Mahrenholz v. County Board of School Trustees, Appellate Court of Illinois, 1981

Fact:
W.E. and Jennie Hutton executed a deed to convey his part of the land to the Trustees of School District No.1 (the predecessors of the defendants) in March 1941. The deed provided that “this land to be used for school purpose only; otherwise to revert to Grantors herein”. The land conveyed by the Hutton became the Hutton School and the School had run until 1973. The school children were transported to other facilities in 1973 and since then, the property was used for storage purposes. In July 1941, the Huttons purported to convey the reversionary interest in the school land to the Jacqmains. W.E. Hutton died intestate in 1951, and Jennie Hutton died intestate in 1969, and the Hutton’s legal heir was their only son, Harry E. Hutton. In 1959, the Jacqmains purported to convey their interest in the Hutton School land to the Mahrenholzes (plaintiff). In 1977, Harry Hutton (son) conveyed to Herbert and Betty Mahrenholz (the plaintiff) all of his interest in the Hutton School land.

Procedural History:
The plaintiff filed a complaint to seek quiet title to the school property. In 1979, the trial court dismissed the complaint, on the ground that the conveyance was a fee simple subject to a condition subsequent, followed by the right of entry for condition broken, rather than a determinable fee followed by a possibility of reverter. Since Harry Hutton did not retake the land, the trial court found that the plaintiff was not entitled to the land. The plaintiff appealed.

Issue:
When the language of the deed provides the ambiguous purpose and otherwise reverting the land to the grantor, does the deed create a fee simple determinable with the possibility of reverter?

Holdings:
Yes. The deed was a fee simple determinable followed by a possibility of reverter because the language “only” immediately following “this land to be used for school purpose” shows a limited grant. In addition, “otherwise to revert to grantor” indicates a mandatory return of a fee simple determinable rather than a permissive return by re-entry of the land of a fee simple subject to condition subsequent. Thus, when the land was not used for school purposes, the grant was automatically terminated based on a fee simple determinable. By statute, neither a fee simple subject to a condition subsequent followed by a right of reentry nor a fee simple determinable followed by a possibility of reverter can be alienated inter vivos. Thus, the Huttons could not convey their interest in Hutton School Land to the Jacqmains, and accordingly, the Jacqmains had no interest to convey to Mahrenholzes. Thus, only the Hutton’s heir, their son, Harry had reversionary rights to the Hutton School Land. The trial court errored that in holding that Harry was required to take action to retake the land because the deed was a fee simple determinable. The case was reversed and remanded to the trial court for the determination of whether the school district’s use of the land as storage is considered to be used for the school purpose and whether Harry Effectively conveyed his interest in the property to the Mahrenholzes in 1977.

Rule of the Law:
When the deed language does not state clearly but says “for the purpose only and otherwise reverting the land to the granter”, the grantor creates a fee simple determinable followed by a possibility of reverter.