Transfer of the Property’s Benefits to An Unborn Child

Transfer Of The Property’s Benefits To An Unborn Child

In Property Law; there is a transfer between two living people. The person who transfers the property is known as the transferor and the person to whom property is transferred is known as the transferee. But what about the person who is in the mother womb; Is transfer to an unborn person is void or legal? A person who does not come yet in the world has a right to get property or not?

According to Section 13 of The Transfer of Property Act, 1882,” Where, on a transfer of property, an interest therein is created for the benefit of a person not in existence at the date of the transfer, subject to a prior interest created by the same transfer, the interest created for the benefit of such person shall not take effect unless it extends to the whole of the remaining interest of the transferor in the property.”

There cannot be any direct transfer interest of the property to an unborn child. And here an unborn child means a child who is not in existence even in the mother’s womb. When a child exists in the mother’s womb. Then he is a competent transferee to the property. And we can also transfer the property to the child when he is in his mother’s womb. But we cannot transfer the property can to any such person who does not even exist in the mother’s womb because such kind of person is an unborn person or unborn child. Section 5 of this Act provides that transfer of property takes place between two living persons which means transferee must also be in existence at the date of transfer. And every transfer of the property must involve the transfer of interests. When the property is transferred, then the transferor divests himself of that interest of property and vests it immediately in the transferee. So, if the property is directly transferred to that person who is not in the existence of the world, then the interest of property so transferred shall be divested or to revert from the transferor and it would have to remain in the void and wait for the transferee to come into the existence to whom it could vest.

Rules Regarding The Benefits Of Transfer Of Property For An Unborn Child

Property cannot be transfered directly to an unborn person but the property can be transfered for the benefit of an unborn person. Section 13 provides that property can be transferred for the benefit of an unborn person subject to the following conditions:

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(i) Transfer of the property for an unborn child must be preceded by a life interest in the favour of a person in existence at the date of the transfer.

(ii) Only the absolute interest of property may be transferred in favour of the unborn person.

[i] Prior Life-Interest

This means that the interest of property in the favour of an unborn child always must be preceded by a prior interest created in the favour of a living person. This means where the person intends to transfer certain properties for the benefits of an unborn child, then such an unborn child is the ultimate beneficiary of such property. But since such an unborn person or ultimate beneficiary is not in the existence at the date of the transfer of property and property cannot be given to him directly. There must be a prior life interest in favour of a living person so that such living person holds the property during his life and till that time the unborn would come into existence. After the termination o this life interest i.e. after the death of the living person holding property for life, the interest would pass on ultimately to the unborn there must be an intermediary living person who may take such property in the trust for benefit of the unborn child. In this manner, successive life interests may be created preceding the interest in favour of the unborn person.

Illustration

Sobha transfers his property to Vijay for life and then to Ram for life and then to Rahul for life and thereafter transfer to the unborn child of Rahul. Here Vijay, Ram, Rahul are all living persons in existence at the date of the transfer of property. This disposition of the property is valid. The property can also be given to the more than one living persons successively ‘for life’ before it ultimately vests in the unborn child (Vijay’s unborn child).

[ii] Only The Absolute Interest of property may be given

Only the absolute interest in the property may be transfered in the favour of an unborn person. Limited or life interest of property cannot be given to an unborn person. Transfer of property to an unborn person for life is void and it cannot take effect.  And Section 13 also enacts that property interest given to the unborn person must be the whole of the remaining interest of the transferor in the transferred property. When the property is transfered in the favour of an unborn person, and the transferor first gives a ‘life interest’ to an existing person. And after transferring this interest, he retains with him the ‘remaining interest’ of the transferred property. This ‘remaining interest’ with transferor must be given to the unborn person so that after the termination period of prior life interest, the unborn person gets the whole i.e. absolute interest in the property.

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In other words, ‘whole of remaining interest’ is the entire interest of the transferor less interest carved out of the ownership. The transfer in favour of the unborn and the prior life-interest must exhaust the whole interest of the transferor in the property which is transferred by him. If there is any other limitation that derogates or cuts short other completeness of the grant in favour of the unborn, the transfer is void. Thus, the life interest or other limited interest of property cannot be given to the unborn.

Illustration

(i) Rahul transfers his properties to Sahil for life who is unmarried and then to the eldest child of Sahil absolutely. The transfer in favour of the eldest child of Sahil is valid.

(ii) A transfers his property to X for his life and thereafter to the unborn person for life, X is a living person at the date of the transfer of the property. An unborn person is not in the existence at the date of the transfer of property. Here, the transfer of the life interest in the favour of X is valid. But, the transfer of life-interest in favour of the Unborn person is void because although the transfer in the favour of the unborn person is preceded by a life interest to the X but the unborn person himself has not been given an absolute interest. The result is, therefore, that X shall behold the property during his life but after his death, it shall not pass on the Unborn person but shall be revert back to A or (if A is dead by that time) then to A’s legal heirs.

The above-mentioned two conditions namely, the transfer in favour of an unborn person must be preceded by a life interest and that only absolute interest may be given to the unborn has the following legal consequences:

(a) The intermediary person who living at the date of the transfer of the property is to be given only the life interest of the property. Giving the transfer of life interest or creating the life-estate in the favour of a person means that giving him only the right of enjoyment and possession. He has to preserve the property only like a trustee during his lifetime on behalf of the unborn person. If the absolute interest of the property is given to that living person, then he may be entitled to dispose of it off to anyone. If he retains 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.

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(b) The unborn person must come into the existence before the death of the person who holds the property for life. If the unborn comes into existence say, after one month after the death of the last living person, the property is to revert back to the transferor or his heirs. This is obvious because, after the termination of the life interest of the property, it cannot remain in abeyance and cannot wait even for a moment for the next person to come into existence.

For Example, A transfered the property of which he is the owner to B and his intended 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 interest of property in the 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 the life, not an absolute interest of property. Therefore, the transfer of property in his favour is void and does not take effect.

Essential Element Of Section 13

(i) Transfer for benefit of an unborn person if male directly is void.

(ii) Transfer should be beneficial for the unborn person.

(iii) Transfer is to be made by creating prior life interest.

(iv) Possession of unborn.

(v) Unborn person must take birth before the cessation of prior life interest.

(vi) Unborn person shall get a vested interest in the property on the date of taking birth.

Case Laws: Girjesh Dutt V. Data Din

The facts were as under. A made a gift of her property to her nephew’s daughter C for life and then absolutely to C’s male descendants if she should have any. But, in the absence of any male child of C, to C’s daughter without the power of alienation and, if C has no descendants male or female then to her (A’s) nephew. C died issueless. The Court held that the gift for the life to C was valid as C was a living person at the date of the transfer. But the gift in the favour of C’s daughter was void under Section 9 of the Transfer of Property Act because it was a gift of only limited interest (gift without the power of alienation): she had not been given the absolute interest . Further, since this transfer was invalid the subsequent transfer depending on it also failed.

 

Rajnandni (5th Year)
Sourabh Bhagoriya (2nd Year)
Geeta Institute of Law (Panipat)

Author: Sourabh Bhagoriya,
Geeta Institute of Law, 5th and 2nd Year / Law Student

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