Legal Definitions - power of termination

The power of termination is a legal right that allows a former owner (known as the "grantor") to reclaim property they previously transferred to another party (the "grantee") if a specific condition attached to the transfer is broken. This right is not automatic; the grantor must actively choose to exercise it to take the property back. It is often referred to as a right of entry, right of reentry, or right of entry for breach of condition.

Here are some examples to illustrate this concept:

• Imagine a wealthy philanthropist, Ms. Chen, donates a large plot of land to her hometown's city council with the specific condition that the land must always be maintained as a public botanical garden. Her deed states that if the city ever attempts to sell the land for commercial development or build anything other than garden-related structures, Ms. Chen or her heirs retain the power of termination. Years later, the city council, facing budget shortfalls, considers selling a portion of the garden to a shopping mall developer.

  • This illustrates the power of termination because Ms. Chen (the grantor) attached a condition to her gift. If the city (the grantee) breaches that condition by selling the land for commercial use, the land doesn't automatically revert to Ms. Chen. Instead, Ms. Chen or her heirs would have the right to choose to take legal action to reclaim the property. They are not obligated to do so, but the power exists for them to exercise.

• Mr. Davies, a retired farmer, sells a portion of his farmland to a young couple, the Millers, who want to start an organic farm. To ensure the land remains agricultural, the deed includes a condition that the property must never be used for industrial purposes, such as building a factory or a large warehouse. The deed explicitly grants Mr. Davies a right of entry for breach of condition.

  • Here, Mr. Davies holds the power of termination. If the Millers (or subsequent owners) decide to sell the land to a company that plans to build a factory, they would be breaching the condition. Mr. Davies would then have the option to exercise his right to reclaim the property, preventing its industrialization. He must actively assert this right; the property does not automatically return to him.

• A historical preservation society sells an old, architecturally significant building to a developer, Ms. Rodriguez, with the strict condition that the building's original facade must be maintained and cannot be altered or demolished. The sales agreement specifies that the society retains a right of reentry if this condition is violated.

  • This demonstrates the power of termination because the historical society (the grantor) has reserved the right to reclaim the property if Ms. Rodriguez (the grantee) or future owners fail to uphold the preservation condition. If Ms. Rodriguez decides to tear down the facade to modernize the building, the society would then have the legal option to exercise its power to take the property back, thereby enforcing the preservation terms.