2016 North Dakota Century Code Title 47 Property Chapter 47-02 Classification of Ownership
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CHAPTER 47-02
CLASSIFICATION OF OWNERSHIP
47-02-01. Ownership - Classification.
The ownership of property is:
1. Absolute; or
2. Qualified.
47-02-02. Absolute ownership defined.
The ownership of property is absolute when a single person has the absolute dominion over
it and may use it or dispose of it according to that person's pleasure, subject only to general
laws.
47-02-03. Qualified ownership defined.
The ownership of property is qualified:
1. When it is shared with one or more persons;
2. When the time of enjoyment is deferred or limited; or
3. When the use is restricted.
47-02-04. Sole or concurrent ownership designated.
The ownership of property by a single person is designated as a sole or concurrent
ownership.
47-02-05. Concurrent ownership defined.
The ownership of property by several persons is either:
1. Of joint interests;
2. Of partnership interests; or
3. Of interests in common.
47-02-06. Joint tenancy interest defined.
A joint interest is one owned by several persons in equal shares by a title created by a
single will or transfer, when expressly declared in the will or transfer to be a joint tenancy, or
when granted or devised to executors or trustees as joint tenants.
47-02-07. Partnership interest defined.
A partnership interest is one owned by several persons in partnership for partnership
purposes.
47-02-08. Interest in common defined.
An interest in common is one owned by several persons not in joint ownership or
partnership. Every interest created in favor of several persons in their own right is an interest in
common, unless acquired by them in partnership for partnership purposes, or unless declared in
its creation to be a joint tenancy.
47-02-09. Commencement and duration of interests.
In respect to the time of enjoyment an interest in property is:
1. Present or future; and
2. Perpetual or limited.
47-02-10. Present interest defined.
A present interest means that the owner is entitled to the immediate possession of the
property.
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47-02-11. Future interest defined.
A future interest means that the owner is entitled to the possession of the property only at a
future period.
47-02-12. Perpetual interest defined.
A perpetual interest has a duration equal to that of the property.
47-02-13. Limited interest defined.
A limited interest has a duration less than that of the property.
47-02-14. Determination of time of creation of limitation.
The delivery of the grant, where a limitation, condition, or future interest is created by grant,
and the death of the testator, when it is created by will, is to be deemed the time of the creation
of the limitation, condition, or interest within the meaning of the laws of this state.
47-02-15. Future estates - Classification.
A future interest is either vested or contingent. It is vested when there is a person in being
who would have a right, defeasible or indefeasible, to the immediate possession of the property
upon the ceasing of the intermediate or precedent interest. It is contingent while the person in
whom or the event upon which it is limited to take effect remains uncertain.
47-02-16. Alternative contingencies.
Two or more future interests may be created to take effect in the alternative so that if the
first in order fails to vest, the next in succession shall be substituted for it and take effect
accordingly.
47-02-17. Improbable contingency - Future interest valid.
A future interest is not void merely because of the improbability of the contingency on which
it is limited to take effect.
47-02-18. Future estates pass.
Future interests pass by succession, will, and transfer in the same manner as present
interests.
47-02-19. Posthumous heir.
When a future interest is limited to successors, heirs, issue, or children, posthumous
children are entitled to take in the same manner as if living at the death of their parent.
47-02-20. Mere possibility not an interest.
A mere possibility, such as the expectancy of an heir apparent, is not to be deemed an
interest of any kind.
47-02-21. Future interests - Limitation.
No future interest in property is recognized by the law, except such as is defined in this title.
47-02-22. Conditions of ownership - Definition.
The time when the enjoyment of property is to begin or end may be determined by
computation or made to depend on events. In the latter case, the enjoyment is said to be upon
condition.
47-02-23. Conditions - Classification.
Conditions are precedent or subsequent. The former fix the beginning, the latter the ending
of the right.
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47-02-24. Illegal conditions void.
If a condition precedent requires the performance of an act wrong in itself, the instrument
containing it is so far void, and the right cannot exist. If it requires the performance of an act not
wrong of itself, but otherwise unlawful, the instrument takes effect and the condition is void.
47-02-25. Restraints upon marriage void - Use until marriage.
Conditions imposing restraints upon marriage, except upon the marriage of a minor, or of
the widow of the person by whom the condition is imposed, are void. This does not affect
limitations when the intent was not to forbid marriage but only to give the use until marriage.
47-02-26. Restraints on alienation - When void.
Conditions restraining alienation, when repugnant to the interest created, are void.
47-02-27. Suspension of power of alienation - Rule against perpetuities.
Repealed by S.L. 1991, ch. 484, § 6.
47-02-27.1. Statutory rule against perpetuities - Invalidity of certain contingent
property interests, general powers of appointment, special powers of appointment, and
general testamentary powers of appointment.
1. A contingent property interest is invalid unless:
a. When the interest is created, it is certain to vest or terminate no later than
twenty-one years after the death of an individual then alive; or
b. The interest either vests or terminates within ninety years after its creation.
2. A general power of appointment not presently exercisable because of a condition
precedent is invalid unless:
a. When the power is created, the condition precedent is certain to be satisfied or to
become impossible to satisfy no later than twenty-one years after the death of an
individual then alive; or
b. The condition precedent either is satisfied or becomes impossible to satisfy within
ninety years after its creation.
3. A special power of appointment or a general testamentary power of appointment is
invalid unless:
a. When the power is created, it is certain to be irrevocably exercised or otherwise
to terminate no later than twenty-one years after the death of an individual then
alive; or
b. The power is irrevocably exercised or otherwise terminates within ninety years
after its creation.
4. In determining whether a contingent property interest or a power of appointment is
valid under subdivision a of subsection 1, subdivision a of subsection 2, or subdivision
a of subsection 3, the possibility that a child will be born to an individual after the
individual's death is disregarded.
5. If, in measuring a period from the creation of a trust or other property arrangement,
language in a governing instrument seeks to disallow the vesting or termination of any
interest or trust beyond, seeks to postpone the vesting or termination of any interest or
trust until, or seeks to operate in effect in any similar fashion upon, the later of the
expiration of a period of time not exceeding twenty-one years after the death of the
survivor of specified lives in being at the creation of the trust or other property
arrangement or the expiration of a period of time that exceeds or might exceed
twenty-one years after the death of the survivor of lives in being at the creation of the
trust or other property arrangement, that language is inoperative to the extent it
produces a period of time that exceeds twenty-one years after the death of the
survivor of the specified lives.
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47-02-27.2. When contingent property interest or power of appointment created.
1. Except as provided in subsections 2 and 3 of this section and in subsection 1 of
section 47-02-27.5, the time of creation of a contingent property interest or a power of
appointment is determined under general principles of property law.
2. For purposes of sections 47-02-27.1 through 47-02-27.5, if there is a person who
alone can exercise a power created by a governing instrument to become an
unqualified beneficial owner of a contingent property interest or a property interest
subject to a power of appointment described in subsection 2 or 3 of section
47-02-27.1, the contingent property interest or power of appointment is created when
the power to become the unqualified beneficial owner terminates.
3. For purposes of sections 47-02-27.1 through 47-02-27.5, a contingent property interest
or a power of appointment arising from a transfer of property to a previously funded
trust or other existing property arrangement is created when the contingent property
interest or power of appointment in the original contribution was created.
47-02-27.3. Reformation.
Upon the petition of an interested person, a court shall reform a disposition in the manner
that most closely approximates the transferor's manifested plan of distribution and is within the
ninety years allowed under subdivision b of subsection 1 of section 47-02-27.1, subdivision b of
subsection 2 of section 47-02-27.1, and subdivision b of subsection 3 of section 47-02-27.1, if:
1. A contingent property interest or a power of appointment becomes invalid under
section 47-02-27.1;
2. A class gift is not but might become invalid under section 47-02-27.1 and the time has
arrived when the share of any class member is to take effect in possession or
enjoyment; or
3. A contingent property interest that is not validated by subdivision a of subsection 1 of
section 47-02-27.1 can vest but not within ninety years after its creation.
47-02-27.4. Exclusions from statutory rule against perpetuities.
Section 47-02-27.1 does not apply to:
1. A contingent property interest or a power of appointment arising out of a nondonative
transfer, except a contingent property interest or a power of appointment arising out of
a premarital or postmarital agreement, a separation or divorce settlement, a spouse's
election, a similar arrangement arising out of a prospective, existing, or previous
marital relationship between the parties, a contract to make or not to revoke a will or
trust, a contract to exercise or not to exercise a power of appointment, a transfer in
satisfaction of a duty of support, or a reciprocal transfer.
2. A fiduciary's power relating to the administration or management of assets, including
the power of a fiduciary to sell, lease, or mortgage property, and the power of a
fiduciary to determine principal and income.
3. A power to appoint a fiduciary.
4. A discretionary power of a trustee to distribute principal before termination of a trust to
a beneficiary having an indefeasibly vested interest in the income and principal.
5. A contingent property interest held by a charity, government, or governmental agency
or subdivision, if the contingent property interest is preceded by an interest held by
another charity, government, or governmental agency or subdivision.
6. A property interest, power of appointment, or arrangement that was not subject to the
common-law rule against perpetuities or excluded by another statute of this state.
47-02-27.5. Prospective application.
1. Except as extended by subsection 2, sections 47-02-27.1 through 47-02-27.5 apply to
a contingent property interest or a power of appointment that is created on or after July
1, 1991. For purposes of this section, a contingent property interest or a power of
appointment created by the exercise of a power of appointment is created when the
power is irrevocably exercised or when a revocable exercise becomes irrevocable.
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2.
If a contingent property interest or a power of appointment was created before July 1,
1991, and is determined in a judicial proceeding, commenced on or after July 1, 1991,
to violate this state's rule against perpetuities as that rule existed before July 1, 1991,
a court upon the petition of an interested person may reform the disposition in the
manner that most closely approximates the transferor's manifested plan of distribution
and is within the limits of the rule against perpetuities applicable when the contingent
property interest or power of appointment was created.
47-02-28. Termination of future interest - Provision by creator.
A future interest may be defeated in any manner, or by any act or means, which the party
creating such interest provided for or authorized in the creation thereof, nor is a future interest
thus liable to be defeated to be adjudged void in its creation on that ground.
47-02-29. Future interest dependent on death without successors is defeated by birth
of posthumous child.
A future interest depending on the contingency of the death of any person without
successors, heirs, issue, or children is defeated by the birth of a posthumous child of such
person capable of taking by succession.
47-02-30. Future interest - Effect of change of intermediate interest.
No future interest can be defeated or barred by any alienation or other act of the owner of
the intermediate or precedent interest, nor by any destruction of such precedent interest by
forfeiture, surrender, merger, or otherwise, except as provided by section 47-02-32, or when a
forfeiture is imposed by statute as a penalty for the violation thereof.
47-02-31. Future interest restraining alienation - When void.
Repealed by S.L. 1991, ch. 484, § 6.
47-02-32. Future interest - Effect of determination of precedent interest - Contingent
remainders not artificially destructible.
No future interest, valid in its creation, is defeated by the determination of the precedent
interest before the happening of the contingency on which the future interest is limited to take
effect, but should such contingency afterwards happen, the future interest takes effect in the
same manner and to the same extent as if the precedent interest had continued to the same
period.
47-02-33. Rights of owner of life estate.
The owner of a life estate may use the land in the same manner as the owner of a fee
simple, except that the owner of a life estate must do no act to the injury of the inheritance.
47-02-34. Life estate - Obligation to maintain property - Waste - Taxes - Other charges
and assessments.
The owner of a life estate must keep the buildings and fences in repair from ordinary waste
and must pay the taxes and other annual charges and a just proportion of extraordinary
assessments benefiting the whole inheritance.
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