restraint on alienation


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restraint on alienation

n. an attempt in a deed or will to prevent the sale or other transfer of real property either forever or for an extremely long period of time. Such a restraint on the freedom to transfer property is generally unlawful and therefore, void or voidable (can be made void if an owner objects), since a present owner should not be able to tie the hands of future generations to deal with their property. This ban on a restraint on alienation (transfer) is called "the rule against perpetuities." Examples: Oliver Oldtimer sells his ranch to his son with the condition that title may never be transferred to anyone outside of the family. Martha Oldtimer in her will gives her home to her daughter Jacqueline on condition that "Jacqueline's descendants must never sell the place." However, limiting transfer for a maximum period calculated by "lives in being, plus 21 years" is generally allowed. Restraints on alienation (so-called restrictive covenants) based on race ("only Caucasians may hold title") were declared unconstitutional in 1949. (See: convey, deed, rule against perpetuities, restrictive covenant)

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References in periodicals archive ?
Hayden from 2007.<br />Krupp found that, not unlike the one at issue in Roberts, the restraint on alienation before him was of unlimited duration, applying even after an interest in the properties was transferred to a stranger to the agreement.<br />Due to the "cumbersome mechanism" for determining the fair value for an interest in the properties, which involved the use of a panel of three arbitrators, the owner seeking to divest was not even assured of having the sale price match the one received from a third party, Krupp noted.<br />"Such a restraint on alienation is unreasonable, and the [agreement] is therefore void and unenforceable under the rationale of Roberts," Krupp wrote.<br />The 19-page decision is DiSchino, et al.
On the transfer restriction clause, the court found it unenforceable on the grounds of (i) changed circumstances and (ii) the clause constitutes an unreasonable restraint on alienation. The changed circumstances noted by the court was the "near financial failure of Hess"; Hess' liability and monetary damages for not operating continuously, for which damages were mounting on a daily basis; and also that there was clearly "no affiliate in the Crown/Hess corporate family to assume the anchor store agreement."