 Va. 746 , 151 S.E. 295 (1930).

But section does not apply to lease for five years with option to renew. - A lease for a period of five years, with an option to the lessee to continue for another period of five years, is not a lease for a term of more than five years within the meaning of this section. James v. Kibler's Adm'r, 94 Va. 165 , 26 S.E. 417 (1896).

Since an easement is not an estate, the provisions of § 55-2 do not control the conveyance of an easement. Burdette v. Brush Mt. Estates, LLC, 278 Va. 286 , 682 S.E.2d 549, 2009 Va. LEXIS 91 (2009).

And it has no application to the creation by parol of trusts in personalty or in the proceeds of real estate. Riggan's Adm'r v. Riggan, 93 Va. 78 , 24 S.E. 920 (1896).

This section does not bar the establishment of an oral trust in land or in a leasehold for more than five years, nor does it bar the oral transfer of a beneficiary's interest in a trust. Burns v. Equitable Assocs., 220 Va. 1020 , 265 S.E.2d 737 (1980).

No erasure or alteration in a conveyance, nor even the cancellation thereof by mutual consent of the parties, can divest an estate already vested by operation of the deed; for that would be in conflict with this section, which declares that no estate of inheritance or freehold, or for a term of more than five years in lands, shall be conveyed unless by deed or will. Brooks v. Clintsman, 124 Va. 736 , 98 S.E. 742 , rehearing denied, 124 Va. 749 , 100 S.E. 394 (1919).

Nor is the grantee's title divested by the return of the deed to be canceled. Graysons v. Richards, 37 Va. (10 Leigh) 57 (1839); Jones v. Neale, 2 Pat. & H. 339 (1856).

Husband's expression of desire that wife own property together did not convey legal title subsequent to writing. - Since writing, where husband expressed his desire that he and his wife own property together, was neither a deed nor a will, it did not convey legal title or joint ownership of any kind to the real estate. Westbrook v. Westbrook, 5 Va. App. 446, 364 S.E.2d 523 (1988).

B. PAROL GIFT OR PROMISE OF GIFT.

Effect of statute. - Prior to May 1, 1888, the date upon which the Code of 1887 took effect, a parol gift or a promise of a gift of land, to be consummated by deed, if followed by possession and improvements of the land, was enforceable under the doctrine of such cases as Halsey v. Peters' Ex'r, 79 Va. 60 (1884); and a contract for a gift to be perfected by will, under similar circumstances, was enforceable under the doctrine announced in Burdine v. Burdine's Ex'r, 98 Va. 515 , 36 S.E. 992 , 81 Am. St. R. 741 (1900). But in view of the history and apparent purpose of this section, which first made its appearance in the Code of 1887, no such contract or gift is now enforceable. Wohlford v. Wohlford, 121 Va. 699 , 93 S.E. 629 (1917). See Nicholas v. Nicholas, 100 Va. 660 , 42 S.E. 669 , rehearing denied, 100 Va. 665 , 42 S.E. 866 (1902); Brooks v. Clintsman, 124 Va. 736 , 98 S.E. 742 , rehearing denied, 124 Va. 749 , 100 S.E. 394 (1919); Frizzell v. Frizzell, 149 Va. 815 , 141 S.E. 868 (1928); Creed v. Goodson, 153 Va. 98 , 149 S.E. 509 (1929).

At common law voluntary parol partition of lands between coparceners was valid without deed. Not until § 2413 of the Code of 1887 became effective on May 1, 1888, was a deed required to effect such partition. Rowe v. Big Sandy Coal Corp., 197 Va. 136 , 87 S.E.2d 763 (1955).

It was contended on behalf of the appellant that this section had no application, because the alleged contract was based upon a valuable consideration, to wit: the complainant's change of position by leaving his own farm and bestowing his labor and care upon that of another, and the sale of his own land and application of the proceeds to improvements upon the place with reference to which he had a parol contract. But in this respect, the case cannot be distinguished in principle from Halsey v. Peter's Ex'r, 79 Va. 60 (1884), the doctrine of which and the other Virginia cases of that type this section was expressly designed to abolish. Wohlford v. Wohlford, 121 Va. 699 , 93 S.E. 629 (1917).

Prior to the adoption of this section, an oral promise to give or devise land, followed by possession and improvements, was sufficient to support a right to a conveyance of the same from the heirs or devisees of the donor, but since the adoption of this section such a promise must be in writing before it can be enforced. Mann v. Mann, 159 Va. 240 , 165 S.E. 522 (1932).

It was intended by this section to require some evidence other than parol evidence of a gift of land. In the instant case complainant, who was asserting a gift of land from his father to him, has his evidence in writing and although this writing was crudely drawn it was quite clear that the father intended to give a tract of land to the son in consideration of the maintenance of the father and his wife. Creed v. Goodson, 153 Va. 98 , 149 S.E. 509 (1929).

But the evidence required need not be under seal but only in writing. Creed v. Goodson, 153 Va. 98 , 149 S.E. 509 (1929).

Oral contract for consideration fully performed. - This section had no application where plaintiff relied upon and proved an oral contract for the purchase of a business and what pertained to it in exchange for his services in conducting and operating said business for the lifetime of decedent, which consideration he fully performed. Clark v. Atkins, 188 Va. 668 , 51 S.E.2d 222 (1949).

An oral contract to devise land for a consideration fully performed is not embraced by the provisions of this section. Wright v. Dudley, 189 Va. 448 , 53 S.E.2d 29 (1949).

Oral promise supported by consideration may constitute contract of sale. - If an oral promise to make a conveyance of land is supported by valuable consideration, it is a contract of sale and not a promise to give. Mann v. Mann, 159 Va. 240 , 165 S.E. 522 (1932). But see §§ 11-1 and 11-2 as to necessity that contract for sale of realty be in writing.

In considering what advancements are to be brought into hotchpot under the provisions of § 64.1-17 regard must also be had to this section. Nicholas v. Nicholas, 100 Va. 660 , 42 S.E. 669 , rehearing denied, 100 Va. 665 , 42 S.E. 866 (1902).

CIRCUIT COURT OPINIONS

Editor's note. - The cases cited below were decided under prior law.

Virginia law requires deed to transfer legal title to real property. - Lease agreement did not create a life estate in favor of the mother because § 55-2 required that any purported life estate be transferred through a writing in a deed or a will. Harris v. Finnerty, 74 Va. Cir. 551, 2006 Va. Cir. LEXIS 200 (Fairfax County 2006).

Under this section leases for more than five years must be by deed. - Where a lease for more than five years was not in writing, a former tenant's claim for breach of the lease was defeated by both the statute of frauds codified in § 11-2 , and by the statute of conveyances, codified in § 55-2; therefore, the demurrers thereto were sustained. Flamingo Lounge & Rest., Inc. v. Pure Gold Gentlemen's Club & Sports Bar, L.L.C., 62 Va. Cir. 507, 2003 Va. Cir. LEXIS 306 (Norfolk 2003).

Defendant's demurrer to a motion for judgment seeking recovery on a commercial lease was overruled because, although § 55-2 required that a lease for a term of more than five years had to be conveyed by deed, all that was required of the deed was a manifest intent to grant. Kassco, L.L.C. v. Geodigital Mapping, Inc., 69 Va. Cir. 137, 2005 Va. Cir. LEXIS 327 (Loudoun County 2005).

No oral contract found. - Trial court granted a trust the possession of a residence because the court found that there was not an oral contract between the trust and the occupant of the residence that permitted the occupant to reside therein absent a written lease. The court accepted the testimony of the attorney who drafted the trust that the grantor made no mention of an oral agreement that would have allowed the occupier to remain in the property, and the trust document did not mention allowing the occupier to remain in the property during the occupier's lifetime. Stanley v. Stanley, 102 Va. Cir. 366, 2019 Va. Cir. LEXIS 353 (Orange County Aug. 16, 2019).

Quiet title. - Plaintiff was granted a judgment on its claim to quiet title to the subject properties as to any claims by heirs, except the non-party heirs, because a memorandum between two of the heirs to portion of the subject property did not constitute a valid deed or will and did not convey an interest in the property where it specifically referenced a "quit claim deed," the first heir had no ownership interest in the property to convey to a second heir, a third heir was not a bona fide purchaser of the property where he had both actual and inquiry notice that the first heir had conveyed his interest to the second heir, and the deed of partition conveyed no greater title or interest to other heirs than they had before it was made. Wintergreen Homestead, L.L.C. v. Ray M. Pennington & Bettie's Wintergreen, L.L.C., 104 Va. Cir. 362, 2020 Va. Cir. LEXIS 43 (Nelson County Mar. 23, 2020).

I. [RESERVED.]

II. DECIDED UNDER PRIOR LAW.

History of statute. - For history of the various acts on this subject, from 1757, referring only to slaves, to the present, see the cases of Thomas' Adm'r v. Lewis, 89 Va. 1 , 15 S.E. 389 (1892); First Nat'l Bank v. Holland, 99 Va. 495 , 39 S.E. 126 (1901).

This section and § 55-96 are so closely related as to subject matter of gifts that they may be said to be in pari materia, and should be construed together. Both relate to goods and chattels, this section wholly, and § 55-96 in part. First Nat'l Bank v. Holland, 99 Va. 495 , 39 S.E. 126 (1901).

This section has no application to the creation by parol of trusts in personalty or in the proceeds of real estate. Riggan's Adm'r v. Riggan, 93 Va. 78 , 24 S.E. 920 (1896).

Nor does it apply to gifts causa mortis. - The words "no gift" do not refer to gifts causa mortis, nor does the section embrace them. Thomas' Adm'r v. Lewis, 89 Va. 1 , 15 S.E. 389 (1892).

The words "goods or chattels" do not apply to choses in action. - The words "goods or chattels" used in this section, relating to gifts, do not apply to choses in action, but only to visible and tangible property. A chose in action is the money, damages or thing owing; the bond or note, etc., is but the evidence of it. Bank stock is a chose in action. First Nat'l Bank v. Holland, 99 Va. 495 , 39 S.E. 126 (1901). See Gardner v. Moore's Adm'r, 122 Va. 10 , 94 S.E. 162 (1917).

This section, § 55-87, former §§ 55-88 through 55-90 and former § 55-94 relate to gifts, loans, sales, or partition of the same kind of property, described by the same terms namely, "goods or chattels" or "goods and chattels." They are closely connected in subject matter and in the language employed, and it can hardly be doubted that whatever was meant by the words "goods or chattels" or "goods and chattels" in either one of these sections must have been intended of the same words in each of the other sections. First Nat'l Bank v. Holland, 99 Va. 495 , 39 S.E. 126 (1901).

Where an alleged gift by a mother to her daughter, with whom she resided, was not of money, but was a part of a judgment which the donor had recovered against her son, a mere chose in action, the provision of this section, relating to the residence together of the donor and donee at their place of residence, has no application thereto. Gardner v. Moore's Adm'r, 122 Va. 10 , 94 S.E. 162 (1917).

"Paraphernalia" defined. - For purposes of this section, the Supreme Court would adopt the following definition of "paraphernalia" found in the Oxford English Dictionary (1971): "personal belongings, esp., articles of adornment or attire, trappings; also the articles that compose an apparatus, outfit or equipment; . . . appointments or appurtenances in general." Teed v. Powell, 236 Va. 36 , 372 S.E.2d 131 (1988).

Requirements for gift are intention and actual or constructive delivery. - In order for a gift inter vivos to be effective there must be an intention in praesenti on the part of the donor to make the gift and there must be such actual or constructive delivery as divests the donor of all dominion and control over the property and invests it in donee. Taylor v. Smith, 199 Va. 871 , 102 S.E.2d 160 (1958).

In Virginia, in order for there to be a valid gift of personal property, it must be shown that there existed a present intention on the part of the donor to make a gift, coupled with a delivery, either actual or constructive, such as to divest the donor of all dominion and control over the property and place it in the donee. In addition to the common-law requirements of a valid gift, this section requires a deed or will, unless actual possession comes to and remains with the donee or some person claiming under him. Sadler v. Garrett, 45 Bankr. 190 (Bankr. E.D. Va. 1984).

What constitutes delivery. - The delivery of possession may be actual, constructive or symbolical, depending upon the nature of the thing given. Yancey v. Field, 85 Va. 756 , 8 S.E. 721 (1889); Thomas' Adm'r v. Lewis, 89 Va. 1 , 15 S.E. 389 (1892).

To render a gift effectual, the thing given, or the means of obtaining it, must be delivered by the donor to the donee, or to his agent, and accepted by him. Yancey v. Field, 85 Va. 756 , 8 S.E. 721 (1889).

Delivery vesting equitable title is all that is necessary. - A delivery which vests an equitable title only in the donee is all that is necessary to constitute a valid gift. First Nat'l Bank v. Holland, 99 Va. 495 , 39 S.E. 126 (1901); Thomas' Adm'r v. Lewis, 89 Va. 1 , 15 S.E. 389 (1892).

Not necessary that deed be recorded. - Under this statute, a deed is valid between the parties even without being recorded. Henry v. Graves, 57 Va. (16 Gratt.) 244 (1861).

Donor and donee residing together. - If the donor and donee reside together, possession or delivery at their common place of residence will not be sufficient to constitute a valid gift. Thomas' Adm'r v. Lewis, 89 Va. 1 , 15 S.E. 389 (1892); First Nat'l Bank v. Holland, 99 Va. 495 , 39 S.E. 126 (1901).

This section applies to a husband and wife residing together regardless of whether there were any creditors of the donor at the time the alleged gifts were made. Kendrick v. Watkins, 121 F.2d 287 (4th Cir. 1941).

This section was held applicable where husband bought furniture and other household articles several years before he went bankrupt and gave them to his wife without executing a deed or other writing. Kendrick v. Watkins, 121 F.2d 287 (4th Cir. 1941).

Sale to wife and resale to husband. - A husband, a merchant, conveyed to his wife a stock of goods which she immediately resold to him. There was no valuable consideration for either transfer. After these transfers the husband became indebted to complainant for purchases of merchandise in the ordinary course of business. These purchases from complainant by the husband were made in his own name and solely on his own credit. The husband at the time of the sale to his wife and resale, and thereafter, continued in actual possession of the stock of goods. It was held that neither this section nor former § 55-83 in any way affected the title which the husband took under the contract of resale, and that the sale and resale between husband and wife did not make the wife a debtor as to purchases from complainant made by her husband. Canada v. C.H. Beasley & Bros., 132 Va. 166 , 111 S.E. 251 (1922), overruled in part by Lofton Ridge, LLC v. Norfolk S. Ry. Co., 268 Va. 377 , 601 S.E.2d 648 (2004), to the extent that it suggests judicial estoppel applies in cases where the parties are not the same and do not have a derivative liability relationship.

Jewelry as marital property. - Where husband testified that he gave his wife jewelry valued at $5,000 during the course of the marriage, the commissioner omitted the jewelry completely from the property that was valued for purposes of making an equitable distribution award, and the wife argued that the jewelry should have been excluded because it was "personal paraphernalia" and, thus, was exempt as a gift under this section, the court rejected the wife's argument and classified the jewelry as marital property. Rein v. Rein, No. 1120-93-1, 1994 Va. App. LEXIS 699 (Ct. of Appeals Nov. 29, 1994).

Burden of proof. - The one claiming the validity of the gift has the burden of proving by clear and convincing evidence all the facts and circumstances which would show that the gift was, in fact, a valid one. Sadler v. Garrett, 45 Bankr. 190 (Bankr. E.D. Va. 1984).

When a donee claims title to personal property in a gift inter vivos, the burden of proof rests upon him to establish by clear and convincing evidence every fact and circumstance necessary to show that validity of the gift. The intention of the donor to part with title and delivery of possession are essential requirements. Nelson v. Liggan, 189 Va. 637 , 53 S.E.2d 798, aff'd, 190 Va. 213 , 56 S.E.2d 54 (1949).

The law does not presume a gift and where a donee claims title to personal property by virtue of a gift inter vivos, the burden of proof rests upon him to show every fact and circumstance necessary to constitute a valid gift by clear and convincing evidence. Taylor v. Smith, 199 Va. 871 , 102 S.E.2d 160 (1958).

Evidence was insufficient to establish a gift of money found, after the alleged donor's death, in a safety deposit box which had been rented by the alleged donor in the name of the alleged donee. Taylor v. Smith, 199 Va. 871 , 102 S.E.2d 160 (1958).

Three shotguns and a rifle given by decedent to her son did not qualify as gifts inter vivos where the son lived all his life with the decedent and therefore no actual possession existed. Teed v. Powell, 236 Va. 36 , 372 S.E.2d 131 (1988).

CIRCUIT COURT OPINIONS

Editor's note. - The case cited below was decided under prior law.

No relinquishment of dominion and control. - When a testator and his widow had saved cash in a fruitcake tin, the cash belonged to the widow by virtue of the will, not as an inter vivos gift, as the gift had not been completed. The testator, who told his son to give the money to the widow after his death, had not relinquished dominion and control over it, and the widow admitted that she did not know where the tin was and that she relied upon the son to deliver it to her after the testator died. Davenport v. Walters, 69 Va. Cir. 334, 2005 Va. Cir. LEXIS 332 (Norfolk 2005).

I. [RESERVED.]

II. DECIDED UNDER PRIOR LAW.

One cannot suffer an unlawful forfeiture of something he has gained contrary to law or the terms of his own undertaking. Sundin v. Klein, 221 Va. 232 , 269 S.E.2d 787 (1980), appeal dismissed and cert. denied, 452 U.S. 911, 101 S. Ct. 3043, 69 L. Ed. 2d 414 (1981).

Consent or participation in an immoral or unlawful act by plaintiff precludes recovery for injuries sustained as a result of that act. Wackwitz v. Roy, 244 Va. 60 , 418 S.E.2d 861 (1992).

Although punishment for suicide rescinded, suicide remains common-law crime. - That the legislature affirmatively rescinded the punishment for suicide without decriminalizing the act confirmed to the district court that, although the State cannot punish a suicide in the respects indicated, it in fact remains a common-law crime. Hill v. Nicodemus, 755 F. Supp. 692 (W.D. Va. 1991), aff'd, 979 F.2d 987 (4th Cir. 1992).

Although the General Assembly has rescinded the punishment for suicide, it has not decriminalized the act. Suicide, therefore, remains a common-law crime in Virginia as it does in a number of other common-law states. Wackwitz v. Roy, 244 Va. 60 , 418 S.E.2d 861 (1992).

Suicide remains a common-law crime in Virginia. Hill v. Nicodemus, 979 F.2d 987 (4th Cir. 1992).

To constitute suicide at common law the person must be of years, of discretion and of sound mind; this common-law rule comports with a contemporary definition of suicide. Wackwitz v. Roy, 244 Va. 60 , 418 S.E.2d 861 (1992).

Where the plaintiff alleged that her decedent was of unsound mind when he killed himself, if this were so, then he was not guilty of the common-law crime of suicide, and his act would not be a bar per se to the administrator's action. Wackwitz v. Roy, 244 Va. 60 , 418 S.E.2d 861 (1992).

Convict may take, hold and dispose of his property. - There is no statute in Virginia that deprives a convict of the power to make contracts or conveyances of his real estate, and corruption of blood and forfeiture of estate on conviction of felony as at common law has been expressly abolished by this section. So, in Virginia, the right of a person to take, hold, and dispose of his property, real and personal, is not affected by his attainder of felony. Therefore, a convict is capable of executing a valid power of attorney. Haynes v. Peterson, 125 Va. 730 , 100 S.E. 471 (1919).

Slayer statute did not implicate prohibition against corruption of blood. - Version of the Virginia Slayer Statute, § 55-401 et seq., which was in effect on the date of the decedent's murder in 2005 neither implicated nor violated Virginia's prohibition against corruption of blood or forfeiture of estate. Bell v. Casper, 282 Va. 203 , 717 S.E.2d 783 (2011), cert. denied, 132 S. Ct. 1971, 182 L. Ed. 2d 819, (U.S. 2012).

I. [RESERVED.]

II. DECIDED UNDER PRIOR LAW.

A deed operates as a conveyance without any acknowledgment, under this section. Acknowledgment is necessary for recordation, but not to pass title. Title passes by the execution and delivery of the deed. Gannaway v. Federal Land Bank, 148 Va. 176 , 138 S.E. 564 (1927); Peatross v. Gray, 181 Va. 847 , 27 S.E.2d 203 (1943).

I. [RESERVED.]

II. DECIDED UNDER PRIOR LAW.

In general. - Under this statute every conceivable interest in or claim to real estate, whether present or future, vested or contingent, and however acquired may be disposed of by deed or will. Young v. Young, 89 Va. 675 , 17 S.E. 470 (1893). See Carrington v. Goddin, 54 Va. (13 Gratt.) 587 (1857); Wilson v. Langhorne, 102 Va. 631 , 47 S.E. 871 (1904); Heuser v. Belvin, 118 Va. 346 , 87 S.E. 594 (1916).

Although § 55-2 was inapplicable to the conveyance of easements because an easement was not an estate, the circuit court's judgment was reversed; the deeds at issue, along with a plat incorporated therein for descriptive purposes, did not contain operative words manifesting an intention to grant an easement. Considering the particular circumstances of the two deeds and the plat at issue, and resolving any doubt against the establishment of an easement, there was no conveyance of an express easement across the property owner's two parcels for the benefit of the limited liability company's parcel. Burdette v. Brush Mt. Estates, LLC, 278 Va. 286 , 682 S.E.2d 549, 2009 Va. LEXIS 91 (2009).

Construction with other law. - Virginia Conservation Easement Act [ §§ 10.1-1009 through 10.1-1016 ] did not create a new right to burden land by a negative easement in gross for the purpose of land conservation and historic preservation, but facilitated the continued creation of such easements by providing a clear statutory framework under which tax exemptions are made available to charitable organizations devoted to those purposes and tax benefits and incentives are provided to the grantors of such easements, contrary to the common law; moreover, the easement at issue was not of a novel character and is consistent with the statutory recognition of negative easements in gross for conservation and historic purposes. United States v. Blackman, 270 Va. 68 , 613 S.E.2d 442, 2005 Va. LEXIS 69 (2005).

Section changed common-law rule. - Under this section, the common-law rule was changed and every conceivable interest in or claim to real estate, whether present or future, vested or contingent, and however acquired, may be disposed of by deed or will. Weddle v. Nunley, 43 Bankr. 415 (Bankr. W.D. Va. 1984).

The statute changed the common-law rule by declaring that "any interest in or claim to real estate may be disposed of by deed or will." Carrington v. Goddin, 54 Va. (13 Gratt.) 587 (1857); Mustard v. Wohlford's Heirs, 56 Va. (15 Gratt.) 329 (1859).

Right of entry or action. - A party having an interest in or claim to land held adversely by another may, under this section, sell and convey the same, and his grantee may maintain ejectment for it. Carrington v. Goddin, 54 Va. (13 Gratt.) 587 (1857). See Dobson v. Culpepper, 64 Va. (23 Gratt.) 352 (1873); Mustard v. Wohlford's Heirs, 56 Va. (15 Gratt.) 329 (1859).

Future estates. - Under this section future estates may be created both by will and deed. Harlan v. Weatherly, 183 Va. 49 , 31 S.E.2d 263 (1944).

Contingent remainders. - Under this section a contingent remainder may be conveyed by deed. Young v. Young, 89 Va. 675 , 17 S.E. 470 (1893). See Heuser v. Belvin, 118 Va. 346 , 87 S.E. 594 (1916).

Under this section contingent remainders and executory devises may be disposed of by deed or will. Copenhaver v. Pendleton, 155 Va. 463 , 155 S.E. 802 (1930); In re Camden, 217 F. Supp. 634 (W.D. Va. 1963).

Under this section the right of contingent remaindermen to convey their interests in property cannot be questioned. Larkin v. Wright, 185 Va. 447 , 39 S.E.2d 355 (1946); In re Camden, 217 F. Supp. 634 (W.D. Va. 1963).

At common law, a contingent remainder passed only by estoppel, but under this section any interest in, or claim to, real estate may be transferred by deed or will. Hence, the deed of the debtor, conveying all of his property of every description includes his interest in a contingent remainder. Wilson v. Langhorne, 102 Va. 631 , 47 S.E. 871 (1904).

Under the provisions of this section and §§ 55-49, 55-75, the effect of a joint devise to testator's three sons, with a conditional limitation over that if one or more of them shall die, leaving no issue, his or their share, as the case may be, shall go to his surviving brothers or brother, is to invest the devisees under such a will with the authority to convey and relinquish all their right, title and interest in the land devised, and the grantee of them takes a fee simple estate. Smith v. Smith, 112 Va. 617 , 72 S.E. 119 (1911).

Vested remainder subject to divestment. - Whether interest acquired was a vested remainder subject to divestment or a contingent remainder, it was nevertheless transferable under this section and so passed to trustee in bankruptcy. In re Camden, 217 F. Supp. 634 (W.D. Va. 1963).

Executory interests. - An executory devise stands upon precisely the same footing as contingent remainders insofar as transmissibility of the subject thereof is concerned, and an interest in such subject may be conveyed (certainly by virtue of such a statute as this section) prior to the happening of the contingency upon which the interest is appointed by the will to vest in right of possession, provided the grantor has at the time of conveyance a possibility of taking coupled with an interest. This he has, according to the authorities, if he, at such time, is an ascertained person to take under the devise. And he is such an ascertained person if he is designated by name or by class, all of which class are to take, and one of which he is. Medley v. Medley, 81 Va. 265 (1886); Prince v. Barham, 127 Va. 462 , 103 S.E. 626 (1920).

Where a possible taker under an executory devise is designated by class, and he should die before the testator, if the will speaks as of that time in designating the person to take, the survivors of the class will take; but if he survives such time, his interest, under an executory devise, equally as if it were a contingent remainder, is descendible, and assignable in equity, and also at law, certainly by virtue of this statute in Virginia. Many of the authorities hold that the same is true at common law since the statute of uses and of wills dispenses with livery of seisin. Prince v. Barham, 127 Va. 462 , 103 S.E. 626 (1920).

Possibility of reverter. - Though possibilities of reverter were inalienable at common law by deed or will, they are alienable by both deed and will under the provisions of this section and § 64.1-46. Copenhaver v. Pendleton, 155 Va. 463 , 155 S.E. 802 (1930). See County School Bd. v. Dowell, 190 Va. 676 , 58 S.E.2d 38 (1950); Sanford v. Sims, 192 Va. 644 , 66 S.E.2d 495 (1951).

Under these sections a possibility of reverter, whether it depends upon a base or qualified fee or upon a fee simple limited upon a condition subsequent, is alienable by either deed or will, at any time, either before or after the happening of the contingency or the breach of the condition subsequent upon which the possibility of reverter depends. Copenhaver v. Pendleton, 155 Va. 463 , 155 S.E. 802 (1930).

Right to construct sewer. - A deed conveying part of a tract of land (consisting of 47.5 acres) provided that the grantee should have a right to construct a sewer through the property of the grantor. The deed contemplated the use of the easement not only for the drainage of the 47.5 acres conveyed, but also as essential to the drainage of an incorporated town, and other lands not included in that particular tract. It was held that the easement was not appurtenant to the 47.5 acres conveyed by the deed. It was either an easement in gross, or else extends the area of the land to which it is appurtenant, so as, at least, to include land naturally drained by the channel. If it is to be regarded as an easement in gross, it is still "an interest in land," and, therefore, may be disposed of by deed or will under this section. City of Richmond v. Richmond Sand & Gravel Co., 123 Va. 1 , 96 S.E. 204 (1918).

CIRCUIT COURT OPINIONS

Editor's note. - The case cited below was decided under prior law.

Contingent remainders. - Because there was no reason that would prevent a beneficiary from alienating a part of the beneficiary's interest in a trust, pursuant to §§ 55-6 and 55-52, a commissioner's determination that a beneficiary's expectancy went directly to the beneficiary's surviving children was affirmed. Bowman v. Mericle, 69 Va. Cir. 87, 2005 Va. Cir. LEXIS 259 (Norfolk August 31, 2005).

I. [RESERVED.]

II. DECIDED UNDER PRIOR LAW.

The effect of this section is to validate remainders in such property as remains undisposed of by the life tenant where a fee simple estate arises when the first taker is given a life estate coupled with the power of absolute disposition. Rawlings v. Briscoe, 214 Va. 44 , 197 S.E.2d 211 (1973).

The effect of this section is to validate the gift over where the first taker is given an express estate for life, coupled with the absolute power of disposition. Pigg v. Haley, 224 Va. 113 , 294 S.E.2d 851 (1982).

This section modifies the rule of May v. Joynes . Clarkson v. Bliley, 185 Va. 82 , 38 S.E.2d 22 (1946); Crisman v. Swanson, 193 Va. 247 , 68 S.E.2d 502 (1952); Trustees of Duncan Mem. Methodist Church v. Ray, 195 Va. 803 , 80 S.E.2d 601 (1954); Borum v. National Valley Bank, 195 Va. 899 , 80 S.E.2d 594 (1954); Pigg v. Haley, 224 Va. 113 , 294 S.E.2d 851 (1982).

The application of the doctrine of May v. Joynes , 61 Va. (20 Gratt.) 692 (1871), is limited by this section to the property that remains after a life estate with power in the life tenant to dispose of such property if he desires. Rule v. First Nat'l Bank, 182 Va. 227 , 28 S.E.2d 709 (1944).

Under this section that which was void for repugnancy and uncertainty under the doctrine of May v. Joynes, 61 Va. (20 Gratt.) 692 (1871), is made valid. Now the gift over is validated where the first taker is given an express estate for life, coupled with the power of absolute disposition. Borum v. National Valley Bank, 195 Va. 899 , 80 S.E.2d 594 (1954).

The rule of May v. Joynes, 61 Va. (20 Gratt.) 692 (1871) held that a life estate coupled with the absolute power of disposition created a fee simple estate invalidating the remainder; this rule obviously could defeat a testator's intent, and, therefore, a statute was enacted to validate the remainder to the extent that the life tenant had not disposed of it. First Va. Bank v. United States, 490 F.2d 532 (4th Cir. 1974).

But does not save property lawfully disposed of by life tenant during lifetime. - This section does not save property from the operation of the rule in May v. Joynes, 61 Va. (20 Gratt.) 692 (1871), where the life tenant, with the full power of sale and disposition, lawfully disposed of it during her lifetime. Rawlings v. Briscoe, 214 Va. 44 , 197 S.E.2d 211 (1973).

The following requirements must be met in order to apply this section: (1) The first taker must be given an express estate "for life." (2) There must be "conferred expressly or by implication a power upon the life tenant in his lifetime or by will to dispose absolutely of said property." (3) There must be "a limitation in remainder over." (4) There must be a corpus on which the "limitation in remainder over" can operate. Borum v. National Valley Bank, 195 Va. 899 , 80 S.E.2d 594 (1954); Pigg v. Haley, 224 Va. 113 , 294 S.E.2d 851 (1982).

This section does not preclude creation of life estate by implication. - This section does not require that a life estate be created by express words or preclude creation of such an estate by implication where there is no power of disposal in the first taker. Robinson v. Caldwell, 200 Va. 353 , 105 S.E.2d 852 (1958); Edwards v. Bradley, 227 Va. 224 , 315 S.E.2d 196 (1984).

But it applies only to an estate granted expressly for life. Hall v. Hoak, 184 Va. 821 , 36 S.E.2d 567 (1946); Crisman v. Swanson, 193 Va. 247 , 68 S.E.2d 502 (1952); Trustees of Duncan Mem. Methodist Church v. Ray, 195 Va. 803 , 80 S.E.2d 601 (1954); Borum v. National Valley Bank, 195 Va. 899 , 80 S.E.2d 594 (1954); Gardner v. Worrell, 201 Va. 355 , 111 S.E.2d 285 (1959).

This section, by its express terms, applies only when there is a life estate in the first taker, and is not applicable when the estate of the first taker is a fee, whether created by express words or by implication. Clarkson v. Bliley, 185 Va. 82 , 38 S.E.2d 22 (1946); Borum v. National Valley Bank, 195 Va. 899 , 80 S.E.2d 594 (1954).

The amendment of 1908 applied to "any estate," whether for life or in fee, and permitted a valid remainder, even after a fee, if power of disposition, where granted, was not exercised and there remained anything after the death of the devisee. Southworth v. Sullivan, 162 Va. 325 , 173 S.E. 524 (1934).

This was so unsatisfactory to the Code revisors of 1919 that they changed the amendment and limited the remainder over to cases where there was only an express estate for life. Therefore, subsequent to the revision of 1919, except where there is an express estate for life, the remainder is void just as it was prior to the amendment of 1908. Moore v. Holbrook, 175 Va. 471 , 9 S.E.2d 447 (1940).

Coupled with the absolute power of disposition. Mowery v. Coffman, 185 Va. 491 , 39 S.E.2d 285 (1946); Voigt v. Selander, 190 Va. 638 , 58 S.E.2d 25 (1950); Trustees of Duncan Mem. Methodist Church v. Ray, 195 Va. 803 , 80 S.E.2d 601 (1954).

This section is expressly limited to devises and bequests for life with absolute power of disposition. In such circumstances the doctrine of May v. Joynes, 61 Va. (20 Gratt.) 692 (1871), which holds that whenever in any devise or conveyance a life estate is given and there is afterwards given to the life tenant or first taker power to dispose of or consume the corpus of the estate, the first taker is vested with a fee simple estate, has been abolished, and the estate of the remaindermen preserved. The section is remedial and should be liberally construed. Christian v. Wilson's Ex'rs, 153 Va. 614 , 151 S.E. 300 , cert. denied, 282 U.S. 840, 51 S. Ct. 21, 75 L. Ed. 746 (1930); Southworth v. Sullivan, 162 Va. 325 , 173 S.E. 524 (1934).

Thus, this section has no application where there is a limitation over after conveyance of a fee simple. - Notwithstanding this section, where a testator has given his wife a fee simple estate, an attempted limitation over by him of any portion remaining at her death is void. This section has no application because the gift to the first taker was not of a life estate but of a fee simple. Skinner v. Skinner's Adm'r, 158 Va. 326 , 163 S.E. 90 (1932). See Southworth v. Sullivan, 162 Va. 325 , 173 S.E. 524 (1934).

In Moore v. Holbrook , 175 Va. 471 , 9 S.E.2d 447 (1940), this section was held inapplicable because the estate was granted in general terms by language that unmistakably implied an estate in fee.

And it is inapplicable where no powers of disposal are conferred on first takers. - Where no powers of disposal are conferred upon the first takers by a will, this section cannot be successfully relied upon. Robinson v. Caldwell, 200 Va. 353 , 105 S.E.2d 852 (1958).

Words creating life estate. - The words "shall immediately upon my decease become the property of my wife . . . to be used for her decent support during her natural life," create an express life estate in the testator's property. Pigg v. Haley, 224 Va. 113 , 294 S.E.2d 851 (1982).

Words creating limitation in remainder over. - The words "It is my will and desire that upon the death of my said wife whatever residue of my estate either real or personal which she has not consumed or disposed of shall become the property of . . ." satisfy the requirement that there be a limitation in remainder over. Pigg v. Haley, 224 Va. 113 , 294 S.E.2d 851 (1982).

Residuary clause. - Residuary clause in a testator's will unambiguously granted the testator's wife a life estate in the residual property. Along with directing the disposition of the residual property following the wife's death, the residuary clause placed limitations on the wife's use of the property during her life, and these limitations were irreconcilable with an absolute power of disposition. Feeney v. Feeney, 295 Va. 312 , 811 S.E.2d 830, 2018 Va. LEXIS 35 (2018).

Power of widow to terminate life estate by remarrying. - Where a testator gave to his wife a life estate with power of disposition and remainder over to his children, and provided that in the event of his wife's remarriage the life estate should terminate and one third of the remainder should belong to her absolutely, the power of the wife voluntarily to terminate her life estate by remarrying did not convert her estate into a fee simple interest, and, under the provisions of this section, the remainder over was valid and was not affected by the doctrine of May v. Joynes . Voigt v. Selander, 190 Va. 638 , 58 S.E.2d 25 (1950).

This section does not restrict the life tenant's power of disposition. First Va. Bank v. United States, 490 F.2d 532 (4th Cir. 1974).

A life tenant's right to dispose, sell, trade or use stock during her lifetime for her comfort and care as she may see fit is not limited by this section to an ascertainable standard relating to her health, support, or maintenance, for the purpose of federal estate tax exemption. First Va. Bank v. United States, 490 F.2d 532 (4th Cir. 1974).

Absolute dominion over property given to life tenant. - Language used in a testator's will giving the life tenant the power to sell any and all residue of the property at her discretion shows that the testator intended to give her absolute dominion over the property with full power of disposition, and this section did not save it. Rawlings v. Briscoe, 214 Va. 44 , 197 S.E.2d 211 (1973).

CIRCUIT COURT OPINIONS

Editor's note. - The case cited below was decided under prior law.

Rule inapplicable. - Because a life estate granted to the testatrix was neither expressed nor implied, and the devise was not saved from the operation of May v. Joynes and § 55-7, a motion for summary judgment filed by the testatrix's daughter seeking a declaration that the parcel conveyed did not pass under her will because she, in effect, had only a life estate in the property with a remainder over to her heirs, was denied. Allin v. Morris, 73 Va. Cir. 202, 2007 Va. Cir. LEXIS 53 (Rockingham County 2007).

I. [RESERVED.]

II. DECIDED UNDER PRIOR LAW.

Husband and wife may join in deed to one of themselves. - A husband and wife unquestionably can join in a deed conveying the entirety to a third party, and in Virginia this section permits a husband and wife to join in a deed conveying land to himself or herself. Vasilion v. Vasilion, 192 Va. 735 , 66 S.E.2d 599 (1951).

I. [RESERVED.]

II. DECIDED UNDER PRIOR LAW.

Provision as to warranties applies only to descent of realty. - This section, taken from the statute of Gloucester, and extended generally to common-law warranties, applies only to cases of real assets descending from the warranting ancestor, and not to personal assets, or assets, whether real or personal, accruing from him by devise or bequest. Norman's Ex'x v. Cunningham, 46 Va. (5 Gratt.) 63 (1848).

And is not applicable where a husband conveys the property of his wife, with warranty against the claims of himself and his heirs. His children, deriving title from their mother, will not be affected by the warranty. Urquhart v. Clarke, 23 Va. (2 Rand.) 549 (1824).

I. [RESERVED.]

II. DECIDED UNDER PRIOR LAW.

Words of inheritance or perpetuity unnecessary to create estate of inheritance. - The act passed in 1785 (the original of this section) dispensed with the necessity of words of inheritance or perpetuity to create an estate of inheritance. Goodrich v. Harding, 24 Va. (3 Rand.) 280 (1825); Bells v. Gillespie, 26 Va. (5 Rand.) 273 (1827); Ball v. Payne, 27 Va. (6 Rand.) 73 (1827); Jiggetts v. Davis, 28 Va. (1 Leigh) 368 (1829); Seekright on Demise of Bramble v. Billups, 31 Va. (4 Leigh) 90 (1833); Doe on Demise of See v. Craigen, 35 Va. (8 Leigh) 449 (1836); Tinsley v. Jones, 54 Va. (13 Gratt.) 289 (1856).

The word "heirs" is not necessary to create an estate of inheritance. Daniel v. Lipscomb, 110 Va. 563 , 66 S.E. 850 (1910).

Fee simple or whole estate or interest of grantor passes in absence of words of limitation in deed. - The grantee, in a deed for land conveyed without any words of limitation, usually succeeds to every right of his grantor therein, or, as expressed in this section, such a deed passes the fee simple or whole estate or interest which the grantor had power to dispose of, unless a contrary intention shall appear by the conveyance. Gordon Metal Co. v. Kingan & Co., 132 Va. 229 , 111 S.E. 99 (1922).

Language construed to pass greatest estate it is capable of conveying. - The language in a deed will be construed to pass to the grantee the greatest estate which the language employed is capable of conveying. Goodson v. Capehart, 232 Va. 232 , 349 S.E.2d 130 (1986).

Whole deed must be looked to in order to ascertain intention of grantor. - Since under this statute the whole deed is to be looked to in order to ascertain the intention of the parties, the common-law rule that the habendum clause of a deed must yield to the granting clause in case of repugnance between the two no longer applies where the intention of the grantor can be ascertained with reasonable certainty. Temple's Adm'r v. Wright, 94 Va. 338 , 26 S.E. 844 (1897). See Mauzy v. Mauzy, 79 Va. 537 (1884).

Language disclosing intent to create mere life estates. - Where testator and his wife owned certain lots jointly, and he devised all his real estate to his wife and provided that "at her death it is to go to" his nephew "and at his death to his two boys," and she died some years later having devised her half interest in the property to the nephew "and at his death goes to his two sons," the language of the respective devises clearly disclosed an intent to create mere life estates in the first takers with remainder over, nor was there any policy, statute or canon of property which would override this intent. Robinson v. Caldwell, 200 Va. 353 , 105 S.E.2d 852 (1958).

A deed to a person "forever to hold for life" was held to create only a life estate in Humphrey v. Foster, 54 Va. (13 Gratt.) 653 (1857).

Grant to remaindermen held a fee. - If a remainder, after the death of the life tenant, be given to such persons as shall at that time answer the description of his heirs at law, that is a valid gift of a remainder to such persons, who will be entitled, as purchasers, to an estate in fee simple. Taylor v. Cleary, 70 Va. (29 Gratt.) 448 (1877).

Fee simple interest transferred by deed. - Grant of summary judgment in favor of the town in its action against the property owner for quiet title and for ejectment was appropriate because a fee simple interest was previously transferred to the railroad by the 1909 deed and the town was currently the fee simple owner of that strip of land conveyed by that 1909 deed after the railroad abandoned their railroad line and donated the railroad corridor to the town. Bailey v. Town of Saltville, 279 Va. 627 , 691 S.E.2d 491, 2010 Va. LEXIS 53 (2010).

Residuary clause. - Residuary clause in a testator's will unambiguously granted the testator's wife a life estate in the residual property. Along with directing the disposition of the residual property following the wife's death, the residuary clause placed limitations on the wife's use of the property during her life, and these limitations were irreconcilable with an absolute power of disposition. Feeney v. Feeney, 295 Va. 312 , 811 S.E.2d 830, 2018 Va. LEXIS 35 (2018).

CIRCUIT COURT OPINIONS

Editor's note. - The case cited below was decided under prior law.

Application of rule. - Because a life estate granted to the testatrix was neither expressed nor implied, and the devise was not saved from the operation of May v. Joynes and § 55-7, a motion for summary judgment filed by the testatrix's daughter seeking a declaration that the parcel conveyed did not pass under her will because she, in effect, had only a life estate in the property with a remainder over to her heirs, was denied. Allin v. Morris, 73 Va. Cir. 202, 2007 Va. Cir. LEXIS 53 (Rockingham County 2007).

I. [RESERVED.]

II. DECIDED UNDER PRIOR LAW.

An estate tail is an estate limited to the issue of the donee. Jiggetts v. Davis, 28 Va. (1 Leigh) 368 (1829).

Estates tail were unknown to the common law. They were created by the statute de donis conditionalibus. Bells v. Gillespie, 26 Va. (5 Rand.) 273 (1827).

History of section abolishing estates tail. - The acts of 1776 and 1785 abolished entails and converted estates tail into fee simple estates. See Carter v. Tyler, 5 Va. (1 Call) 165 (1797); Tate v. Tally, 7 Va. (3 Call) 354 (1802); Smith v. Chapman, 11 Va. (1 Hen. & M.) 240 (1807); Bells v. Gillespie, 26 Va. (5 Rand.) 273 (1827); Broaddus v. Turner, 26 Va. (5 Rand.) 308 (1827); Ball v. Payne, 27 Va. (6 Rand.) 73 (1827); Jiggetts v. Davis, 28 Va. (1 Leigh) 368 (1829); Orndoff v. Turman, 29 Va. (2 Leigh) 200 (1830); Seekright on Demise of Bramble v. Billups, 31 Va. (4 Leigh) 90 (1833); Doe on Demise of Thomason v. Andersons, 31 Va. (4 Leigh) 118 (1833); Doe on Demise of See v. Craigen, 35 Va. (8 Leigh) 449 (1836); Nowlin v. Winfree, 49 Va. (8 Gratt.) 346 (1852); East v. Garrett, 84 Va. 523 , 9 S.E. 1112 (1888); Hawthorne v. Beckwith, 89 Va. 786 , 17 S.E. 241 (1893); Walker v. Lewis, 90 Va. 578 , 19 S.E. 258 (1894).

The act of 1776 operated upon all estates tail in possession, and those in reversion or remainder, after the determination of an estate for life, or lives, or of any lesser estate; but a greater estate than for life or lives, was not within the operation of the act. An estate tail in remainder, after the determination of a preceding estate tail, e.g., was not affected by the act. Roy v. Garnett, 2 Va. (2 Wash.) 9 (1794). Hence, the statute of 1785, abolishing all entails, was reenacted from the statute of 1776, which had failed to accomplish its avowed purpose. Bells v. Gillespie, 26 Va. (5 Rand.) 273 (1827).

It was held that by the act of 1776, for docking entails, all remainders, contingent as well as vested, were utterly barred, whether the entail was created before or after passage of the act. Hence, a devise of lands to A. and if the said A. should die not having any lawful heir of his body, then the land to go to B., created an estate tail in A., which by the statute was converted into a fee simple, and the limitation over was void. Carter v. Tyler, 5 Va. (1 Call) 165 (1797). See Hunter v. Haynes' Lessee, 1 Va. (1 Wash.) 71 (1792); Hill v. Burrow, 7 Va. (3 Call) 342 (1802); Tate v. Tally, 7 Va. (3 Call) 354 (1802); Eldridge v. Fisher, 11 Va. (1 Hen. & M.) 559 (1807); Sydnor v. Sydnors, 16 Va. (2 Munf.) 263 (1811); M'Clintic v. Manns, 18 Va. (4 Munf.) 328 (1814); Tidball v. Lupton, 22 Va. (1 Rand.) 194 (1822); Kendall v. Eyre, 22 Va. (1 Rand.) 288 (1823); Bells v. Gillespie, 26 Va. (5 Rand.) 273 (1827); Broaddus v. Turner, 26 Va. (5 Rand.) 308 (1827); Jiggetts v. Davis, 28 Va. (1 Leigh) 368 (1829); Doe on Demise of See v. Craigen, 35 Va. (8 Leigh) 449 (1836); Callis v. Kemp, 52 Va. (11 Gratt.) 78 (1854); Tinsley v. Jones, 54 Va. (13 Gratt.) 289 (1856); Hood v. Haden, 82 Va. 588 (1886). But this doctrine of Carter v. Tyler, 5 Va. (1 Call) 165 (1797), was abrogated after January 1, 1820 by the provision of this section that "every limitation upon such estate shall be held valid if the same would be valid when limited upon an estate in fee simple created by technical language."

Statute liberally construed. - The statute abolishing entails is a highly remedial statute and should be liberally construed. Orndoff v. Turman, 29 Va. (2 Leigh) 200 (1830).

Presumption against intention to create entailed estate. - Since the act of 1776 abolishing entails, it is not to be supposed that a man intended to convey an estate tail unless plain and unequivocal words were used, such as would of themselves create a fee tail without resorting to implication. Walker v. Lewis, 90 Va. 578 , 19 S.E. 258 (1894). See Smith v. Chapman, 11 Va. (1 Hen. & M.) 240 (1807); Taylor v. Cleary, 70 Va. (29 Gratt.) 448 (1877).

I. [RESERVED.]

II. DECIDED UNDER PRIOR LAW.

Statement of the rule in Shelley's Case. - Whenever the ancestor, by any will, gift, or conveyance, takes an estate of freehold in lands, or tenements, and in the same will, gift, or conveyance, an estate is afterwards limited by way of remainder, either mediately or immediately, to his heirs, or to the heirs of his body, the words "heirs," or "heirs of the body," are words of limitation of the estate, carrying the inheritance to the ancestor, and not words of purchase creating a contingent remainder in the heirs. Moore v. Brooks, 53 Va. (12 Gratt.) 135 (1855); Taylor v. Cleary, 70 Va. (29 Gratt.) 448 (1877); King v. Johnson, 117 Va. 49 , 83 S.E. 1070 (1915); Turner v. Monteiro, 127 Va. 537 , 103 S.E. 572 (1920).

History and effect of statute. - Code 1849, c. 146, § 11, essaying to abolish the rule in Shelley's Case, applied only where the grantor or testator was competent to, and did vest in the heir a remainder in fee simple after an estate for the ancestor's life. Hood v. Haden, 82 Va. 588 (1886). This is not true under the present statute, which is coordinate with the rule itself.

The parties of the first part in a deed granted property to the party of the second part: "To have and to hold unto the party of the second part for her lifetime and then to her heirs forever." It was held that under this section the language used gave to the grantee an estate for life and to her children a remainder in fee. Puckett v. Campbell, 151 Va. 213 , 144 S.E. 434 (1928).

Rule of property; not of construction. - The rule in Shelley's Case, where the requisites concur, controls the intention of the testator, or grantor, and overrides his purpose, often very clearly expressed, to limit the ancestor to an estate of freehold. The rule is not a means to discover the intent of the grantor, or testator, but, supposing the intent ascertained, the rule controls it. Taylor v. Cleary, 70 Va. (29 Gratt.) 448 (1877); Turner v. Monteiro, 127 Va. 537 , 103 S.E. 572 (1920). See Walker v. Lewis, 90 Va. 578 , 19 S.E. 258 (1894).

Words must be used to import class of persons to take indefinitely in succession. - It is a part of the rule in Shelley's Case and essential to its operation, that the words used to indicate the persons to whom the estate is limited, by way of remainder, must import a class of persons to take indefinitely in succession. If they do import such a class, then the rule is of inflexible application; but if the words are used to designate particular individuals, the words so used are words of purchase and not of limitation, e.g. , grant to A. for life, remainder to the heirs of A. now living, or remainder to the sons of A. and their heirs, or remainder to the children of A. In all of these instances, particular individuals are indicated by the words used; hence, the rule does not apply. Turner v. Monteiro, 127 Va. 537 , 103 S.E. 572 (1920).

"Descendants" and "heirs of the body" are of equivalent meaning. - The rule in Shelley's Case applies when the limitation in remainder is to the "heirs of the body" of the tenant of the freehold. The words "descendants" and "heirs of the body" are of equivalent meaning. Turner v. Monteiro, 127 Va. 537 , 103 S.E. 572 (1920).

Who are "descendants." - While the word "descendants" is not a technical word to the extent that the law has not impressed it with a different meaning from that accorded in common acceptation and general understanding, it is a word much used in law and of very clear and definite meaning. A descendant is an individual proceeding from an ancestor in any degree. It is synonymous with issue. It is offspring, near or remote. The word "child" is not synonymous with the word "descendant," though a child is a descendant and a descendant may be a child; but a descendant may also proceed from an ancestor in the remotest as well as the nearest degree. Obviously, this is not true as to a child. Turner v. Monteiro, 127 Va. 537 , 103 S.E. 572 (1920).

Application of rule. - Under a will which took effect before the abolition of the rule in Shelley's Case, a testator gave land to two of his sons during their lifetime to hold jointly and after the death of the last of the two to their descendants, if they have any; if not, to a third party or his descendants. Held, that by force of this rule in Shelley's Case the two sons took an estate tail, which, by operation of the statute, then as now in force, was converted into a joint fee. Turner v. Monteiro, 127 Va. 537 , 103 S.E. 572 (1920).

The court held that where a testator gave his estate to his wife during her life, and at her death to be equally divided amongst all of his children and the shares of his two daughters to be held by them during their natural lives and no longer, and then equally to be divided between their heirs lawfully begotten, the words "heirs lawfully to be begotten" (or similar words) were words of limitation and the daughters took the whole interest in their shares of the estate. Moore v. Brooks, 53 Va. (12 Gratt.) 135 (1855). See Tinsley v. Jones, 54 Va. (13 Gratt.) 289 (1856); Hall's Ex'r v. Smith, 66 Va. (25 Gratt.) 70 (1874); Walker v. Lewis, 90 Va. 578 , 19 S.E. 258 (1894).

Rule not applicable. - The court held that a grant by D. to his grandson R., his executors, administrators and assigns, from and after the grantor's death, for and during his life only; and after his death the said piece of land to go to such person or persons as shall at that time answer the description of heir or heirs at law of the said R., and such person or persons shall take the said land under that description as purchasers under and by virtue of this deed, and not by inheritance as heirs of the said R., created in R. but a life estate in the land; and the persons who at the time of R.'s death answered the description of his heirs at law took as purchasers under the deed. Taylor v. Cleary, 70 Va. (29 Gratt.) 448 (1877).

The statute does not apply to a trust deed for the benefit of the grantor's wife "for life and the remainder to the heirs of her body begotten by" the grantor in the trust deed. Halsey v. Fulton, 119 Va. 571 , 89 S.E. 912 (1916).

CIRCUIT COURT OPINIONS

Editor's note. - The case cited below was decided under prior law.

Application of rule. - Because a life estate granted to the testatrix was neither expressed nor implied, and the devise was not saved from the operation of May v. Joynes and § 55-7, a motion for summary judgment filed by the testatrix's daughter seeking a declaration that the parcel conveyed did not pass under her will because she, in effect, had only a life estate in the property with a remainder over to her heirs, was denied. Allin v. Morris, 73 Va. Cir. 202, 2007 Va. Cir. LEXIS 53 (Rockingham County 2007).

I. [RESERVED.]

II. DECIDED UNDER PRIOR LAW.

Where some of children were born after testator's death, the interest or estate that had vested in those in being when testator died would open up and let in the after-born members of the class as each came into being. Newsome v. Scott, 200 Va. 833 , 108 S.E.2d 369 (1959).

I. [RESERVED.]

II. DECIDED UNDER PRIOR LAW.

History of statute. - The English statute of uses (St. 27 Hen. VIII, Ch. 10) was not in force in Virginia after 1792. This section, the only one ever enacted in Virginia, is materially different from the English statute. See Jones v. Tatum, 60 Va. (19 Gratt.) 720 (1870).

This section does not apply to uses created by devise nor transfer such uses into the possession of the cestui que use. Bass v. Scott, 29 Va. (2 Leigh) 356 (1830). See Jones v. Tatum, 60 Va. (19 Gratt.) 720 (1870).

I. [RESERVED.]

II. DECIDED UNDER PRIOR LAW.

Trustee in a land trust receives both legal and equitable title. - Unlike a creditor trust where legal title resides in the trustee while the beneficiary retains equitable title, the trustee in a land trust receives both legal and equitable title to the property. Air Power, Inc. v. Thompson, 244 Va. 534 , 422 S.E.2d 768 (1992).

Beneficiary receives no interest in property in a land trust. - In a land trust, the beneficiary retains no interest, legal or equitable, in the property itself, but instead holds only a personal property interest in the rents, proceeds, and profits from the property. Air Power, Inc. v. Thompson, 244 Va. 534 , 422 S.E.2d 768 (1992).

Third party has no responsibility to notify beneficiary of action against property. - The provisions of this section effectively eliminate a third party's responsibility, and ability, to notify land trust beneficiaries of any action against the property which that party may contemplate. Air Power, Inc. v. Thompson, 244 Va. 534 , 422 S.E.2d 768 (1992).

Beneficiary was proper but not necessary party in mechanics lien action. - A beneficiary may be a proper party to an action to enforce a mechanic's lien, which would provide notice and the opportunity to preserve its interests in the proceeds from a potential judicial sale; nevertheless, the beneficiary is not a necessary party to the enforcement suit. Air Power, Inc. v. Thompson, 244 Va. 534 , 422 S.E.2d 768 (1992).

Status of land trust. - Where the facts in the record were insufficient to support a finding that an entity other than a land trust was actually created, and the trust agreement specifically provided that it would not be deemed to create or evidence the existence of a corporation, association, joint venture, or partnership, a land trust created under this section was not some type of business organization. Curtis v. Lee Land Trust, 235 Va. 491 , 369 S.E.2d 853 (1988).

Limitation on use of trust. - Owner-borrowers should not be permitted to use a Virginia statutory land trust as a device to defeat the rights of the defendant savings and loan associations from accelerating the payment of their secured notes as provided for by due on sale clauses. Williams v. First Fed. Sav. & Loan Ass'n, 500 F. Supp. 307 (E.D. Va. 1980), aff'd, 651 F.2d 910 (4th Cir. 1981).

In Virginia, it is clear that the land trust statute may not be used as an artifice to avoid creditors. Bluff Ventures Ltd. Partnership v. Chicago Title Ins. Co., 950 F.2d 139 (4th Cir. 1991).

Lack of beneficiary's signature held not to affect trustees' power under due-on-sale clause. See Barnes v. VNB Mtg. Corp., 230 Va. 4 , 334 S.E.2d 531 (1985).

"Deemed to be personal property" provision ineffectual to extent noteholder's rights affected. - To the extent that a "deemed to be personal property" provision in a land trust agreement would affect the noteholder's right to invoke the due-on-sale clause in a deed of trust against the beneficiary thereunder, the provision is ineffectual. Barnes v. VNB Mtg. Corp., 230 Va. 4 , 334 S.E.2d 531 (1985).

Liability imposed only upon promise to pay. - Because of the nature of the land trust, before personal liability can be imposed upon the beneficiaries, they must expressly or by implication promise to pay. Curtis v. Lee Land Trust, 235 Va. 491 , 369 S.E.2d 853 (1988).

CIRCUIT COURT OPINIONS

Editor's note. - The case cited below was decided under prior law.

Applicability. - Section 55-17.1 did not apply as it focused on the interest of the beneficiary, not the authority of the grantor of the settlor to convey property once conveyed to the trust. Barksdale v. Haynes, 100 Va. Cir. 160, 2018 Va. Cir. LEXIS 339 (Lynchburg Oct. 5, 2018).

I. DECIDED UNDER CURRENT LAW.

Property owner as third party beneficiary. - Family sufficiently alleged that its contract with a home owner made the property owner a third-party beneficiary where the complaint alleged that the home builder was aware that the improvements to the real property were to solely benefit the record title owner of the property and the owner desired to build living quarters for the family to live on site while performing valuable services for the owner. Tingler v. Graystone Homes, Inc., 298 Va. 63 , 834 S.E.2d 244, 2019 Va. LEXIS 138 (2019).

II. DECIDED UNDER PRIOR LAW.

A. IN GENERAL.

Purpose of statute. - The statute was enacted for a double purpose. One was to change the rule of the common law that one not a party to a deed inter partes could not sue for a breach of a covenant therein made for his benefit. The other purpose was to change the common-law rule that a suit for breach of a covenant made with two persons for the benefit of one of them must be jointly brought by both the covenantees. City of Newport News v. Potter, 122 F. 321 (4th Cir. 1903).

As to purpose of 1919 revision of this section, see Horney v. Mason, 184 Va. 253 , 25 S.E.2d 78 (1945).

It was not the purpose of this section to limit or restrict the powers of parties to contract, or their right to select the parties with whom they would contract, or to prevent parties from limiting the right of action to the immediate parties with whom the contract was made, nor to create beneficiaries not made so by the contract, but to extend the remedy on the contracts mentioned in the section to beneficiaries under the contracts, where such extension was not forbidden by the terms of the contract itself. Montague Mfg. Co. v. Homes Corp., 142 Va. 301 , 128 S.E. 447 (1925); Indemnity Ins. Co. of N. Am. v. Davis' Adm'r, 150 Va. 778 , 143 S.E. 328 (1928); Norfolk-Portsmouth Newspapers, Inc. v. Stott, 208 Va. 228 , 156 S.E.2d 610 (1967).

This section is highly remedial and should be liberally construed in order to accomplish the ends manifestly intended. Montague Mfg. Co. v. Homes Corp., 142 Va. 301 , 128 S.E. 447 (1925); Indemnity Ins. Co. of N. Am. v. Davis' Adm'r, 150 Va. 778 , 143 S.E. 328 (1928); Bristol Steel & Iron Works, Inc. v. Plank, 163 Va. 819 , 178 S.E. 58 (1935).

This section is remedial and is to be liberally interpreted and applied. Graybar Elec. Co. v. Doley, 273 F.2d 284 (4th Cir. 1959).

Remedy provided is cumulative. - The instant case was a suit against vendees who had assumed the payment of a mortgage. Defendants demurred on the ground that the complainant had a complete and adequate remedy at law under this section. Upon the question of whether under this section the complainant might sue the defendants at law on their assumption of the mortgage debt due complainant, the Supreme Court expressed no opinion. However, the statutory remedy by an action at law under this section is cumulative only in such cases, and does not oust courts of chancery from the jurisdiction they have long exercised to grant relief to a mortgage creditor against the grantee of mortgaged property who has assumed the mortgage debt, under the doctrine of subrogation. Blanton v. Keneipp, 155 Va. 668 , 156 S.E. 413 (1931).

And equity power is not diminished. - The power given by this section to law courts in nowise diminishes that theretofore exercised in equity. It is but cumulative and concurrent. Buchanan v. Buchanan, 174 Va. 255 , 6 S.E.2d 612 (1940).

This section does not forbid a suit in the name of the original obligee. Glens Falls Ins. Co. v. Sherritt, 95 F.2d 823 (4th Cir. 1938).

Limited liability of purchaser of property subject to existing lien. - When one purchases property subject to an existing lien the purchaser is not personally liable for any deficiency. In such a case the defaulter can only lose the underlying property. Unlike taking property subject to an existing lien, when a purchaser takes property and assumes the underlying lien the purchaser is personally liable for the indebtedness including any deficiency that may result from foreclosure. Bankers Mtg. Corp. v. Jacobs, 613 F. Supp. 1579 (E.D. Va. 1985).

Mortgagee has no direct action at law against second mortgagor. - The mortgagee's right to hold a subsequent purchaser liable is not grounded in contract between the mortgagee and the subsequent purchaser, as generally no such contract exists, but on the theory that the covenant of the subsequent purchaser is a collateral security obtained by the mortgagor, which by equitable subrogation inures to the benefit of the mortgagee. Thus, as between the original mortgagor and the subsequent purchaser, the latter is the principal debtor and the mortgagor is his surety. The promise of a subsequent purchaser to assume the mortgage debt upon the property is a contract only between the two of them absent an independent undertaking by the purchaser and the mortgagee. Admittedly, the contract benefits the mortgagee but the primary beneficiary of this collateral undertaking is the mortgagor. Therefore, absent some statutory authority, no direct action at law (as distinguished from equity) by the mortgagee against the second mortgagor will lie. If upon foreclosure the property does not bring enough to satisfy the entire debt, the mortgage creditor may proceed in an equity court against the subsequent purchaser for any deficiency. Bankers Mtg. Corp. v. Jacobs, 613 F. Supp. 1579 (E.D. Va. 1985).

Mortgagee need not first foreclose prior to obtaining a judgment against a subsequent purchaser who assumes in writing the obligation secured by the property, as there need be no privity of contract under the present third-party beneficiary statute of Virginia. Bankers Mtg. Corp. v. Jacobs, 613 F. Supp. 1579 (E.D. Va. 1985).

Restrictive covenant enforceable by beneficiary. - Where a covenant is for the benefit of third persons they have the right to enforce it in their own names, under this section. Cheatham v. Taylor, 148 Va. 26 , 138 S.E. 545 (1927).

A restrictive covenant for the benefit of a third party may be enforced in his own name under this section. Meagher v. Appalachian Elec. Power Co., 195 Va. 138 , 77 S.E.2d 461 (1953).

Section not applicable. - Where premises are subleased to an assignee of the lessees who does not assume the obligation of maintaining fire insurance on the premises, which obligation was a covenant in the lease between lessor and lessees, this section has no application, since it does not purport to create a contract where no contract exists. Burton v. Chesapeake Box & Lumber Corp., 190 Va. 755 , 57 S.E.2d 904 (1950).

Section held inapplicable. Benoit v. Baxter, 196 Va. 360 , 83 S.E.2d 442 (1954).

Contract found not to be made for the benefit of third party. Graybar Elec. Co. v. Doley, 273 F.2d 284 (4th Cir. 1959).

Because the benefit to the third-party referred to in the first phrase of the statute derives from an instrument, this section must refer to a benefit from a written document. Thorsen v. Richmond SPCA, 292 Va. 257 , 786 S.E.2d 453 (2016) (but see § 64.2-520.1 and notes thereunder).

This section did not apply to an oral contract between an attorney and a testator where although the statute clearly applied to a written instrument, it did not abrogate the common law, which allowed third-party beneficiaries to sue upon oral contracts. Thorsen v. Richmond SPCA, 292 Va. 257 , 786 S.E.2d 453 (2016) (but see § 64.2-520.1 and notes thereunder).

Implied guarantee not within section. - Where defendants, for whom a building was being erected, agreed with plaintiff to retain sufficient funds and pay plaintiff for materials furnished, an action on the agreement was to recover upon an implied guarantee made by defendants to plaintiff and was not a suit upon a contract made by defendants for plaintiff's benefit, such as is dealt with in this section. Nicholas v. Harrisonburg Bldg. & Supply Co., 181 Va. 207 , 24 S.E.2d 452 (1943).

B. INTENDED BENEFICIARY.

1. IN GENERAL.

A person may have a beneficial interest in a contract to which he is not a named party. Horney v. Mason, 184 Va. 253 , 35 S.E.2d 78 (1945).

A third-party beneficiary to a contract is entitled to enforce the terms of the contract and is subject to defenses arising out of it. Levine v. Selective Ins. Co. of Am., 250 Va. 282 , 462 S.E.2d 81 (1995).

Where evidence was clear that subordination agreement between plaintiff and corporation was intended to confer a benefit upon lender, a nonparty, lender took its interests under the subordination agreement subject to the plaintiff's right to rescind the agreement because of fraud, even through lender had no knowledge of the fraud. Ashmore v. Herbie Morewitz, Inc., 252 Va. 141 , 475 S.E.2d 271 (1996), cert. denied, 520 U.S. 1120, 117 S. Ct. 1254, 137 L. Ed. 2d 335 (1997).

Like a party to an agreement, a third-party beneficiary is entitled to enforce the terms of the agreement and is subject to the defenses arising from that agreement. First Sec. Fed. Sav. Bank, Inc. v. McQuilken, 253 Va. 110 , 480 S.E.2d 485 (1997).

But it must be shown that contract was made for his benefit. - This section limits the right of a third person to sue upon a contract to which he is not a party to a case where it can be shown that the contract was made for his benefit. Graybar Elec. Co. v. Doley, 273 F.2d 284 (4th Cir. 1959); Norfolk-Portsmouth Newspapers, Inc. v. Stott, 208 Va. 228 , 156 S.E.2d 610 (1967).

The third-party beneficiary doctrine is subject to the limitation that the third party must show that the parties to the contract clearly and definitely intended it to confer a benefit upon him. Professional Realty Corp. v. Bender, 216 Va. 737 , 222 S.E.2d 810 (1976); Valley Landscape Co. v. Rolland, 218 Va. 257 , 237 S.E.2d 120 (1977); Richmond Shopping Center, Inc. v. Wiley N. Jackson Co., 220 Va. 135 , 255 S.E.2d 518 (1979).

The third-party beneficiary statute has no application unless the party sought to be held liable has assumed an obligation for the benefit of a third party. The statute does not purport to create a contract when no contract exists. Professional Realty Corp. v. Bender, 216 Va. 737 , 222 S.E.2d 810 (1976); Valley Landscape Co. v. Rolland, 218 Va. 257 , 237 S.E.2d 120 (1977).

If a promise or covenant is made for the benefit of a third party, that party may maintain an action on the promissory instrument in his own name. However, the third party must show that the parties to the instrument clearly intended to confer a benefit on him. Sinicrope v. Black Diamond Sav. & Loan Ass'n, 21 Bankr. 476 (Bankr. W.D. Va. 1982).

Defendants' motion to dismiss plaintiff's breach of implied warranty claim in regard to a construction contract was denied. The contract evinced an intent to directly benefit plaintiff by conferring third-party beneficiary status upon him; thus, the privileges associated with privity were also conferred, pursuant to § 55-22, and plaintiff was entitled to sue based on an implied warranty of fitness for a particular purpose. Wal-Mart Stores, Inc. v. J.A. Fielden Co., 440 F. Supp. 2d 523, 2006 U.S. Dist. LEXIS 49901 (W.D. Va. 2006).

And showing benefit incidental to contract is insufficient. - To come within the purview of this provision it is insufficient for a person to show that incidental to the contract he would benefit from its enforcement. The person "must show that the parties to the contract clearly and definitely intended to confer a benefit upon him." In re County Green Ltd. Partnership, 438 F. Supp. 693 (W.D. Va. 1977).

A clear intent to benefit the third person must appear to enable him to sue on the contract; incidental beneficiaries cannot maintain an action thereon. Valley Landscape Co. v. Rolland, 218 Va. 257 , 237 S.E.2d 120 (1977).

Incidental beneficiaries may not sue on a contract as a third-party beneficiary. Richmond Shopping Center, Inc. v. Wiley N. Jackson Co., 220 Va. 135 , 255 S.E.2d 518 (1979).

The fact that a building contractor would be incidentally benefited by a proper performance of duties on the part of the architect is not sufficient to make the contractor a third-party beneficiary of a contract between the architect and the owner. Valley Landscape Co. v. Rolland, 218 Va. 257 , 237 S.E.2d 120 (1977).

A mere incidental beneficiary of a contract does not have standing to sue on the contract. Kelley v. Griffin, 252 Va. 26 , 471 S.E.2d 475 (1996).

Incidental and intended beneficiaries distinguished. - An incidental beneficiary is so far removed from the obligations assumed by the contracting parties that a court will not allow him to sue on that contract, whereas an intended beneficiary is such an integral part of the obligations assumed by the contracting parties that a court will permit him to sue on that contract. Radosevic v. Virginia Intermont College, 651 F. Supp. 1037 (W.D. Va. 1987).

Subcontractor was not an intended third-party beneficiary entitled to sue on a services contract between the City of Richmond and the contractor because the subcontractor was not a party to the contract; the primary purpose of the contract was to benefit the City with a working records management system; and, thus, the subcontractor was merely an incidental beneficiary and not an intended third-party beneficiary. BIS Computer Solutions, Inc. v. City of Richmond, 122 Fed. Appx. 608, 2005 U.S. App. LEXIS 651 (4th Cir. Jan. 13, 2005).

Third-party beneficiary must demonstrate intent of contracting parties to benefit him. - In order for a third-party beneficiary to qualify as an intended beneficiary, he must demonstrate that the contracting parties clearly and definitely intended to directly benefit him. Radosevic v. Virginia Intermont College, 651 F. Supp. 1037 (W.D. Va. 1987).

Trial court properly found that investors were not third-party beneficiaries arising from transactions in which a third party opened accounts at the bank; evidence of the bank's intention in setting up the accounts was provided by a vice president's testimony that his main concern was to protect the bank from any involvement with criminal activity. There was no direct evidence of the intentions of the third party, the other contracting party, but the circumstantial evidence of the conduct of its principals was sufficient to support the trial court in concluding that conferring a benefit upon the investors was the farthest thing from their minds. Collins v. First Union Nat'l Bank, 272 Va. 744 , 636 S.E.2d 442, 2006 Va. LEXIS 95 (2006).

Chapter 7 debtor suffered dismissal with prejudice of his adversary complaint against the malpractice insurer for his former bankruptcy lawyer who allegedly failed to persuade a bank that held mortgages on certain real estate to renegotiate the terms of those mortgages because debtor was neither an insured under the policy nor a third-party beneficiary with a right to enforce the policy per § 55-22. Debtor's assertion of a direct claim against the insurer also was precluded by § 38.2-2200 , which permitted the pursuit of such a direct action only after the putative claimant has obtained an unsatisfied judgment against the insured under the policy. Reynolds Living Trust v. Wells Fargo Bank, N.A. (In re Reynolds),, 2011 Bankr. LEXIS 3352 (Bankr. W.D. Va. Sept. 6, 2011).

Bondholders not intended beneficiaries of underlying contracts. - Bondholders were not the intended beneficiaries of a contract between a county and a contractor hired to construct and operate a solid waste facility where there was no provision, express or implied, of the construction contract or the operations contract that clearly and definitely showed an intent to confer a benefit upon the bondholders as third-party beneficiaries of those contracts. Caudill v. County of Dinwiddie, 259 Va. 785 , 529 S.E.2d 313, 2000 Va. LEXIS 78 (2000).

Intent of parties evidenced by contract. - The four concerns of a contract evidence whether contracting parties clearly and definitely intended to directly benefit a third party. Radosevic v. Virginia Intermont College, 651 F. Supp. 1037 (W.D. Va. 1987).

Condition precedent to insurer's obligation to pay for loss applied to third-party additional insured. - Under a personal liability umbrella policy, a provision requiring an insured to perform the affirmative act of maintaining underlying insurance at policy limits greater than the amount required by § 46.2-472 was enforceable against a third-party additional insured because the provision was a condition precedent to the insurer's obligation to pay for loss that exceeded an insured's underlying policy limits and a third-party additional insured's rights could not be greater than the rights of the named insured. State Farm Fire & Cas. Co. v. Nationwide Mut. Ins. Co., 596 F. Supp. 2d 940, 2009 U.S. Dist. LEXIS 8263 (E.D. Va. 2009).

Person must be intended beneficiary of contract and not third-party beneficiary of estate. - Remaindermen failed to assert third-party beneficiary claims against attorney who wrote will of remaindermen's grandparents; although remaindermen were third-party beneficiaries of the estate, they were not the intended beneficiaries of the contract between the grandparents and the attorney. Copenhaver v. Rogers, 238 Va. 361 , 384 S.E.2d 593 (1989).

Nonparty, partial beneficiary may directly sue promisor. - The legislative history of this section reveals that the statute was amended, in part, in order to enable one not a party to a contract but who is only a partial beneficiary rather than a sole beneficiary to directly sue the promisor. Bankers Mtg. Corp. v. Jacobs, 613 F. Supp. 1579 (E.D. Va. 1985).

Buyer evinced no intent to benefit broker. - Where plaintiff-broker sought to recover cash commission from buyers who breached the sales contract, the presence of the sellers' express covenant to pay the commission and the absence thereof as to the buyers evinces an intent not to confer a benefit upon the broker. Professional Realty Corp. v. Bender, 216 Va. 737 , 222 S.E.2d 810 (1976).

The buyers' promise to purchase ran in favor of the sellers; that promise was made in consideration of the sellers' promise to sell, not in consideration of brokerage services rendered, and cannot fairly be construed to evince an intent by the buyers to confer a gratuitous benefit upon the broker. Professional Realty Corp. v. Bender, 216 Va. 737 , 222 S.E.2d 810 (1976).

Seller's intent to benefit broker. - Both the sellers' covenant to sell to the buyers and the sellers' covenant to pay a commission for services rendered by the broker ran in favor of the broker, and together they evince the sellers' intent to confer a benefit upon the broker. Professional Realty Corp. v. Bender, 216 Va. 737 , 222 S.E.2d 810 (1976).

Any person having an interest in property insured, though no party to the policy, may institute and maintain an action in his own name to extent of loss occasioned him by its destruction. Tilley v. Connecticut Fire Ins. Co., 86 Va. 811 , 11 S.E. 120 (1890).

A remote beneficiary in an insurance policy might, under this section, maintain an action thereon in his own name. Clemmitt v. New York Life Ins. Co., 76 Va. 355 (1882).

Creditor may sue surety on bond. - Where the principal contracted to liquidate and pay in full all of the liabilities of a corporation then existing or thereafter arising, and the surety guaranteed the performance of his contract, the contract of the surety was not for the exclusive benefit of the parties therein named, but inured to the benefit of the creditors of the corporation, and under this section a creditor not named could prosecute his action against the surety in his own name. Montague Mfg. Co. v. Homes Corp., 142 Va. 301 , 128 S.E. 447 (1925).

Under this section, a creditor of a road contractor for labor and material may maintain an action on the contractor's bond against his surety, such bond being made in part for his benefit. Aetna Cas. & Sur. Co. v. Earle-Lansdell Co., 142 Va. 435 , 129 S.E. 263 (1925).

Under this section, one furnishing labor and material for the construction of a highway may sue the surety on the contractor's undertaking bond for labor and material furnished in or about the construction of the highway. Fidelity & Deposit Co. v. Mason, 145 Va. 138 , 133 S.E. 793 (1926).

A judgment creditor of an insured may bring an action under this section only for the breach of covenant or promise which was made for his benefit in whole or in part. Rowe v. United States Fid. & Guar. Co., 421 F.2d 937 (4th Cir. 1970).

2. ILLUSTRATIVE CASES.

Prospective purchasers held not able to bring action. - Where there was no allegation in the motion for judgment to support a conclusion that the listing agreement clearly and definitely intended to confer a benefit upon prospective purchasers, prospective purchasers could not bring an action. Allen v. Lindstrom, 237 Va. 489 , 379 S.E.2d 450, cert. denied, 493 U.S. 849, 110 S. Ct. 145, 107 L. Ed. 2d 104 (1989).

Railroad may sue member of coal exchange. - Where a member of a coal exchange in joining such exchange contracted to abide by its rules, one of which obligated the payment of demurrage, and later the member shipped coal under the contract, under this section he was liable to a railroad company for demurrage incurred. Smokeless Fuel Co. v. C & O Ry., 142 Va. 355 , 128 S.E. 624 (1925).

The touchstone for application of this section to construction contractors is whether the architects' contract was made for builders' benefit "in whole or in part." That determination depends in turn upon the intent of the primary contracting parties, which may be gleaned either upon the face of the contract or from extrinsic evidence in that regard. McCloskey & Co. v. Wright, 363 F. Supp. 223 (E.D. Va. 1973).

Subcontractor as beneficiary under performance bond. - Where performance bond was written in such a way that general contractor and surety were bound, jointly and severally, to owner for any liability arising under construction contract, the subcontractors were clearly third-party beneficiaries under the bond. Sinicrope v. Black Diamond Sav. & Loan Ass'n, 21 Bankr. 476 (Bankr. W.D. Va. 1982).

Subcontractor not intended beneficiary of a contract. - Subcontractor failed to allege sufficient facts under Fed. R. Civ. P. 8(a) to maintain a breach of contract claim against a tiling company and a grout distributor based on stained and discolored grout at a certain construction site because it did not aver any facts showing that it was an intended third-party beneficiary of the contract between the tiling company and the grout distributor, as required for a claim as a third-party beneficiary of a contract under § 55-22. RCI Contrs. & Eng'rs, Inc. v. Joe Rainero Tile Co., 677 F. Supp. 2d 914, 2010 U.S. Dist. LEXIS 1674 (W.D. Va. 2010).

Materialman held not entitled to recover on contractor's bond given to city where bond and contract between contractor and city did not evidence an intent to protect materialmen. Century Indem. Co. v. Esso Std. Oil Co., 195 Va. 502 , 79 S.E.2d 625 (1954).

Engineer may enforce forfeiture provision in contract with city. - Under this section where a contract with a city for the construction of a sewer required the city to deduct from the amount due the contractor a specified sum for each day's delay in the completion of the work beyond a time specified, and to pay such sum to the engineer employed by the city to superintend the work, the engineer may maintain an action on such covenant in his own name. City of Newport News v. Potter, 122 F. 321 (4th Cir. 1903).

Public service corporation may enforce covenant as beneficiary. - There is no public policy that would prohibit a public service corporation from enforcing an otherwise valid covenant as third-party beneficiary thereto. Kempsville Util. Corp. v. Wills, 213 Va. 679 , 194 S.E.2d 740 (1973).

The beneficiary should be given the opportunity to explain the business justification of a covenant which benefits it. Kempsville Util. Corp. v. Wills, 213 Va. 679 , 194 S.E.2d 740 (1973).

Purchaser of cargo held beneficiary. - A purchaser, for whose benefit and at whose risk cargo was being transported after it was loaded by the seller f.o.b. Roanoke, was a third-party beneficiary to the contract of carriage, entitled to sue on the contract, bound by the terms of the contract, and subject to defenses arising out of the contract. Sydnor & Hundley, Inc. v. Wilson Trucking Corp., 213 Va. 704 , 194 S.E.2d 733 (1973).

Injured party as beneficiary under contract of insurance. - If the injured party is a beneficiary under the contract of insurance and the policy is made for his benefit, then he should be entitled to maintain an action in his own name for a breach of that contract. Davis v. National Grange Ins. Co., 281 F. Supp. 998 (E.D. Va. 1968).

Tort claimants had standing to seek indemnification on insurance policies issued to tortfeasors. - Tort claimants had standing to seek a declaration that the insurance policies issued to the first tortfeasor required its insurer to defend and indemnify it for any damages awarded in the underlying tort suit because the denial of coverage would injure the claimants if they obtained judgment against the first tortfeasor and the judgment went unsatisfied as subdivision 2 of § 38.2-2200 allowed the claimants to sue defendant directly for the outstanding amount of an unsatisfied judgment against the first tortfeasor, Virginia law conferred on tort claimants the right to sue on the policy as a third-party beneficiary, and the claimant's were third-party beneficiaries from the moment of injury pursuant to § 55-22; the second tortfeasor and its insurer, however, could not establish that they suffered an injury-in-fact as a result of defendant's denial of coverage to the first tortfeasor, and thus, they were dismissed from the action. Lott v. Scottsdale Ins. Co., 811 F. Supp. 2d 1224, 2011 U.S. Dist. LEXIS 104803 (E.D. Va. 2011).

No evidence established injured third parties as intended beneficiaries to insurance contract. - Where defendants claimed there was a well-recognized duty owed by insurers to injured third parties, which provided a right to an independent action against an insurer, no evidence was before the court that established the defendants as intended beneficiaries to the insurance contract between insurance company and the original named insureds under this section. Without such evidence, the defendants lacked proper standing to bring an action alleging bad faith by insurance company. Fireman's Fund Ins. Co. v. St. Asaph Lawyer's Title Co. (In re Dameron), 213 Bankr. 482 (Bankr. E.D. Va. 1997).

Lot owner not intended beneficiary of covenant as to multifamily dwellings. - Under a third-party beneficiary theory, the third party must show that the parties to the contract clearly and definitely intended it to confer a benefit upon him. Where the evidence showed that a resort imposed special covenants as to multifamily residences to protect its own interests, only incidentally benefiting the lot owners, the lot owners did not clearly show that the contracting parties definitely intended the contract to confer a benefit upon them. Forbes v. Schaefer, 226 Va. 391 , 310 S.E.2d 457 (1983).

Where a covenant in a deed of trust is for the benefit of the holder of notes secured, the right to sue thereon comes squarely within the provisions of this statute. Holcomb v. Webley, 185 Va. 150 , 37 S.E.2d 762 (1946).

The assumption of the payment of a lien on land as a part of the purchase price thereof, for which the grantee's immediate grantor is not personally bound, is a promise for the sole benefit of the holder of the lien within the meaning of this section and may be enforced by such holder against the party so promising. Casselman v. Gordon, 118 Va. 553 , 88 S.E. 58 (1916). See Swain v. Virginia Bank & Trust Co., 151 Va. 655 , 144 S.E. 645 (1928).

Purchasers of a home were third-party beneficiaries under certain "Insurance/Warranty Documents" entered into by their builder, a home warranty corporation, and a home warranty insurer, where the documents showed that the contracting parties clearly and definitely intended to confer a benefit upon the purchasers. Cobert v. Home Owners Warranty Corp., 239 Va. 460 , 391 S.E.2d 263 (1990).

Court did not commit plain error in failing to address third-party beneficiary status. - In a boat owner's negligence action against a subcontractor, the district court did not commit plain error in failing to address whether the owner was a third-party beneficiary of the contract between his general contractor and the subcontractor, and, thus, could maintain an action against the subcontractor pursuant to § 55-22, because the owner informed the district court that it need not address the issue, and he presented absolutely no argument on the matter. Dur v. W. Branch Diesel, 240 Fed. Appx. 568, 2007 U.S. App. LEXIS 16237 (4th Cir. July 9, 2007).

CIRCUIT COURT OPINIONS

Editor's note. - The cases cited below were decided under prior law.

Applicability. - When a comatose nursing home patient sued the general partner of the limited liability partnership that owned the nursing home, as well as current and former nursing home employees, a claim that the patient had to engage in arbitration since the patient was a third-party beneficiary of a contract signed by the patient's sister upon admitting the patient to the nursing home was irrelevant because the patient's claims were not based on the contract. Gibson v. Medical Facilities of Am., Inc., 79 Va. Cir. 329, 2009 Va. Cir. LEXIS 269 (Norfolk Sept. 25, 2009).

Beneficiaries distinguished. - Homebuilder was, at most, an incidental beneficiary of a contract between its subcontractor and the manufacturer of a building product for the purchase and sale of the product, since there was no evidence the parties to that contract knowingly intended to benefit the builder. MacConkey v. F.J. Matter Design, Inc., 54 Va. Cir. 1, 2000 Va. Cir. LEXIS 390 (Virginia Beach 2000).

Intent of parties. - Condominium owners were not third-party beneficiaries of a contract between the builder of their condominiums and an insurer to provide insurance against defects in the construction of the condominiums, because the owners were each issued individual insurance policies; there was no intent in the contract between the builder and the insurer that the owners were beneficiaries of that contract. Bay Point Condo. Ass'n Bd. of Dirs. v. Mid-Atlantic Ins. Corp., 54 Va. Cir. 124, 2000 Va. Cir. LEXIS 555 (Norfolk 2000).

Subcontractor was not an intended third-party beneficiary of a contractor's separate subcontract with a tile remover, and, at most, the subcontractor was an incidental beneficiary of the tile removal contract and, therefore, had no right to enforce the warranties under that contract in seeking contribution and indemnification from the tile remover. Metro Panel Sys. v. Sordoni Skanska Constr. Co., 56 Va. Cir. 399, 2001 Va. Cir. LEXIS 478 (Norfolk 2001).

Intent of parties evidenced by contract. - Where a second amended motion for judgment alleged the existence of consulting agreements between an equine services provider and each veterinarian, and that the clients of the provider were the intended third-party beneficiaries of the agreements, demurrers filed by the veterinarians were overruled. Washington v. Equine Reprod. Concepts, L.L.C., 61 Va. Cir. 727, 2002 Va. Cir. LEXIS 431 (Rappahannock County 2002).

Guarantor alleged not only that the bank and the car dealership considered him when entering into financing documents, but that they did so with the intention of allowing him to satisfy his creditors (including the bank) while protecting his personal estate. Although it was by no means clear whether it was to be proven that the parties intended to confer a direct benefit upon the guarantor, he alleged sufficient facts on the bank's demurrer to allege that he was a third-party beneficiary. Wachovia Bank, N.A. v. Ranson Tyler Chevrolet, L.L.C., 73 Va. Cir. 143, 2007 Va. Cir. LEXIS 43 (Roanoke 2007).

Although a company's claim that it was a third-party beneficiary of a December 24, 2003 contract because the company was a party to a December 29, 2003 contract between itself and an excess insurer and an insurance group was rejected, the company stated a valid cause of action for breach of a third-party beneficiary contract under Va. Code § 55-22 by adequately alleging under Va. Sup. Ct. R. 1:4(d) that when the excess insurers entered into the December 24, 2003 contract with a hospital, those parties intended to directly benefit the company by settling the hospital's claims for payment of company's employee's medical bills, which were covered by the company plan and the excess coverage. Old Dominion Freight Line, Inc. v. Std. Sec. Life Ins. Co., 73 Va. Cir. 441, 2007 Va. Cir. LEXIS 135 (Richmond 2007).

Plaintiff's deceased patient was a third-party beneficiary, i.e., was an intended beneficiary, not an incidental beneficiary, of the 9/16/11 Radiology Services Agreement between defendant radiological associates, and the physician services corporation; thus, based on the totality of the agreement, the whole intent of the parties was to meet the care, services, and requirements of unnamed unknown future patients. Rauchfuss v. Peninsula Radiological Assocs., 94 Va. Cir. 8, 2016 Va. Cir. LEXIS 60 (Newport News Apr. 28, 2016).

Contract clearly bestowed a benefit. - Because an agreement provided that third-party defendant would provide a transfer station location for various sources of waste and thereby the language bestowed a benefit upon third-party plaintiff, third-party plaintiff could maintain a breach of contract claim pursuant to the terms of this section. Rivanna Solid Waste Auth. v. Van Der Linde, 78 Va. Cir. 418, 2009 Va. Cir. LEXIS 190 (Charlottesville July 21, 2009).

Borrowers were not intended beneficiaries. - Borrowers were not a party to or an intended beneficiary of the assignment, and therefore lacked standing to challenge its validity under § 55-22. Buzbee v. United States Bank, N.A., 84 Va. Cir. 485, 2012 Va. Cir. LEXIS 39 (Fairfax County May 2, 2012).

Standing to sue. - Injured person's parents had no standing as parties to a suit brought by the injured person against an insurer relating to the injured person's claims under the medical pay provisions of a policy issued by the insurer to the parents; the injured person was a third-party beneficiary of the insurance contract between his parents and the insurer, and as such, had standing to initiate a breach of contract claim. Tolbert v. Dwyer,, 2000 Va. Cir. LEXIS 651 (Nelson County Mar. 9, 2000).

Because there was no express agreement between a patient and a doctor, and the patient was not a third-party beneficiary of an agreement between the doctor and a health plan, the patient lacked standing to sue the doctor for breach of contract. Hughes v. Olin, 69 Va. Cir. 46, 2005 Va. Cir. LEXIS 191 (Prince William County 2005).

In a case alleging the mismanagement of irrevocable trusts, a beneficiary was permitted to proceed in a malpractice action where she alleged that she was an intended third-party beneficiary of an attorney client relationship between a lawyer and a trustee. Burton v. Dolph, 89 Va. Cir. 101, 2014 Va. Cir. LEXIS 129 (Norfolk June 27, 2014).

I. [RESERVED.]

II. DECIDED UNDER PRIOR LAW.

This section made a decided change in the law in regard to suits to quiet title. Kennedy Coal Corp. v. Buckhorn Coal Corp., 140 Va. 37 , 124 S.E. 482 (1924).

It extends equity jurisdiction in case of removal of a cloud from title to conditions where the plaintiff is both out of possession and has only an equitable title. United States v. McIntosh, 2 F. Supp. 244 (E.D. Va. 1932), appeal dismissed, 70 F.2d 507 (4th Cir.), cert. denied, 293 U.S. 586, 55 S. Ct. 101, 79 L. Ed. 682 (1934).

Prior to Acts 1912, p. 76, from which this section was derived, only those who had a complete legal and equitable title to land, accompanied by possession, could invoke the jurisdiction of a court of equity to remove a cloud upon their title. Buchanan Co. v. Heirs of Smyth, 115 Va. 704 , 80 S.E. 794 (1914).

Possession is not necessary. - Under the provisions of this section it is immaterial whether the complainant in a suit to quiet title is in or out of possession of the land. Kennedy Coal Corp. v. Buckhorn Coal Corp., 140 Va. 37 , 124 S.E. 482 (1924). See Buchanan Co. v. Heirs of Smyth, 115 Va. 704 , 80 S.E. 794 (1914); Payne v. Buena Vista Extract Co., 124 Va. 296 , 98 S.E. 34 (1919); Buchanan Coal Co. v. Street, 175 Va. 531 , 9 S.E.2d 339 (1940).

It is doubtful whether this statute can be legally effective to expand federal equity jurisdiction to remove a cloud from title to all cases where the plaintiff is both out of possession and has only an equitable title. It could hardly be properly extended to cases where the plaintiff out of possession but with legal title has adequate remedy in an ejectment suit. United States v. McIntosh, 2 F. Supp. 244 (E.D. Va. 1932), appeal dismissed, 70 F.2d 507 (4th Cir.), cert. denied, 293 U.S. 586, 55 S. Ct. 101, 79 L. Ed. 682 (1934).

A void commissioner's deed conveying property to a divorced wife constituted a cloud on the husband's title which a court of equity, under this section, had jurisdiction and power to remove by cancelling and setting aside said deed. Watson v. Mose, 165 Va. 661 , 183 S.E. 428 (1936).

As to quieting title involving grants of public lands, see Chapman v. Kite, 130 Va. 70 , 107 S.E. 702 (1921).

Settlement of disputes as to title and boundaries. - Except when the relief which is authorized by this section is sought, and in the absence of some peculiar equity, courts of equity are without jurisdiction to settle disputes regarding the title and boundaries of land. Duty v. Honaker Lumber Co., 131 Va. 31 , 108 S.E. 863 (1921); Bath Hardwood Lumber Co. v. Back Creek Mt. Corp., 140 Va. 280 , 125 S.E. 213 (1924).

Judgment lien did not constitute good title to property. - Judgment creditor's action for quiet title failed because the creditor's claim of superior title failed because the creditor's judgment lien did not constitute good title to the property, and the creditor cited absolutely no support for the proposition that its claimed interest in the form of a judgment lien that had attached to the property was itself a title to the estate. PEI P'ship Architects, LLC v. Celebrate Va. South, LLC,, 2013 U.S. Dist. LEXIS 38030 (E.D. Va. Mar. 19, 2013).

When there is another remedy. - The fact that complainants owned the fee simple title to a tract of land and the mineral rights in an adjacent tract did not deprive them of the right to have the established boundary lines of the adjacent tract fixed and determined by a court of equity, even though, as owners of the fee in the first-mentioned tract, they might have proceeded under §§ 8.01-179 through 8.01-183 , as coterminous owners of the surface with the owners of the surface of the adjacent tract, to have the boundary line between the tracts determined. Buchanan Coal Co. v. Street, 175 Va. 531 , 9 S.E.2d 339 (1940).

Determination of title as between hostile claims. - A court of equity is without jurisdiction in a suit to remove a cloud upon title to determine the question of title as between several independent, distinct and hostile claims. Such an independent and hostile claim, involving the whole property and denying in toto and ab initio the title of the complainants, cannot be set up and adjudicated in a suit in equity. To permit this would authorize an adverse claimant to implead other claimants of the title in such a way as to substitute an equity suit for an action of ejectment. Duty v. Honaker Lumber Co., 131 Va. 31 , 108 S.E. 863 (1921).

Recovery of possession. - As to jurisdiction under this section of a suit to try title and recover possession from an adverse claimant, see Roller v. Armentrout, 118 Va. 173 , 86 S.E. 906 (1915), writ dismissed, 245 U.S. 642, 38 S. Ct. 221, 62 L. Ed. 527 (1918).

Forfeiture for breach of condition not within section. - A suit in equity to annul and rescind a deed for breach of a condition subsequent cannot be treated as a suit to remove a cloud from title where the complainant has neither legal nor equitable title, and therefore does not fall within the class of persons who may bring a suit to quiet title under this section. Until the consummation of the forfeiture, the grantor in a case like this has nothing but a right of action. Pence v. Tidewater Townsite Corp., 127 Va. 447 , 103 S.E. 694 (1920).

Relief against fraud and enforcement of trusts. - It was never intended, either by this section, or by the cases which have construed it, to deny to a court of equity jurisdiction either to relieve against fraud or to declare and enforce trusts resulting therefrom. Bath Hardwood Lumber Co. v. Back Creek Mt. Corp., 140 Va. 280 , 125 S.E. 213 (1924).

In a suit to remove clouds upon title and to establish a resulting trust, equity had jurisdiction and it was not harmful to deny a jury trial. Bath Hardwood Lumber Co. v. Back Creek Mt. Corp., 140 Va. 280 , 125 S.E. 213 (1924).

Amendment of bill. - In a suit involving title to a tract of land, the original bill sought to have a grant from the Commonwealth to appellants cancelled but after the court decided that appellee had failed to prove that the grant had been procured through fraud, the bill was amended so as to pray to have the deed to appellants removed as a cloud upon appellee's title. It was held that the procedure adopted by the trial court conformed to the provisions of this section. French v. Clinchfield Coal Corp., 171 Va. 211 , 198 S.E. 503 (1938).

A. GENERAL PURPOSE

Section 1 sets forth the Statutory Rule Against Perpetuities (Statutory Rule). As explained above, the Statutory Rule supersedes the Common-law Rule Against Perpetuities (Common-law Rule) or any statutory version or variation thereof.

The Common-law Rule's Validating and Invalidating Sides. The Common-law Rule Against Perpetuities is a rule of initial validity or invalidity. At common law, a nonvested property interest is either valid or invalid as of its creation. Like most rules of property law, the Common-law Rule has both a validating and an invalidating side. Both sides are derived from John Chipman Gray's formulation of the Common-law Rule:

No [nonvested property] interest is good unless it must vest, if at all, not later than 21 years after some life in being at the creation of the interest.

J. Gray, The Rule Against Perpetuities § 201 (4th ed. 1942). From this formulation, the validating and invalidating sides of the Common-law Rule are derived as follows:

Validating Side of the Common-law Rule. A nonvested property interest is valid when it is created (initially valid) if it is then certain to vest or terminate (fail to vest) - one or the other - no later than 21 years after the death of an individual then alive.

Invalidating Side of the Common-law Rule. A nonvested property interest is invalid when it is created (initially invalid) if there is no such certainty.

Notice that the invalidating side focuses on a lack of certainty, which means that invalidity under the Common-law Rule is not dependent on actual post-creation events but only on possible post-creation events. Actual post-creation events are irrelevant, even those that are known at the time of the lawsuit. It is generally recognized that the invalidating side of the Common-law Rule is harsh because it can invalidate interests on the ground of possible post-creation events that are extremely unlikely to happen and that in actuality almost never do happen, if ever.

The Statutory Rule Against Perpetuities. The essential difference between the Common-law Rule and its statutory replacement is that the Statutory Rule preserves the Common-law Rule's overall policy of preventing property from being tied up in unreasonably long or even perpetual family trusts or other property arrangements, while eliminating the harsh potential of the Common-law Rule. The Statutory Rule achieves this result by codifying (in slightly revised form) the validating side of the Common-law Rule and modifying the invalidating side by adopting a wait-and-see element. Under the Statutory Rule, interests that would have been initially valid at common law continue to be initially valid, but interests that would have been initially invalid at common law are invalid only if they do not actually vest or terminate within the permissible vesting period set forth in Section 1(a)(2). Thus, the Uniform Act recasts the validating and invalidating sides of the Rule Against Perpetuities as follows:

Validating Side of the Statutory Rule: A nonvested property interest is initially valid if, when it is created, it is then certain to vest or terminate (fail to vest) - one or the other - no later than 21 years after the death of an individual then alive. The validity of a nonvested property interest that is not initially valid is in abeyance. Such an interest is valid if it vests within the permissible vesting period after its creation.

Invalidating Side of the Statutory Rule: A nonvested property interest that is not initially valid becomes invalid (and subject to reformation under Section 3) if it neither vests nor terminates within the permissible vesting period after its creation.

As indicated, this modification of the invalidating side of the Common-law Rule is generally known as the wait-and-see method of perpetuity reform. The wait-and-see method of perpetuity reform was approved by the American Law Institute as part of the Restatement (Second) of Property (Donative Transfers)

§§ 1.1-1.6 (1983). For a discussion of the various methods of perpetuity reform, including the wait-and-see method and the Restatement (Second)'s version of wait-and-see, see Waggoner, Perpetuity Reform, 81 Mich.L.Rev. 1718 (1983).

B. SECTION 1(a)(1): NONVESTED PROPERTY INTERESTS THAT ARE INITIALLY VALID

Nonvested Property Interest. Section 1(a) sets forth the Statutory Rule Against Perpetuities with respect to nonvested property interests. A nonvested property interest (also called a contingent property interest) is a future interest in property that is subject to an unsatisfied condition precedent. In the case of a class gift, the interests of all the unborn members of the class are nonvested because they are subject to the unsatisfied condition precedent of being born. At common law, the interests of all potential class members must be valid or the class gift is invalid. As pointed out in more detail later in this Comment, this so-called all-or-nothing rule with respect to class gifts is not superseded by this Act, and so remains in effect under the Statutory Rule. Consequently, all class gifts that are subject to open are to be regarded as nonvested property interests for the purposes of this Act.

Section 1(a)(1) Codifies the Validating Side of the Common-law Rule. The validating side of the Common-law Rule is codified in Section 1(a)(1) (and, with respect to powers of appointment, in Sections 1(b)(1) and 1(c)(1)).

A nonvested property interest that satisfies the requirement of Section 1(a)(1) is initially valid. That is, it is valid as of the time of its creation. There is no need to subject such an interest to the waiting period set forth in Section 1(a)(2), nor would it be desirable to do so.

For a nonvested property interest to be valid as of the time of its creation under Section 1(a)(1), there must then be a certainty that the interest will either vest or terminate - an interest terminates when vesting becomes impossible - no later than 21 years after the death of an individual then alive. To satisfy this requirement, it must be established that there is no possible chain of events that might arise after the interest was created that would allow the interest to vest or terminate after the expiration of the 21-year period following the death of an individual in being at the creation of the interest. Consequently, initial validity under Section 1(a)(1) can be established only if there is an individual for whom there is a causal connection between the individual's death and the interest's vesting or terminating no later than 21 years thereafter. The individual described in subsection (a)(1) (and subsections (b)(1) and (c)(1) as well) is often referred to as the "validating life," the term used throughout the Comments to this Act.

Determining Whether There is a Validating Life. The process for determining whether a validating life exists is to postulate the death of each individual connected in some way to the transaction, and ask the question: Is there with respect to this individual an invalidating chain of possible events? If one individual can be found for whom the answer is No, that individual can serve as the validating life. As to that individual there will be the requisite causal connection between his or her death and the questioned interest's vesting or terminating no later than 21 years thereafter.

In searching for a validating life, only individuals who are connected in some way to the transaction need to be considered, for they are the only ones who have a chance of supplying the requisite causal connection. Such individuals vary from situation to situation, but typically include the beneficiaries of the disposition, including the taker or takers of the nonvested property interest, and individuals related to them by blood or adoption, especially in the ascending and descending lines. There is no point in even considering the life of an individual unconnected to the transaction - an individual from the world at large who happens to be in being at the creation of the interest. No such individual can be a validating life because there will be an invalidating chain of possible events as to every unconnected individual who might be proposed: Any such individual can immediately die after the creation of the nonvested property interest without causing any acceleration of the interest's vesting or termination. (The life expectancy of any unconnected individual, or even the probability that one of a number of new-born babies will live a long life, is irrelevant.)

Example (1) - Parent of Devisees as the Validating Life. G devised property "to A for life, remainder to A's children who attain 21." G was survived by his son (A), by his daughter (B), by A's wife (W), and by A's two children (X and Y).

The nonvested property interest in favor of A's children who reach 21 satisfies Section 1(a)(1)'s requirement, and the interest is initially valid. When the interest was created (at G's death), the interest was then certain to vest or terminate no later than 21 years after A's death.

The process by which A is determined to be the validating life is one of testing various candidates to see if any of them have the requisite causal connection. As noted above, no one from the world at large can have the requisite causal connection, and so such individuals are disregarded. Once the inquiry is narrowed to the appropriate candidates, the first possible validating life that comes to mind is A, who does in fact fulfill the requirement: Since A's death cuts off the possibility of any more children being born to him, it is impossible, no matter when A dies, for any of A's children to be alive and under the age of 21 beyond 21 years after A's death. (See the discussion of subsection (d), below.)

A is therefore the validating life for the nonvested property interest in favor of A's children who attain 21. None of the other individuals who is connected to this transaction could serve as the validating life because an invalidating chain of possible post-creation events exists as to each one of them. The other individuals who might be considered include W, X, Y, and B. In the case of W, an invalidating chain of events is that she might predecease A, A might remarry and have a child by his new wife, and such child might be alive and under the age of 21 beyond the 21-year period following W's death. With respect to X and Y, an invalidating chain of events is that they might predecease A, A might later have another child, and that child might be alive and under 21 beyond the 21-year period following the death of the survivor of X and Y. As to B, she suffers from the same invalidating chain of events as exists with respect to X and Y. The fact that none of these other individuals can serve as the validating life is of no consequence, however, because only one such individual is required for the validity of a nonvested interest to be established, and that individual is A.

The Rule of Subsection (d). The rule established in subsection (d) plays a significant role in the search for a validating life. Subsection (d) declares that the possibility that a child will be born to an individual after the individual's death is to be disregarded. It is important to note that this rule applies only for the purposes of determining the validity of an interest (or power of appointment) under paragraph (1) of subsection (a), (b), or (c). The rule of subsection (d) does not apply, for example, to questions such as whether or not a child who is born to an individual after the individual's death qualifies as a taker of a beneficial interest - as a member of a class or otherwise. Neither subsection (d), nor any other provision of this Act, supersedes the widely accepted common-law principle, sometimes codified, that a child in gestation (a child sometimes described as a child en ventre sa mere ) who is later born alive is regarded as alive at the commencement of gestation.

The limited purpose of subsection (d) is to solve a perpetuity problem caused by advances in medical science. The problem is illustrated by a case such as Example (1), above - "to A for life, remainder to A's children who reach 21." When the Common-law Rule was developing, the possibility was recognized, strictly speaking, that one or more of A's children might reach 21 more than 21 years after A's death. The possibility existed because A's wife (who might not be a life in being) might be pregnant when A died. If she was, and if the child was born viable a few months after A's death, the child could not reach his or her 21st birthday within 21 years after A's death. The device then invented to validate the interest of A's children was to "extend" the allowable perpetuity period by tacking on a period of gestation, if needed. As a result, the common-law perpetuity period was comprised of three components: (1) a life in being (2) plus 21 years (3) plus a period of gestation, when needed. Today, thanks to sperm banks, frozen embryos, and even the possibility of artificially maintaining the body functions of deceased pregnant women long enough to develop the fetus to viability (see Detroit Free Press, July 31, 1986, at 5A; Ann Arbor News, Oct. 30, 1978, at C5 (AP story); N.Y. Times, Dec. 6, 1977, at 30; N.Y. Times, Dec. 2, 1977, at B16) - advances in medical science unanticipated when the Common-law Rule was in its developmental stages - having a pregnant wife at death is no longer the only way of having children after death. These medical developments, and undoubtedly others to come, make the mere addition of a period of gestation inadequate as a device to confer initial validity under Section 1(a)(1) on the interest of A's children in the above example. The rule of subsection (d), however, does insure the initial validity of the children's interest. Disregarding the possibility that children of A will be born after his death allows A to be the validating life. None of his children, under this assumption, can reach 21 more than 21 years after his death.

Note that subsection (d) subsumes not only the case of children conceived after death, but also the more conventional case of children in gestation at death. With subsection (d) in place, the third component of the common-law perpetuity period is unnecessary and has been jettisoned. The perpetuity period recognized in paragraph (1) of subsections (a), (b), and (c) has only two components: (1) a life in being (2) plus 21 years.

As to the legal status of conceived-after-death children, that question has not yet been resolved. For example, if in Example (1) it in fact turns out that A does leave sperm on deposit at a sperm bank and if in fact A's wife does become pregnant as a result of artificial insemination, the child or children produced thereby might not be included at all in the class gift. Cf. Restatement (Second) of Property (Donative Transfers) Introductory Note to Ch. 26 at pp. 2-3 (Tent. Draft No. 9, 1986). Without trying to predict how that matter will be settled in the future, the best way to handle the problem from the perpetuity perspective is subsection (d)'s rule requiring the possibility of post-death children to be disregarded.

Recipients as Their Own Validating Lives. It is well established at common law that, in appropriate cases, the recipient of an interest can be his or her own validating life. See, e.g., Rand v. Bank of California, 236 Or. 619, 388 P.2d 437 (1964). Given the right circumstances, this principle can validate interests that are contingent on the recipient's reaching an age in excess of 21, or are contingent on the recipient's surviving a particular point in time that is or might turn out to be in excess of 21 years after the interest was created or after the death of a person in being at the date of creation.

Example (2) - Devisees as Their Own Validating Lives. G devised real property "to A's children who attain 25." A predeceased G. At G's death, A had three living children, all of whom were under 25.

The nonvested property interest in favor of A's children who attain 25 is validated by Section 1(a)(1). Under subsection (d), the possibility that A will have a child born to him after his death (and since A predeceased G, after G's death) must be disregarded. Consequently, even if A's wife survived G, and even if she was pregnant at G's death or even if A had deposited sperm in a sperm bank prior to his death, it must be assumed that all of A's children are in being at G's death. A's children are, therefore, their own validating lives. (Note that subsection (d) requires that in determining whether an individual is a validating life, the possibility that a child will be born to "an" individual after the individual's death must be disregarded. The validating life and the individual whose having a post-death child is disregarded need not be the same individual.) Each one of A's children, all of whom under subsection (d) are regarded as alive at G's death, will either reach the age of 25 or fail to do so within his or her own lifetime. To say this another way, it is certain to be known no later than at the time of the death of each child whether or not that child survived to the required age.

Validating Life Can Be Survivor of Group. In appropriate cases, the validating life need not be individualized at first. Rather the validating life can initially (i.e., when the interest was created) be the unidentified survivor of a group of individuals. It is common in such cases to say that the members of the group are the validating lives, but the true meaning of the statement is that the validating life is the member of the group who turns out to live the longest. As the court said in Skatterwood v. Edge, 1 Salk. 229, 91 Eng. Rep. 203 (K.B. 1697), "for let the lives be never so many, there must be a survivor, and so it is but the length of that life; for Twisden used to say, the candles were all lighted at once."

Example (3) - Case of Validating Life Being the Survivor of a Group. G devised real property "to such of my grandchildren as attain 21." Some of G's children are living at G's death.

The nonvested property interest in favor of G's grandchildren who attain 21 is valid under Section 1(a)(1). The validating life is that one of G's children who turns out to live the longest. Since under subsection (d), it must be assumed that none of G's children will have post-death children, it is regarded as impossible for any of G's grandchildren to be alive and under 21 beyond the 21-year period following the death of G's last surviving child.

Example (4) - Sperm Bank Case. G devised property in trust, directing the income to be paid to G's children for the life of the survivor, then to G's grandchildren for the life of the survivor, and on the death of G's last surviving grandchild, to pay the corpus to G's great-grandchildren then living. G's children all predeceased him, but several grandchildren were living at G's death. One of G's predeceased children (his son, A) had deposited sperm in a sperm bank. A's widow was living at G's death.

The nonvested property interest in favor of G's great-grandchildren is valid under Section 1(a)(1). The validating life is the last surviving grandchild among the grandchildren living at G's death. Under subsection (d), the possibility that A will have a child conceived after G's death must be disregarded. Note that subsection (d) requires that in determining whether an individual is a validating life, the possibility that a child will be born to "an" individual after the individual's death is disregarded. The validating life and the individual whose having a post-death child is disregarded need not be the same individual. Thus in this example, by disregarding the possibility that A will have a conceived-after-death child, G's last surviving grandchild becomes the validating life because G's last surviving grandchild is deemed to have been alive at G's death, when the great-grandchildren's interests were created.

Example (5) - Child in Gestation Case. G devised property in trust, to pay the income equally among G's living children; on the death of G's last surviving child, to accumulate the income for 21 years; on the 21st anniversary of the death of G's last surviving child, to pay the corpus and accumulated income to G's then-living descendants, per stirpes; if none, to X Charity. At G's death his child (A) was 6 years old, and G's wife (W) was pregnant. After G's death, W gave birth to their second child (B).

The nonvested property interests in favor of G's descendants and in favor of X Charity are valid under Section 1(a)(1). The validating life is A. Under subsection (d), the possibility that a child will be born to an individual after the individual's death must be disregarded for the purposes of determining validity under Section 1(a)(1). Consequently, the possibility that a child will be born to G after his death must be disregarded; and the possibility that a child will be born to any of G's descendants after their deaths must also be disregarded.

Note, however, that the rule of subsection (d) does not apply to the question of the entitlement of an after-born child to take a beneficial interest in the trust. The common-law rule (sometimes codified) that a child in gestation is treated as alive, if the child is subsequently born viable, applies to this question. Thus, subsection (d) does not prevent B from being an income beneficiary under G's trust, nor does it prevent a descendant in gestation on the 21st anniversary of the death of G's last surviving child from being a member of the class of G's "then-living descendants," as long as such descendant has no then-living ancestor who takes instead.

Different Validating Lives Can and in Some Cases Must Be Used. Dispositions of property sometimes create more than one nonvested property interest. In such cases, the validity of each interest is treated individually. A validating life that validates one interest might or might not validate the other interests. Since it is not necessary that the same validating life be used for all interests created by a disposition, the search for a validating life for each of the other interests must be undertaken separately.

Perpetuity Saving Clauses and Similar Provisions. Knowledgeable lawyers almost routinely insert perpetuity saving clauses into instruments they draft. Saving clauses contain two components, the first of which is the perpetuity-period component. This component typically requires the trust or other arrangement to terminate no later than 21 years after the death of the last survivor of a group of individuals designated therein by name or class. (The lives of corporations, animals, or sequoia trees cannot be used.) The second component of saving clauses is the gift-over component. This component expressly creates a gift over that is guaranteed to vest at the termination of the period set forth in the perpetuity-period component, but only if the trust or other arrangement has not terminated earlier in accordance with its other terms.

It is important to note that regardless of what group of individuals is designated in the perpetuity-period component of a saving clause, the surviving member of the group is not necessarily the individual who would be the validating life for the nonvested property interest or power of appointment in the absence of the saving clause. Without the saving clause, one or more interests or powers may in fact fail to satisfy the requirement of paragraph (1) of subsections (a), (b), or (c) for initial validity. By being designated in the saving clause, however, the survivor of the group becomes the validating life for all interests and powers in the trust or other arrangement: The saving clause confers on the last surviving member of the designated group the requisite causal connection between his or her death and the impossibility of any interest or power in the trust or other arrangement remaining in existence beyond the 21-year period following such individual's death.

Example (6) - Valid Saving Clause Case. A testamentary trust directs income to be paid to the testator's children for the life of the survivor, then to the testator's grandchildren for the life of the survivor, corpus on the death of the testator's last living grandchild to such of the testator's descendants as the last living grandchild shall by will appoint; in default of appointment, to the testator's then-living descendants, per stirpes. A saving clause in the will terminates the trust, if it has not previously terminated, 21 years after the death of the testator's last surviving descendant who was living at the testator's death. The testator was survived by children.

In the absence of the saving clause, the nongeneral power of appointment in the last living grandchild and the nonvested property interest in the gift-in-default clause in favor of the testator's descendants fail the test of Sections 1(a)(1) and 1(c)(1) for initial validity. That is, were it not for the saving clause, there is no validating life. However, the surviving member of the designated group becomes the validating life, so that the saving clause does confer initial validity on the nongeneral power of appointment and on the nonvested property interest under Sections 1(a)(1) and 1(c)(1).

If the governing instrument designates a group of individuals that would cause it to be impracticable to determine the death of the survivor, the common-law courts have developed the doctrine that the validity of the nonvested property interest or power of appointment is determined as if the provision in the governing instrument did not exist. See cases cited in Restatement (Second) of Property (Donative Transfers) (1983), Reporter's Note No. 3 at p. 45. See also Restatement (Second) of Property (Donative Transfers) § 1.3(1) Comment a (1983); Restatement of Property § 374 and Comment l (1944); 6 American Law of Property § 24.13 (A. Casner ed. 1952); 5A R. Powell, The Law of Real Property Para. 766[5] (1985); L. Simes & A. Smith, The Law of Future Interests § 1223 (2d ed. 1956). If, for example, the designated group in Example (6) were the residents of X City (or the members of Y Country Club) living at the time of the testator's death, the saving clause would not validate the power of appointment or the nonvested property interest. Instead, the validity of the power of appointment and the nonvested property interest would be determined as if the provision in the governing instrument did not exist. Since without the saving clause the power of appointment and the nonvested property interest would fail to satisfy the requirements of Sections 1(a)(1) and 1(c)(1) for initial validity, their validity would be governed by Sections 1(a)(2) and 1(c)(2).

The application of the above common-law doctrine, which is not superseded by this Act and so remains in full force, is not limited to saving clauses. It also applies to trusts or other arrangements where the period thereof is directly linked to the life of the survivor of a designated group of individuals. An example is a trust to pay the income to the grantor's descendants from time to time living, per stirpes, for the period of the life of the survivor of a designated group of individuals living when the nonvested property interest or power of appointment in question was created, plus the 21-year period following the survivor's death; at the end of the 21-year period, the corpus is to be divided among the grantor's then-living descendants, per stirpes, and if none, to the XYZ Charity. If the group of individuals so designated is such that it would be impracticable to determine the death of the survivor, the validity of the disposition is determined as if the provision in the governing instrument did not exist. The term of the trust is therefore governed by the 90- year permissible vesting period of paragraph (2) of subsections (a), (b), or (c) of the Statutory Rule.

Additional references. Restatement (Second) of Property (Donative Transfers) § 1.3(1) (1983), and the Comments thereto; Waggoner, Perpetuity Reform, 81 Mich.L.Rev. 1718, 1720-1726 (1983).

C. SECTION 1(a)(2): WAIT-AND-SEE - NONVESTED PROPERTY INTERESTS WHOSE VALIDITY IS INITIALLY IN ABEYANCE

Unlike the Common-Law Rule, the Statutory Rule Against Perpetuities does not automatically invalidate nonvested property interests for which there is no validating life. A nonvested property interest that does not meet the requirements for validity under Section 1(a)(1) might still be valid under the wait-and-see provisions of Section 1(a)(2). Such an interest is invalid under Section 1(a)(2) only if in actuality it does not vest (or terminate) during the permissible vesting period. Such an interest becomes invalid, in other words, only if it is still in existence and nonvested when the permissible vesting period expires.

1. The 90-Year Permissible Vesting Period
2. Technical Violations of the Common-Law Rule

Since a wait-and-see rule against perpetuities, unlike the Common-law Rule, makes validity or invalidity turn on actual post-creation events, it requires that an actual period of time be measured off during which the contingencies attached to an interest are allowed to work themselves out to a final resolution. The Statutory Rule Against Perpetuities establishes a permissible vesting period of 90 years. Nonvested property interests that have neither vested nor terminated at the expiration of the 90-year permissible vesting period become invalid.

As explained in the Prefatory Note, the permissible vesting period of 90 years is not an arbitrarily selected period of time. On the contrary, the 90-year period represents a reasonable approximation of - a proxy for - the period of time that would, on average, be produced through the use of an actual set of measuring lives identified by statute and then adding the traditional 21-year tack-on period after the death of the survivor.

One of the harsh aspects of the invalidating side of the Common-Law Rule, against which the adoption of the wait-and-see element in Section 1(a)(2) is designed to relieve, is that nonvested property interests at common law are invalid even though the invalidating chain of possible events almost certainly will not happen. In such cases, the violation of the Common-law Rule could be said to be merely technical. Nevertheless, at common law, the nonvested property interest is invalid.

Cases of technical violation fall generally into discrete categories, identified and named by Professor Leach in Perpetuities in a Nutshell, 51 Harv.L.Rev. 638 (1938), as the fertile octogenarian, the administrative contingency, and the unborn widow. The following three examples illustrate how Section 1(a)(2) affects these categories.

Example (7) - Fertile Octogenarian Case. G devised property in trust, directing the trustee to pay the net income therefrom "to A for life, then to A's children for the life of the survivor, and upon the death of A's last surviving child to pay the corpus of the trust to A's grandchildren." G was survived by A (a female who had passed menopause) and by A's two adult children (X and Y).

The remainder interest in favor of G's grandchildren would be invalid at common law, and consequently is not validated by Section 1(a)(1). There is no validating life because, under the common law's conclusive presumption of lifetime fertility, which is not superseded by this Act (see Part H, below), A might have a third child (Z), conceived and born after G's death, who will have a child conceived and born more than 21 years after the death of the survivor of A, X, and Y.

Under Section 1(a)(2), however, the remote possibility of the occurrence of this chain of events does not invalidate the grandchildren's interest. The interest becomes invalid only if it remains in existence and nonvested 90 years after G's death. The chance that the grandchildren's remainder interest will become invalid under Section 1(a)(2) is negligible.

Example (8) - Administrative Contingency Case. G devised property "to such of my grandchildren, born before or after my death, as may be living upon final distribution of my estate." G was survived by children and grandchildren.

The remainder interest in favor of A's grandchildren would be invalid at common law, and consequently is not validated by Section 1(a)(1). The final distribution of G's estate might not occur within 21 years of G's death, and after G's death grandchildren might be conceived and born who might survive or fail to survive the final distribution of G's estate more than 21 years after the death of the survivor of G's children and grandchildren who were living at G's death.

Under Section 1(a)(2), however, the remote possibility of the occurrence of this chain of events does not invalidate the grandchildren's remainder interest. The interest becomes invalid only if it remains in existence and nonvested 90 years after G's death. Since it is almost certain that the final distribution of G's estate will occur well within this 90-year period, the chance that the grandchildren's interest will be invalid is negligible.

Example (9) - Unborn Widow Case. G devised property in trust, the income to be paid "to my son A for life, then to A's spouse for her life, and upon the death of the survivor of A and his spouse, the corpus to be delivered to A's then living descendants." G was survived by A, by A's wife (W), and by their adult children (X and Y).

Under Section 1(a)(2), however, the remote possibility of the occurrence of this chain of events does not invalidate the descendants' remainder interest. The interest becomes invalid only if it remains in existence and nonvested 90 years after G's death. The chance that the descendants' remainder interest will become invalid under the Statutory Rule is small.

Age Contingencies in Excess of 21. Another category of technical violation of the Common-Law Rule arises in cases of age contingencies in excess of 21 where the takers cannot be their own validating lives (unlike Example (2), above). The violation of the Common-law Rule falls into the technical category because the insertion of a saving clause would in almost all cases allow the disposition to be carried out as written. In effect, the Statutory Rule operates like the perpetuity-period component of a saving clause.

Example (10) - Age Contingency in Excess of 21 Case. G devised property in trust, directing the trustee to pay the income "to A for life, then to A's children; the corpus of the trust is to be equally divided among A's children who reach the age of 30." G was survived by A, by A's spouse (H), and by A's two children (X and Y), both of whom were under the age of 30 when G died.

The remainder interest in favor of A's children who reach 30 is a class gift. At common law, the interests of all potential class members must be valid or the class gift is totally invalid. Leake v. Robinson, 2 Mer. 363, 35 Eng. Rep. 979 (Ch. 1817). This Act does not supersede the all-or-nothing rule for class gifts (see Part G, below), and so the all-or-nothing rule continues to apply under this Act. Although X and Y will either reach 30 or die under 30 within their own lifetimes, there is at G's death the possibility that A will have an afterborn child (Z) who will reach 30 or die under 30 more than 21 years after the death of the survivor of A, H, X, and Y. The class gift would be invalid at common law and consequently is not validated by Section 1(a)(1).

Under Section 1(a)(2), however, the possibility of the occurrence of this chain of events does not invalidate the children's remainder interest. The interest becomes invalid only if an interest of a class member remains nonvested 90 years after G's death.

Although unlikely, suppose that at A's death Z's age is such that he could be alive and under the age of 30 at the expiration of the allowable waiting period. Suppose further that at A's death X or Y or both is over the age of 30. The court, upon the petition of an interested person, must under Section 3 reform G's disposition. See Example (3) in the Comment to Section 3.

D. SECTIONS 1(b)(1) AND 1(c)(1): POWERS OF APPOINTMENT THAT ARE INITIALLY VALID

Powers of Appointment. Sections 1(b) and 1(c) set forth the Statutory Rule Against Perpetuities with respect to powers of appointment. A power of appointment is the authority, other than as an incident of the beneficial ownership of property, to designate recipients of beneficial interests in or powers of appointment over property. Restatement (Second) of Property (Donative Transfers) § 11.1 (1986). The property or property interest subject to a power of appointment is called the "appointive property."

The various persons connected to a power of appointment are identified by a special terminology. The "donor" is the person who created the power of appointment. The "donee" is the person who holds the power of appointment, i.e., the powerholder. The "objects" are the persons to whom an appointment can be made. The "appointees" are the persons to whom an appointment has been made. The "takers in default" are the persons whose property interests are subject to being defeated by the exercise of the power of appointment and who take the property to the extent the power is not effectively exercised. Restatement (Second) of Property (Donative Transfers) § 11.2 (1986).

A power of appointment is "general" if it is exercisable in favor of the donee of the power, the donee's creditors, the donee's estate, or the creditors of the donee's estate. A power of appointment that is not general is a "nongeneral" power of appointment. Restatement (Second) of Property (Donative Transfers) § 11.4 (1986).

A power of appointment is "presently exercisable" if, at the time in question, the donee can by an exercise of the power create an interest in or a power of appointment over the appointive property. Restatement (Second) of Property (Donative Transfers) § 11.5 (1986). A power of appointment is "testamentary" if the donee can exercise it only in the donee's will. Restatement of Property § 321 (1940). A power of appointment is "not presently exercisable because of a condition precedent" if the only impediment to its present exercisability is a condition precedent, i.e., the occurrence of some uncertain event. Since a power of appointment terminates on the donee's death, a deferral of a power's present exercisability until a future time (even a time certain) imposes a condition precedent that the donee be alive at that future time.

A power of appointment is a "fiduciary" power if it is held by a fiduciary and is exercisable by the fiduciary in a fiduciary capacity. A power of appointment that is exercisable in an individual capacity is a "nonfiduciary" power. As used in this Act, the term "power of appointment" refers to "fiduciary" and to "nonfiduciary" powers, unless the context indicates otherwise.

Although Gray's formulation of the Common-law Rule Against Perpetuities does not speak directly of powers of appointment, the Common-law Rule is applicable to powers of appointment (other than presently exercisable general powers of appointment). The principle of subsections (b)(1) and (c)(1) is that a power of appointment that satisfies the Common-law Rule Against Perpetuities is valid under the Statutory Rule Against Perpetuities, and consequently it can be validly exercised, without being subjected to a waiting period during which the power's validity is in abeyance.

Two different tests for validity are employed at common law, depending on what type of power is at issue. In the case of a nongeneral power (whether or not presently exercisable) and in the case of a general testamentary power, the power is initially valid if, when the power was created, it is certain that the latest possible time that the power can be exercised is no later than 21 years after the death of an individual then in being. In the case of a general power not presently exercisable because of a condition precedent, the power is initially valid if it is then certain that the condition precedent to its exercise will either be satisfied or become impossible to satisfy no later than 21 years after the death of an individual then in being. Subsections (b)(1) and (c)(1) codify these rules. Under either test, initial validity depends on the existence of a validating life. The procedure for determining whether a validating life exists is essentially the same procedure explained in Part B, above, pertaining to nonvested property interests.

Example (11) - Initially Valid General Testamentary Power Case. G devised property "to A for life, remainder to such persons, including A's estate or the creditors of A's estate, as A shall by will appoint." G was survived by his daughter (A).

A's power, which is a general testamentary power, is valid as of its creation under Section 1(c)(1). The test is whether or not the power can be exercised beyond 21 years after the death of an individual in being when the power was created (G's death). Since A's power cannot be exercised after A's death, the validating life is A, who was in being at G's death.

Example (12) - Initially Valid Nongeneral Power Case. G devised property "to A for life, remainder to such of A's descendants as A shall appoint." G was survived by his daughter (A).

A's power, which is a nongeneral power, is valid as of its creation under Section 1(c)(1). The validating life is A; the analysis leading to validity is the same as applied in Example (11), above.

Example (13) - Case of Initially Valid General Power Not Presently Exercisable Because of a Condition Precedent. G devised property "to A for life, then to A's first born child for life, then to such persons, including A's first born child or such child's estate or creditors, as A's first born child shall appoint." G was survived by his daughter (A), who was then childless.

The power in A's first born child, which is a general power not presently exercisable because of a condition precedent, is valid as of its creation under Section 1(b)(1). The power is subject to a condition precedent - that A have a child - but this is a contingency that under subsection (d) is deemed certain to be resolved one way or the other within A's lifetime. A is therefore the validating life: The power cannot remain subject to the condition precedent after A's death. Note that the latest possible time that the power can be exercised is at the death of A's first born child, which might occur beyond 21 years after the death of A (and anyone else who was alive when G died). Consequently, if the power conferred on A's first born child had been a nongeneral power or a general testamentary power, the power could not be validated by Section 1(c)(1); instead, the power's validity would be governed by Section 1(c)(2).

E. SECTIONS 1(b)(2) AND 1(c)(2): WAIT-AND-SEE-POWERS OF APPOINTMENT WHOSE VALIDITY IS INITIALLY IN ABEYANCE

Under the Common-law Rule, a general power not presently exercisable because of a condition precedent is invalid as of the time of its creation if the condition might neither be satisfied nor become impossible to satisfy within a life in being plus 21 years. A nongeneral power (whether or not presently exercisable) or a general testamentary power is invalid as of the time of its creation if it might not terminate (by irrevocable exercise or otherwise) within a life in being plus 21 years.

Sections 1(b)(2) and 1(c)(2), by adopting the wait-and-see method of perpetuity reform, shift the ground of invalidity from possible to actual post-creation events. Under these subsections, a power of appointment that would have violated the Common-law Rule, and therefore fails the subsection (b)(1) or (c)(1) tests for initial validity, is nevertheless not invalid as of the time of its creation. Instead, its validity is in abeyance. A general power not presently exercisable because of a condition precedent is invalid only if in actuality the condition neither is satisfied nor becomes impossible to satisfy within the 90-year permissible vesting period. A nongeneral power or a general testamentary power is invalid only if in actuality it does not terminate (by irrevocable exercise or otherwise) within the 90-year permissible period.

Example (14) - General Testamentary Power Case. G devised property "to A for life, then to A's first born child for life, then to such persons, including the estate or the creditors of the estate of A's first born child, as A's first born child shall by will appoint; in default of appointment, to G's grandchildren in equal shares." G was survived by his daughter (A), who was then childless, and by his son (B), who had two children (X and Y).

Since the general testamentary power conferred on A's first born child fails the test of Section 1(c)(1) for initial validity, its validity is governed by Section 1(c)(2). If A has a child, such child's death must occur within 90 years of G's death for any provision in the child's will purporting to exercise the power to be valid.

Example (15) - Nongeneral Power Case. G devised property "to A for life, then to A's first born child for life, then to such of G's grandchildren as A's first born child shall appoint; in default of appointment, to the children of G's late nephew, Q." G was survived by his daughter (A), who was then childless, by his son (B), who had two children (X and Y), and by Q's two children (R and S).

Since the nongeneral power conferred on A's first born child fails the test of Section 1(c)(1) for initial validity, its validity is governed by Section 1(c)(2). If A has a child, such child must exercise the power within 90 years after G's death or the power becomes invalid.

Example (16) - General Power Not Presently Exercisable Because of a Condition Precedent. G devised property "to A for life, then to A's first born child for life, then to such persons, including A's first born child or such child's estate or creditors, as A's first born child shall appoint after reaching the age of 25; in default of appointment, to G's grandchildren." G was survived by his daughter (A), who was then childless, and by his son (B), who had two children (X and Y).

The power conferred on A's first born child is a general power not presently exercisable because of a condition precedent. Since the power fails the test of Section 1(b)(1) for initial validity, its validity is governed by Section 1(b)(2). If A has a child, such child must reach the age of 25 (or die under 25) within 90 years after G's death or the power is invalid.

Fiduciary Powers. Purely administrative fiduciary powers are excluded from the Statutory Rule under Sections 4(2) and (3), but the only distributive fiduciary power that is excluded is the power described in Section 4(4). Otherwise, distributive fiduciary powers are subject to the Statutory Rule. Such powers are usually nongeneral powers.

Example (17) - Trustee's Discretionary Powers Over Income and Corpus. G devised property in trust, the terms of which were that the trustee was authorized to accumulate the income or pay it or a portion of it out to A during A's lifetime; after A's death, the trustee was authorized to accumulate the income or to distribute it in equal or unequal shares among A's children until the death of the survivor; and on the death of A's last surviving child to pay the corpus and accumulated income (if any) to B. The trustee was also granted the discretionary power to invade the corpus on behalf of the permissible recipient or recipients of the income.

The trustee's nongeneral powers to invade corpus and to accumulate or spray income among A's children are not excluded by Section 4(4), nor are they initially valid under Section 1(c)(1). Their validity is, therefore, governed by Section 1(c)(2). Both powers become invalid thereunder, and hence no longer exercisable, 90 years after G's death.

It is doubtful that the powers will become invalid, because the trust will probably terminate by its own terms earlier than the expiration of the permissible 90-year period. But if the powers do become invalid, and hence no longer exercisable, they become invalid as of the time the permissible 90-year period expires. Any exercises of either power that took place before the expiration of the permissible 90-year period are not invalidated retroactively. In addition, if the powers do become invalid, a court in an appropriate proceeding must reform the instrument in accordance with the provisions of Section 3.

F. THE VALIDITY OF THE DONEE'S EXERCISE OF A VALID POWER

The fact that a power of appointment is valid, either because it (i) was not subject to the Statutory Rule to begin with, (ii) is initially valid under Sections 1(b)(1) or 1(c)(1), or (iii) becomes valid under Sections 1(b)(2) or 1(c)(2), means merely that the power can be validly exercised. It does not mean that any exercise that the donee decides to make is valid. The validity of the interests or powers created by the exercise of a valid power is a separate matter, governed by the provisions of this Act. A key factor in deciding the validity of such appointed interests or appointed powers is determining when they were created for purposes of this Act. Under Section 2, as explained in the Comment thereto, the time of creation is when the power was exercised if it was a presently exercisable general power; and if it was a nongeneral power or a general testamentary power, the time of creation is when the power was created. This is the rule generally accepted at common law (see Restatement (Second) of Property (Donative Transfers) § 1.2, Comment d (1983); Restatement of Property § 392 (1944)), and it is the rule adopted under this Act (except for purposes of Section 5 only, as explained in the Comment to Section 5).

Example (18) - Exercise of a Nongeneral Power of Appointment. G was the life income beneficiary of a trust and the donee of a nongeneral power of appointment over the succeeding remainder interest, exercisable in favor of M's descendants (except G). The trust was created by the will of G's mother, M, who predeceased him. G exercised his power by his will, directing the income to be paid after his death to his brother B's children for the life of the survivor, and upon the death of B's last surviving child, to pay the corpus of the trust to B's grandchildren. B predeceased M; B was survived by his two children, X and Y, who also survived M and G.

G's power and his appointment are valid. The power and the appointed interests were created at M's death when the power was created, not on G's death when it was exercised. See Section 2. G's power passes Section 1(c)(1)'s test for initial validity: G himself is the validating life. G's appointment also passes Section 1(a)(1)'s test for initial validity: Since B was dead at M's death, the validating life is the survivor of B's children, X and Y.

Suppose that G's power was exercisable only in favor of G's own descendants, and that G appointed the identical interests in favor of his own children and grandchildren. Suppose further that at M's death, G had two children, X and Y, and that a third child, Z, was born later. X, Y, and Z survived G. In this case, the remainder interest in favor of G's grandchildren would not pass Section 1(a)(1)'s test for initial validity. Its validity would be governed by Section 1(a)(2), under which it would be valid if G's last surviving child died within 90 years after M's death.

If G's power were a general testamentary power of appointment, rather than a nongeneral power, the solution would be the same. The period of the Statutory Rule with respect to interests created by the exercise of a general testamentary power starts to run when the power was created (at M's death, in this example), not when the power was exercised (at G's death).

Example (19) - Exercise of a Presently Exercisable General Power of Appointment. G was the life income beneficiary of a trust and the donee of a presently exercisable general power of appointment over the succeeding remainder interest. G exercised the power by deed, directing the trustee after his death to pay the income to G's children in equal shares for the life of the survivor, and upon the death of his last surviving child to pay the corpus of the trust to his grandchildren.

The validity of G's power is not in question: A presently exercisable general power of appointment is not subject to the Statutory Rule Against Perpetuities. G's appointment, however, is subject to the Statutory Rule. If G reserved a power to revoke his appointment, the remainder interest in favor of G's grandchildren passes Section 1(a)(1)'s test for initial validity. Under Section 2, the appointed remainder interest was created at G's death. The validating life for his grandchildren's remainder interest is G's last surviving child.

If G's appointment were irrevocable, however, the grandchildren's remainder interest fails the test of Section 1(a)(1) for initial validity. Under Section 2, the appointed remainder interest was created upon delivery of the deed exercising G's power (or when the exercise otherwise became effective). Since the validity of the grandchildren's remainder interest is governed by Section 1(a)(2), the remainder interest becomes invalid, and the disposition becomes subject to reformation under Section 3, if G's last surviving child lives beyond 90 years after the effective date of G's appointment.

Example (20) - Exercises of Successively Created Nongeneral Powers of Appointment. G devised property to A for life, remainder to such of A's descendants as A shall appoint. At his death, A exercised his nongeneral power by appointing to his child B for life, remainder to such of B's descendants as B shall appoint. At his death, B exercised his nongeneral power by appointing to his child C for life, remainder to C's children. A and B were living at G's death. Thereafter, C was born. A later died, survived by B and C. B then died survived by C.

A's nongeneral power passes Section 1(c)(1)'s test for initial validity. A is the validating life. B's nongeneral power, created by A's appointment, also passes Sections 1(c)(1)'s test for initial validity. Since under Section 2 the appointed interests and powers are created at G's death, and since B was then alive, B is the validating life for his nongeneral power. (If B had been born after G's death, however, his power would have failed Section 1(c)(1)'s test for initial validity; its validity would be governed by Section 1(c)(2), and would turn on whether or not it was exercised by B within 90 years after G's death.)

Although B's power is valid, his exercise may be partly invalid. The remainder interest in favor of C's children fails the test of Section 1(a)(1) for initial validity. The period of the Statutory Rule begins to run at G's death, under Section 2. (Since B's power was a nongeneral power, B's appointment under the common-law relation back doctrine of powers of appointment is treated as having been made by A. If B's appointment related back no further than that, of course, it would have been validated by Section 1(a)(1) because C was alive at A's death. However, A's power was also a nongeneral power, so relation back goes another step. A's appointment - which now includes B's appointment - is treated as having been made by G.) Since C was not alive at G's death, he cannot be the validating life. And, since C might have more children more than 21 years after the deaths of A and B and any other individual who was alive at G's death, the remainder interest in favor of his children is not initially validated by Section 1(a)(1). Instead, its validity is governed by Section 1(a)(2), and turns on whether or not C dies within 90 years after G's death.

Note that if either A's power or B's power (or both) had been a general testamentary power rather than a nongeneral power, the above solution would not change. However, if either A's power or B's power (or both) had been a presently exercisable general power, B's appointment would have passed Sections 1(a)(1)'s test for initial validity. (If A had the presently exercisable general power, the appointed interests and power would be created at A's death, not G's; and if the presently exercisable general power were held by B, the appointed interests and power would be created at B's death.)

Common-Law "Second-look" Doctrine. As indicated above, both at common law and under this Act (except for purposes of Section 5 only, as explained in the Comment to Section 5), appointed interests and powers established by the exercise of a general testamentary power or a nongeneral power are created when the power was created, not when the power was exercised. In applying this principle, the common law recognizes a so-called doctrine of second look, under which the facts existing on the date of the exercise are taken into account in determining the validity of appointed interests and appointed powers. E.g., Warren's Estate, 320 Pa. 112, 182 A. 396 (1930); In re Estate of Bird, 225 Cal.App.2d 196, 37 Cal.Rptr. 288 (1964). The common-law's second-look doctrine in effect constitutes a limited wait-and-see doctrine, and is therefore subsumed under but not totally superseded by this Act. The following example, which is a variation of Example (18) above, illustrates how the second-look doctrine operates at common law and how the situation would be analyzed under this Act.

Example (21) - Second-look Case. G was the life income beneficiary of a trust and the donee of a nongeneral power of appointment over the succeeding remainder interest, exercisable in favor of G's descendants. The trust was created by the will of his mother, M, who predeceased him. G exercised his power by his will, directing the income to be paid after his death to his children for the life of the survivor, and upon the death of his last surviving child, to pay the corpus of the trust to his grandchildren. At M's death, G had two children, X and Y. No further children were born to G, and at his death X and Y were still living.

The common-law solution of this example is as follows: G's appointment is valid under the Common-law Rule. Although the period of the Rule begins to run at M's death, the facts existing at G's death can be taken into account. This second look at the facts discloses that G had no additional children. Thus the possibility of additional children, which existed at M's death when the period of the Rule began to run, is disregarded. The survivor of X and Y, therefore, becomes the validating life for the remainder interest in favor of G's grandchildren, and G's appointment is valid. The common-law's second-look doctrine would not, however, save G's appointment if he actually had one or more children after M's death and if at least one of these after-born children survived G.

Under this Act, if no additional children are born to G after M's death, the common-law second-look doctrine can be invoked as of G's death to declare G's appointment then to be valid under Section 1(a)(1); no further waiting is necessary. However, if additional children are born to G and one or more of them survives G, Section 1(a)(2) applies and the validity of G's appointment depends on G's last surviving child dying within 90 years after M's death.

Additional References. Restatement (Second) of Property (Donative Transfers) § 1.2, Comments d, f, g, and h; § 1.3, Comment g; § 1.4, Comment l (1983).

G. SECTION 1(e): EFFECT OF CERTAIN "LATER-OF" TYPE LANGUAGE; COORDINATION OF GENERATION-SKIPPING TRANSFER TAX REGULATIONS WITH UNIFORM ACT

Effect of Certain "Later-of" Type Language. Section 1(e) was added to the Uniform Act in 1990. It primarily applies to a non-traditional type of "later-of" clause (described below). Use of that type of clause might have produced unintended consequences, which are now rectified by the addition of Section 1(e).

In general, perpetuity saving or termination clauses can be used in either of two ways. The predominant use of such clauses is as an override clause. That is, the clause is not an integral part of the dispositive terms of the trust, but operates independently of the dispositive terms; the clause provides that all interests must vest no later than at a specified time in the future, and sometimes also provides that the trust must then terminate, but only if any interest has not previously vested or if the trust has not previously terminated. The other use of such a clause is as an integral part of the dispositive terms of the trust; that is, the clause is the provision that directly regulates the duration of the trust. Traditional perpetuity saving or termination clauses do not use a "later-of" approach; they mark off the maximum time of vesting or termination only by reference to a 21-year period following the death of the survivor of specified lives in being at the creation of the trust.

Section 1(e) applies to a non-traditional clause called a "later-of" (or "longer-of") clause. Such a clause might provide that the maximum time of vesting or termination of any interest or trust must occur no later than the later of (A) 21 years after the death of the survivor of specified lives in being at the creation of the trust or (B) 90 years after the creation of the trust.

Under the Uniform Act as originally promulgated, this type of "later-of" clause would not achieve a "later-of" result. If used as an override clause in conjunction with a trust whose terms were, by themselves, valid under the Common-law Rule, the "later-of" clause did no harm. The trust would be valid under the Common-law Rule as codified in Section 1(a)(1) because the clause itself would neither postpone the vesting of any interest nor extend the duration of the trust. But, if used either (1) as an override clause in conjunction with a trust whose terms were not valid under the Common-law Rule or (2) as the provision that directly regulated the duration of the trust, the "later-of" clause would not cure the perpetuity violation in case (1) and would create a perpetuity violation in case (2). In neither case would the clause qualify the trust for validity at common law under Section 1(a)(1) because the clause would not guarantee that all interests will be certain to vest or terminate no later than 21 years after the death of an individual then alive.** In any given case, 90 years can turn out to be longer than the period produced by the specified-lives-in-being-plus-21-years language. **By substantial analogous authority, the specified-lives-in-being-plus-21-years prong of the "later-of" clause under discussion is not sustained by the separability doctrine (described in Part H of the Comment to Section 1). See, e.g., Restatement of Property § 376 Comments e and f and illustration 3 (1944); Easton v. Hall, 323 Ill. 397, 154 N.E. 216 (1926); Thorne v. Continental Nat'l Bank & Trust Co., 305 Ill. App. 222, 27 N.E.2d 302 (1940). The inapplicability of the separability doctrine is also supported by perpetuity policy, as described in the text above.

Because the clause would fail to qualify the trust for validity under the Common-law Rule of Section 1(a)(1), the nonvested interests in the trust would be subject to the wait-and-see element of Section 1(a)(2) and vulnerable to a reformation suit under Section 3. Under Section 1(a)(2), an interest that is not valid at common law is invalid unless it actually vests or terminates within 90 years after its creation. Section 1(a)(2) does not grant such nonvested interests a permissible vesting period of either 90 years or a period of 21 years after the death of the survivor of specified lives in being. Section 1(a)(2) only grants such interests a period of 90 years in which to vest.

The operation of Section 1(a), as outlined above, is also supported by perpetuity policy. If Section 1(a) allowed a "later-of" clause to achieve a "later-of" result, it would authorize an improper use of the 90-year permissible vesting period of Section 1(a)(2). The 90-year period of Section 1(a)(2) is designed to approximate the period that, on average, would be produced by using actual lives in being plus 21 years. Because in any given case the period actually produced by lives in being plus 21 years can be shorter or longer than 90 years, an attempt to utilize a 90-year period in a "later-of" clause improperly seeks to turn the 90-year average into a minimum.

Set against this background, the addition of Section 1(e) is quite beneficial. Section 1(e) limits the effect of this type of "later-of" language to 21 years after the death of the survivor of the specified lives, in effect transforming the clause into a traditional perpetuity saving/termination clause. By doing so, Section 1(e) grants initial validity to the trust under the Common-law Rule as codified in Section 1(a)(1) and precludes a reformation suit under Section 3.

Note that Section 1(e) covers variations of the "later-of" clause described above, such as a clause that postpones vesting until the later of (A) 20 years after the death of the survivor of specified lives in being or (B) 89 years. Section 1(e) does not, however, apply to all dispositions that incorporate a "later-of" approach. To come under Section 1(e), the specified-lives prong must include a tack-on period of up to 21 years. Without a tack-on period, a "later-of" disposition, unless valid at common law, comes under Section 1(a)(2) and is given 90 years in which to vest. An example would be a disposition that creates an interest that is to vest upon "the later of the death of my widow or 30 years after my death."

Coordination of the Federal Generation-Skipping Transfer Tax with the Uniform Statutory Rule. In 1990, the Treasury Department announced a decision to coordinate the tax regulations under the "grandfathering" provisions of the federal generation-skipping transfer tax with the Uniform Act. Letter from Michael J. Graetz, Deputy Assistant Secretary of the Treasury (Tax Policy), to Lawrence J. Bugge, President, National Conference of Commissioners on Uniform State Laws (Nov. 16, 1990) (hereinafter Treasury Letter ).

Section 1433(b)(2) of the Tax Reform Act of 1986 generally exempts ("grandfathers") trusts from the federal generation-skipping transfer tax that were irrevocable on September 25, 1985. This section adds, however, that the exemption shall apply "only to the extent that such transfer is not made out of corpus added to the trust after September 25, 1985." The provisions of Section 1433(b)(2) were first implemented by Temp. Treas. Reg. § 26.2601-1, promulgated by T.D. 8187 on March 14, 1988. Insofar as the Uniform Act is concerned, a key feature of that temporary regulation is the concept that the statutory reference to "corpus added to the trust after September 25, 1985" not only covers actual post-9/25/85 transfers of new property or corpus to a grandfathered trust but "constructive" additions as well. Under the temporary regulation as first promulgated, a "constructive" addition occurs if, after 9/25/85, the donee of a nongeneral power of appointment exercises that power "in a manner that may postpone or suspend the vesting, absolute ownership or power of alienation of an interest in property for a period, measured from the date of creation of the trust, extending beyond any life in being at the date of creation of the trust plus a period of 21 years. If a power is exercised by creating another power it will be deemed to be exercised to whatever extent the second power may be exercised." Temp. Treas. Reg. § 26.2601- 1(b)(1)(v)(B)(2) (1988).

Because the Uniform Act was promulgated in 1986 and applies only prospectively, any "grandfathered" trust would have become irrevocable prior to the enactment of the Uniform Act in any state. Nevertheless, the second sentence of Section 5(a) extends the wait-and-see approach to post-effective-date exercises of nongeneral powers even if the power itself was created prior to the effective date of the Uniform Act in any state. Consequently, a post-effective-date exercise of a nongeneral power of appointment created in a "grandfathered" trust could come under the provisions of the Uniform Act.

The literal wording, then, of Temp. Treas. Reg. § 26.2601-1(b)(1)(v)(B)(2) (1988), as first promulgated, could have jeopardized the grandfathered status of an exempt trust if (1) the trust created a nongeneral power of appointment, (2) the donee exercised that nongeneral power, and (3) the Uniform Act is the perpetuity law applicable to the donee's exercise. This possibility arose not only because the donee's exercise itself might come under the 90-year permissible vesting period of Section 1(a)(2) if it otherwise violated the Common-law Rule and hence was not validated under Section 1(a)(1). The possibility also arose in a less obvious way if the donee's exercise created another nongeneral power. The last sentence of the temporary regulation states that "if a power is exercised by creating another power it will be deemed to be exercised to whatever extent the second power may be exercised."

In late March 1990, the National Conference of Commissioners on Uniform State Laws (NCCUSL) filed a formal request with the Treasury Department asking that measures be taken to coordinate the regulation with the Uniform Act. By the Treasury Letter referred to above, the Treasury Department responded by stating that it "will amend the temporary regulations to accommodate the 90-year period under USRAP as originally promulgated [in 1986] or as amended [in 1990 by the addition of subsection (e)]." This should effectively remove the possibility of loss of grandfathered status under the Uniform Act merely because the donee of a nongeneral power created in a grandfathered trust inadvertently exercises that power in violation of the Common-law Rule or merely because the donee exercises that power by creating a second nongeneral power that might, in the future, be inadvertently exercised in violation of the Common-law Rule.

The Treasury Letter states, however, that any effort by the donee of a nongeneral power in a grandfathered trust to obtain a "later-of" specified-lives-in-being-plus-21-years or 90-years approach will be treated as a constructive addition, unless that effort is nullified by state law. As explained above, the Uniform Act, as originally promulgated in 1986 or as amended in 1990 by the addition of Section 1(e), nullifies any direct effort to obtain a "later-of" approach by the use of a "later-of" clause.

The Treasury Letter states that an indirect effort to obtain a "later-of" approach would also be treated as a constructive addition that would bring grandfathered status to an end, unless the attempt to obtain the later-of approach is nullified by state law. The Treasury Letter indicates that an indirect effort to obtain a "later-of" approach could arise if the donee of a nongeneral power successfully attempts to prolong the duration of a grandfathered trust by switching from a specified-lives-in-being-plus-21-years perpetuity period to a 90-year perpetuity period, or vice versa. Donees of nongeneral powers in grandfathered trusts would therefore be well advised to resist any temptation to wait until it becomes clear or reasonably predictable which perpetuity period will be longer and then make a switch to the longer period if the governing instrument creating the power utilized the shorter period. No such attempted switch and no constructive addition will occur if in each instance a traditional specified-lives-in-being-plus-21-years perpetuity saving clause is used.

Any such attempted switch is likely in any event to be nullified by state law and, if so, the attempted switch will not be treated as a constructive addition. For example, suppose that the original grandfathered trust contained a standard perpetuity saving clause declaring that all interests in the trust must vest no later than 21 years after the death of the survivor of specified lives in being. In exercising a nongeneral power created in that trust, any indirect effort by the donee to obtain a "later-of" approach by adopting a 90-year perpetuity saving clause will likely be nullified by Section 1(e). If that exercise occurs at a time when it has become clear or reasonably predictable that the 90-year period will prove longer, the donee's exercise would constitute language in a governing instrument that seeks to operate in effect to postpone the vesting of any interest until the later of the specified-lives-in-being-plus-21-years period or 90 years. Under Section 1(e), "that language is inoperative to the extent it produces a period of time that exceeds 21 years after the death of the survivor of the specified lives."

Quite apart from Section 1(e), the relation-back doctrine generally recognized in the exercise of nongeneral powers stands as a doctrine that could potentially be invoked to nullify an attempted switch from one perpetuity period to the other perpetuity period. Under that doctrine, interests created by the exercise of a nongeneral power are considered created by the donor of that power. See, e.g., Restatement (Second) of Property, Donative Transfers § 11.1 comment b (1986). As such, the maximum vesting period applicable to interests created by the exercise of a nongeneral power would apparently be covered by the perpetuity saving clause in the document that created the power, notwithstanding any different period the donee purports to adopt.

H. SUBSIDIARY COMMON-LAW DOCTRINES: WHETHER SUPERSEDED BY THIS ACT

As noted at the beginning of this Comment, the courts in interpreting the Common-law Rule developed several subsidiary doctrines. This Act does not supersede those subsidiary doctrines except to the extent the provisions of this Act conflict with them. As explained below, most of these common-law doctrines remain in full force or in force in modified form.

Constructional Preference for Validity. Professor Gray in his treatise on the Common-law Rule Against Perpetuities declared that a will or deed is to be construed without regard to the Rule, and then the Rule is to be "remorselessly" applied to the provisions so construed. J. Gray, The Rule Against Perpetuities § 629 (4th ed. 1942). Some courts may still adhere to this proposition. Colorado Nat'l Bank v. McCabe, 143 Colo. 21, 353 P.2d 385 (1960). Most courts, it is believed, would today be inclined to adopt the proposition put by the Restatement of Property § 375 (1944), which is that where an instrument is ambiguous - that is, where it is fairly susceptible to two or more constructions, one of which causes a Rule violation and the other of which does not - the construction that does not result in a Rule violation should be adopted. Cases supporting this view include Southern Bank & Trust Co. v. Brown, 271 S.C. 260, 246 S.E.2d 598 (1978); Davis v. Rossi, 326 Mo. 911, 34 S.W.2d 8 (1930); Watson v. Goldthwaite, 184 N.E.2d 340, 343 (Mass. 1962); Walker v. Bogle, 244 Ga. 439, 260 S.E.2d 338 (1979); Drach v. Ely, 703 P.2d 746 (Kan. 1985).

The constructional preference for validity is not superseded by this Act, but its role is likely to be different. The situation is likely to be that one of the constructions to which the ambiguous instrument is fairly susceptible would result in validity under Section 1(a)(1), 1(b)(1), or 1(c)(1), but the other construction does not necessarily result in invalidity; rather it results in the interest's validity being governed by Section 1(a)(2), 1(b)(2), or 1(c)(2). Nevertheless, even though the result of adopting the other construction is not as harsh as it is at common law, it is expected that the courts will incline toward the construction that validates the disposition under Section 1(a)(1), 1(b)(1), or 1(c)(1).

Conclusive Presumption of Lifetime Fertility. At common law, all individuals - regardless of age, sex, or physical condition - are conclusively presumed to be able to have children throughout their entire lifetimes. This principle is not superseded by this Act, and in view of new advances in medical science that allow women to become pregnant after menopause by way of test-tube fertilization (see Sauer, Paulson & Lobo, A Preliminary Report on Oocyte Donation Extending Reproductive Potential to Women Over 40, 323 N.Eng.J.Med. 1157 (1990)) and the widely accepted rule of construction that adopted children are presumptively included in class gifts, the conclusive presumption of lifetime fertility is not unrealistic. Since even elderly individuals probably cannot be excluded from adopting children based on their ages alone, the possibility of having children by adoption is seldom extinct. See, generally, Waggoner In re Lattouf's Will and the Presumption of Lifetime Fertility in Perpetuity Law, 20 San Diego L.Rev. 763 (1983). Under this Act, the main force of this principle is felt in Example (7), above, where it prevents a nonvested property interest from passing the test for initial validity under Section 1(a)(1).

Act Supersedes Doctrine of Infectious Invalidity. At common law, the invalidity of an interest can, under the doctrine of infectious invalidity, be held to invalidate one or more otherwise valid interests created by the disposition or even invalidate the entire disposition. The question turns on whether the general dispositive scheme of the transferor will be better carried out by eliminating only the invalid interest or by eliminating other interests as well. This is a question that is answered on a case-by-case basis. Several items are relevant to the question, including who takes the stricken interests in place of those the transferor designated to take.

The doctrine of infectious invalidity is superseded by this Act by Section 3, under which courts, upon the petition of an interested person, are required to reform the disposition to approximate as closely as possible the transferor's manifested plan of distribution when an invalidity under the Statutory Rule occurs.

Separability. The common law's separability doctrine is that when an interest is expressly subject to alternative contingencies, the situation is treated as if two interests were created in the same person or class. Each interest is judged separately; the invalidity of one of the interests does not necessarily cause the other one to be invalid. This common-law principle was established in Longhead v. Phelps, 2 Wm.Bl. 704, 96 Eng. Rep. 414 (K.B. 1770), and is followed in this country. L. Simes & A. Smith, The Law of Future Interests § 1257 (2d ed. 1956); 6 American Law of Property § 24.54 (A. Casner ed. 1952); Restatement of Property § 376 (1944). Under this doctrine, if property is devised "to B if X-event or Y-event happens," B in effect has two interests, one contingent on X-event happening and the other contingent on Y-event happening. If the interest contingent on X-event but not the one contingent on Y-event is invalid, the consequence of separating B's interest into two is that only one of them, the one contingent on X-event, is invalid. B still has a valid interest - the one contingent on the occurrence of Y-event.

The separability principle is not superseded by this Act. As illustrated in the following example, its invocation will usually result in one of the interests being initially validated by Section 1(a)(1) and the validity of the other interests being governed by Section 1(a)(2).

Example (22) - Separability Case. G devised real property "to A for life, then to A's children who survive A and reach 25, but if none of A's children survives A or if none of A's children who survives A reaches 25, then to B." G was survived by his brother (B), by his daughter (A), by A's husband (H), and by A's two minor children (X and Y).

The remainder interest in favor of A's children who reach 25 fails the test of Section 1(a)(1) for initial validity. Its validity is, therefore, governed by Section 1(a)(2) and depends on each of A's children doing any one of the following things within 90 years after G's death: predeceasing A, surviving A and failing to reach 25, or surviving A and reaching 25.

Under the separability doctrine, B has two interests. One of them is contingent on none of A's children surviving A. That interest passes Section 1(a)(1)'s test for initial validity; the validating life is A. B's other interest, which is contingent on none of A's surviving children reaching 25, fails Section 1(a)(1)'s test for initial validity. Its validity is governed by Section 1(a)(2) and depends on each of A's surviving children either reaching 25 or dying under 25 within 90 years after G's death.

Suppose that after G's death, A has a third child (Z). A subsequently dies, survived by her husband (H) and by X, Y, and Z. This, of course, causes B's interest that was contingent on none of A's children surviving A to terminate. If X, Y, and Z had all reached the age of 25 by the time of A's death, their interest would vest at A's death, and that would end the matter. If one or two, but not all three of them, had reached the age of 25 at A's death, B's other interest - the one that was contingent on none of A's surviving children reaching 25 - would also terminate. As for the children's interest, if the after- born child Z's age was such at A's death that Z could not be alive and under the age of 25 at the expiration of the allowable waiting period, the class gift in favor of the children would be valid under Section 1(a)(2), because none of those then under 25 could fail either to reach 25 or die under 25 after the expiration of the allowable 90-year waiting period. If, however, Z's age at A's death was such that Z could be alive and under the age of 25 at the expiration of the 90-year permissible vesting period, the circumstances requisite to reformation under Section 3(2) would arise, and the court would be justified in reforming G's disposition by reducing the age contingency with respect to Z to the age he would reach on the date when the permissible vesting period is due to expire. See Example (3) in the Comment to Section 3. So reformed, the class gift in favor of A's children could not become invalid under Section 1(a)(2), and the children of A who had already reached 25 by the time of A's death could receive their shares immediately.

The "All-or-Nothing" Rule with Respect to Class Gifts; the Specific Sum and Sub-Class Doctrines. The common law applies an "all-or-nothing" rule with respect to class gifts, under which a class gift stands or falls as a whole. The all-or-nothing rule, usually attributed to Leake v. Robinson, 2 Mer. 363, 35 Eng. Rep. 979 (Ch. 1817), is commonly stated as follows: If the interest of any potential class member might vest too remotely, the entire class gift violates the Rule. Although this Act does not supersede the basic idea of the much-maligned "all-or-nothing" rule, the evils sometimes attributed to it are substantially if not entirely eliminated by the wait-and-see feature of the Statutory Rule and by the availability of reformation under Section 3, especially in the circumstances described in Sections 3(2) and (3). For illustrations of the application of the all-or-nothing rule under this Act, see Examples (3), (4), and (6) in the Comment to Section 3.

The common law also recognizes a doctrine called the specific-sum doctrine, which is derived from Storrs v. Benbow, 3 De G.M. & G. 390, 43 Eng. Rep. 153 (Ch. 1853), and states: If a specified sum of money is to be paid to each member of a class, the interest of each class member is entitled to separate treatment and is valid or invalid under the Rule on its own. The common law also recognizes a doctrine called the sub-class doctrine, which is derived from Cattlin v. Brown, 11 Hare 372, 68 Eng. Rep. 1318 (Ch. 1853), and states: If the ultimate takers are not described as a single class but rather as a group of subclasses, and if the share to which each separate subclass is entitled will finally be determined within the period of the Rule, the gifts to the different subclasses are separable for the purpose of the Rule. American Security & Trust Co. v. Cramer, 175 F.Supp. 367 (D.D.C. 1959); Restatement of Property § 389 (1944). The specific-sum and sub-class doctrines are not superseded by this Act. The operation of the specific-sum doctrine under this Act is illustrated in the following example.

Example (23) - Specific-Sum Case. G bequeathed "$10,000 to each child of A, born before or after my death, who attains 25." G was survived by A and by A's two children (X and Y). X but not Y had already reached 25 at G's death. After G's death a third child (Z) was born to A.

If the phrase "born before or after my death" had been omitted, the class would close as of G's death under the common-law's rule of construction known as the rule of convenience: The after-born child, Z, would not be entitled to a $10,000 bequest, and the interests of both X and Y would be valid upon their creation at G's death. X's interest would be valid because it was initially vested; neither the Common-law Rule nor the Statutory Rule applies to interests that are vested upon their creation. Although the interest of Y was not vested upon its creation, it would be initially valid under Section 1(a)(1) because Y would be his own validating life; Y will either reach 25 or die under 25 within his own lifetime.

The inclusion of the phrase "before or after my death," however, would probably be construed to mean that G intended after-born children to receive a $10,000 bequest. See Earle Estate, 369 Pa. 52, 85 A.2d 90 (1951). Assuming that this construction were adopted, the specific-sum doctrine allows the interest of each child of A to be treated separately from the others for purposes of the Statutory Rule. For the reasons cited above, the interests of X and Y are initially valid under Section 1(a)(1). The nonvested interest of Z, however, fails Section 1(a)(1)'s test for initial validity; there is no validating life because Z, who was not alive when the interest was created, could reach 25 or die under 25 more than 21 years after the death of the survivor of A, X, and Y. Under Section 1(a)(2), the validity of Z's interest depends on Z's reaching (or failing to reach) 25 within 90 years after G's death.

The operation of the sub-class doctrine under this Act is illustrated in the following example.

Example (24) - Sub-Class Case. G devised property in trust, directing the trustee to pay the income "to A for life, then in equal shares to A's children for their respective lives; on the death of each child, the proportionate share of corpus of the one so dying shall go to the children of such child." G was survived by A and by A's two children (X and Y). After G's death, another child (Z) was born to A. A now has died, survived by X, Y, and Z.

Under the sub-class doctrine, each remainder interest in favor of the children of a child of A is treated separately from the others. This allows the remainder interest in favor of X's children and the remainder interest in favor of Y's children to be validated under Section 1(a)(1). X is the validating life for the one, and Y is the validating life for the other.

The remainder interest in favor of the children of Z fails Section 1(a)(1)'s test for initial validity; there is no validating life because Z, who was not alive when the interest was created, could have children more than 21 years after the death of the survivor of A, X, and Y. Under Section 1(a)(2), the validity of the remainder interest in favor of Z's children depends on Z's dying within 90 years after G's death.

Note why both of the requirements of the sub-class rule are met. The ultimate takers are described as a group of sub-classes rather than as a single class: "children of the child so dying," as opposed to "grandchildren." The share to which each separate sub-class is entitled is certain to be finally determined within a life in being plus 21 years: As of A's death, who is a life in being, it is certain to be known how many children he had surviving him; since in fact there were three, we know that each sub-class will ultimately be entitled to one-third of the corpus, neither more nor less. The possible failure of the one-third share of Z's children does not increase to one-half the share going to X's and Y's children; they still are entitled to only one-third shares. Indeed, should it turn out that X has children but Y does not, this would not increase the one-third share to which X's children are entitled.

Example (25) - General Testamentary Powers - Sub-Class Case. G devised property in trust, directing the trustee to pay income "to A for life, then in equal shares to A's children for their respective lives; on the death of each child, the proportionate share of corpus of the one so dying shall go to such persons as the one so dying shall by will appoint; in default of appointment, to G's grandchildren in equal shares." G was survived by A and by A's two children (X and Y). After G's death, another child (Z) was born to A.

The general testamentary powers conferred on each of A's children are entitled to separate treatment under the principles of the sub-class doctrine. See above. Consequently, the powers conferred on X and Y, A's children who were living at G's death, are initially valid under Section 1(c)(1). But the general testamentary power conferred on Z, A's child who was born after G's death, fails the test of Section 1(c)(1) for initial validity. The validity of Z's power is governed by Section 1(c)(2). Z's death must occur within 90 years after G's death if any provision in Z's will purporting to exercise his power is to be valid.

Duration of Indestructible Trusts - Termination of Trusts by Beneficiaries. The widely accepted view in American law is that the beneficiaries of a trust other than a charitable trust can compel its premature termination if all beneficiaries consent and if such termination is not expressly restrained or impliedly restrained by the existence of a "material purpose" of the settlor in establishing the trust. Restatement (Second) of Trusts § 337 (1959); IV A. Scott, The Law of Trusts § 337 (3d ed. 1967). A trust that cannot be terminated by its beneficiaries is called an indestructible trust.

It is generally accepted that the duration of the indestructibility of a trust, other than a charitable trust, is limited to the applicable perpetuity period. See Restatement (Second) of Trusts § 62, Comment o (1959); Restatement (Second) of Property (Donative Transfers) § 2.1 and Legislative Note and Reporter's Note (1983); I A. Scott, The Law of Trusts § 62.10(2) (3d ed. 1967); J. Gray, The Rule Against Perpetuities § 121 (4th ed. 1942); L. Simes & A. Smith, The Law of Future Interests §§ 1391-93 (2d ed. 1956).

Nothing in this Act supersedes this principle. One modification, however, is necessary: As to trusts that contain a nonvested property interest or power of appointment whose validity is governed by the wait-and-see element adopted in Section 1(a)(2), 1(b)(2), or 1(c)(2), the courts can be expected to determine that the applicable perpetuity period is 90 years.

I. [RESERVED.]

II. DECIDED UNDER PRIOR LAW.

Purpose of section. - The purpose of this section is to effectuate the intention of the testator by rendering valid a limitation which would have been otherwise invalid as violative of the rule against perpetuities. Since January 1, 1820, words which had previously been construed to mean an indefinite failure of issue are now construed to mean a definite failure of issue, and the limitations founded thereon are no longer void for remoteness. Daniel v. Lipscomb, 110 Va. 563 , 66 S.E. 850 (1910). See Elys v. Wynne, 63 Va. (22 Gratt.) 224 (1872); Wine v. Markwood, 72 Va. (31 Gratt.) 43 (1878); Corr v. Porter, 74 Va. (33 Gratt.) 278 (1880); Thomas v. Thomas, 224 Va. 4 , 294 S.E.2d 795 (1982).

This section focuses upon contingent limitations to estates. Mullins v. Simmons, 235 Va. 194 , 365 S.E.2d 771 (1988).

Rule incorporated in section. - A devise to a person with limitation over to another, in the event of the first taker's death without issue, is a limitation which takes effect when the first devisee dies without heir or issue, and vests in the first devisee a defeasible fee. This rule is incorporated in this section. Rinker v. Trout, 171 Va. 327 , 198 S.E. 913 (1938).

It is manifest from reading this section that it was the legislative intent that every limitation in a deed or will contingent upon the dying of any person without heirs, etc., should be construed to be a limitation to take effect when such person shall die not having such heirs, etc. People's Nat'l Bank v. Crickenberger, 159 Va. 264 , 165 S.E. 412 (1932).

Section based on proposition that invalid limitation not intended. - The statutory rule is based upon the proposition that a testator does not intend to create an invalid limitation, but intends instead to make the limitation effective at a time not violative of the rule against perpetuities. Hence, where a will contains a bare provision that a limitation shall take effect upon the death of a person without issue, this section saves the limitation from a claim of remoteness by arbitrarily fixing the date of the person's death as the time for determining whether he dies without issue. Thomas v. Thomas, 224 Va. 4 , 294 S.E.2d 795 (1982).

But plainly intended limitation given effect even if invalidation results. - Under this section, if a will declares plainly an intention that the limitation shall be effective at some later time, the intention will be given effect even though the declared time is impermissibly remote and results in the invalidation of the limitation. Thomas v. Thomas, 224 Va. 4 , 294 S.E.2d 795 (1982).

Purpose served where will fixes time earlier than that fixed by section. - If a will displays the testator's intention that a die-without-issue limitation shall take effect earlier than the time fixed in this section, thus avoiding a possible claim of remoteness, the statutory purpose is served and the intent should be given effect. In these circumstances, an express declaration of intent on the face of the will is not necessary; it suffices if the intention to fix an earlier vesting date can be discerned from the application of conventional rules of construction. A contrary holding would permit use of this section to thwart, rather than effectuate, a testator's intention. Thomas v. Thomas, 224 Va. 4 , 294 S.E.2d 795 (1982).

Section does not preempt consideration of all other rules of will construction. Rather, it is designed to complement other rules in the ascertainment of the true intention of the testator. Thomas v. Thomas, 224 Va. 4 , 294 S.E.2d 795 (1982).

Under the provisions of this section it is immaterial whether the testator meant heirs, or issue, or children; the language employed refers, in any event, to the death of the person not having such heir, issue, or child. The statute is devoid of ambiguity. People's Nat'l Bank v. Crickenberger, 159 Va. 264 , 165 S.E. 412 (1932).

This section does not contemplate a limitation wherein an express and unlimited power to the grantee to dispose of the estate during his lifetime is created. The fact that the grantee is limited in the means of making disposition to a conveyance by deed and not given the power to dispose of it by will does not change the rule. Hall v. Hoak, 184 Va. 821 , 36 S.E.2d 567 (1946). See § 55-7.

The statute does not effect a limitation expressly created upon an indefinite failure of descendants, as was true in Claiborne v. Wilson, 168 Va. 469 , 192 S.E. 585 (1937).

Illustrations. - In 1833 W. made his will, and died. By clause 6 he gives to his daughter, D., a designated tract of land, to her and the heirs of her body; but should D. "die without heir, as above mentioned, my wish is that said land shall return to my other heirs, and be sold, and the moneys arising from the sale to be equally divided among all my heirs." It was held that D. took a fee simple estate in the land defeasible upon her dying without a child living at her death. Elys v. Wynne, 63 Va. (22 Gratt.) 224 (1872).

Testatrix devised real property in fee simple to one N.E.P., if living, or to her issue, and if the said N.E.P. shall die without issue then the property shall pass to W.H.P., if living at the death of the said N.E.P. Bearing in mind the language of this section, and the holdings of the Supreme Court the limitation to W.H.P. was contingent upon N.E.P. dying without issue, and the language of the will had reference to the death of N.E.P. and not to the death of the testatrix. Farrar v. Pemberton, 154 Va. 61 , 152 S.E. 339 (1930).

I. [RESERVED.]

II. DECIDED UNDER PRIOR LAW.

An option agreement which violates the rule against perpetuities is invalid and unenforceable. United Va. Bank v. Union Oil Co., 214 Va. 48 , 197 S.E.2d 174 (1973).

A perpetuities problem may not be solved by resort to what occurs after commencement of the period fixed by the rule. United Va. Bank v. Union Oil Co., 214 Va. 48 , 197 S.E.2d 174 (1973).

Where a trust contained a right of first refusal that was unlimited in duration, that section of the Declaration of Trust violated the rule against perpetuities, and therefore was stricken from the trust agreement. Joseph v. Pollak, 795 F. Supp. 163 (E.D. Va. 1992).

Vesting in beneficiary upon execution. - A trust created by Declaration and Supplemental Declaration of Trust did not violate the rule against perpetuities where the beneficial property interests vested in every beneficiary upon its execution, even though the trust contained no termination date. Joseph v. Pollak, 795 F. Supp. 163 (E.D. Va. 1992).

I. [RESERVED.]

II. DECIDED UNDER PRIOR LAW.

Section significantly modified the harsh rule against perpetuities by providing that no transfer of an interest in property will fail unless it does not vest, if at all, within the period of the rule. Ryland Group, Inc. v. Wills, 229 Va. 459 , 331 S.E.2d 399 (1985).

Rule prior to enactment of section. - Prior to amendment in 1982 by the enactment of this section, the rule against perpetuities required that interests in property must vest, if at all, within the period fixed by the rule. Ryland Group, Inc. v. Wills, 229 Va. 459 , 331 S.E.2d 399 (1985).

Period where parties are corporate entities. - Normally, the period is a life or lives in being plus 21 years and 10 months. However, where the parties are corporate entities and do not contract with reference to a life or lives in being, the determinative period is 21 years from the date of creation of the interest. Ryland Group, Inc. v. Wills, 229 Va. 459 , 331 S.E.2d 399 (1985).

Rule not violated where reasonable time for performance less than 21 years. - Where a reasonable time for performance of the contract, as contemplated by the parties, would be well within 21 years, the contract does not violate the rule. Ryland Group, Inc. v. Wills, 229 Va. 459 , 331 S.E.2d 399 (1985).

Reasonable time for development of subdivision lots is less than 21 years. - Settled contract law implies a reasonable time limitation for performance of conditions in contracts for the sale of land where no time for performance is fixed by the contract itself. This reasoning is applicable in the context of a contract for sale of residential lots to be developed as a subdivision. Where the sellers agreed to develop any lots for which the purchaser exercised the option, the sellers were obligated to perform this duty within a reasonable time or be subject to remedies the purchaser might pursue for the sellers' breach of the express terms of the contract. A reasonable time for completion of development would be far less than 21 years. Ryland Group, Inc. v. Wills, 229 Va. 459 , 331 S.E.2d 399 (1985).

Option contracts. - The rule against perpetuities is applicable to option contracts. Ryland Group, Inc. v. Wills, 229 Va. 459 , 331 S.E.2d 399 (1985).

This section may not be applied retroactively to save the right of first refusal subject to the rule against perpetuities. Lake of the Woods Ass'n v. McHugh, 238 Va. 1 , 380 S.E.2d 872 (1989).

This section may not be retroactively applied to save a right of first refusal of unlimited duration. Joseph v. Pollak, 795 F. Supp. 163 (E.D. Va. 1992).

Upon exercise of an option to purchase subdivision lots, the purchaser would acquire an equitable interest in the lots it committed itself to purchase, with the right to compel conveyance of legal title and the agreement would become an executory contract for the sale of land with mutuality of obligation and remedy. Such a contract creates an interest in land enforceable in equity and is therefore subject to the rule against perpetuities. Ryland Group, Inc. v. Wills, 229 Va. 459 , 331 S.E.2d 399 (1985).

CIRCUIT COURT OPINIONS

Editor's note. - The cases cited below were decided under prior law.

Validity of right of first refusal. - Pursuant to § 8.01-184 , the trial court declared that a right of first refusal in the articles of incorporation of a company was void ab initio, as this limitation on the transfer of stock was an unreasonable restraint, and also violated the rule against perpetuities. Frazer v. Millington, 63 Va. Cir. 458, 2003 Va. Cir. LEXIS 256 (Fairfax County 2003).

Rule not violated. - Where the contract for the sale of land provided that, if the property was not subdivided by the date of closing, that date was to be extended day-for-day until the sellers' subdivision and/or adjustment of property lines was approved, the contract did not violate the rule against perpetuities as provided under subsection A of § 55-13.3; that section required a court to examine whether 21 years had passed and whether or not the interest had vested, and although the property was subdivided and the subdivision plat was recorded late, this was done in less than one and one-half years or within the 21-year period provided in subsection A of § 55-13.3. Bel-Aire, Inc. v. RB Trexlertown, LLC, 68 Va. Cir. 108, 2005 Va. Cir. LEXIS 138 (Virginia Beach 2005).

I. [RESERVED.]

II. DECIDED UNDER PRIOR LAW.

A. NOTES FROM FORMER SECTION 55-20.

History and effect of statute. - In Virginia, as between joint tenants, survivorship was abolished as early as July 1st, 1787, but this act was held to have no application to tenants by entireties. See Thornton v. Thornton, 24 Va. (3 Rand.) 179 (1825); M'Clanachan v. Siter, Price & Co., 42 Va. (2 Gratt.) 280 (1845); Norman's Ex'x v. Cunningham, 46 Va. (5 Gratt.) 63 (1848); Dooley v. Baynes, 86 Va. 644 , 10 S.E. 974 (1890).

It was also held that the statute abolishing survivorship between joint tenants had no application where the estate in joint tenancy had not vested, and, hence, when one joint tenant predeceased the testator the whole estate passed to the survivor. Lockhart v. Vandyke, 97 Va. 356 , 33 S.E. 613 (1899). This doctrine was changed in 1919 by the enactment of the present statute. Gardner v. Gardner, 152 Va. 677 , 148 S.E. 781 (1929).

The effect of this section and § 55-21 is to abolish tenancies by the entirety and joint tenancies unless it is manifest from the wording of the conveyance that the grantor intends to establish a tenancy by the entirety. Wolfe v. Sprouse, 183 Bankr. 739 (W.D. Va. 1995), aff'd, 91 F.3d 133 (4th Cir. 1996).

This section and § 55-21 fall in line with the development that the ancient common-law rule favoring joint tenancies has been reversed, and the presumptions are now almost wholly in favor of tenancies in common by requiring that the desire to create a survivorship interest be manifestly apparent from the tenor of the instrument in order to establish a joint tenancy or a tenancy by the entirety. Wolfe v. Sprouse, 183 Bankr. 739 (W.D. Va. 1995), aff'd, 91 F.3d 133 (4th Cir. 1996).

This section abolishes survivorship as between joint tenants. Wilkinson v. Witherspoon, 206 Va. 297 , 142 S.E.2d 478 (1965).

The doctrine of survivorship between joint tenants has been abolished by this section, and the legislature intended to place joint tenants, insofar as dower and curtesy are concerned, in the same situation as tenants in common. Turner v. Turner, 185 Va. 505 , 39 S.E.2d 299 (1946); Roane v. Roane, 193 Va. 18 , 67 S.E.2d 906 (1951).

Survivorship not created. - A deed conveying land to grantees "as joint tenants, and not as tenants in common" does not create an estate with survivorship. Hoover v. Smith, 248 Va. 6 , 444 S.E.2d 546 (1994).

Subject to certain statutory exceptions in the section following. Rady v. Staiars, 160 Va. 373 , 168 S.E. 452 (1933); Roane v. Roane, 193 Va. 18 , 67 S.E.2d 906 (1951).

This section is not applicable where it is manifest from the tenor of the instrument that it is intended that the part of the one dying should belong to the survivors. Leonard v. Boswell, 197 Va. 713 , 90 S.E.2d 872 (1956).

Survivorship can be conferred only by the instrument conveying property. - Since the enactment of §§ 55-20 and 55-21, survivorship can be conferred only by the instrument conveying the property. Funches v. Funches, 243 Va. 26 , 413 S.E.2d 44 (1992).

Estates by entireties are abolished except where the deed or will manifests an intent that they shall continue. Allen v. Parkey, 154 Va. 739 , 149 S.E. 615 , aff'd, 154 Va. 749 , 154 S.E. 919 (1930).

In Virginia, when real property is conveyed to a husband and wife, the deed must specify that a tenancy by the entirety is intended or a tenancy in common results. In re Manicure, 29 Bankr. 248 (Bankr. W.D. Va. 1983).

And converted into tenancies in common. - The effect of this section when an estate is conveyed to a husband and wife, is to convert a tenancy by entirety into a tenancy in common and of course to destroy survivorship, but § 55-21 provides that this section shall not apply when it was manifest from the instrument creating the estate that it was intended that the part of the one dying should then belong to the other. Allen v. Parkey, 154 Va. 739 , 149 S.E. 615 , aff'd, 154 Va. 749 , 154 S.E. 919 (1930).

The deed in question did in fact create a tenancy by the entireties, notwithstanding the lack of language using those specific words, since the intent was conveyed by the language "with the full common law right of survivorship." In re Zella, 196 Bankr. 752 (Bankr. E.D. Va.), aff'd, 202 Bankr. 712 (E.D. Va. 1996).

A conveyance to husband and wife creates only a tenancy in common, unless it manifestly appears from the tenor of the instrument that it was intended on the part of the one dying that the property in question should then belong to the other. In re Zella, 196 Bankr. 752 (Bankr. E.D. Va.), aff'd, 202 Bankr. 712 (E.D. Va. 1996).

In Virginia, estates by the entireties are abolished except where the deed or will manifests an intent of survivorship. In re Scialdone, 197 Bankr. 225 (Bankr. E.D. Va. 1995).

Manifest means "obvious to the understanding, evident to the mind, not obscure or hidden, and is synonymous with open, clear, visible, unmistakable, indubitable, indisputable, evident and self-evident." In re Scialdone, 197 Bankr. 225 (Bankr. E.D. Va. 1995).

It will be observed that partition is not compellable by statute between tenants by entirety, but that end is reached through this section, which makes tenants by entirety tenants in common. Allen v. Parkey, 154 Va. 739 , 149 S.E. 615 , aff'd, 154 Va. 749 , 154 S.E. 919 (1930).

Survivor's interest in personal property unclear. - Although this section had effect of abolishing survivorship between husband and wife with respect to both real and personal property unless an intent to create a survivorship interest was clearly expressed, it does not address the question of whether the resulting survivorship interest is held as joint tenants or as tenants by the entirety. With respect to real property, it is clear that an estate by the entirety is created; but whether the same would be true with respect to personal property is far from clear. In re Massey, 225 Bankr. 887 (Bankr. E.D. Va. 1998).

The deed which purports to establish a tenancy by the entirety between persons who are not married to each other creates a joint tenancy; the words of survivorship expressly manifest the requisite intent that the joint tenancy is clothed with the common-law right of survivorship, and, this express manifestation of survivorship necessarily excludes the wife's dower interest. Funches v. Funches, 243 Va. 26 , 413 S.E.2d 44 (1992).

The interest of the surviving joint tenant is superior to the dower interest of the wife of the other joint tenant. Funches v. Funches, 243 Va. 26 , 413 S.E.2d 44 (1992).

No application to derivatives of property held by entireties. - Neither this section nor § 55-21 was intended to apply to derivatives of property held by the entireties. Moore v. Glotzbach, 188 F. Supp. 267 (E.D. Va. 1960).

Right to hold personalty by entireties. - This section and § 55-21, when read together, carry the inference that Virginia recognizes the right to hold personalty as tenants by the entireties. Moore v. Glotzbach, 188 F. Supp. 267 (E.D. Va. 1960).

A lease to a tenant does not qualify as a conveyance or devise to a husband and wife as provided by this section, and hence the exception stated in § 55-21 would be inapplicable to the lease and rental flowing therefrom. Moore v. Glotzbach, 188 F. Supp. 267 (E.D. Va. 1960).

Reservation by grantor of estate for himself and wife "during the period of their natural lives." - Since the enactment of this section, changing the common-law doctrine of tenants by entireties, if a husband by his sole deed conveys land excepting from the grant an estate "for and during the period of the natural lives" of himself and wife, each has only a life interest in one moiety of the land. If the exception be treated as a grant, then under the statute they take as tenants in common a moiety each. But in neither event is there any survivorship between them. American Nat'l Bank v. Taylor, 112 Va. 1 , 70 S.E. 534 (1911).

Partition. - A joint tenancy with right of survivorship, as at common law, is subject to partition by a judgment lien creditor of one of the several joint tenants. Jones v. Conwell, 227 Va. 176 , 314 S.E.2d 61 (1984).

The words "joint tenants" as used in § 8.01-81 were intended by the legislature to include joint tenants with right of survivorship and, pursuant to § 8.01-81 , such tenants shall be compellable to make partition at the instance of a judgment lien creditor. Jones v. Conwell, 227 Va. 176 , 314 S.E.2d 61 (1984).

Parties formerly married to each other, but thereafter divorced, are as free to hold property jointly under the exception contained in § 55-21 as are any other parties and although they lack one of the essential unities prerequisite to the creation of a tenancy by the entirety, they may become joint tenants, and if the instrument creating the estate manifests the requisite intention, the joint tenancy will be clothed with the common-law right of survivorship, unaffected by this section. Gant v. Gant, 237 Va. 588 , 379 S.E.2d 331 (1989).

Section construed with former § 64.1-64. - Reading this section and former § 64.1-64, bearing in mind the common-law doctrine governing lapses, the conclusion is irresistible that a devise to a joint tenant who predeceases the testator would lapse, just as a devise to a tenant in common would do, unless the tenant left issue who survived the testator, or unless a different disposition thereof be made or required by the will. Gardner v. Gardner, 152 Va. 677 , 148 S.E. 781 (1929).

Tenancy by entirety property is not exempt from process by a joint creditor of the husband and wife. Community Bank v. Costley, 39 Bankr. 585 (Bankr. E.D. Va. 1984).

Creditors of one spouse may not attach real estate owned by tenants by the entireties; only creditors with joint debts of both spouses may reach the entireties' realty. Ford v. Poston, 53 Bankr. 444 (W.D. Va. 1984), aff'd, 773 F.2d 52 (4th Cir. 1985).

Proceeds of entireties' realty are immune from creditors whom individual spouse owes. Ford v. Poston, 53 Bankr. 444 (W.D. Va. 1984), aff'd, 773 F.2d 52 (4th Cir. 1985).

Application of law of another state. - Florida law was applied to determine the creation of an estate by the entireties in certain bonds, and Virginia law was consulted as to the incidents of the estate. Johnson v. McCarty, 202 Va. 49 , 115 S.E.2d 915 (1960).

B. NOTES FROM FORMER SECTION 55-21.

This section limits the provisions of § 55-20 abolishing survivorship in certain cases. The pertinent exception in this section is that the right of survivorship shall not be abolished "when it manifestly appears from the tenor of the instrument that it was intended the part of the one dying should then belong to the others." Roane v. Roane, 193 Va. 18 , 67 S.E.2d 906 (1951).

The effect of § 55-20 and this section is to abolish tenancies by the entirety and joint tenancies unless it is manifest from the wording of the conveyance that the grantor intends to establish a tenancy by the entirety. Wolfe v. Sprouse, 183 Bankr. 739 (W.D. Va. 1995), aff'd, 91 F.3d 133 (4th Cir. 1996).

There is no contrary public policy or prohibitive legislation affecting the creation of a joint tenancy with right of survivorship. Leonard v. Boswell, 197 Va. 713 , 90 S.E.2d 872 (1956).

Right of survivorship depends on intention. - Where it manifestly appears from the tenor of the will that the share of one dying should then belong to the others, survivorship in such a case is not abolished. Drake v. Blythe, 108 Va. 38 , 60 S.E. 632 (1908).

This section was inapplicable where the only "instrument" to which two joint depositors were a party, affecting their interest in treasury bill purchased by bank at the direction of deceased depositor, was a "Security Buy Memo," which contained no words evidencing an intent to create a right of survivorship. Bennet v. First & Merchants Nat'l Bank, 233 Va. 355 , 355 S.E.2d 888 (1987).

In Virginia, estates by the entireties are abolished except where the deed or will manifests an intent of survivorship. In re Scialdone, 197 Bankr. 225 (Bankr. E.D. Va. 1995).

The deed in question did in fact create a tenancy by the entireties, notwithstanding the lack of language using those specific words, since the intent was conveyed by the language "with the full common law right of survivorship." In re Zella, 196 Bankr. 752 (Bankr. E.D. Va.), aff'd, 202 Bankr. 712 (E.D. Va. 1996).

This section requires only that the intention to create a survivorship estate be made manifest. To satisfy this requirement, parties need only use language that passes a simple test, one inherent in the meaning of the word "manifest." Manifest means "obvious to the understanding, evident to the mind, not obscure or hidden, and is synonymous with open, clear, visible, unmistakable, indubitable, indisputable, evident, and self-evident." Hoover v. Smith, 248 Va. 6 , 444 S.E.2d 546 (1994).

A joint estate or one to donees, share and share alike, etc., is not enough to give a right of survivorship. The donor or testator must make plain his purpose, but when that purpose has been made plain and it is manifest that he intended survivorship should follow, the court will give effect to this intention, and no particular words are necessary. Wallace v. Wallace, 168 Va. 216 , 190 S.E. 293 (1937).

The doctrine of survivorship in the case of executors obtains in Virginia and this is true even though it should be conceded that this section and § 64.1-145 do not apply. Hofheimer v. Seaboard Citizens' Nat'l Bank, 154 Va. 896 , 156 S.E. 581 (1930), cert. denied, 283 U.S. 855, 51 S. Ct. 648, 75 L. Ed. 1462 (1931).

In the instant case appellant and a state bank were designated as coexecutors in a will. Before the death of testator the state bank was merged in appellee, a national bank. It was held that the right of survivorship is preserved and appellant was entitled to qualify as the sole surviving executor of the testator. Hofheimer v. Seaboard Citizens' Nat'l Bank, 154 Va. 392 , 153 S.E. 656 (1930), cert. denied, 283 U.S. 855, 51 S. Ct. 648, 75 L. Ed. 1462 (1931).

Conveyances within section. - Where land is conveyed to "husband and wife, as tenants by the entireties, with right of survivorship as at common law," such quoted words are not meaningless, but are placed in the deed for the express purpose of bringing the conveyance within the exception to § 55-20 contained in this section. Vasilion v. Vasilion, 192 Va. 735 , 66 S.E.2d 599 (1951).

Manifest means "obvious to the understanding, evident to the mind, not obscure or hidden, and is synonymous with open, clear, visible, unmistakable, indubitable, indisputable, evident and self-evident." In re Scialdone, 197 Bankr. 225 (Bankr. E.D. Va. 1995).

A lease to a tenant does not qualify as a conveyance or devise to a husband and wife as provided by § 55-20, and hence the exception stated in this section would be inapplicable to the lease and rental flowing therefrom. Moore v. Glotzbach, 188 F. Supp. 267 (E.D. Va. 1960).

Termination of entirety estate. - Implicit in the terms under which an entirety estate originates is the proposition that the estate can be terminated only by the voluntary action of both tenants or the death of one as a result of a cause reasonably contemplated at the time the tenancy is created. Sundin v. Klein, 221 Va. 232 , 269 S.E.2d 787 (1980), appeal dismissed and cert. denied, 452 U.S. 911, 101 S. Ct. 3043, 69 L. Ed. 2d 414 (1981).

Where one entirety tenant murders the other, the "one person" fiction must give way to the reality that, by his murderous act, the killer has destroyed the unitary nature of the entirety estate and, contrary to his implied agreement, for all practical purposes has terminated the tenancy by a cause of death not contemplated at the time of the original conveyance. While this sort of practical termination may not be sufficient to pass legal title to those claiming under the victim, it would justify limiting the killer's interest for their benefit. Sundin v. Klein, 221 Va. 232 , 269 S.E.2d 787 (1980), appeal dismissed and cert. denied, 452 U.S. 911, 101 S. Ct. 3043, 69 L. Ed. 2d 414 (1981).

Parties formerly married to each other, but thereafter divorced, are as free to hold property jointly under the exception contained in this section as are any other parties and although they lack one of the essential unities prerequisite to the creation of a tenancy by the entirety, they may become joint tenants, and if the instrument creating the estate manifests the requisite intention, the joint tenancy will be clothed with the common-law right of survivorship, unaffected by § 55-20. Gant v. Gant, 237 Va. 588 , 379 S.E.2d 331 (1989).

Joint bank accounts. - The provisions of this section apply to bank accounts. Wilkinson v. Witherspoon, 206 Va. 297 , 142 S.E.2d 478 (1965).

A joint estate in a bank account with right of survivorship was held to have been expressly created in accord with this section. Johnson v. McCarty, 202 Va. 49 , 115 S.E.2d 915 (1960).

Where a bank deposit by a person is in the name of himself and another, not his wife, the presumption is that it was done for the purpose of convenience only, and this presumption is strengthened by the illness or infirmity of the depositor. King v. Merryman, 196 Va. 844 , 86 S.E.2d 141 (1955); Quesenberry v. Funk, 203 Va. 619 , 125 S.E.2d 869 (1962).

In the absence of any statutory presumption, the rule is that when a person deposits his money in the bank to the credit of himself and another, payable to the order of either, or to the survivor, the rights and interests of the depositors as between themselves are dependent upon whether the owner of the money intended to make a gift to the other, or whether the account was entered in joint form in accordance with a contract or for other purposes. Wrenn v. Daniels, 200 Va. 419 , 106 S.E.2d 126 (1958); Quesenberry v. Funk, 203 Va. 619 , 125 S.E.2d 869 (1962).

Parol evidence is admissible to show the intent of a person setting up a joint bank account. Quesenberry v. Funk, 203 Va. 619 , 125 S.E.2d 869 (1962).

Where deceased had directed a bank to change his account to a joint account of himself and his daughter, but the tenor of his instructions to the bank and the form of deposit did not show that the intention to create a tenancy with survivorship "manifestly appeared," the daughter did not take the fund by survivorship. King v. Merryman, 196 Va. 844 , 86 S.E.2d 141 (1955).

This section applies to bank accounts. Colley v. Cox, 209 Va. 811 , 167 S.E.2d 317 (1969).

Investment accounts. - Where, in selecting the type of account to be opened, the depositor and his daughter checked the box for "Joint Tenants with Rights of Survivorship" and the agreement further stated that in the event of the death of either, the entire interest in the account would vest in the survivor, this language was unambiguous and manifestly signified the intent that the entire interest in the account would vest in the surviving tenant upon the death of the joint tenant. Buck v. Jordan, 256 Va. 535 , 508 S.E.2d 880 (1998).

Partition. - A joint tenancy with right of survivorship, as at common law, is subject to partition by a judgment lien creditor of one of the several joint tenants. Jones v. Conwell, 227 Va. 176 , 314 S.E.2d 61 (1984).

The words "joint tenants" as used in § 8.01-81 were intended by the legislature to include joint tenants with right of survivorship and, pursuant to § 8.01-81 , such tenants shall be compellable to make partition at the instance of a judgment lien creditor. Jones v. Conwell, 227 Va. 176 , 314 S.E.2d 61 (1984).

In the instant case there was a conveyance after marriage to a man and his wife jointly. The intention was manifest that the estate by entirety should not be converted into an estate in common and therefore, as provided by this section, § 55-20 did not apply. The seisin was per tout et non per mie, and there is survivorship upon the death either of husband or wife and neither can dispose of any part of the estate without the consent of the other. Since there is no separate interest in either tenant there can be no partition. Allen v. Parkey, 154 Va. 739 , 149 S.E. 615 , aff'd, 154 Va. 749 , 154 S.E. 919 (1930).

In a suit to compel a partition, complainant alleged that a certain lot was conveyed to defendant and his wife to be held by them as joint tenants with common-law right of survivorship; that defendant deserted his wife, and the latter conveyed all her interest in the property to complainant, her daughter; that as a result complainant and defendant were tenants in common and that complainant had a right to compel a partition. That the parties to the original deed intended the part of a dying grantee to belong to the survivor was conceded, and a demurrer to the bill was sustained. Burroughs v. Gorman, 166 Va. 58 , 184 S.E. 174 (1936).

CIRCUIT COURT OPINIONS

Editor's note. - The cases cited below were decided under prior law.

Action to enforce agreement signed by partners. - Trial court dismissed an action in which a surviving partner filed action against a deceased partner's heirs, seeking specific performance of an agreement that gave the deceased partner's interest in a warehouse to the surviving partner, because the surviving partner sued the heirs as individuals, instead of suing the administratrix of the deceased partner's estate, but gave the surviving partner leave to amend her bill of complaint to name the administratrix as a party. Quenza v. Baum, 62 Va. Cir. 284, 2003 Va. Cir. LEXIS 295 (Norfolk 2003).

Joint bank accounts. - Couple's bank account was not subject to garnishment, as it was owned as tenants by the entirety; the signature card plainly "manifested" an intent of survivorship, as the words "with survivorship" were expressly contained on the card. Sulzman v. Barnick, 62 Va. Cir. 139, 2003 Va. Cir. LEXIS 93 (Spotsylvania County 2003).

I. DECIDED UNDER CURRENT LAW.

Garnishment. - In a garnishment action, even if the insureds did have the requisite common-law unities, the insurance policy did not create a contractual right held by them with the common-law right of survivorship, an essential attribute of a tenancy by the entirety, as the policy did not use the expression "tenants by the entireties" or "tenants by the entirety"; and it did not state that the insureds held whatever interest they might have with the "right of survivorship" as at common law. Jones v. Phillips, 850 S.E.2d 646, 2020 Va. LEXIS 141 (Dec. 3, 2020).

II. DECIDED UNDER PRIOR LAW.

In general. - Based on the language of a deed, the directives of § 55-20.1, and the rulings of the Virginia Supreme Court and the Fourth Circuit, Chapter 7 debtor and her mother were joint tenants, and not tenants in common. Debtor's interest as a joint tenant with the right of survivorship became property of her bankruptcy estate. Scott v. Hoole (In re Hoole),, 2018 Bankr. LEXIS 810 (Bankr. W.D. Va. Mar. 21, 2018).

In arguing that her joint tenancy with her mother was owned unequally and that extrinsic evidence was necessary to determine the portion owned by each joint tenant, a Chapter 7 debtor's reliance on § 58.1-3211.1 was misplaced, as that provision confined its applicability to tax relief and nothing in that provision suggested that it negated § 55-20.1. Scott v. Hoole (In re Hoole),, 2018 Bankr. LEXIS 810 (Bankr. W.D. Va. Mar. 21, 2018).

I. DECIDED UNDER CURRENT LAW.

Garnishment. - Circuit court erred in dismissing the garnishment because there was no disposition of the property as a disposition involved an act of transferring something to another's care or possession or the relinquishing of property, and the property in the current case was not transferred to the insurer or to anyone else. Jones v. Phillips, 850 S.E.2d 646, 2020 Va. LEXIS 141 (Dec. 3, 2020).

In a garnishment action, even if the insureds did have the requisite common-law unities, the insurance policy did not create a contractual right held by them with the common-law right of survivorship, an essential attribute of a tenancy by the entirety, as the policy did not use the expression "tenants by the entireties" or "tenants by the entirety"; and it did not state that the insureds held whatever interest they might have with the "right of survivorship" as at common law. Jones v. Phillips, 850 S.E.2d 646, 2020 Va. LEXIS 141 (Dec. 3, 2020).

II. DECIDED UNDER PRIOR LAW.

Gift from husband to wife of his interest in the proceeds from the sale of real property that they owned as tenants by the entirety was not fraud as to the rights of the husband's creditor because the creditor was not prejudiced by a gift of property that was exempt from their claims. The gift was not void under § 55-81. Banc of Am. Leasing & Capital LLC v. Havel,, 2006 U.S. Dist. LEXIS 70828 (E.D. Va. Sept. 29, 2006).

Ownership of motor vehicles. - Section 46.2-622 , which is a specific statute prohibiting motor vehicles from being held as tenants by the entirety, limits subsection A of § 55-20.2, which allows personal property in general to be held as tenants by the entirety. In re Rodriguez, 406 Bankr. 707, 2008 Bankr. LEXIS 2659 (Bankr. E.D. Va. 2008).

Chapter 7 debtor could not exempt a minivan jointly owned with his non-debtor wife as tenancy by the entireties property because, although § 55-20.2 permitted a husband and wife to own real or personal property as tenants by the entireties, § 46.2-622 precluded holding title to a motor vehicle as tenants by the entirety. In re Cordova, 394 Bankr. 389, 2008 Bankr. LEXIS 2956 (Bankr. E.D. Va. 2008).

Motor vehicles are not exempt property. - Debtors were not entitled to claim their motor vehicles as exempt tenants by the entirety property under 11 U.S.C.S. § 522(b)(3)(B) because § 46.2-622 did not allow them to be held as tenants by the entirety, and the tenants by the entirety estate in the proceeds from an equity line of credit terminated upon the purchase of the vehicles. In re Rodriguez, 406 Bankr. 707, 2008 Bankr. LEXIS 2659 (Bankr. E.D. Va. 2008).

CIRCUIT COURT OPINIONS

Editor's note. - The cases cited below were decided under prior law.

Joint bank account by husband and wife held as tenants by entirety. - Judgment creditor was unable to garnish a judgment debtor's bank account, where it was a joint account held with the debtor's wife, who was not a debtor to the creditor, as they held the property as tenants by the entirety under § 55-20.2; it was noted that prior to application of § 6.1-125.3 [now see § 6.2-606 ], the threshold issue of whether the funds were garnishable was to be resolved, which, in this case was done against the creditor. Sulzman v. Barnick, 62 Va. Cir. 139, 2003 Va. Cir. LEXIS 94 (Spotsylvania County 2003).

Attorney's liens. - In a case in which an attorney, who had represented the ex-husband in his divorce, sought to enforce his attorney's lien against the property in question, which had been conveyed to the wife and had been held as tenants by the entirety, the attorney unsuccessfully argued that the property converted to a tenancy in common upon the entry of the final decree of divorce and that the lien attached at that time. That argument failed to take into account that notice of the lien was given when the property was still held in tenancy by the entirety so the lien could not attach by the time the recording of the lien took place, and the property was already solely owned by the ex-wife, never having converted to a tenancy in common, and therefore could not be subject to the satisfaction of the attorney's lien. Borden v. Wilson, 79 Va. Cir. 111, 2009 Va. Cir. LEXIS 50 (Fairfax June 24, 2009).

I. [RESERVED.]

II. DECIDED UNDER PRIOR LAW.

A. IN GENERAL.

Editor's note. - The cases cited below were decided under former Title 55 or prior law. Many were also decided prior to the abolition of dower and curtesy. See § 64.2-301 .

History of section. - See Vigilant Ins. Co. v. Bennett, 197 Va. 216 , 89 S.E.2d 69 (1955).

Right of legislature to remove disabilities. - It was entirely competent, for the legislature to remove the disability of married women in whole or in part, and to define her powers with reference to property of all kinds, to ascertain the rights of the husband, if any, therein, and the liability of the property to claims against the wife. Hall v. Stewart, 135 Va. 384 , 116 S.E. 469 (1923).

The effect of this section is to give the wife as full control over her property during the coverture as her husband has over his. She may sue her husband as if he were a stranger. A husband in Virginia may be a trespasser upon his wife's lands whenever she is not occupying them, if he goes there against her will or her commands; she may prosecute him for criminal trespass; she may dispossess him if he is in possession; or may hold him to account in connection with any transaction with reference to her lands as if he were a stranger. His right to curtesy and his marital rights give him no more power or authority over his wife's property than if he were a total stranger. Edmonds v. Edmonds, 139 Va. 652 , 124 S.E. 415 (1924). See Vigilant Ins. Co. v. Bennett, 197 Va. 216 , 89 S.E.2d 69 (1955).

This section has wiped aside every vestige of control the husband ever had under the common law, and all his rights as husband except as to curtesy. Edmonds v. Edmonds, 139 Va. 652 , 124 S.E. 415 (1924).

"The revisors of the Code of 1919, when they came to deal with § 5134, (from which this section was taken) in order that there might, thereafter, be no doubt of the total abolition of the husband's common-law rights, added immediately after 'but neither his right to curtesy,' the following significant words, 'nor his marital rights,' to language which of itself seemed to have eliminated the husband's previous rights. The language 'nor his marital rights' would seem but to emphasize and clarify, to make certain, the first few lines of the act: 'A married woman shall have the right to acquire, hold, use, control, and dispose of property as if she were unmarried,' etc." Commonwealth v. Rutherfoord, 160 Va. 524 , 169 S.E. 909 (1933).

Section gives substantive right to sue husband for tortious damage to property. - This section gives to the wife full ownership and control of her property, including her choses in action. Her husband is now a stranger to her property and property rights, and she to his. In the ownership and control of their respective properties, their identities are now wholly separate and distinct. Thus the substantive right to sue her husband for tortious damage to her property (as distinguished from a purely personal tort) is furnished by this section. Vigilant Ins. Co. v. Bennett, 197 Va. 216 , 89 S.E.2d 69 (1955).

Section 55-41 does not prohibit married woman from selling her property. - Section 55-41, relating to the effect to be given to certain conveyances made by married women and the covenants therein contained, does not in any way prohibit her from contracting to sell her statutory separate estate, or inhibit or interfere with a court of equity in the enforcement of such contracts. Dunn v. Stowers, 104 Va. 290 , 51 S.E. 366 (1905).

This section does not apply to warranty in deed to release dower. - This section was not intended to apply to a warranty in a deed in which the wife united for the purpose only of relinquishing her inchoate right of dower in her husband's property, nor does it repeal by implication § 55-41, declaring the effect of such a warranty. Augusta Nat'l Bank v. Beard's Ex'r, 100 Va. 687 , 42 S.E. 694 (1902).

Husband who steals from wife subject to criminal law. - The broad provisions of the Married Woman's Act, giving the wife absolute control over her tangible personal property, must necessarily bring her within the protective shelter of the criminal laws by making any thief, including her husband, who takes and deprives her of possession and use of her property subject to the usual criminal sanctions. Stewart v. Commonwealth, 219 Va. 887 , 252 S.E.2d 329 (1979).

The purpose of the Married Woman's Act would be frustrated if a husband could steal with impunity from his wife. Therefore, he may be prosecuted as any other thief for the larceny of her property. Stewart v. Commonwealth, 219 Va. 887 , 252 S.E.2d 329 (1979).

Although a husband could be convicted of larceny of his wife's separate property under § 55-35, defendant had a good faith belief that he had a claim of right to certain cassette tapes that he took; as a result, the evidence, as found by the trial court, was insufficient to support defendant's conviction. Ward v. Commonwealth, No. 2799-01-3, 2003 Va. App. LEXIS 211 (Ct. of Appeals Apr. 8, 2003).

Extent of right of husband to use property. - It is difficult to see how a husband under this section can have any right of occupancy of the wife's real estate unless she resides upon it, and he gets the right of joint occupancy with her then, not because he has any interest in her land, or control over it, or the right to use it, but because as her husband he has the right to the enjoyment of her society. The husband's rights so far as the wife's property is concerned are determined by this section and his occupancy even as a home or use or control thereof are not only not provided for thereby but they are expressly provided against. Edmonds v. Edmonds, 139 Va. 652 , 124 S.E. 415 (1924).

The husband no longer has exclusive possession or control over any portion of property held as tenants by the entireties. Logic dictates that the same rule should apply to the rents, issues and profits derived from such entirety property. Moore v. Glotzbach, 188 F. Supp. 267 (E.D. Va. 1960).

Notwithstanding this section, the presumption prevails that the husband is the owner of all property, real and personal, of which the wife may be in possession during coverture, especially if they are living together as husband and wife; and to overcome this presumption, in a contest between the husband's creditors and the wife, she must show affirmatively that the property is her own, and that it was derived from a source other than her husband and in good faith, if he be insolvent. Otherwise, a wide door would be opened to fraud. First Nat'l Bank v. House, 145 Va. 149 , 133 S.E. 664 (1926). See Childress v. Fidelity & Cas. Co., 194 Va. 191 , 72 S.E.2d 349 (1952).

This section does not change the presumption that the husband is the owner of all property of which the wife may be in possession during coverture, but the sources from which a wife may accumulate a separate estate are enlarged by it. Thus, while at common law the husband was absolutely entitled to the wife's earnings unless she was a sole trader, under this section the wife may accumulate a separate estate through her earnings. Harris v. Carver, 139 Va. 676 , 124 S.E. 206 (1924).

In a suit by creditors of an insolvent husband against the wife, the presumption is that every conveyance or transfer of real or personal estate made to the wife, during the coverture, either by her husband or a third person, is founded upon a consideration furnished by the husband, and the burden is upon the wife to show by clear and satisfactory evidence that the consideration was in good faith paid by her out of her own estate, and not by her husband. This presumption is based upon the relationship of the parties and exists notwithstanding the emancipation of married women as to their property rights. Johnson v. Ables, 119 Va. 593 , 89 S.E. 908 (1916). See Childress v. Fidelity & Cas. Co., 194 Va. 191 , 72 S.E.2d 349 (1952).

B. CURTESY.

This section destroyed the estate of tenancy by the curtesy initiate, but does not affect the husband's estate by the curtesy at his wife's death. The section only protects the wife's estate during her life, but does not after her death, affect the law of succession as to her real or personal estate. Breeding v. Davis, 77 Va. 639 (1883). See Campbell v. McBee, 92 Va. 68 , 22 S.E. 807 (1895).

The right of the husband as tenant by marital right and tenant by curtesy initiate have been taken away by the section, and no right by curtesy consummate could accrue after divorce, the latter right being dependent on the death of the wife. Jones v. Kirby, 146 Va. 109 , 135 S.E. 676 (1926).

Rights of husband's creditors. - Estate by the curtesy consummate exists in the husband in the wife's lands unaliened by her during her lifetime, though devised by her will. Such estate is subject to the liens of the husband's creditors acquired during the coverture, in preference to the general liens of creditors upon her real estate. Browne v. Bockover, 84 Va. 424 , 4 S.E. 745 (1888). See Campbell v. McBee, 92 Va. 68 , 22 S.E. 807 (1895).

I. [RESERVED.]

II. DECIDED UNDER PRIOR LAW.

A. CONTRACTS OF MARRIED WOMAN.

1. IN GENERAL.

History. - For the history of certain acts relating to the power of married women to contract, see Wynn v. Louthan, 86 Va. 946 , 11 S.E. 878 (1890). For history of section, see Vigilant Ins. Co. v. Bennett, 197 Va. 216 , 89 S.E.2d 69 (1955).

Purpose. - The ultimate purpose running through the Married Woman's Act is to place the wife on an equality with her husband. Carey v. Foster, 221 F. Supp. 185 (E.D. Va. 1963), aff'd, 345 F.2d 772 (4th Cir. 1965).

Common law. - At common law, no right of consortium was ever vested in the wife. Carey v. Foster, 221 F. Supp. 185 (E.D. Va. 1963), aff'd, 345 F.2d 772 (4th Cir. 1965).

A married woman may contract and be contracted with, as if she were unmarried. Moreland v. Moreland, 108 Va. 93 , 60 S.E. 730 (1908). See Young v. Hart, 101 Va. 480 , 44 S.E. 703 (1903).

A married woman can legally execute with her husband a joint promissory negotiable note. Poole v. Perkins, 126 Va. 331 , 101 S.E. 240 (1919).

2. TRANSACTIONS WITH HUSBAND.

Agreements for separation. - Where husband and wife who have already separated enter a contract adjusting property rights and providing a maintenance for the wife, it is not essential to the validity of the contract that the provision for the wife be made through the intervention of a trustee. Moreland v. Moreland, 108 Va. 93 , 60 S.E. 730 (1908).

A paper writing under seal executed by husband and wife, which granted to the survivor the right to all real estate and personal property, was a contract under seal, which, under this section the husband and wife might make as if she were unmarried. Harlan v. Weatherly, 183 Va. 49 , 31 S.E.2d 263 (1944).

B. SUITS BY AND AGAINST MARRIED WOMEN.

1. IN GENERAL.

This section is in derogation of the common law and is to be strictly construed and read as if the common law remained unchanged unless the purpose to change it appears expressly or by necessary implication. Furey v. Furey, 193 Va. 727 , 71 S.E.2d 191 (1952).

Husband may not recover for loss of services or consortium. This section has abolished causes of action brought by a husband in personal injury cases for his wife's medical expenses or the loss of his wife's services or consortium. Bolen v. Bolen, 409 F. Supp. 1374 (W.D. Va. 1976).

Maryland law allowing for loss of consortium claims does not contravene Virginia public policy because both Maryland and Virginia were similarly interested in preserving equality between spouses when creating their respective laws regarding claims for loss of consortium, and because of these similar ideals, Maryland law is not in contravention of Virginia public policy. Kelley v. United States, 580 F. Supp. 2d 490, 2008 U.S. Dist. LEXIS 84298 (E.D. Va. 2008).

A married woman may sue and be sued as if she were unmarried. Moreland v. Moreland, 108 Va. 93 , 60 S.E. 730 (1908). See Young v. Hart, 101 Va. 480 , 44 S.E. 703 (1903).

It is no longer necessary for an adult married woman to sue by next friend. Lynchburg Cotton Mills v. Rives, 112 Va. 137 , 70 S.E. 542 (1911).

Construction of word "unmarried." - The word "unmarried" originally and ordinarily means, it is true, never having been married, but the term is a word of flexible meaning and slight circumstances will be sufficient to give the word its other meaning of not having a husband or wife at the time in question, and as the term is used in this section it has the meaning of "not having a husband" at the time of the suit or action. Keister's Adm'r v. Keister's Ex'rs, 123 Va. 157 , 96 S.E. 315 (1918).

Right to maintain action for personal injuries is vested exclusively in wife. - Under this section the right to maintain an action for personal injuries inflicted upon a married woman is vested exclusively in the wife and that right includes the right to recover the entire damages sustained, both to herself and those sustained by the husband and formerly recoverable only by him. Alsop v. Eastern Air Lines, 171 F. Supp. 180 (E.D. Va. 1959).

She may recover entire damages sustained by personal injury to her. - The addition to this section in 1919 of the provision giving married women the right to recover the entire damage sustained, in the event of a personal injury, did not affect the rule laid down in Edmonds v. Edmonds, 139 Va. 652 , 124 S.E. 415 (1924), but was intended to change the law as announced in Richmond Ry. & Elec. Co. v. Bowles, 92 Va. 738 , 24 S.E. 388 (1896).

Including medical bills. - Under this section, a married woman may now recover for a personal injury inflicted on her "the entire damage sustained." This would, of course, embrace medical bills incurred by her, necessary to effect a cure and for which she is liable. United Dentists, Inc. v. Bryan, 158 Va. 880 , 164 S.E. 554 (1932).

The right of the husband to recover for loss of domestic services of his wife from one who had tortiously injured her was taken from him and given to the wife by § 5134 of the Code of 1919, but this did not deprive him of the right to recover for medical expenses made necessary by the injury and paid by him. Nor was its language broad enough to take from him and vest in the wife his right to recover for loss of her consortium as distinguished from the loss of her domestic services. However, the amendment of 1932 (Acts 1932, c. 25, p. 21) broadened and enlarged the scope of this section so that it expressly gave to the wife the right to recover every item of damage incident to her injury, and provided that no action for any element of damage incident to such injury could be maintained by the husband. This prevented the husband from recovering for such medical expenses. Floyd v. Miller, 190 Va. 303 , 57 S.E.2d 114 (1950).

But recovery is chargeable with husband's claim for reimbursement of expenses. - Under this section, the wife's recovery is chargeable with the husband's claim for reimbursement of expenses, the evident intention of the 1950 amendment being to constitute the wife the trustee for the benefit of the husband to that extent. Carey v. Foster, 345 F.2d 772 (4th Cir. 1965).

Husband may not recover for loss of services or consortium. - In a joint action brought by husband and wife against a third party for the recovery of damages alleged to have been tortiously inflicted upon the wife, the husband may not recover for the loss of services or consortium of the wife. Alsop v. Eastern Air Lines, 171 F. Supp. 180 (E.D. Va. 1959).

This section did not intend to change the common law, other than to deprive the husband of his right of action for loss of consortium. Carey v. Foster, 221 F. Supp. 185 (E.D. Va. 1963), aff'd, 345 F.2d 772 (4th Cir. 1965).

Under this section the husband is prohibited from bringing an action for loss of consortium. Carey v. Foster, 345 F.2d 772 (4th Cir. 1965).

And wife may not recover for loss of husband's consortium. - The Married Woman's Act, which removed the common-law disability of a wife to sue and be sued in her own name, has not conferred upon the wife a right to maintain an action in her name for the loss of consortium occasioned by injuries to her husband. Carey v. Foster, 221 F. Supp. 185 (E.D. Va. 1963), aff'd, 345 F.2d 772 (4th Cir. 1965).

For negligent actions arising in Virginia, there is no existing right of action for loss of consortium which can be maintained by the wife for injuries inflicted upon the husband, or by the husband for injuries inflicted upon the wife. Carey v. Foster, 221 F. Supp. 185 (E.D. Va. 1963), aff'd, 345 F.2d 772 (4th Cir. 1965).

When the husband is injured negligently, consideration of equality requires that the wife be allowed no recovery for loss of her husband's consortium. She cannot claim in the name of equality rights the counterparts of which the husband does not enjoy. Carey v. Foster, 345 F.2d 772 (4th Cir. 1965).

Nor may she recover for husband's loss of wife's consortium. - The statute does not mean that the wife may recover for the husband's loss of the wife's consortium, but merely means that there may be no recovery as to that element of damage and the wife is entitled to recover as though she were unmarried. Carey v. Foster, 221 F. Supp. 185 (E.D. Va. 1963), aff'd, 345 F.2d 772 (4th Cir. 1965).

This section cannot be construed to authorize the wife to recover for the husband's loss of her affection and companionship consequent upon injury negligently inflicted upon her. Carey v. Foster, 345 F.2d 772 (4th Cir. 1965).

Constitutional guarantee of due process does not apply. - The constitutional guarantee of due process could have no more application to a right of action to recover for loss of service and consortium than would be the situation involving related common-law relationships which have been drastically changed by statute, such as the former curtesy rights of the husband. Alsop v. Eastern Air Lines, 171 F. Supp. 180 (E.D. Va. 1959).

Wife may sue for criminal conversation with her husband and alienation of his affections. - The common-law rule that a wife had no right of action for criminal conversation with her husband and alienation of his affections has been abrogated by this section. Newsom v. Fleming, 165 Va. 89 , 181 S.E. 393 (1935).

Christian name of wife proper. - In a proceeding by motion for judgment to recover damages for the negligent killing of plaintiff's intestate against a husband and wife, the wife should be impleaded by her own baptismal, or Christian name and not by the initial letters of her husband's name. The former is her legal designation. Ratcliffe v. McDonald's Adm'r, 123 Va. 781 , 97 S.E. 307 (1918).

Allegation that contract made with reference to separate estate unnecessary. - It is unnecessary since this provision was enacted to allege that the contract sued on was made with reference to the married woman's separate estate. Young v. Hart, 101 Va. 480 , 44 S.E. 703 (1903).

2. BY AND AGAINST HUSBAND.

The reason for interspousal immunity is to foster a harmonious and conjugal relationship. Obviously the reason for the rule is lost upon the death of one of the parties for there is no longer a marriage to be saved or a union to be preserved. Korman v. Carpenter, 216 Va. 86 , 216 S.E.2d 195 (1975).

The modern trend is to abrogate, or at least substantially modify, interspousal immunity doctrine. Korman v. Carpenter, 216 Va. 86 , 216 S.E.2d 195 (1975).

There is no distinct line of demarcation between what tort actions may or may not be maintained by one spouse against the other. The more logical line of cleavage would seem to place on one side actions for purely personal torts, such as for personal injury, defamation of character, malicious prosecutions, false imprisonment or the like, for which actions should not lie. On the other side, actions by a husband or wife for those torts that may be inflicted upon or committed against the property (or property rights) of the other should lie. Vigilant Ins. Co. v. Bennett, 197 Va. 216 , 89 S.E.2d 69 (1955).

Section does not confer right to sue husband for assault. - This statute has not conferred upon a married woman a right of action against her husband for damages for an assault upon her committed by the husband during the coverture. Keister's Adm'r v. Keister's Ex'rs, 123 Va. 157 , 96 S.E. 315 (1918); Furey v. Furey, 193 Va. 727 , 71 S.E.2d 191 (1952), commented on in 10 Wash. & Lee L. Rev. 128 (1953).

This section did not change the common-law rule prohibiting one spouse from suing the other in a tort action. Alexander v. Kuykendall, 192 Va. 8 , 63 S.E.2d 746 (1951).

This section merely enlarged the remedies of married women with respect to other substantive rights of theirs existing at common law and conferred by the first portion of the statute. Furey v. Furey, 193 Va. 727 , 71 S.E.2d 191 (1952), commented on in 10 Wash. & Lee L. Rev. 128 (1953).

The common law, as it existed in 1918, conferred no right in the wife to sue her husband for an assault. Surratt v. Thompson, 212 Va. 191 , 183 S.E.2d 200 (1971).

Although committed before marriage. - A wife cannot under this section maintain a suit against her husband for a tort committed by him against her before their marriage. Furey v. Furey, 193 Va. 727 , 71 S.E.2d 191 (1952), commented on in 10 Wash. & Lee L. Rev. 128 (1953).

Nor can such an action be maintained by husband against wife. - It has been held that actions for torts against the person brought by the wife, or her personal representatives, will not lie against the husband or his personal representative. Yet upon consideration of the change in the common-law status of husbands and wives wrought by legislation and the historical development of marital rights and liabilities, upon principles of simple justice and public policy, it is plain that no similar action could be maintained by the husband against the wife. Vigilant Ins. Co. v. Bennett, 197 Va. 216 , 89 S.E.2d 69 (1955).

Personal representative of wife may not sue for death caused by husband. - The personal representative of a wife who was killed by her husband when the husband and wife were living together in that relationship has no right of action against the husband or his personal representative for the death of the wife. Keister's Adm'r v. Keister's Ex'rs, 123 Va. 157 , 96 S.E. 315 (1918).

An action for wrongful death may be maintained, predicated upon injuries to one spouse during marriage arising out of a wrongful act by the other spouse, when such an act results in the termination of the marriage by death, and when the deceased spouse is survived by no living child or grandchild. Korman v. Carpenter, 216 Va. 86 , 216 S.E.2d 195 (1975).

When wife immune from liability for certain personal injuries to husband. - Wife is immune from liability in tort for personal injuries intentionally inflicted upon the husband at her direction during the marriage, i.e., and abortive murder-for-hire scheme, when the parties are divorced from the bond of matrimony at the time the action is instituted. Counts v. Counts, 221 Va. 151 , 266 S.E.2d 895 (1980).

Wife can maintain an action against her husband for personal injuries that result from a motor vehicle accident. Surratt v. Thompson, 212 Va. 191 , 183 S.E.2d 200 (1971).

The common law, as it exists today, does not cling to the concept that the "one flesh" of husband and wife may not so divide itself as to permit an action by wife against husband for personal injuries sustained in an automobile accident. Surratt v. Thompson, 212 Va. 191 , 183 S.E.2d 200 (1971).

Each spouse is liable to the other for tortious damage to property. Vigilant Ins. Co. v. Bennett, 197 Va. 216 , 89 S.E.2d 69 (1955).

From the language of §§ 55-35, 55-36, and 55-37, it appears that as to their property rights the legislature intended wholly to sever the common-law unity of husband and wife and remove all disabilities and impediments preventing one spouse from suing the other for wrongs to their respective properties. When read together, these sections empower each spouse to maintain actions at law for wrongful invasions of their respective property rights as if they had never been married. Vigilant Ins. Co. v. Bennett, 197 Va. 216 , 89 S.E.2d 69 (1955).

Wife may maintain ejectment against husband. - As a husband is not entitled to the possession or use of the rents and profits of his wife's real estate during the coverture, a wife may maintain an action of ejectment against her husband for a house which he had conveyed to her upon consideration of natural love and affection. Humphreys v. Strong, 141 Va. 146 , 126 S.E. 194 (1925).

A fire insurance company, as subrogee of insured, was entitled to maintain an action against insured's wife for her alleged destruction of his property. Vigilant Ins. Co. v. Bennett, 197 Va. 216 , 89 S.E.2d 69 (1955).

I. [RESERVED.]

II. DECIDED UNDER PRIOR LAW.

Necessaries doctrine unconstitutional. - Predecessors of this section, which is part of the Married Woman's Act (Acts 1876-77, c. 329), did not affect the common-law necessaries doctrine, creating an obligation directly between a husband and a third party who provided services to his wife, but the necessaries doctrine is unconstitutional as a gender-based classification not substantially related to governmental interests. Schilling v. Bedford County Memorial Hosp., 225 Va. 539 , 303 S.E.2d 905 (1983).

By this section the husband's liability for the wife's torts has been completely abolished, and no action by him against her need be also against himself. Vigilant Ins. Co. v. Bennett, 197 Va. 216 , 89 S.E.2d 69 (1955).

Attachment of lien on principal residence held as tenants by the entirety. - Where a creditor filed two claims for medical care provided to Chapter 13 debtor wife, who had cancer surgery performed on her, and objected to confirmation of debtors' plan because it failed to pay creditor as much as it would have received in a Chapter 7 liquidation, the objection was overruled on the basis that the trustee could not have § 55-37 administered for creditor's benefit on debtors' marital residence, held by them as tenants by the entireties, had debtors filed for relief under Chapter 7 because § 55-37 expressly exempted the marital residence from process to enforce the debt. In re Balthrop,, 2005 Bankr. LEXIS 2713 (Bankr. E.D. Va. Nov. 28, 2005).

CIRCUIT COURT OPINIONS

Editor's note. - The cases cited below were decided under prior law.

Statute inapplicable. - Statute did not bar children's lawsuit against their deceased father's second wife because it was not one seeking to impose personal liability against the second wife for her late husband's contractual obligations; the children sought recovery to the extent that the second wife was unjustly enriched as a result of any amounts distributed to her through an insurance policy, and thus, the cause of action stood separate from the initial breach of contract. Griffin v. Cowser-Griffin, 92 Va. Cir. 282, 2016 Va. Cir. LEXIS 207 (Surry County Jan. 29, 2016).

Responsibility for funeral expenses of deceased spouse. - Decedent's sister was entitled to recover funeral costs from the decedent's surviving spouse, pursuant to § 55-37 and the common-law doctrine of necessaries, because the decedent's sister paid for the decedent's burial instead of her surviving spouse, and § 64.1-136.1 did not extend liability solely to the decedent's estate. Shepard v. Moore, 83 Va. Cir. 377, 2011 Va. Cir. LEXIS 216 (Norfolk Sept. 22, 2011).

I. [RESERVED.]

II. DECIDED UNDER PRIOR LAW.

Purpose. - The statute language, "no covenant or warranty [in a deed] shall operate to bind . . . her any further than to convey her . . . interest in such land . . ." makes clear that the writers of the statute understood the phraseology as contained in the instant deed has been, was, and would continue to be found in deeds. The very purpose of the statute was to remove from this much-used language the operative effect of binding the dower- or curtesy-conveying spouse to the burden of defending the purchaser's good title or guaranteeing him quiet possession and the like. American Dev. Group, Inc. v. Brookes, 587 F. Supp. 992 (E.D. Va. 1984).

Relationship to other statutes. - The contention that § 55-41 specifically provides that when a husband and wife join in a deed of conveyance, the provisions of clause (i) of subsection B of § 64.1-16.1 are satisfied is rejected. Chappell v. Perkins, 266 Va. 413 , 587 S.E.2d 584 (2003).

Nonland-owning spouse not obligated to warrant title when exception does not apply. - Where the exception to the general rule in this section has not been met, the nonland-owning spouse has no obligation to any grantee with respect to a general warranty of title or with respect to the English covenants. American Dev. Group, Inc. v. Brookes, 587 F. Supp. 992 (E.D. Va. 1984).

I. [RESERVED.]

II. DECIDED UNDER PRIOR LAW.

Section construed distributively. - Chapter 1 of Title 64.1 deals with two very distinct subjects, the descent of real estate and the distribution of personal property. The reference then in this section must be construed distributively, that is to say, when the wife's property consists of real estate it shall pass as real estate passes under that chapter, and when of personal property it passes as personal property passes in that chapter. Hall v. Stewart, 135 Va. 384 , 116 S.E. 469 (1923).

What property passes. - Under this section, what passes is not a surplus but the whole of the estate of which the wife dies intestate. Hall v. Stewart, 135 Va. 384 , 116 S.E. 469 (1923).

Section prevails over statutes relating to funeral expenses. - This section was passed many years after the statutes relating to funeral expenses and, of course, would prevail if there is any conflict between them. Hall v. Stewart, 135 Va. 384 , 116 S.E. 469 (1923).

I. [RESERVED.]

II. DECIDED UNDER PRIOR LAW.

Husband who steals from wife subject to criminal law. - The broad provisions of the Married Woman's Act, giving the wife absolute control over her tangible personal property, must necessarily bring her within the protective shelter of the criminal laws by making any thief, including her husband, who takes and deprives her of possession and use of her property subject to the usual criminal sanctions. Stewart v. Commonwealth, 219 Va. 887 , 252 S.E.2d 329 (1979).

I. [RESERVED.]

II. DECISIONS UNDER PRIOR LAW.

In Virginia there is no statute fixing an invariable form for deeds of conveyance of land. The form given in this section uses the word "grant," but that is not an indispensable requisite. To constitute a grant it is not indispensable that technical words be used. Albert v. Holt, 137 Va. 5 , 119 S.E. 120 (1923).

Use of technical words or strict compliance with the form in this section is not necessary to effect a transfer, if the language used plainly shows on the face of the document a clear intent to convey title. Lim v. Soo Myung Choi, 256 Va. 167 , 501 S.E.2d 141 (1998).

Valid deed not found. - Where a memorandum was void of any language indicating an intent to transfer property, but rather was replete with contemporaneous statements regarding joint tenant's belief in property's current status, the memorandum did not constitute a valid deed. Lim v. Soo Myung Choi, 256 Va. 167 , 501 S.E.2d 141 (1998).

Although § 55-2 was inapplicable to the conveyance of easements because an easement was not an estate, the circuit court's judgment was reversed; the deeds at issue, along with a plat incorporated therein for descriptive purposes, did not contain operative words manifesting an intention to grant an easement. Considering the particular circumstances of the two deeds and the plat at issue, and resolving any doubt against the establishment of an easement, there was no conveyance of an express easement across the property owner's two parcels for the benefit of the limited liability company's parcel. Burdette v. Brush Mt. Estates, LLC, 278 Va. 286 , 682 S.E.2d 549, 2009 Va. LEXIS 91 (2009).

Seal. - Neither § 55-57 nor § 55-48 contain seal requirements that § 55-51 operates to suspend, and neither of these statutes imposes a seal requirement on deeds, which the common law and the Statute of Conveyances, have already accomplished; these provisions only offer recommended language, purely permissive, not mandatory, for deeds already required to be under seal, and the presence or absence of either statute has no effect on the seal requirement. Game Place, L.L.C. v. Fredericksburg 35, LLC, 295 Va. 396 , 813 S.E.2d 312, 2018 Va. LEXIS 54 (2018).

CIRCUIT COURT OPINIONS

Statutory formalities. - Defendant's demurrer to a motion for judgment seeking recovery on a commercial lease was overruled, because while there were statutory formalities for a deed, failure to comply with them was not necessarily fatal to an enforcement action between parties to deed under § 55-51. Only the intent to grant needed to be manifest. Kassco, L.L.C. v. Geodigital Mapping, Inc., 69 Va. Cir. 137, 2005 Va. Cir. LEXIS 327 (Loudoun County 2005).

I. [RESERVED.]

II. DECIDED UNDER PRIOR LAW.

Language admitting of two constructions. - In the construction of language contained in a deed the grantor must generally be considered as having intended to convey all that the language he employed is capable of passing to the grantee, and where the description admits of two constructions, it will be construed most favorably to the grantee. Waskey v. Lewis, 224 Va. 206 , 294 S.E.2d 879 (1982).

Joint devisees with right of survivorship may convey fee simple. - Under the provisions of this section and §§ 55-6 and 55-75, the effect of a joint devise to testator's three sons, with a conditional limitation over that if one or more of them shall die leaving no issue his or their share shall go to his surviving brothers or brother, is to invest the devisees with the authority to convey and relinquish all their rights, title and interest in the land devised, and the grantee of the three of them takes a fee simple estate. Smith v. Smith, 112 Va. 617 , 72 S.E. 119 (1911).

Deed of heir conveying land of decedent. - A deed made by an heir and conveying land of a decedent, although void as to creditors of the decedent until the expiration of a year from the decedent's death, was valid between the parties and, under this section, conveyed to the grantee all the estate, right, title and interest of the grantor in the lands. Heeke v. Allan, 127 Va. 65 , 102 S.E. 655 (1920).

I. [RESERVED.]

II. DECIDED UNDER PRIOR LAW.

This section is merely an affirmation of the common law. Whitmore v. Margaret Paxton Mem. for Convalescent Children, 151 Va. 1018 , 145 S.E. 827 (1928).

The recording statutes are designed primarily to protect prospective purchasers against encumbrances and only incidentally to memorialize passage of appurtenances. Corbett v. Ruben, 223 Va. 468 , 290 S.E.2d 847 (1982).

Deed to land embraces underlying minerals. - Where land is sold without reservation of any kind it embraces the underlying minerals. Steinman v. Vicars, 99 Va. 595 , 39 S.E. 227 (1901).

And may include easement of waterway. - Pursuant to this section a grant of all the grantor's "right, title and claim of whatever kind, in and to" certain property carries with it, as an appurtenance, the easement of a waterway over the lands of the grantor to and for the use of the premises granted, although such easement be not expressly mentioned. Norfolk & W. Ry. v. Obenchain, 107 Va. 596 , 59 S.E. 604 (1907).

License vs. easement. - Where the original deed to sellers contained no reference to nearby swimming pool privileges but reference thereto was made in the original contract of sale, sellers enjoyed a license and therefore did not convey an easement or privilege to use the pool to purchasers. Bunn v. Offutt, 216 Va. 681 , 222 S.E.2d 522 (1976).

No right to apportion easement to third parties. - Language allowing a park authority to grant third-party easements "of any nature" subject to approval by a power company demonstrated the exclusivity of the power company's easement; the deed language unambiguously provided the power company a non-exclusive easement in gross, and thus, the power company did not have the right to apportion the easement to third parties. Va. Elec. & Power Co. v. N. Va. Reg'l Park Auth., 270 Va. 309 , 618 S.E.2d 323, 2005 Va. LEXIS 73 (2005).

I. [RESERVED.]

II. DECIDED UNDER PRIOR LAW.

This section is merely an affirmation of the common law. Whitmore v. Margaret Paxton Mem. for Convalescent Children, 151 Va. 1018 , 145 S.E. 827 (1928).

The recording statutes are designed primarily to protect prospective purchasers against encumbrances and only incidentally to memorialize passage of appurtenances. Corbett v. Ruben, 223 Va. 468 , 290 S.E.2d 847 (1982).

Deed to land embraces underlying minerals. - Where land is sold without reservation of any kind it embraces the underlying minerals. Steinman v. Vicars, 99 Va. 595 , 39 S.E. 227 (1901).

And may include easement of waterway. - Pursuant to this section a grant of all the grantor's "right, title and claim of whatever kind, in and to" certain property carries with it, as an appurtenance, the easement of a waterway over the lands of the grantor to and for the use of the premises granted, although such easement be not expressly mentioned. Norfolk & W. Ry. v. Obenchain, 107 Va. 596 , 59 S.E. 604 (1907).

An easement continues to adhere to the dominant estate to which it is appurtenant, and passes with it to the grantee thereof, even though not specifically mentioned. Corbett v. Ruben, 223 Va. 468 , 290 S.E.2d 847 (1982).

Easement extinguished by express agreement. - Although an easement remained with the dominant estate to which it was appurtenant and passed to a subsequent grantee even though not specifically mentioned in the deed to that grantee, where an original easement was expressly abandoned by an agreement creating the new easement, any rights to the original easement were extinguished. Taylor v. McConchie, 264 Va. 377 , 569 S.E.2d 35, 2002 Va. LEXIS 96 (2002).

Easement by implication. - Where there are no descriptive words of grant or reservation in the deed, an easement by implication from former use will arise only where the use of the property has been continuous, apparent, reasonably necessary for the enjoyment of the dominant tract, and in existence at the time of the conveyance. Haynie v. Brenner, 216 Va. 722 , 222 S.E.2d 546 (1976).

License vs. easement. - Where the original deed to sellers contained no reference to nearby swimming pool privileges but reference thereto was made in the original contract of sale, sellers enjoyed a license and therefore did not convey an easement or privilege to use the pool to purchasers. Bunn v. Offutt, 216 Va. 681 , 222 S.E.2d 522 (1976).

No right to apportion easement to third parties. - Language allowing a park authority to grant third-party easements "of any nature" subject to approval by a power company demonstrated the exclusivity of the power company's easement; the deed language unambiguously provided the power company a non-exclusive easement in gross, and thus, the power company did not have the right to apportion the easement to third parties. Va. Elec. & Power Co. v. N. Va. Reg'l Park Auth., 270 Va. 309 , 618 S.E.2d 323, 2005 Va. LEXIS 73 (2005).

CIRCUIT COURT OPINIONS

Editor's note. - The case cited below was decided under prior law.

City's right of way could not be relocated because one-third of its interest in the right of way was held in fee simple, and the court had no authority to move that interest to another plot of land. City of Fredericksburg v. Yarboro, 57 Va. Cir. 124, 2001 Va. Cir. LEXIS 320 (Spotsylvania County Nov. 6, 2001).

I. [RESERVED.]

II. DECIDED UNDER PRIOR LAW.

Failure to state claim. - Landowners were unable to state a private nuisance claim under § 55-50.1 against a gas company because they failed to allege any direct, physical damages related to certain construction, which breached the parties' right of way agreement. O'Connor v. Columbia Gas Transmission Corp., 643 F. Supp. 2d 799, 2009 U.S. Dist. LEXIS 65414 (W.D. Va. 2009).

I. [RESERVED.]

II. DECIDED UNDER PRIOR LAW.

Seal. - Neither § 55-57 nor § 55-48 contain seal requirements that § 55-51 operates to suspend, and neither of these statutes imposes a seal requirement on deeds, which the common law and the Statute of Conveyances, have already accomplished; these provisions only offer recommended language, purely permissive, not mandatory, for deeds already required to be under seal, and the presence or absence of either statute has no effect on the seal requirement. Game Place, L.L.C. v. Fredericksburg 35, LLC, 295 Va. 396 , 813 S.E.2d 312, 2018 Va. LEXIS 54 (2018).

CIRCUIT COURT OPINIONS

Editor's note. - The case cited below was decided under prior law.

Deed valid. - Defendant's demurrer to a motion for judgment seeking recovery on a commercial lease was overruled because while there were statutory formalities for a deed, failure to comply with them was not necessarily fatal to an enforcement action between parties to deed. Only the intent to grant needed to be manifest. Kassco, L.L.C. v. Geodigital Mapping, Inc., 69 Va. Cir. 137, 2005 Va. Cir. LEXIS 327 (Loudoun County 2005).

I. [RESERVED.]

II. DECIDED UNDER PRIOR LAW.

Section prevents grantor from denying that title actually passed to grantee. - This section, a codification of the equitable doctrine of estoppel by deed, operates to prevent the grantor from denying that title has actually passed to the grantee. Thus, as between the parties, the statute permits the passage of title. It does not prejudice the rights of third parties. Hausman v. Hausman, 233 Va. 1 , 353 S.E.2d 710 (1987).

Lien of child support judgment had priority over recorded deed of trust on entirety property. - The lien of a child support judgment docketed after couple's divorce had priority over a recorded deed of trust on entirety property executed solely by the husband prior to the divorce, despite the bank's argument that the entry of the divorce decree, in conjunction with the application of this section (the after-acquired property doctrine), transformed the bank's interest into a viable lien, as the bank's deed of trust with respect to the property was void as to wife and children. Hausman v. Hausman, 233 Va. 1 , 353 S.E.2d 710 (1987).

Recording of deed of trust before Chapter 11 debtor acquired title did not affect lien. - Chapter 11 debtor was not entitled to summary judgment on her claim that she was to be treated as a bona fide purchaser under 11 U.S.C.S. § 544(a)(3) where she had signed a deed of trust that was recorded before she actually acquired title to the property, under § 55-52, that fact did not affect the deed's validity, and applicable judicial precedent held that 11 U.S.C.S. § 544(a) barred a debtor-in-possession from avoiding a deed of trust that would have been binding on the debtor herself. Wilson v. Moir (In re Wilson),, 2006 Bankr. LEXIS 1001 (Bankr. E.D. Va. May 26, 2006).

Application of estoppel by deed. - Appeals court rejected an argument that the circuit court erred in overruling an LLC's motion in limine that sought to enforce via an estoppel by deed, on grounds that a widow attempted by her evidence to contradict the clear wording of the 1972 deed from which she derived her ownership interest; moreover, the widow was not estopped from claiming that she owned more than a one-half interest in the property and from asserting that she and her decedent husband were not divorced. 1924 Leonard Rd., L.L.C. v. Van Roekel, 272 Va. 543 , 636 S.E.2d 378, 2006 Va. LEXIS 114 (2006).

Rights of third parties. - Case did not deal solely with the rights of the party that first recorded a deed of trust vis-a-vis debtor, but rather with the rights of third parties, including a lender. Consequently, § 55-52 did not insulate the deed of trust from an attack predicated on § 55-105. Wilson v. Moir (In re Wilson), 359 Bankr. 123, 2006 Bankr. LEXIS 3635 (Bankr. E.D. Va. 2006).

Circuit court properly ruled that an ex-wife's deed of trust had priority over a bank's deed of trust because, while the bank's deed of trust was recorded before the ex-wife's deed of trust, the after-acquired-title statute did not purport to affect the deeds of third parties or influence the relative priority of their interests, the bank's deed of trust was void against the ex-wife as a judgment lien creditor, and the bank's deed of trust was not properly recorded in the ex-wife's chain of title. Deutsche Bank Nat'l Trust Co. v. Arrington, 290 Va. 109 , 772 S.E.2d 571, 2015 Va. LEXIS 83 (2015).

CIRCUIT COURT OPINIONS

Editor's note. - The case cited below was decided under prior law.

Contingent remainders. - Because there was no reason that would prevent a beneficiary from alienating a part of the beneficiary's interest in a trust, pursuant to §§ 55-6 and 55-52, a commissioner's determination that a beneficiary's expectancy went directly to the beneficiary's surviving children was affirmed. Bowman v. Mericle, 69 Va. Cir. 87, 2005 Va. Cir. LEXIS 259 (Norfolk August 31, 2005).

OPINIONS OF THE ATTORNEY GENERAL

Editor's note. - The opinion cited below refers to prior law.

"Deed." - The term "deed" as used in § 58.1-817 should be construed to include deeds of trust and leases, so long as the instruments are recorded in a jurisdiction in which open-space easements are held by the Virginia Outdoors Foundation. See opinion of Attorney General to Ms. Brett C. Glymph, Executive Director, Virginia Outdoors Foundation, 15-081, 2016 Va. AG LEXIS 17 (9/1/16).

I. [RESERVED.]

II. DECIDED UNDER PRIOR LAW.

Vendor's implied lien was abolished in 1850. - In 1842, the common-law implied vendor's lien was in existence, it not having been abolished until 1850, and could be enforced against a purchaser for value with notice, either actual or constructive; but, even as between parties, vendors and vendees, it might be waived by taking other securities, or a security of different form. Hunton v. Wood, 101 Va. 54 , 43 S.E. 186 (1903).

Object of section was to make lien a matter of record. - The object of this section in requiring the lien to be reserved on the face of the deed was to make it a matter of record, and thus furnish to all persons dealing with the property the necessary information of all liens and incumbrances thereon. Patton v. Hoge, 63 Va. (22 Gratt.) 443 (1872); Coles v. Withers, 74 Va. (33 Gratt.) 186 (1880).

The uncertainty in the state of the law, and the perplexing litigation growing out of it, led to the passage of this section. Coles v. Withers, 74 Va. (33 Gratt.) 186 (1880).

This section leaves unaffected a lien expressly reserved upon the face of the conveyance, which lien continues to have the same force and effect it always had. The reason for this is obvious. None of the evils growing out of the vendor's implied lien result from a lien expressly reserved on the face of the conveyance. The lien being set forth in the first link of the vendee's chain of title, purchasers from him have just as much notice of it as they would have of a lien upon the land by deed of trust or mortgage. Patton v. Hoge, 63 Va. (22 Gratt.) 443 (1872).

It does not impart any new quality to vendor's lien. - This section provides that the vendor shall have no lien for unpaid purchase money unless a lien is reserved on the face of the deed, thus abolishing the lien by implication of law and substituting in its place a lien by express contract. This provision was not intended to impart any new quality to the vendor's lien, but to end the vexatious litigation growing out of claims for unpaid purchase money against bona fide purchasers of the legal title. Day v. Hale, 63 Va. (22 Gratt.) 146 (1872); Gordon v. Rixey, 76 Va. 694 (1882); Stoner v. Harris, 81 Va. 451 (1886); Roanoke Brick & Lime Co. v. Simmons, 2 Va. Dec. 70, 20 S.E. 955 (1895).

Express lien is as valid as implied lien formerly was. - A vendor's lien expressly reserved on the face of a conveyance, as required by this section, is as valid as to the estate or interest in the land conveyed as the implied vendor's lien formerly was, whether the estate in the land conveyed is an absolute fee simple title or a mere equitable interest therein. Dingus v. Minneapolis Imp. Co., 98 Va. 737 , 37 S.E. 353 (1900).

Extent of reserved lien depends upon contract. - The extent of the lien reserved on the face of a deed does not depend upon the extent of the vendor's interest in the land conveyed, but upon the contract of the parties as gathered from the deed itself, in reserving the lien. Patterson v. Grottoes Co., 93 Va. 578 , 25 S.E. 602 (1896).

It creates no property in land. - Reserving lien for purchase money creates no property in the land. It passes as personalty. Assigning the debt carries the lien. It binds the land for the purchase money, excluding other claims. Gordon v. Rixey, 76 Va. 694 (1882).

Statement not constituting reservation of lien. - The statement in a deed that it is made "in consideration of five hundred dollars secured to be paid," without more, does not constitute an express reservation of a lien on the land on the face of the deed to secure its payment within the meaning of this section. Harris v. Shield's Ex'r, 111 Va. 643 , 69 S.E. 933 (1911).

Section does not apply where no conveyance made by vendor. - The statute abolishing the implied lien has no application, it will be perceived, where no conveyance is made by the vendor. By retaining the legal title the vendor preserves his lien unaffected by this section. Day v. Hale, 63 Va. (22 Gratt.) 146 (1872); Stoner v. Harris, 81 Va. 451 (1886). See Stovall v. Hardy, 1 Va. Dec. 342 (1879).

And vendor has lien as long as he retains title. - In case of a contract to convey, passing equitable title, of course there is a lien, as a vendor has a lien for purchase money as long as he retains title. Yancey v. Mauck, 56 Va. (15 Gratt.) 300 (1859).

Lien is enforceable against subsequent vendee or lienor. - If the vendor has sold the legal title, but not conveyed, the land would be charged with the purchase money in the hands of a subsequent purchaser or encumbrancer, even without notice, and notwithstanding that the vendor had taken personal or other security. Day v. Hale, 63 Va. (22 Gratt.) 146 (1872); Stoner v. Harris, 81 Va. 451 (1886).

For a court of equity will never compel a vendor to part with the legal title until the purchase money has been paid, or the lien therefor has been waived or extinguished. Yancey v. Mauck, 56 Va. (15 Gratt.) 300 (1859); Coles v. Withers, 74 Va. (33 Gratt.) 186 (1880).

I. [RESERVED.]

II. DECIDED UNDER PRIOR LAW.

Bound by recorded deed of repurchase. - Where debtor purchased her residential real property from Habitat for Humanity subject to a limitation imposed by a recorded deed of repurchase, the court concluded that a hypothetical chapter 7 trustee would be bound by the deed of right to repurchase. The trustee could not avoid the recorded deed of repurchase under Virginia law. In re Plascencia, 354 Bankr. 774, 2006 Bankr. LEXIS 3066 (Bankr. E.D. Va. 2006).

I. [RESERVED.]

II. DECIDED UNDER PRIOR LAW.

The objects of this section are to preserve a general form for deeds of trust, where the parties do not prefer some other form, and to save labor in the preparation of such instruments. Michie v. Jeffries, 62 Va. (21 Gratt.) 334 (1871).

Deed held deed of trust and not mortgage. - A deed substantially in the form prescribed for a deed of trust by this section is a deed of trust, and not a mortgage, and the fact that it does not prescribe any terms of sale is immaterial, where the trustee, making a sale thereunder, complies in all respects with § 55-59. Hopkins v. Givens, 119 Va. 578 , 89 S.E. 871 (1916).

Debtor retains equitable right to repay indebtedness secured by the trust and obtain the property upon full payment. The trustee has the right upon default to accelerate the debt secured on behalf of the trust beneficiary, take possession of the property and sell it. Abdelhaq v. Pflug, 82 Bankr. 807 (E.D. Va. 1988).

Virginia law requires deed to transfer legal title to real property. However, this rule does not change the fact that petitioners possessed neither a legal nor an equitable interest in the property once the auctioneer's hammer fell and the memorandum of sale was signed. At this point, and before settlement, the trustee retains legal title to the property, while the purchaser possesses the right to enforce the sale in equity. Abdelhaq v. Pflug, 82 Bankr. 807 (E.D. Va. 1988).

Foreclosure sale occurring prior to filing of bankruptcy petition cuts off debtor's interest in foreclosed property, and a deed of trust conveys legal title to the property to the trustee. Abdelhaq v. Pflug, 82 Bankr. 807 (E.D. Va. 1988).

I. [RESERVED.]

II. DECIDED UNDER PRIOR LAW.

Out-of-state lender. - If the lender who initiates foreclosure is an out-of-state entity, a Virginia resident must be appointed to serve as trustee. United States v. Romer, 148 F.3d 359 (4th Cir. 1998), cert. denied, 525 U.S. 1141, 119 S. Ct. 1032, 143 L. Ed. 2d 41 (1999).

Federal preemption. - Because § 55-58.1 granted state banks, but not national banks with no principal office in Virginia, the power to act as a deed of trust trustee and foreclose, a power incidental to a national bank's real estate lending power, the National Bank Act preempted § 55-58.1; a national bank could act as a deed of trust trustee with power to foreclose against borrowers. Jaldin v. Recontrust Co., N.A., 539 Fed. Appx. 97, 2013 U.S. App. LEXIS 18073 (4th Cir. 2013), cert. denied, 572 U.S. 1115, 134 S. Ct. 2293, 189 L. Ed. 2d 174 (2014).

CIRCUIT COURT OPINIONS

Editor's note. - The cases cited below were decided under prior law.

"Principal office." - Highest bidder at a foreclosure sale was entitled to summary judgment in her action to recover her deposit and the contract and memo of sale were void and unenforceable by either party because the trustee lacked both the capacity and authority to be named or act as substitute trustee where it knew when it was named as substitute trustee and entered into the memo of sale with the bidder that its principal office was not within the Commonwealth of Virginia. Hu v. CorpServe, Inc., 88 Va. Cir. 450, 2013 Va. Cir. LEXIS 149 (Westmoreland County Aug. 5, 2013).

Corporate trustee had to have principal office within Commonwealth. - Actions of a corporate trustee that had its principal office outside Virginia rendered the trustee auction and the memo executed pursuant thereto voidable because the statute required that in order for the trustee to be named or to act as trustee, it had to have its principal office within the Commonwealth; the requirements for a corporation serving as a trustee cannot be read as optional. Hu v. CorpServe, Inc., 88 Va. Cir. 450, 2013 Va. Cir. LEXIS 147 (Westmoreland County Feb. 26, 2013).

Trustee's capacity and authority. - Bidder's deposit at a foreclosure sale was to be returned to her by a trustee and lender because the memo of sale between the bidder and the trustee was void and unenforceable where the trustee lacked both the capacity and authority to be named or act as substitute trustee, and while the lender was not a party to the memo, it currently held the funds based solely upon its claim to the deposit. Hu v. CorpServe, Inc., 88 Va. Cir. 450, 2014 Va. Cir. LEXIS 14 (Westmoreland County Jan. 24, 2014).

Foreign trustee serving with Virginia trustee. - Mere appointment of a foreign corporation, who did not qualify as a trustee, together with a Virginia corporation as co-trustees did not render two foreclosure sales invalid and, therefore, an exception to a commissioner's report invalidating the sales was sustained since the otherwise qualified co-trustee was a Virginia corporation. In re Trustee's Sale, 67 Va. Cir. 204, 2005 Va. Cir. LEXIS 182 (Norfolk Mar. 25, 2005).

Conclusive presumption. - Purchaser's claim to set aside the memo by which she bought the property at the trustee sale was not barred by the statute; the conclusive presumption language must be limited to validating the correctness of the residence or business address of the trustee as it appears in the deed of trust. Hu v. CorpServe, Inc., 88 Va. Cir. 450, 2013 Va. Cir. LEXIS 147 (Westmoreland County Feb. 26, 2013).

Breach of contract action. - Corporate trustee's ground of demurrer that the statute did not create a private cause of action in favor of a defaulting buyer was overruled because although the buyer alleged that the trustee violated the statute, her cause of action was for common-law breach of contract. Hu v. CorpServe, Inc., 88 Va. Cir. 450, 2013 Va. Cir. LEXIS 147 (Westmoreland County Feb. 26, 2013).

OPINIONS OF THE ATTORNEY GENERAL

Editor's note. - The opinions cited below refer to prior law.

A limited liability company has the authority to serve as a trustee in a deed of trust on real property. See opinion of Attorney General to The Honorable Albert Teich Jr., Clerk, Circuit Court of the City of Norfolk, 01-006, 2001 Va. AG LEXIS 36 (6/22/01).

A registered limited liability partnership organized under the laws of the Commonwealth may serve as a trustee under a deed of trust covered by § 55-58.1. See opinion of Attorney General to The Honorable Gregory D. Habeeb, Member, House of Delegates, 11-131, 2012 Va. AG LEXIS 13 (3/23/12).

"Principal office." - For purposes of subdivision (2) of § 55-58.1 [now subsection A of § 55-58.1], "principal office" may be defined according to the definition of this term provided in Title 13.1. A corporation's registered office does not satisfy the requirements of subdivision (2) of § 55-58.1 [now subsection A of § 55-58.1] unless such office also meets the definition of "principal office." See opinion of Attorney General to The Honorable J. Chapman Petersen, Member, Senate of Virginia, 11-053, 2012 Va. AG LEXIS 34 (9/14/2012).

I. [RESERVED.]

II. DECIDED UNDER PRIOR LAW.

"Credit line deed of trust." - Notwithstanding that a creditor sued on a note secured by a credit line deed of trust and was awarded a judgment lien, which it properly recorded under § 8.01-458 , the creditor's credit line deed of trust note remained secured by the debtors' property. In Virginia, a mortgage remained valid and enforceable until the debt was satisfied or the mortgage was released, and under § 55-58.2, a credit line deed of trust was a general term used to describe a variety of instruments, including a mortgage. Didlake v. Wachovia Bank (In re Didlake), 454 Bankr. 349, 2011 Bankr. LEXIS 2928 (Bankr. W.D. Va. 2011).

Inapplicability of this section to former § 8.9-312(7) (see now § 8.9A-323 ). - Language of this section concerning future advances under a line of credit secured by real property would not be applied to a case governed by former § 8.9-312(7) (see now § 8.9A-323 ) by employment of the doctrine of pari materia; this doctrine did not apply, as it requires that the statute being interpreted must be ambiguous, which former § 8.9-312(7) (see now § 8.9A-323) was not, and further requires that the statutes being compared relate to the same thing or have a common purpose, which this section and former § 8.9-312(7) (see now § 8.9A-323) do not. In re Enfolinc, Inc., 233 Bankr. 351 (Bankr. E.D. Va. 1999).

I. [RESERVED.]

II. DECIDED UNDER PRIOR LAW.

Application. - Where an assignee sought a determination that its deed of trust maintained priority over previously recorded judgment liens, dismissal was appropriate because § 55-58.3, which applied to the deed of trust because the deed of trust paid the debt owned under the original loan secured by the prior mortgage, did not entitle the deed of trust to retain the position of the prior mortgage as to liens that were subordinate to the prior mortgage because the deed of trust did not contain the required language in bold on the front of the document and exceeded the prior mortgage by more than $5,000. Deutsche Nat'l Bank Trust Co. v. Batmanghelidj,, 2007 U.S. Dist. LEXIS 68499 (E.D. Va. Sept. 17, 2007).

I. [RESERVED.]

II. DECIDED UNDER PRIOR LAW.

A. GENERAL CONSIDERATION.

Section regulates conduct of trustee only so far as deed fails to do so. - It will be seen, on examination, that the object of this section is to prescribe the duties and regulate the conduct of the trustee only so far as the deed fails to do so. Clark v. Moore, 76 Va. 262 (1882).

Deed is sole source of his authority. - The trustee can only do with the trust property what the deed, either in express terms or by necessary implication, authorizes him to do. Williams v. Jones, 165 Va. 398 , 182 S.E. 280 (1935).

Deed of trust considered a contract. - As a deed of trust was a contract under the law, it was clear that plaintiff's claim sounded in contract, not tort; thus, the trial court erred in characterizing the claim was a common-law negligence claim. Crosby v. ALG Trustee, LLC, 296 Va. 561 , 822 S.E.2d 185, 2018 Va. LEXIS 196 (Dec. 20, 2018).

Only statute that addresses the trustee's duties with regard to a foreclosure sale expressly indicates that it does not cover the entire field of duties the trustee has in this area; the statute states that in the event of sale under a deed of trust, the trustee shall have the following powers and duties in addition to all others, and this language clearly indicates that the legislature did not intend to limit a trustee's powers and duties to those enumerated in the statute. Crosby v. ALG Trustee, LLC, 296 Va. 561 , 822 S.E.2d 185, 2018 Va. LEXIS 196 (Dec. 20, 2018).

Section controlling unless otherwise provided. - The provisions of this section are controlling when the deeds of trust do not otherwise provide. Colonial Inv. Co. v. Cherrydale Cement Block Co., 194 Va. 454 , 73 S.E.2d 419 (1952).

According to this section, when the deed of trust provides otherwise, the statutory requirements are inapplicable and a trustee thus did not violate subsection (7) by selling the property at auction without having declared the debt immediately payable where the deed of trust provided that the beneficiary could declare the debt immediately payable prior to the auction. Riley v. Robey, 122 F. Supp. 2d 684, 2000 U.S. Dist. LEXIS 17426 (W.D. Va. 2000).

The validity of an acceleration clause in a deed of trust is recognized. Where it is not otherwise provided by the deed of trust, this section requires such a clause to be read into it. Devany v. Colgin, 163 Va. 848 , 178 S.E. 15 (1935).

A due-on-sale acceleration clause in a deed of trust is not an unreasonable restraint on alienation. Lipps v. First Am. Serv. Corp., 223 Va. 131 , 286 S.E.2d 215 (1982); United Va. Bank/National v. Best, 223 Va. 112 , 286 S.E.2d 221, cert. denied, 459 U.S. 879, 103 S. Ct. 175, 74 L. Ed. 2d 144 (1982).

Incorporation of section in deed by reference. - Suit was brought to set aside a sale of property under a deed of trust upon the ground that the sale had not been advertised once a week for four successive weeks in a newspaper as required by this section. At the time the deed was made, this section did not require a newspaper advertisement, and the statute, as it existed at that time, was expressly referred to, incorporated in and made a part of the deed of trust. It was held that the provisions of this section, as it existed at the time the deed of trust was made, became a material portion of the contract between the parties. Gloucester Realty Corp. v. Guthrie, 182 Va. 869 , 30 S.E.2d 686 (1944).

This section and § 55-60 do not affect the determination of lien priorities, but merely define certain language employed in the deed of trust. W.T. Jones & Co. v. Foodco Realty, Inc., 318 F.2d 881 (4th Cir. 1963).

Priority of real estate taxes over payment of foreclosure sale proceeds. - This section and § 58.1-3340 give real estate taxes a priority over the payment of the proceeds of a foreclosure sale. They direct that the foreclosure trustee must satisfy all outstanding tax deficiencies before distributing the proceeds, and in the event that this section fails, it is provided that the delinquent taxes shall remain a debt outstanding against the purchaser at the sale. In re Polumbo, 271 F. Supp. 640 (W.D. Va. 1967).

Power of court to enjoin settlement of trustees' account. - A court of equity had jurisdiction to entertain a bill of complaint filed by beneficiaries under a second deed of trust seeking injunction against excessive settlement by the trustees under first deed of trust. Bradley v. Canter, 201 Va. 747 , 113 S.E.2d 878 (1960).

Equity of redemption. - Upon default in payment of the indebtedness secured by the deed of trust, the secured creditor may accelerate the indebtedness and request the trustee under the deed of trust to execute a sale. The creditor or the trustee must notify the debtor in writing of the acceleration and pending sale. At this point, the trustee holds legal title to the property conveyed in trust and the debtor has an "equity of redemption." This is an equitable right incident to every mortgage which allows the mortgagor to pay the indebtedness and require the secured creditor to reconvey the property free of the deed of trust lien. Rolen v. Southwest Va. Nat'l Bank, 39 Bankr. 260 (Bankr. W.D. Va. 1983).

Debtor retains equitable right to repay indebtedness secured by trust and obtain property upon full payment. The trustee has the right upon default to accelerate the debt secured on behalf of the trust beneficiary, take possession of the property and sell it. Abdelhaq v. Pflug, 82 Bankr. 807 (E.D. Va. 1988).

Foreclosure sale occurring prior to filing of bankruptcy petition cuts off debtor's interest in foreclosed property, and a deed of trust conveys legal title to the property to the trustee. Abdelhaq v. Pflug, 82 Bankr. 807 (E.D. Va. 1988).

Virginia law requires deed to transfer legal title to real property. However, this rule does not change the fact that petitioners possessed neither a legal nor an equitable interest in the property once the auctioneer's hammer fell and the memorandum of sale was signed. At this point, and before settlement, the trustee retains legal title to the property, while the purchaser possesses the right to enforce the sale in equity. Abdelhaq v. Pflug, 82 Bankr. 807 (E.D. Va. 1988).

Frazier-Lemke Act was invalid as regards this section. - The Frazier-Lemke Act, in spite of its amendments, was unconstitutional under the Fourteenth Amendment of the federal Constitution as regards this section. In re Sherman, 12 F. Supp. 297 (W.D. Va. 1935).

Bankruptcy court bound by provision stipulating attorney's fees to creditor. - The bankruptcy court was bound by a provision in a secured note awarding stipulated attorney's fees to the secured creditor in the event he found it necessary to employ counsel for purposes of collection, since, in Virginia, where provision for stipulated attorney's fees is made in a note secured by a deed of trust, which deed specifies that it is given as security for the note, the attorney's fees themselves are part of the secured debt, and since the validity in bankruptcy proceedings of a provision in a secured note calling for stipulated attorney's fees presents a question of state law. In re Crafty Fox, Ltd., 475 F. Supp. 634 (W.D. Va. 1979). But see In re Saunders, 130 Bankr. 208 (Bankr. W.D. Va. 1991).

Pursuant to 11 U.S.C. § 1322(b)(5), a debtor may cure defaults under a deed of trust and reinstate such obligation if done within a reasonable amount of time. In re Stokes, 39 Bankr. 336 (Bankr. E.D. Va. 1984).

Action under federal question jurisdiction not permitted. - This section did not involve sufficient state action to permit plaintiffs to maintain a cause of action under federal question jurisdiction. Levine v. Stein, 560 F.2d 1175 (4th Cir. 1977), cert. denied, 434 U.S. 1046, 98 S. Ct. 891, 54 L. Ed. 2d 797 (1978).

Beneficiary necessary parties. - Both the trustee and the named beneficiary of an antecedent deed of trust are necessary parties in a suit to enforce a mechanic's lien. Mendenhall v. Douglas L. Cooper, Inc., 239 Va. 71 , 387 S.E.2d 468 (1990).

Holder to foreclose on a deed of trust. - Virginia law allowed a holder to foreclose on a deed of trust because, inter alia, the mortgage note was a negotiable instrument under § 8.3A-104 , both the note and the deed of trust demonstrated that the parties intended to allow the loan to be freely transferred, the note was endorsed in blank, the note was currently in the holder's hands, there was no alteration to the note or deed of trust at any time, and the owner was in default on his obligations. Bernardo v. Nat'l City Real Estate Servs., LLC, 435 Fed. Appx. 240, 2011 U.S. App. LEXIS 10812 (4th Cir. May 26, 2011).

B. FORECLOSURE BY SALE.

Requests by beneficiary. - Although the beneficiary did not actually request the trustee to sell, it was clear from the circumstances that his actions were tantamount to a request. Rogers v. Runyon, 201 Va. 814 , 113 S.E.2d 679 (1960).

Statute determining method of advertising. - Under a provision in a deed of trust that in event of default the trustee should sell the real estate pursuant to this section, the method of advertising the sale is to be measured and determined by the language of the statute which was in effect at the date of the execution and delivery of the deed, and not by that which was in effect at the time of the sale. Cromer v. DeJarnette, 188 Va. 680 , 51 S.E.2d 201 (1949).

Provision as to advertising is not retroactive. - The legislature, in providing that sales under deeds of trust shall be advertised once a week for four successive weeks in a newspaper, did not intend that this provision should affect deeds of trust, executed prior to its effective date, which embodied agreed terms of sale and an agreed manner of advertisement in event of foreclosure. Gloucester Realty Corp. v. Guthrie, 182 Va. 869 , 30 S.E.2d 686 (1944).

Newspaper advertisement not a substitute for mandatory posting. - The provisions of the deed of trust providing for posting of notices in three public places as well as advertising in the newspaper were, in effect, conjunctive provisions rather than disjunctive provisions and the newspaper advertisement did not substitute for the mandatory posting under the terms of the instrument since the terms of the deed of trust required such posting as well as the statutory requirement for public advertising in the newspaper and the statute gave the trustee no option and the debtor was entitled to have the deed of trust terms complied with. Burke v. Fleet Fin., Inc., 98 Bankr. 746 (Bankr. W.D. Va. 1989).

Lack of authority in trustee invalidates sale. - Lack of authority in the trustee under a deed of trust to foreclose goes to the validity of the sale itself. Wills v. Chesapeake W. Ry., 178 Va. 314 , 16 S.E.2d 649 (1941).

But misapplication of proceeds does not. - Failure of the trustee to apply the proceeds properly does not invalidate the sale. Wills v. Chesapeake W. Ry., 178 Va. 314 , 16 S.E.2d 649 (1941).

Trustee has power to sell either for cash or on time. - Even before the incorporation in this section of the present authority to sell "upon such terms and conditions as the trustee may deem best" such power was usually written in deeds of trust in this State. And from time immemorial such language has been interpreted by the profession to include the power to sell either for cash or on time. Obviously it was the purpose of the legislature to have the language of this section conform to the accepted practice, and thus to broaden and not to restrict the powers of the trustee. Woodhouse v. Harrison, 168 Va. 574 , 191 S.E. 776 (1937).

But his discretion is reviewable by the court. - The discretion granted by this section to a trustee under a deed of trust, as to the incidents of the sale, is reviewable by the courts. Perdue v. Davis, 176 Va. 102 , 10 S.E.2d 558 (1940).

Advertisement for cash followed by sale on credit held not an abuse of discretion. Rogers v. Runyon, 201 Va. 814 , 113 S.E.2d 679 (1960).

The trustee has a fiduciary duty to obtain the highest possible purchase price for the property. United States v. Romer, 148 F.3d 359 (4th Cir. 1998), cert. denied, 525 U.S. 1141, 119 S. Ct. 1032, 143 L. Ed. 2d 41 (1999).

Trustee should apply to court to remove impediments to fair sale. - If there is doubt or uncertainty as to the debts secured, or the amount thereof, or disputes or conflicts among creditors, or any other impediment to a fair sale, the trustee should file a bill to have the matter determined, and he may and should delay the sale until the matter has been adjusted. If he fails or refuses to discharge his duty in this respect, any party interested or who would be injured by his default, may apply to a court of equity to have the necessary steps taken. Muller's Adm'r v. Stone, 84 Va. 834 , 6 S.E. 223 (1888); Stull v. Harvey, 112 Va. 816 , 72 S.E. 701 (1911).

By removal of cloud from title. - Where there is a cloud on the title to the trust property, the trustee should apply to a court of equity to have it removed before making the sale, and if he fails or refuses to discharge his duty in this respect any party interested or who would be injured by his default may apply to a court of equity to have it removed. Muller's Adm'r v. Stone, 84 Va. 834 , 6 S.E. 223 (1888).

Or account of liens. - Where the land conveyed by a deed of trust is subject to various liens, it is essential that the trustee should make application to a court of equity to have an account taken of the liens and of their priorities. Alexander v. Howe, 85 Va. 198 , 7 S.E. 248 (1888).

Section provides machinery for collection of taxes. - The provisions of this section, in the case of a foreclosure, set up a simple and expeditious machinery for the collection of a city's taxes. The city has nothing to do in the premises, but it receives the benefit of the services of the trustee. Broun v. City of Roanoke, 172 Va. 227 , 1 S.E.2d 279 (1939).

And purchaser takes property free of delinquent tax liens. - This section and § 8.01-102 assure purchasers, at trustees' and commissioners' sales, that they will take the property free of delinquent tax liens, and that the taxes will be paid by the trustee out of the purchase price which he has collected. Broun v. City of Roanoke, 172 Va. 227 , 1 S.E.2d 279 (1939).

Sale will not be enjoined because of financial depression. - A financial depression, or unprecedented scarcity of money for ordinary transactions, or enforced stagnation of the real estate market, is not sufficient to warrant a court of equity in restraining the exercise of the power of sale in a deed of trust. Williams v. Jones, 165 Va. 398 , 182 S.E. 280 (1935).

Or because time is unpropitious. - Allegations to the effect that the time is unpropitious for a sale, that the land could likely be sold for a better price later, that the large cash payment required would be attended with great, if not irreparable, loss and injury to the debtor, present no grounds for the interposition of equity jurisdiction by injunction or otherwise. Williams v. Jones, 165 Va. 398 , 182 S.E. 280 (1935).

Right of bank to bid in property. - The bank, as a holder of a note secured by a deed of trust, has a right to bid in the property at a foreclosure sale. Rolen v. Southwest Va. Nat'l Bank, 39 Bankr. 260 (Bankr. W.D. Va. 1983).

When foreclosure sale is complete. - In a sale by a trustee under a deed of trust, the sale is complete when the trustee knocks the land down to the bidder, makes a memorandum of the sale and its terms, and signs the same. The contract is as complete at this time as the contract for sale made by a commissioner is when the court accepts the bid by confirming the sale. Rolen v. Southwest Va. Nat'l Bank, 39 Bankr. 260 (Bankr. W.D. Va. 1983).

Substitute trustee. - Argument by plaintiff homeowners that under subdivision 9 of § 55-59 defendant beneficiary of a Deed to Trust could not appoint a substitute trustee to conduct the foreclosure proceedings failed because the homeowners signed the Deed of Trust and received a copy of the Deed of Trust and other documents, and knew that the beneficiary was also the nominee of the Lender, and that the Deed of Trust authorized the nominee to act on behalf of the Lender to foreclose in the event of a default on the loans. Tapia v. United States Bank, N.A., 718 F. Supp. 2d 689, 2010 U.S. Dist. LEXIS 62448 (E.D. Va. 2010).

Substitute trustee appointment. - Borrower's claim that the appointment of a substitute trustee was invalid was rejected where there was no authority for her assertion that subdivision 9 of § 55-59 required an instrument of appointment to be completely intact when it was executed. Wolf v. Fannie Mae, 830 F. Supp. 2d 153, 2011 U.S. Dist. LEXIS 135259 (W.D. Va. 2011).

Borrowers had not alleged, nor could they, that defendant trustee had any basis for asserting a competing ownership claim to the property; the trustee was properly appointed under the deed of trust, and had authority to act as substitute trustee and to perform the attendant duties authorized by Virginia law. McFadden v. Fannie Mae, 525 Fed. Appx. 223, 2013 U.S. App. LEXIS 10067 (4th Cir. May 20, 2013).

C. RIGHT OF TRUSTEE TO COMPENSATION AND EXPENSES.

Compensation is controlled by deed or by this section. - The compensation is determined either by the contract in the deed itself, or by this section, which controls where there is no specific agreement. Dillard v. Serpell, 138 Va. 694 , 123 S.E. 343 (1924).

In Virginia, if the terms of an indenture trustee's compensation are not specified in the trust document, his compensation is controlled by statute. In re Manning, 43 Bankr. 712 (Bankr. W.D. Va. 1984).

Commission may not be fixed by deed of trust without determining reasonableness. - An indentured trustee's commission may not be fixed by a deed of trust without due consideration by the bankruptcy court as to what fee is reasonable under the circumstances where the proposed foreclosure and sale of the property has been stayed by the filing of a Chapter 13 petition. In re Manning, 43 Bankr. 712 (Bankr. W.D. Va. 1984).

Under this section compensation is conditioned upon sale. - In this section provision is made for compensation of the trustee in case he sells the property under the deed of trust. For this service and for no other the statute provides, and that provision controls unless, as allowed by the statute, there are other provisions in the deed for the compensation of the trustee. Dillard v. Serpell, 138 Va. 694 , 123 S.E. 343 (1924). See Littleton v. Kincaid, 179 F.2d 848 (4th Cir.), cert. denied, 340 U.S. 809, 71 S. Ct. 38, 95 L. Ed. 595 (1950).

But trustee is entitled to be reimbursed for expenses. - A trustee who in good faith engages the services of counsel to aid him in the exercise of his duties is entitled to pay them out of the trust fund, or to be reimbursed out of that fund for all expenses which he has incurred, including reasonable fees to attorneys, notwithstanding that he has made no sale so as to be entitled to the compensation provided by this section. Stull v. Harvey, 112 Va. 816 , 72 S.E. 701 (1911).

The accepted rule is that the court shall exercise just discretion and make or withhold allowances as the peculiar circumstances require. Littleton v. Kincaid, 179 F.2d 848 (4th Cir.), cert. denied, 340 U.S. 809, 71 S. Ct. 38, 95 L. Ed. 595 (1950).

Effect of sale by debtor. - Where a debtor has given a deed of trust to secure the payment of his debt, under ordinary circumstances he always has the right to sell the property himself to pay his debt. Generally, when there has been no sale by the trustee, the trustee has no claim for compensation. Dillard v. Serpell, 138 Va. 694 , 123 S.E. 343 (1924).

Compensation to trustee of executory trust. - A trustee, chosen to hold a legal title as a mere security for debt, with power to sell in case of default, possession to remain with the grantor and not the trustee, is not entitled to invoke the jurisdiction of a court of equity to adjudicate his compensation, when he has not been and may never be called upon to execute the trust. Dillard v. Serpell, 138 Va. 694 , 123 S.E. 343 (1924).

If the trust had been either partly or completely executed, and the trustee had then invoked the jurisdiction of equity for the settlement of his accounts, or its direction as to the distribution of the trust fund, or the court had acquired jurisdiction over the estate upon any equitable ground, then unquestionably the court would consider and determine the amount of the trustee's compensation for all the services previously rendered. Dillard v. Serpell, 138 Va. 694 , 123 S.E. 343 (1924).

Compensation for holding insurance policy. - The holding of insurance policies on the property conveyed by the trustee in a deed of trust was a mere incidental service, for which the trustee was not entitled to compensation from the creditors secured or from the property, where the grantor, not the creditors, covenanted to keep the property insured. Dillard v. Serpell, 138 Va. 694 , 123 S.E. 343 (1924). See § 55-60, subdivision (8).

For countersigning bonds. - Where no compensation was provided for the countersigning of bonds for the purpose of identification, such act being expressly required of the trustee, while this service could not be required without compensation, yet when it was rendered without expressed or implied agreement for compensation it must be regarded as voluntary, either as incidental to the acceptance of the trusteeship or as satisfied by the anticipated compensation in case there should be a default and sale. Dillard v. Serpell, 138 Va. 694 , 123 S.E. 343 (1924).

For representing beneficiaries in bankruptcy. - Where a trustee in a deed of trust appeared for the beneficiaries under the deed in bankrupt proceedings against the grantor, but the grantees failed to file proofs of their claim, choosing to rely upon the security afforded by the deed, the grantees cannot be held personally liable for attorney's fees, nor was the property pledged liable. Dillard v. Serpell, 138 Va. 694 , 123 S.E. 343 (1924).

The trustee is entitled to compensation whether his services were rendered as attorney or as trustee. But a court is only justified in paying attorney's fees out of the trust fund under its control where parties in interest have stood by without counsel, and reaped benefits by reason of the efforts of counsel with whom they were not in privity. Dillard v. Serpell, 138 Va. 694 , 123 S.E. 343 (1924).

CIRCUIT COURT OPINIONS

Editor's note. - The cases cited below were decided under prior law.

Substitute trustee. - Corporation's deed of trust was inferior to the lien of a partnership's deed of trust because the lien of the partnership deed of trust was not effectively released and was a first lien on a golf course; the partnership had the authority under its deed of trust and subdivision 9 of § 55-59 to substitute trustees. Bristol County Ret. Sys. v. Senior Tour Players Fund I, L.P.,, 2006 Va. Cir. LEXIS 337 (Loudoun County Mar. 10, 2006).

Demurrer filed by the beneficiary of a deed of trust was sustained in a mortgagor's action seeking a declaratory judgment that the foreclosure of her property was unlawful and alleging that the beneficiary did not have authority to appoint a substitute trustee because the deed of trust specifically authorized the beneficiary to appoint a substitute trustee to conduct foreclosure proceedings; when a deed of trust provides otherwise the statutory requirements in § 55-59 are inapplicable. Graves v. Mortg. Elec. Registration Sys., 96 Va. Cir. 457, 2011 Va. Cir. LEXIS 97 (Fairfax County June 29, 2011).

Deeds of trust permitted a bank to appoint a limited liability company to serve as substitute trustee because there was no language in the deeds of trust indicating that the parties intended otherwise; the statute clearly contemplates that limited liability companies without residences may serve as substitute trustees under deeds of trust. Southern Bank & Trust Co. v. Woodhouse, 92 Va. Cir. 402, 2016 Va. Cir. LEXIS 81 (Norfolk May 26, 2016).

Deeds of trust permitted a bank to appoint a limited liability company to serve as substitute trustee because there was no language in the deeds of trust indicating that the parties intended otherwise; nothing in the deeds of trust suggested that the parties intended to limit the bank to using individual persons rather than corporate trustees. Southern Bank & Trust Co. v. Woodhouse, 92 Va. Cir. 402, 2016 Va. Cir. LEXIS 81 (Norfolk May 26, 2016).

No authority to enjoin substitute trustee. - County board of supervisors was not entitled to enjoin a substitute trustee from foreclosing on an affordable dwelling unit (ADU) because there was no authority under the deed of trust or § 55-59 to enjoin the substitute trustee from selling the property at public auction to the highest bidder when the buyer of the property defaulted. Moreover, nothing in county ordinances or the ADU covenants at the time the property was transferred altered this requirement, as an added covenant and amendment to the ordinances could not be applied retroactively to the buyer. Loudoun County Bd. of Supervisors v. Jefferson, 83 Va. Cir. 464, 2011 Va. Cir. LEXIS 226 (Loudoun County Oct. 20, 2011).

Deed interpretation. - Deed of trust, which granted the holder of a note the power to appoint a trustee or substitute trustee, but did not grant that appointee the ability to appoint an agent or to not be present at the foreclosure sale, also allowed the holder to render said sale voidable. Wachovia Bank, N.A. v. Van Huyck, 64 Va. Cir. 306, 2004 Va. Cir. LEXIS 180 (Norfolk 2004).

Duties arose by virtue of contractual relationship. - Property owners failed to assert a valid claim for negligence against a trustee because the duties of impartiality and ordinary care of a fiduciary the trustee allegedly breached arose by virtue of the parties' contractual relationship under a deed of trust, which constituted a contract under § 55-59, and not the common law; but for the existence of the deed of trust, the trustee would not have owed any fiduciary duties to the owners, and since the trustee had no relationship with the owners absent the deed of trust, any fiduciary duty allegedly breached existed solely because of that contractual relationship. Salazar v. US Bank NA, 82 Va. Cir. 344, 2011 Va. Cir. LEXIS 30 (Fairfax County Mar. 9, 2011).

Deed of trust did not create duty. - Demurrer filed by a law firm and an attorney was sustained in investors' action alleging legal malpractice because the investors failed to allege any privity between the parties; the deed of trust did not create an attorney-client relationship or a duty to the investors, other than the specific duties set out in the deed of trust and § 55-59. Sellman v. Florance Gordon Brown, P.C.,, 2010 Va. Cir. LEXIS 319 (Richmond Nov. 18, 2010).

Judgment was entered in favor of foreclosure trustees on a corporation's third-party claim alleging that they breached their obligations and duties because neither the deed of trust and guaranty agreement nor § 55-59 listed any of the duties the corporation and guarantors would have imposed on the trustees in foreclosure sales. W. Harold Talley I, L.L.C. v. North Richmond Investments, Inc., 84 Va. Cir. 1, 2011 Va. Cir. LEXIS 268 (Richmond Oct. 20, 2011).

Bank's response. - Under 12 U.S.C.S. § 2605(e)(2)(C), a bank's response was adequate to meet its obligation as servicer to the loan, because it sent a timely response, explained the reason for any missing information, and provided contact information to answer any additional questions. Buzbee v. United States Bank, N.A., 84 Va. Cir. 485, 2012 Va. Cir. LEXIS 39 (Fairfax County May 2, 2012).

Default. - Corporation and guarantors were held properly in default, and the amounts due accelerated, triggering foreclosure because both the deed of trust and the guaranty agreement described default as a failure to pay the agreed upon amounts at the agreed upon time on a monthly basis. W. Harold Talley I, L.L.C. v. North Richmond Investments, Inc., 84 Va. Cir. 1, 2011 Va. Cir. LEXIS 268 (Richmond Oct. 20, 2011).

I. [RESERVED.]

II. DECIDED UNDER PRIOR LAW.

Both this section and § 55-59.2 were adopted as part of single enactment, Acts 1979, c. 12. But there is a significant difference between them. After providing for written notice to the debtor, this section provides: "Failure to comply with the requirements of notice contained in this section shall not affect the validity of the sale under the deed of trust . . . ." Section 55-59.2, although a part of the same act, contains no such ameliorative language in case of failure to follow its mandatory time periods. It is apparent that the General Assembly intended that different consequences would flow from violations of these respective sections. Deep v. Rose, 234 Va. 631 , 364 S.E.2d 228 (1988).

Purchaser's knowledge of notice to debtor of foreclosure sale. - It might be difficult for a purchaser at a foreclosure sale to ascertain whether 14 days' personal notice had been given to the debtor as required by this section, and the legislature, undoubtedly for that reason, relieved the purchaser of the consequences of the trustee's failure in that respect. By contrast, a purchaser who has been attracted to a sale by a series of newspaper advertisements has ready means of ascertaining whether the sale falls within the prescribed time period after publication, as required by § 55-59.2. If the sale falls without that period, he need not bid. Deep v. Rose, 234 Va. 631 , 364 S.E.2d 228 (1988).

Right of acceleration in deed of trust. - While a notice of a foreclosure sale may act as the exercise of the "right of acceleration" under a deed of trust, subsection A of § 55-59.1 does not establish a statutory mandate as to whether such "right of acceleration" is in existence and capable of being exercised by the foreclosure notice. Such a determination remains a matter of contract between the parties. Bayview Loan Servicing, LLC v. Simmons, 275 Va. 114 , 654 S.E.2d 898, 2008 Va. LEXIS 20 (2008).

Where condition precedent for acceleration in deed of trust is not fulfilled, there is no right to accelerate or foreclose. While subsection A of § 55-59.1 allowed a notice of foreclosure sale to act as an exercise of the right of acceleration, as the holder of mortgage failed to fulfill a contractual condition precedent that would have given it such a right, serving the mortgagor or sending her by certified mail a notice of breach and intent to accelerate, its right to accelerate and to foreclose never matured, and it was liable to the mortgagor for the equity she lost in the foreclosure sale. Bayview Loan Servicing, LLC v. Simmons, 275 Va. 114 , 654 S.E.2d 898, 2008 Va. LEXIS 20 (2008).

Sale held valid. - Where holder of mechanic's lien asserts that third party which had interest in property sold at foreclosure sale did not receive notice of sale, this section provides such a sale is nevertheless valid. Nelson White Constr. Mgt. Corp. v. McConaghy, 15 Bankr. 480 (Bankr. E.D. Va. 1981).

Requisite notice provided. - Defendant did not fail to provide requisite notice of a foreclosure sale because the notice of sale indicated that it was mailed to plaintiff more than fourteen days prior to the sale pursuant to subsection A of § 55-59.1; the notice of sale was published once a week for two successive weeks as required by the deed of trust, and the foreclosure sale was then held more than eight days following the first advertisement and less than thirty days following the last advertisement, as required by subdivision A 2 of § 55-59.2. Gallant v. Deutsche Bank Nat'l Trust Co., 766 F. Supp. 2d 714, 2011 U.S. Dist. LEXIS 10209 (W.D. Va. 2011).

Defendant's inability to produce the original note did not render a foreclosure sale invalid because the note was freely transferable without prior notice under Virginia law, and plaintiff's claim that a secured party was required to prove its authority or standing to foreclose on the secured property was contrary to the Virginia non-judicial foreclosure laws; by signing the deed of trust, plaintiff specifically acknowledged that "the note or a partial interest in the note (together with the security instrument) could be sold one or more times without prior notice to borrower." Gallant v. Deutsche Bank