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In English law, a fee simple or fee simple absolute is an
estate in land An estate in land is, in the law of England and Wales, an interest in real property that is or may become possessory. It is a type of personal property and encompasses land ownership, rental and other arrangements that give people the right to us ...
, a form of
freehold Freehold may refer to: In real estate *Freehold (law), the tenure of property in fee simple * Customary freehold, a form of feudal tenure of land in England * Parson's freehold, where a Church of England rector or vicar of holds title to benefice ...
ownership. A "fee" is a vested, inheritable, present possessory interest in land. A "fee simple" is real property held without limit of time (i.e., permanently) under
common law In law, common law (also known as judicial precedent, judge-made law, or case law) is the body of law created by judges and similar quasi-judicial tribunals by virtue of being stated in written opinions."The common law is not a brooding omnipres ...
, whereas the highest possible form of ownership is a "fee simple absolute," which is without limitations on the land's use (such as qualifiers or conditions that disallow certain uses of the land or subject the vested interest to termination). The rights of the fee-simple owner are limited by government powers of
taxation A tax is a compulsory financial charge or some other type of levy imposed on a taxpayer (an individual or legal entity) by a governmental organization in order to fund government spending and various public expenditures (regional, local, o ...
,
compulsory purchase Compulsion may refer to: * Compulsive behavior, a psychological condition in which a person does a behavior compulsively, having an overwhelming feeling that they must do so. * Obsessive–compulsive disorder, a mental disorder characterized by ...
, police power, and
escheat Escheat is a common law doctrine that transfers the real property of a person who has died without heirs to the crown or state. It serves to ensure that property is not left in "limbo" without recognized ownership. It originally applied to a ...
, and may also be limited further by certain
encumbrance An encumbrance is a third party's right to, interest in, or legal liability on property that does not prohibit the property's owner from transferring title (but may diminish its value). Encumbrances can be classified in several ways. They may be ...
s or conditions in the deed, such as, for example, a condition that required the land to be used as a public park, with a reversion interest in the grantor if the condition fails; this is a fee simple conditional.


History

The word "fee" is related to the term
fief A fief (; la, feudum) was a central element in medieval contracts based on feudal law. It consisted of a form of property holding or other rights granted by an overlord to a vassal, who held it in fealty or "in fee" in return for a form ...
, meaning a feudal landholding. Feudal land tenures existed in several varieties, most of which involved the tenant having to supply some service to his overlord, such as
knight-service Knight-service was a form of feudal land tenure under which a knight held a fief or estate of land termed a knight's fee (''fee'' being synonymous with ''fief'') from an overlord conditional on him as tenant performing military service for his ov ...
(military service). If the tenant's overlord was the king,
grand serjeanty Under feudalism in France and England during the Middle Ages, tenure by serjeanty () was a form of tenure in return for a specified duty other than standard knight-service. Etymology The word comes from the French noun , itself from the Latin , ...
, then this might require providing many different services, such as providing horses in time of war or acting as the king's ceremonial butler. These fiefs gave rise to a complex relationship between landlord and tenant, involving duties on both sides. For example, in return for receiving his tenant's fealty or homage, the overlord had a duty to protect his tenant. When feudal land tenure was abolished, all fiefs became "simple", without conditions attached to the tenancy.


Common law

In English common law, the
Crown A crown is a traditional form of head adornment, or hat, worn by monarchs as a symbol of their power and dignity. A crown is often, by extension, a symbol of the monarch's government or items endorsed by it. The word itself is used, partic ...
had
radical title Allodial title constitutes ownership of real property (land, buildings, and fixtures) that is independent of any superior landlord. Allodial title is related to the concept of land held "in allodium", or land ownership by occupancy and defense ...
or the
allodium In the law of the Middle Ages and early Modern Period and especially within the Holy Roman Empire, an allod ( Old Low Franconian ''allōd'' ‘fully owned estate’, from ''all'' ‘full, entire’ and ''ōd'' ‘estate’, Medieval Latin ''allodiu ...
of all land in England, meaning that it was the ultimate "owner" of all land in the past feudal era. Allodial title is reserved to governments under a civil law structure. However, the Crown can grant ownership in an
abstract entity In metaphysics, the distinction between abstract and concrete refers to a divide between two types of entities. Many philosophers hold that this difference has fundamental metaphysical significance. Examples of concrete objects include plants, h ...
- called an estate in land - which is what is owned rather than the land it represents. The fee simple estate is also called "estate in fee simple" or "fee-simple title", or sometimes simply "freehold" in England and Wales. From the start of the
Norman Norman or Normans may refer to: Ethnic and cultural identity * The Normans, a people partly descended from Norse Vikings who settled in the territory of Normandy in France in the 10th and 11th centuries ** People or things connected with the Norm ...
period, when
feudalism Feudalism, also known as the feudal system, was the combination of the legal, economic, military, cultural and political customs that flourished in medieval Europe between the 9th and 15th centuries. Broadly defined, it was a way of structur ...
was introduced to England, the tenant or "holder" of a
fief A fief (; la, feudum) was a central element in medieval contracts based on feudal law. It consisted of a form of property holding or other rights granted by an overlord to a vassal, who held it in fealty or "in fee" in return for a form ...
could not alienate (sell) it from the possession of his overlord. However, a tenant could separate a parcel of the land and grant it as a subordinate fief to his own sub-tenant, a process known as sub-enfeoffing or " subinfeudation". The 1290 Statute of
Quia Emptores ''Quia Emptores'' is a statute passed by the Parliament of England in 1290 during the reign of Edward I that prevented tenants from alienating their lands to others by subinfeudation, instead requiring all tenants who wished to alienate the ...
abolished subinfeudation and instead allowed the sale of fee simple estates.
William Blackstone Sir William Blackstone (10 July 1723 – 14 February 1780) was an English jurist, judge and Tory politician of the eighteenth century. He is most noted for writing the ''Commentaries on the Laws of England''. Born into a middle-class family ...
defined fee simple as the estate in land that a person has when the lands are given to him and his heirs absolutely, without any end or limit put to his estate. Land held in fee simple can be conveyed to whomsoever its owner pleases; it can also be mortgaged or put up as security. Owners of real property in fee simple have the privilege of interest in the property during their lifetime and typically have a say in determining who gets to own an interest in the property after their death. Historically, estates could be limited in time. Common temporal limitations include
life estate In common law and statutory law, a life estate (or life tenancy) is the ownership of immovable property for the duration of a person's life. In legal terms, it is an estate in real property that ends at death when ownership of the property may ...
, a land ownership that terminates upon the grantee's (or another person's) death even if the land had been granted to a third party, or a term of years, a lease for a specified term, such as in an estate for years. A fee also could be limited through the method of its inheritance, such as by an "entailment", which created a
fee tail In English common law, fee tail or entail is a form of trust established by deed or settlement which restricts the sale or inheritance of an estate in real property and prevents the property from being sold, devised by will, or otherwise alien ...
. Traditionally, fee tail was created by words of grant such as "to N. and the male heirs of his body", which would restrict those who could inherit the property. If no heirs could be found, then the property would revert to the original grantor's heirs. Most common law countries have abolished entailment by statute.


Duration

An estate in fee simple denotes the maximum ownership in land that can be legally granted; it is the greatest possible aggregate of rights, powers, privileges and immunities available in land. The three hallmarks of the fee simple estate are that it is alienable, devisable and descendible.


Creation and characteristic of fee simple

Rules requiring words of general inheritance to create fee simple by conveyance have been abolished by statute in the United States.Moynihan's Introduction to the Law of Real Property, Sheldon F. Kurtz To convey an estate in fee simple at common law, the deed or will must state "to B and his heirs." Anything short of those words transferred a smaller estate. Modern deeds usually follow a standardized form. There is a presumption that the testator intends to convey his or her property in fee simple unless the will indicates an intention to transfer a smaller estate, such as a life estate.


Life estate

Many jurisdictions retain the possibility of creating a
life estate In common law and statutory law, a life estate (or life tenancy) is the ownership of immovable property for the duration of a person's life. In legal terms, it is an estate in real property that ends at death when ownership of the property may ...
, although this is uncommon. In the United States, life estates are most commonly used either to grant someone use of the property for the remainder of that person's life in a will, or by a grantor to reserve the right to continue using the property for the remainder of the grantor's life after it is sold. The right to ownership of the property after the death of the life estate owner is called the ''remainder estate''. In England and Wales fee simple is the only freehold estate that remains; a life estate can only be created in equity and is not a right in property.


Retained life estate gift

In the United States, retained life estates are often used by donors who intend to leave property as
bequest A bequest is property given by will. Historically, the term ''bequest'' was used for personal property given by will and ''deviser'' for real property. Today, the two words are used interchangeably. The word ''bequeath'' is a verb form for the act ...
s to
charitable organization A charitable organization or charity is an organization whose primary objectives are philanthropy and social well-being (e.g. educational, religious or other activities serving the public interest or common good). The legal definition of a ...
s while retaining the use of the property during their lifetimes. The donor receives a
tax deduction Tax deduction is a reduction of income that is able to be taxed and is commonly a result of expenses, particularly those incurred to produce additional income. Tax deductions are a form of tax incentives, along with exemptions and tax credits. T ...
for the gift of their remainder interest in the property, and at the donor's death, the property passes to the organization without being subject to probate. Retained life estate gifts often involve agreements about acceptable uses of the property, payment of real estate taxes, property maintenance, etc. during the donor's lifetime.


Types of fee simple

If previous grantors of a fee simple estate do not create any conditions for subsequent grantees, then the title is called fee simple absolute. A fee simple absolute is the highest estate permitted by law, and it gives the holder full possessory rights and obligations now and in the future. Other fee simple estates in real property include fee simple defeasible (or fee simple determinable) estates. A defeasible estate is created when a grantor places a condition on a fee simple estate (in the deed). When a specified event happens, the estate may become void or subject to annulment. There are two types of defeasible estates: fee simple determinable and the fee simple subject to a condition subsequent. If the grantor uses durational language in the condition such as "to A. as long as the land is used for a park", then upon the happening of the specified event (in this case if the land is used for anything other than a park), the estate will automatically terminate and revert to the grantor or the grantor's estate; this is called a fee simple determinable. If the grantor uses language such as "but if alcohol is served", then the grantor or the heirs have a right of entry if the condition occurs, but the estate does not automatically revert to the grantor; this is a fee simple subject to a condition subsequent. In most jurisdictions in the United States these concepts have been modified by statute. Fee simple determinable was generally preferred by courts in the common law of the early United States. Recently, that trend has reversed, and most courts in the United States will find a fee simple subject to condition subsequent in situations where the conveying document's language is unclear.


Rent

The claim that no
rent Rent may refer to: Economics *Renting, an agreement where a payment is made for the temporary use of a good, service or property *Economic rent, any payment in excess of the cost of production *Rent-seeking, attempting to increase one's share of e ...
or similar obligations are due from the owner of property in fee simple is only partially true. For example, a
rentcharge In English property law, a rentcharge is an annual sum paid by the owner of freehold land (terre-tenant) to the owner of the rentcharge (rentcharger), a person who need have no other legal interest in the land. They are often known as chief rents ...
may exist requiring a freeholder to pay a fixed sum of money closely resembling rent, and many jurisdictions have created financial obligations that may be imposed on a freehold estate. England and Wales impose an estate charge. In the
United States The United States of America (U.S.A. or USA), commonly known as the United States (U.S. or US) or America, is a country primarily located in North America. It consists of 50 states, a federal district, five major unincorporated territori ...
, fee simple owners are usually subject to
property tax A property tax or millage rate is an ad valorem tax on the value of a property.In the OECD classification scheme, tax on property includes "taxes on immovable property or net wealth, taxes on the change of ownership of property through inhe ...
and the revenue generated is directed to the municipality's general fund. Other local tax assessments called "special purpose taxes" may be assessed in addition to the property taxes for specific purposes such as infrastructure improvements. Real estate owned as a condominium is usually similarly owned in fee simple, but typically subject to rules in the declaration of condominium or created by the condominium association, such as paying required monthly fees for maintaining the property's common areas; however, these are generally treated legally as covenants running with the land (contracts binding on the possessors of real property) imposing an affirmative duty to pay money rather than as rent for property held in fee simple.


Etymology

Fee – A right in law to the use of land; i.e. a
fief A fief (; la, feudum) was a central element in medieval contracts based on feudal law. It consisted of a form of property holding or other rights granted by an overlord to a vassal, who held it in fealty or "in fee" in return for a form ...
. Simple – in the unconstrained sense: # without limit to the inheritance of heirs; # unrestricted as to transfer of ownership. The English word ''fee'' ultimately goes back to the Indo-European root ''*peku'', which refers to moveable wealth, that is, cattle. The Latin word ''pecunia'', money, also comes from this root and becomes ''pecuniary'' in English. The root appears in Modern German as ''Vieh'', cattle, beast. American Heritage Dictionary of the English language, editions with the Index of Indo-European Roots, under peku


See also

*
Freehold (law) In common law jurisdictions such as England and Wales, Australia, Canada, and Ireland, a freehold is the common mode of ownership of real property, or land, and all immovable structures attached to such land. It is in contrast to a leasehold, in ...
, covering all types and mentioning trusts and most common, major, adverse interests. ** Freehold (Scots law) * Allodial title *
Fee tail In English common law, fee tail or entail is a form of trust established by deed or settlement which restricts the sale or inheritance of an estate in real property and prevents the property from being sold, devised by will, or otherwise alien ...
*
Leasehold A leasehold estate is an ownership of a temporary right to hold land or property in which a lessee or a tenant holds rights of real property by some form of title from a lessor or landlord. Although a tenant does hold rights to real property, a l ...
*
Life estate In common law and statutory law, a life estate (or life tenancy) is the ownership of immovable property for the duration of a person's life. In legal terms, it is an estate in real property that ends at death when ownership of the property may ...
*
Quia Emptores ''Quia Emptores'' is a statute passed by the Parliament of England in 1290 during the reign of Edward I that prevented tenants from alienating their lands to others by subinfeudation, instead requiring all tenants who wished to alienate the ...


Notes

{{reflist, 35em Common law Real property law Feudalism in England Land tenure