Legal Definitions - life-owner

A life-owner, also known as a life tenant, is an individual who holds an interest in property for the duration of their own life or the life of another specified person. This means they have the right to possess, use, and enjoy the property, and often to receive any income it generates, but they do not have full ownership rights that would allow them to sell or transfer the property outright beyond their lifetime. Upon the death of the designated person, the property typically passes to another designated beneficiary, known as the 'remainderman'.

• Example 1 (Residential Property): Eleanor's will states that her son, David, can live in her family home for the rest of his life. After David passes away, the house is to go to Eleanor's grandchildren.

  Explanation: David is the life-owner of the house. He has the right to live in and enjoy the house for his entire life. However, he cannot sell the house outright or leave it to his own heirs in his will, because his interest in the property ends upon his death, at which point it automatically transfers to the grandchildren.

• Example 2 (Agricultural Land and Income): A charitable trust owns a large farm. The trust agreement specifies that Farmer John is granted the right to farm the land and keep all the profits from its produce for as long as he lives. After John's death, the farming rights and profits will revert entirely to the charity.

  Explanation: Farmer John is the life-owner of the farming rights and the income generated from the land. He benefits from the property during his lifetime, but he does not own the farm itself and cannot pass on the farming rights to his children; those rights terminate upon his death.

• Example 3 (Commercial Property Income): A wealthy investor sets up a trust for his niece, Sarah. The trust holds a commercial office building. The terms of the trust stipulate that Sarah is to receive all the rental income generated by the office building for the duration of her life. Upon Sarah's death, the building itself, and all future rental income, will be transferred to a university endowment.

  Explanation: Sarah is the life-owner of the income stream from the commercial property. She enjoys the financial benefits of the property during her lifetime, but she does not own the building itself and cannot sell it or direct its future ownership after her death.