Transfer for benefit of Unborn Persons: (Section 13)

Section 13 explains about Transfer for benefits of unborn and represents the common
law rule against remoteness of limitation. Gift to an unborn child is unknown to Hindu Law
observed in Tagore Vs. Tagore. Whilby Vs. Minshell the rule laid down in this case it was
held that if the property is transferred to a person, it cannot be further granted to an unborn
of that unborn child.
The Conditions required to create an interest in favor of unborn person
There must always be an estate for life 1.
The unborn person should come into existence on or before the expiry of the prior 2.
estate
The whole Remainder in the estate must be conferred on the unborn person 3.
The vest of the estate must not be postponed beyond a life or lives in being and
minority 4. of the unborn person that is to say. it cannot be deferred to a longer
period then what is necessary for him to attain Majority ( section 13 and 14 ).
Rule against perpetuity: (Section 14)
The word perpetuity means for (almost) ever. As a term used in the Act, it means an
inalienable and indestructible interest in the property or interest, which cannot vest till a
remote period of time.
No transfer of property can operate to create an interest which is to take effect after
the lifetime of one or more persons living at the date of such transfer, and the minority of
some person who shall be in existence at the expiration of that period, and to whom, if he
attains full age, the interest created is to belong. Cadell v. Palmer and Thelluson v.
Woodford, according to the rule every estate or interest must vest, if at all, not later than 21
years after the determination of some life in being at the time of the creation of such estate
or interest and not only must the person to take be ascertained but the amount of his
interest must be ascertained within the prescribed period.
Transfer to class of persons: (Section 15)
If, on a transfer of property, an interest therein is created for the benefit of a class of
persons with regard to some of whom such interest fails by reason of any of the rules
contained in sections 13 and 14, such interest fails [in regard to those persons only and not
in regard to the whole class].
It has been held by the Supreme Court that although no interest could be created in
favour of an unborn person but if gift was made to a class of series of person some of whom
were in existence and some were not, it was valid with regard to the former and invalid as to
the latter; Raj Bajrang Bahadur Singh v. Thakurain Bakhtraj Kuer, (1953) SCR 232.

Direction for accumulation: (Section 17)

Where a testator issues a direction separating the income from ownership of property
so as to form a separate fund or so as to postpone the beneficial enjoyment of property is
called Direction for Accumulation. In Indian law, limits within which a direction may be
made for accumulation given (a) the life of the transferor, or (b) a period of 18 years from the
date of transfer.
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 The direction for accumulation may be express or implied

A direction for accumulation may be void under the perpetuity rule, if the
accumulation is directed for a period excess of that allowed by the perpetuity
rule.
A direction for accumulation may be void for repugnancy
Exceptions:
(i) The payment of the debts of the transferor or any other person taking any
interest under the transfer; or
(ii) The provision of portions for children or remoter issue of the transfer or of any
other person taking any interest under the transfer; or
(iii) The preservation or maintenance of the property transferred.
Vested and Contingent Interests
Vested and contingent interests are dealt with in the Transfer of Property Act under
Sections 19 to 23.
Vested Interests: (Section 19)
In a transfer, when an interest is created in favour of a person without specifying the
time in which it is to take effect, or specifying that it shall take effect on the happening of an
event which is certain to happen, such an interest is said to be vested unless the terms of
the transfer indicate a contrary intention. It depends upon the happening of the event which
must happen, i.e. certain event. It is not defeated by the death of the transferee.
Illustration:
A may transfer ownership to B but retain a life interest in the estate. In such a case,
the life estate of A is a particular estate, as it is a specific part of the owners interest and the
interest of B is the remainder. The remainder is obviously what is left out after carving out
the particular estate. The remainder is seen as vested when the only obstacle between
securing possession is the existence of the particular estate. Therefore, in the above
example, Bs remainder interest is vested in him and he can take possession the moment
the particular estate ends.
The primary requirement for a vested interest to take effect is that it must not be
subject to a condition precedent. It can only be subjected to a condition that relates to an
event that is certain to happen by its very nature. If there is a condition precedent and it
relates to an event, which is uncertain, then it ceases to be a vested interest and becomes a
contingent one.
Contingent Interests: (Section 21)
A contingent interest is one that is created on a transfer that will take effect only
on the happening or non-happening of a specified uncertain event. As you may

be aware, such an interest is regarded as a contingent interest, one whose

existence is contingent or dependent on the occurrence of an uncertain event. If
the event occurs, the interest becomes vested. If the event does not occur, the
interest does not get vested. Contingent Interest depends upon the happening
of the uncertain event.