Caseflicks

Appellate Court of Illinois • 1981

Mahrenholz v. County Board of School Trustees

417 N.E.2d 138 | 93 Ill. App. 3d 366 | 48 Ill. Dec. 736 | 1981 Ill. App. LEXIS 2112

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Takeaway

In short, this case teaches that deed language limiting land to a single use and providing that it will “revert” if that use ends can create a fee simple determinable, causing title to return automatically rather than requiring the grantor’s reentry.

Background

In 1941, W. E. and Jennie Hutton conveyed land to the trustees of School District No. 1 for the Hutton School. The deed stated: “this land to be used for school purpose only; otherwise to revert to Grantors herein.” The school district held classes on the site until May 30, 1973, then transported students elsewhere and used the property only for storage.

The Huttons’ sole heir, Harry Hutton, executed a 1977 deed purporting to convey his interest in the school land to the plaintiffs. Around the same time, he signed a disclaimer and release in favor of the school trustees. The plaintiffs also relied on a 1959 deed from the Jacqmains that excepted the school tract but purported to transfer the reversionary interest to the plaintiffs.

The plaintiffs brought an action to quiet title. The circuit court dismissed their third amended complaint, holding that the 1941 deed created a fee simple subject to a condition subsequent and a right of entry for condition broken. Because Harry Hutton had not reentered the property, the court concluded that he had no possessory interest to convey. The plaintiffs appealed.

Issues

Issue #1

Whether the plaintiffs acquired an interest in the school property through the 1959 Jacqmain deed.

Holding

No. The Jacqmains could not transfer the future interest in 1959 because Illinois law made possibilities of reverter and rights of entry neither transferable during life nor devisable, and the school-use condition had not then been broken.

Reasoning

The parties agreed that the 1941 deed created a defeasible fee simple in the school district and retained a future interest for the Huttons. That retained interest could only be a possibility of reverter or a right of entry for condition broken.

Under the Illinois statute governing these future interests, neither a possibility of reverter nor a right of entry could be transferred by inter vivos conveyance or by will, although each remained inheritable. In 1959, the land was still being used for classes, so the future interest had not become possessory. The Jacqmain deed therefore could not give the plaintiffs an interest in the school tract.

Issue #2

Whether the 1941 deed created a fee simple determinable with a possibility of reverter or a fee simple subject to a condition subsequent with a right of entry.

Holding

The deed created a fee simple determinable in the school trustees and a possibility of reverter in the Huttons and their heirs.

Reasoning

The distinction matters because a fee simple determinable ends automatically when its stated limitation is violated; title then returns to the grantor or heirs by operation of law. By contrast, a fee simple subject to a condition subsequent continues after breach until the grantor or heirs affirmatively reenter or otherwise act to terminate it.

The court read the phrase “this land to be used for school purpose only” as placing a limitation within the grant itself. The word “only,” immediately following the permitted use, indicated that the school district was to hold the land only while it was needed for that single purpose, rather than receiving an otherwise absolute estate burdened by an appended condition.

The additional language, “otherwise to revert to Grantors herein,” reinforced that reading. Although “revert” does not automatically establish a possibility of reverter, its use together with the exclusive-use language indicated a mandatory and automatic return when school use ceased. The deed did not say that the grantors “may” reenter.

The court distinguished deeds using express conditional language, such as “upon condition,” “provided that,” or grants made “forever” but expressly subjected to conditions. It found North v. Graham particularly persuasive because that Illinois case treated a deed providing for return when church use ceased as creating a determinable fee.

The court acknowledged McElvain v. Dorris, which involved similar mill-purpose language and described the interest as a condition subsequent. But it regarded McElvain as ambiguous and, to the extent it supported the defendants’ position, contrary to the greater weight of Illinois and American authority.

Issue #3

Whether the trial court properly dismissed the complaint on the ground that Harry Hutton lacked an interest capable of conveyance because he had not reentered the property.

Holding

No. Because Harry Hutton inherited a possibility of reverter, he could have become owner automatically when the property ceased being used for school purposes; the complaint therefore should not have been dismissed on the theory that reentry was required.

Reasoning

If Harry Hutton had inherited only a right of entry, he would have had to take legal action to retake the premises before obtaining title, and that unexercised right could not be conveyed during life. The trial court’s dismissal rested on that understanding of the 1941 deed.

But a possibility of reverter operates differently. If the school district’s cessation of classes in 1973 amounted to a cessation of “school purpose” use, title returned automatically to Harry Hutton at that time. He could then potentially convey a possessory interest to the plaintiffs in 1977.

The appellate court did not decide whether using the property for storage remained a school purpose, whether Hutton’s 1977 deed was legally sufficient, or whether his disclaimer in favor of the defendants superseded the conveyance to plaintiffs. Those unresolved questions required further proceedings after reversal.