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Transfer of Property to Unborn Child

Transfer of property Act which clearly state under section 13 that deals with transfer of property to unborn child .A child in its mother's womb is for many purposes regarded by a legal fiction as already born, in accordance with the maxim nasciturus pro jam nato habetur ,which means that the legal capacity of the natus (post born) is determined by referring back to a time when he was still nasciturus (unborn) but present in womb.

Thus, in the law of property, there is a narrative that a child en ventre sa mere is a person in being a life chosen to form part of the period in the rule against perpetuities. According to Fleming and Hains: the right to life of all human beings has the nature of non-transgressed norm already which contained in the Universal Declaration of Human rights 1948, the International Covenant on Civil and Political rights 1966 and the Declaration of the Rights of the Child 1959.

Under international law, the unborn child is protected.[1] In this Assignment rules of Section-13, its limitation, life interests vested and consequences were explained.

Cases relevant to Section -13 are discussed with various illustrations. Where property is desired to be transferred or bequeathed by any person to more than one generation, it is imperative that these Rules are conformed to. Transfer of property to unborn child is a complex concept and has certain limitations to be followed.

Section 13 of the Act refers to Transfer for benefit of unborn person. This Section is an attempt to import into India what used to be known in England, the concept of The rule of Double Possibilities. The rule is that a person disposing of property to another shall not shackle the free disposition of that property in the hands of more than one generation[1]. As we have read earlier that both the parties to a transfer of property must be living persons (including juristic person), but Section 13 is an exception to the general rule of transfer inter vivos.S.13 is a transfer by born to the unborn. A property can be transferred to a child in the mother's womb but not to one who's not in the mother's womb.[2]

Section 5 of the transfer of property act 1882, transfer as between living persons.

Exception: There are certain sections in the act which lay down certain rules regarding transfer for the benefit of unborn person. Section 13 is one of the group of sections which refer to interest created for the benefit of person not existing at the date of transfer. This section provides that there should never be such a person as an unborn one takes for life, because it is an understandable contingency.

Legal status of an unborn child

An unborn child is termed as a person post his/her birth. Infant enventresa mere i.e. child in the womb is supposed to take birth for many reasons. As per the property law, the unborn child can attain definite rights and inherit the property but only in case he or she is born alive. Although the unborn child cannot be well-thought-out as a person yet his/her rights can be vested in the hands of his/her trustees.

Limited Interest: Limited interest cannot be created for the benefit of an unborn person even though it is subject to a prior interest in favour of a living person.

Rights of an unborn child on property under the property act

The proposition of child enventresa mere under the property act gives the right on property to an unborn child only if he or she is born alive. By the time he/she is born, till then all the rights lay in the name of his or her parents/trustees. One can easily consult a family lawyer and pursue online legal help or advice in Delhi, Mumbai, Chennai, Bangalore, Hyderabad, Pune, Goa, Kolkata, Ahmedabad, Gurgaon or Noida.[3]

Pre-Requisites Of Valid Transfer To Unborn Child

No transfer: The transfer of property can be done by way of trusts but not directly. In the absence of trust the property must be created in favour of a living person and then to the minor.
Prior Interest: Life interest can be enjoyed by persons until the unborn comes into existence into this world.

Before the death of last life estate holder: The unborn person must come into existence before the death of the last life estate holder. It is not necessary that he should be born, even if he is in the mother's womb that is enough. A child en ventre sa mere is equal to child in essence meaning a child in the mother's womb is equal to a child in existence.

Immediate transfer of rights: All the rights should vest in the unborn child as soon as he comes into existence. He will be the absolute owner of the property vested in him. The pertinent fact here is that the transfer can be made to an unborn person but not to the issue of an unborn person. There the gift made in favour of the unborn grandchildren was not in respect of the whole interest in the property, the gift was held to be a valid document.

In the case of Isaac Nissim Silas v. Official trustee of Bengal,[4] the trust was a family trust created for the benefit of settlor and his wife his two sons and their children to be born. This trust was formed by Issac Nissim Silas the settlor by an Indenture of Trust dated 1-4-1931. The Official Trustee of Bengal has been made a trustee and the property was conveyed to the trustee to be held by him upon trust set out in the said agreement. At the date of the trust the settlor's family consisted of his wife and his three children in equal parts.

The trust deed provided that the trustee after making provisions for meeting the necessary expenditures the property will remain in lifetime of settlor, thereafter to his wife, thereafter to his three sons in equal shares. Remainder in favour of the son's children that are unborn and remain alive at a certain period subject to certain restrictions. The legality of the gift made in favour of the grandsons was questioned. It was held that the trust in favour of the grandchildren in deed of trust amount to curtailment of such absolute gift and such was void.[5]

Rules Underlying Under Section-13

No Direct Transfer:

  1. A transfer cannot be made directly to an unborn. Such a transfer can only be made by the machinery of trusts.
  2. Such a transfer can only be made by the machinery of trusts.
  3. It is a fundamental principle of the English common law, that any disposition of land considered to produce an abeyance of ownership is void.
  4. Accordingly, if a transfer were made directly to an unborn person, there would be an abeyance of ownership from the date of transfer till coming into existence of the unborn person.


Prior Interest

  1. In case a trust is not created, the estate must vest interest in some person between the date of the transfer and the coming into existence of the unborn person.
  2. In other words, the interest in favour of an unborn person must always be led by a prior interest in favour of a living person.[6]


Absolute Interest

  1. The entire property must be transferred to the unborn person.
  2. It is not permissible to confer a life-interest on an unborn person.
  3. In the illustration to the section, the benefit created for the eldest unborn son is only a life-interest and it, therefore, fails.
  4. In English Law, it is possible to give an estate to an unborn person for life. But this aspect of English Law was subject to a restriction called the rule against double possibilities.


Some Illustrations:

  1. A gives property to B for life, and afterwards to his son (unborn), subject to the condition that if the son changes his religion, the property should be forfeited. Here the condition regarding change of religion fetters the estate, and does not therefore comply with Section 13, which speaks of the whole of the estate.
  2. A transfer his properties to X for life and then to Y for life and then to Z for life and thereafter to the unborn child of Z. Here, X, Y and Z are all living persons in existence at the date of the transfer. This disposition of property is valid. The property may be given to more than one living persons successively ‘for life' before it ultimately vests in the unborn (Z's unborn child).
  3. A transfer his properties to X for life who is unmarried and then to the eldest child of X absolutely. The transfer in favour of eldest child of X is valid. [7]


Girjesh Dutt v/s. Datadin Air 1934

  1. A transferred gift to B, Nephew daughter. Then to B's male descendant.
  2. Absence of B's male child to B's daughter (limited interest was created) and absence of B, any descendant male/female to A's Nephew.
  3. B dies issueless,
  4. Gift in favour of B was valid but gift made in favour of B's daughter was void as limited interest was created and according to section 13, interest created in favour of unborn person should be absolute interest.
  5. Further subsequent transfer to A's nephew will also fail as per section 16 (Transfer to take effect on failure of prior interest) of Transfer of Property act, 1882.[8]


Legal Consequences For Transfer To Unborn Child

  1. The intermediary person living at the date of the transfer is to be assumed only life interest. He has to preserve the property like a trustee during his life-time on behalf of the unborn. If absolute interest is given to this living person, he may be entitled to dispose it off to anyone. If he holds it, the property after his death shall go to his legal heir and not to the unborn for whose ultimate benefit the disposition was made.
     
  2. The unborn must come into existence before the death of the person holding property for life. If the unborn comes into existence say, after one month after the death of the last living person (i.e. after termination of the preceding interest), the property is to revert back to the transferor or his legal heirs. This is apparent because after termination of the life-interest, it cannot remain in abeyance and cannot wait even for a moment for the next person to come into existence.[9]
     
  3. For instance, A transfer property of which he is the owner to B and his future wife successively for their lives, and after the death of the survivor for the eldest son of the intended marriage for life and after his death for A's second son. Here, the successive life interests in favour of B and his intended wife is a valid transfer. But the eldest son of the intended marriage who is unborn has been given the property only for life and not an absolute interest. Therefore, the transfer in his favour is void and does not take effect.


Conclusion
The TOPA (Transfer of Property Act) does not permit transfer of property directly in favour of an unborn person. Thus, in order to transfer a property for the benefit of a person unborn on the date of the transfer, it is imperious that the property must first be transferred in favour of some other person living on the date of transfer. In other words, the property must vest in some person between the date of the transfer and the coming into existence of the unborn person since property cannot be transferred directly in favour of an unborn person. The interest of the unborn person must in every case be preceded by a prior interest.

Further where an interest is formed in favour of an unborn person on a transfer of property such interest in favour of the unborn person shall take consequence only if it extends to the whole of the outstanding interest of the transfer-or in the property thereby making it impossible to confer an estate for life on an unborn person. In other words, the interest in favour of the unborn person shall constitute the whole remaining interest. The underlying principle in section 13 is that a person disposing of property to another shall not shackle the free disposition of that property in the hands of more than one generation.

Section 13 does not prohibit successive interests being formed in favour of several persons living at the time of the transfer. What is prohibited under section 13 is the grant of interest restricted by time or otherwise to an unborn person. In simple terms, while section 13 of TOPA lays down the instrument for transfer of property for the benefit of unborn person and "what property" is required to be ultimately transferred in favour of an unborn person in order to legalize such transfer, section 14 of TOPA delivers the "maximum period as to when" such property can be vested upon such unborn person.

Endnotes:

  1. Wordpress.com/transfer-of-property-to-unborn-child
  2. Dr. Avatar Singh, Transfer of Property Act, Universal Law Publishing Co.
  3. Dr. G.C Bharuka, Mulla transfer of property act1882, Lexis Nexis
  4. Isaac Nissim Silas And Ors. vs Official Trustee Of Bengal on 9 May, 1956
  5. www.academia.com/transfer -of-property-unborn-child
  6. lawtimesjournel.in/transfer-for-benefit-of-unborn-child
  7. lawoctopus.com/academike/transfer-of-property-unborn-child
  8. dtlegal.in/girjesh-dutta-vs-datadin-air-1934-landmarkcase
  9. Real property future interest-rights of unborn child, Indiana Law Journal 1931

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