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Trusts: Rule Against Perpetuities

Welcome to the quiz on Trusts: Rule Against Perpetuities. Test your understanding of this legal principle that limits the duration of interests in property.

14 Questions Published
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Questions

Question 1 Multiple Choice (Single Answer)

What is the primary purpose of the Rule Against Perpetuities?

  1. To prevent the accumulation of property in perpetuity
  2. To ensure the equitable distribution of property among heirs
  3. To protect the rights of future generations
  4. To simplify the administration of trusts
Question 2 Multiple Choice (Single Answer)

What is the general time frame specified by the Rule Against Perpetuities?

  1. 21 years after the death of the settlor
  2. The lifetime of the settlor plus 21 years
  3. 90 years after the creation of the trust
  4. The lifetime of the settlor's grandchildren
Question 3 Multiple Choice (Single Answer)

What is a common exception to the Rule Against Perpetuities?

  1. The Rule of Convenience
  2. The Cy-près Doctrine
  3. The Doctrine of Worthier Title
  4. The Rule of Capture
Question 4 Multiple Choice (Single Answer)

What is the effect of violating the Rule Against Perpetuities?

  1. The entire trust is void
  2. Only the offending provision is void
  3. The trust is accelerated and terminates immediately
  4. The trust is reformed to comply with the rule
Question 5 Multiple Choice (Single Answer)

What is the purpose of a wait-and-see approach in applying the Rule Against Perpetuities?

  1. To allow courts to determine if a future interest will vest within the permissible period
  2. To give trustees more time to administer the trust
  3. To avoid the need for immediate litigation
  4. To protect the rights of unborn beneficiaries
Question 6 Multiple Choice (Single Answer)

What is the difference between a vested remainder and a contingent remainder?

  1. A vested remainder is certain to vest, while a contingent remainder may or may not vest
  2. A vested remainder is subject to divestment, while a contingent remainder is not
  3. A vested remainder is created by a present transfer, while a contingent remainder is created by a future transfer
  4. A vested remainder is alienable, while a contingent remainder is not
Question 7 Multiple Choice (Single Answer)

What is the Rule of Destructibility?

  1. A rule that states that a trust cannot last longer than the lifetime of the settlor
  2. A rule that states that a trust cannot last longer than the lifetime of the beneficiaries
  3. A rule that states that a trust cannot last longer than the permissible period under the Rule Against Perpetuities
  4. A rule that states that a trust cannot last longer than the duration specified in the trust instrument
Question 8 Multiple Choice (Single Answer)

What is the purpose of a perpetuities period?

  1. To limit the duration of interests in property
  2. To ensure the equitable distribution of property among heirs
  3. To protect the rights of future generations
  4. To simplify the administration of trusts
Question 9 Multiple Choice (Single Answer)

What is the difference between a general power of appointment and a special power of appointment?

  1. A general power of appointment allows the holder to appoint the property to anyone, while a special power of appointment limits the holder to appointing the property to a specific group of people
  2. A general power of appointment is created by statute, while a special power of appointment is created by the settlor of the trust
  3. A general power of appointment is subject to the Rule Against Perpetuities, while a special power of appointment is not
  4. A general power of appointment can be exercised by the holder during their lifetime, while a special power of appointment can only be exercised after the holder's death
Question 10 Multiple Choice (Single Answer)

What is the Rule of Construction in Favor of Vesting?

  1. A rule that states that courts should construe trusts in a way that favors vesting of interests
  2. A rule that states that courts should construe trusts in a way that favors the settlor's intent
  3. A rule that states that courts should construe trusts in a way that favors the beneficiaries
  4. A rule that states that courts should construe trusts in a way that favors the trustee
Question 11 Multiple Choice (Single Answer)

What is the purpose of a savings clause in a trust instrument?

  1. To prevent the trust from violating the Rule Against Perpetuities
  2. To protect the rights of future beneficiaries
  3. To simplify the administration of the trust
  4. To give the trustee more discretion in managing the trust
Question 12 Multiple Choice (Single Answer)

What is the difference between a reversionary interest and a remainder interest?

  1. A reversionary interest is an interest that remains in the settlor after the creation of the trust, while a remainder interest is an interest that is created in a third party
  2. A reversionary interest is subject to the Rule Against Perpetuities, while a remainder interest is not
  3. A reversionary interest is vested, while a remainder interest is contingent
  4. A reversionary interest can be sold or transferred, while a remainder interest cannot
Question 13 Multiple Choice (Single Answer)

What is the Rule of 21 Years?

  1. A rule that states that a trust cannot last longer than 21 years after the death of the settlor
  2. A rule that states that a trust cannot last longer than 21 years after the creation of the trust
  3. A rule that states that a trust cannot last longer than 21 years after the death of the last beneficiary
  4. A rule that states that a trust cannot last longer than 21 years after the termination of the trust
Question 14 Multiple Choice (Single Answer)

What is the purpose of the wait-and-see approach in applying the Rule Against Perpetuities?

  1. To allow courts to determine if a future interest will vest within the permissible period
  2. To give trustees more time to administer the trust
  3. To avoid the need for immediate litigation
  4. To protect the rights of unborn beneficiaries
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