Finance With Owner

Fee simple is an estate in land in common law. It is the most common way real estate is owned in common law countries, and is ordinarily the most complete ownership interest that can be had in real property short of allodial title, which is often reserved for governments. Fee simple ownership represents absolute ownership of real property but it is limited by the four basic government powers of taxation, eminent domain, police power, and escheat and could also be limited by certain encumbrances or a condition in the deed. How ownership is limited by these government powers often involves the shift from allodial title to fee simple such as when uniting with other property owners acceding to property restrictions or municipal regulation.

Types of fee simple

If previous grantors of a fee simple estate do not create any conditions for subsequent grantees to own the conveyed property in fee simple title, which is commonly the case these days, then the title is called fee simple absolute. 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). Upon the happening of a specified event, the estate may become void or subject to annulment. Two types of defeasible estates are the 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, 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, but the estate does not automatically revert to the grantor; this is a fee simple subject to a condition subsequent. In the United States many of these concepts have been modified by statute in some states.