Rule “against” Perpetuties

Perpetuity Per‘pe*tuȷi*ty, n. [L. perpetuitas: cf. F. perp[‘e]tuit[‘e].] 1. The quality or state of being perpetual; as, the perpetuity of laws.

And yet we should, for perpetuity, go hence in debt. Shakespeare.

Most states have a rule against perpetuities, designed, basically, to keep folks from ruling from the grave.

No interest is good unless it must vest, if at all, not later than twenty-one years after some life in being at the creation of the interest.

is how John Chipman Gray, formulated it in 1886.

One of the purposes of the Rule was to prevent the holders of large, possibly aristocratic estates from being kept in one family for more than one or two generations at a time.

Now legislatures are all too often peopled by politicians who owe their office to the monied gentry. As a result, the Rule has been seriously eroded.

In Nevada, for all intents and purposes, it has been abandoned altogether. Nevada’s Rule Against Perpetuties provides:

NRS 111.1031 Statutory rule against perpetuities.

1. A nonvested property interest is invalid unless:

(a) When the interest is created, it is certain to vest or terminate no later than 21 years after the death of a natural person then alive; or

(b) The interest either vests or terminates within 365 years after its creation.

The name of the Rule, however inappropriate, however Orwellian, has survived. Had this been the law when Nevada became a state, restrictions on the alienation of land imposed in November of 1864 could still be wrecking commerce in Nevada.

Bill Gates can now rest easy. Microsoft can keep its ill-gotten gains, and can continue to grind its heel into Wordperfect, etc. until at least the year 2384.

Eat, Drink and be Merry

On the theory that most who occasionally glance at this blog are human, we here at White Law Chartered occasionally get a little off-track. Today is such a day.

We constantly hear that we must do this or that, or eat this or that, to survive. But is survival what its all about? Isn’t quality of life in there somewhere? Unlike the U.S, the Nevada constitution guarantees us the right to pursue happiness along the way. Are these words meaningless trivia? You would think so as our governments rush headlong to keep us alive. Helmet laws, seat belt laws, drinking laws, smoking laws may keep us healthy, but is longevity what life is all about? Isn’t freedom in there somewhere?

We are told that we must stay healthy because medical care is expensive and often subsidized by the taxpayer. But what about end of life care? When our estates have been depleted by $8,000 a month to warehouse us in a memory care facility, we don’t just die. Rather we are then housed in a more spartan facility at taxpayer expense. No one we know has done a study that shows taxpayers are worse off if we die at 30 from lung cancer than if we die at 90 in an old folks home. And do we really want our estate to go to a memory care facility? Wouldn’t most of us prefer it go to our children?

Those so interested in keeping us healthy for the most part have good hearts, however broken. They generally and mistakenly act as if they and the rest of us are going to live forever. But we here at Whitelaw have done a study which proves otherwise, to wit, we have divided those born in 1700 into two groups, one, of those who drink and smoke and the other of teetotallng, non-smoking vegans. Our study proved by clear and convincing evidence that no one in either group is alive today. And that those in the first group formed a great country that eventually ended the scourge of slavery.

Paragraph from Dickens’ Pickwick Papers, Chapter 13

It appears, then, that the Eatanswill people, like the people of many other small towns, considered themselves of the utmost and most mighty importance, and that every man in Eatanswill, conscious of the weight that attached to his example, felt himself bound to unite, heart and soul, with one of the two great parties that divided the town–the Blues and the Buffs.  Now the Blues lost no opportunity of opposing the Buffs, and the Buffs lost no opportunity of opposing the Blues; and the consequence was, that whenever the Buffs and Blues met together at public meeting, town-hall, fair, or market, disputes and high words arose between them.  With these dissensions it is almost superfluous to say that everything in Eatanswill was made a party question.  If the Buffs proposed to new skylight the market-place, the Blues got up public meetings, and denounced the proceeding; if the Blues proposed the erection of an additional pump in the High Street, the Buffs rose as one man and stood aghast at the enormity. There were Blue shops and Buff shops, Blue inns and Buff inns–there was a Blue aisle and a Buff aisle in the very church itself.

More on Vail

For reasons that escape me, the Nevada State Bar holds its annual convention outside of Nevada. This year Vail, last year Chicago, year before that Austin. Next year New Orleans. By careful budgeting, I generally am able to attend these annual meetings. The topics discussed are generally quite relevant to my practice.

This year, for example, one of the main topics was women and their recent emergence as a dominant force in the Nevada legislature. The question? Were the thousand of new laws passed this year different from laws that would have been passed by a male-dominated legislature?

Of course, there was no definitive answer. We were, however, treated to a discussion of this by woman legislators and it was quite interesting. First, the phenomena, if it be such, was explained by Lieutenant Governor Kate Marshall, as resulting from term limits, limits which cleared the field of many otherwise unbeatable incumbents. This was good as it allowed new blood in that body, but bad in the sense that it gave more power to lobbyists, lobbyists not being subject to term limits.

As might be expected, there was no consensus except that, perhaps, since most of the woman legislators were also Democrats, a largely liberal session was the result.

I can’t help but cringing at some of the excesses, whether blamable on women or on Democrats, such as the decision to allow state workers to “unionize”. It will be recalled that the reason for unions, being to force companies to more equitably share profits with their employees, simply does not apply to state workers as state governments are not profit making enterprises. So, whatever they are, collectives of state workers are not unions…they are simply lobbyists, funded by taxes, whose sole purpose for being is to increase taxes. If we are lucky, the current crowd will be replaced by legislators who are not beholden to public collectives. It is obviously unfair to force, say, a $10 per hour waiter, to, under threat of prison, pay taxes to support a lobbying effort to raise the salaries of a $50 per hour state engineer.

Attorney Fees

At this weekend’s Nevada State Bar convention in Vail, Colorado, one of the speakers hit upon a topic dear to the heart of clients and their lawyers. The speaker, a professor at Georgetown law school, started his lecture with maps. Yes, maps. He pointed out how the law is much like a map, in that the client and his lawyer go from place to place. But, unlike maps, there is little in the way of fee reference points. The lawyer simply says something like: “I will charge you $600 per hour but, since I have no clue how hard the other side will fight, I can’t fix the ultimate fee at this time.” So the client can’t budget or assess whether to settle or proceed. If its not a life-changing dispute, the client will often just capitulate or try to represent himself.

The professor told us attendees that help was on the way in the form of analytics…computer programs that show the average high and the average low number of attorney hours for that kind of dispute. I bought one of those programs and plan to learn to use it soon. Fairness to both the lawyer and the client involves some way of knowing the unknowable. At least its worth a try. I will report as I learn how to use the program.

Home equity caution

The media is full of ads trying to get homeowners to borrow on their home, at low interest, and to use the $ to pay off high-interest credit cards, etc.

Just remember: Over half a million dollars of home equity in Nevada is exempt from judgment creditors. To use exempt money to pay off debt, such a credit card debt, which is subject to being discharged in bankruptcy is at the top of the “poor money-management ideas” bucket and rightfully so.

June 5

I’ll likely figure out how to index these Blogs someday, but meanwhile, I will just title them with the date written. I spent most of this morning, doing what I often do: handling living trust problems. This fellow, now deceased, had set up a living trust back in the mid nineties. He had babied it for about 10 years and then forgot about it. So when he died the other day, his bank account and his safe deposit box were in his own name. They were not owned by the trust. I am in the process of deciding between the two available opportunities: Simply file a probate and, as he left a pour-over will, have the probate court distribute the bank account etc to the trustee of his trust or, in the alternative, file a Heggsted suit. Heggsted is available here as the decedent actually listed his bank account and account number on Schedule A to his trust. Probate is simpler, but takes six to eight months. And the executor can open and inventory the safe deposit box. Heggsted is faster but is no help with the safe-deposit box as it is not listed on Schedule A as being owned by the trust. So a petition for an order authorizing my client to open and inventory the safe deposit box would be necessary.

2019 Nevada Legislature is about done

For much, if not most of our history, we allowed ourselves to be governed by the common law (judge made law). We still do to a lesser extent, as it is the courts which interpret the law. Some think it best if our representatives just put their feet up on their desk and sip mint juleps for the 90 days or so that the legislature meets every two years. But that is an unreasonable wish. There is much that needs addressing which cannot be addressed by the Courts, particularly when it comes to allocating money to schools, highways and the like. Normally, some of the new laws go into effect immediately upon passage (and, if appropriate) signed by the Governor. Others have a a specific effective date and still others go into effect at the beginning of next year (2020). So be careful. If you are going to rely on a new law, first make sure it has become effective.

White Law Chartered

Post #1 Welcome

We here at WLC are diligently (after a fashion) getting our website back up and running. We are not sure why it went down but appreciate that one of our clients so informed us a few weeks ago.

So be a little careful with the site until we can make sure it is OK again.