Washington State Managing Broker Practice Exam

A Fee Simple Determinable is a type of estate that is granted conditionally. It comes with specific stipulated conditions under which the property can be held. If those conditions are not met, the legal effect is that the ownership of the property automatically reverts back to the original grantor, or the person who created the estate.

This automatic reversion occurs without the need for legal action or a court proceeding, which is a defining characteristic of a Fee Simple Determinable. The grantor has retained a future interest in the property, known as a "possibility of reverter." Therefore, if the conditions attached to the Fee Simple Determinable are violated or not fulfilled, the title to the property will revert to the grantor, thereby terminating the original grantee’s interest in the property.

The other options do not accurately describe what happens when the conditions of a Fee Simple Determinable are not satisfied. For example, the idea that it remains permanently with the buyer contradicts the nature of this type of interest, as violations of the conditions would lead to its reversion. Similarly, the transition into a leasehold estate or a Fee Simple Absolute does not hold legal validity in the context of a Fee Simple Determinable. Therefore,