Perpetuities (Law)

The Rule Against Perpetuities is a big idea in American property law and has been a part of Arkansas law since its early days of statehood.

When a person sells or gives property to another person, the giver/seller can set requirements on the property that the new owner has to follow or give up their ownership. When a requirement is set on property, and that requirement lasts forever, the sale or gift of that property is a “perpetuity.” The Rule Against Perpetuities is a legal idea that stops the sale or gift “perpetuity,” causing it to have no effect. When the rule works, it is as if the property was not sold or given at all.

The Rule Against Perpetuities was first developed by judges in England in 1682. The purposes of the rule were threefold: to make sure people could easily sell property, to make sure property was controlled by living people, and to prevent the hoarding of wealth. The American colonists brought the Rule Against Perpetuities to the United States from England. Thomas Jefferson supported the idea, writing, “The earth belongs always to the living.” Harvard law professor John Chipman Gray wrote the formal definition of the Rule Against Perpetuities in 1886: “No interest subject to a condition precedent is good, unless the condition must be fulfilled, if at all, within twenty-one years after some life in being at the creation of the interest.” In other words, this rule applies if the requirement on the property does not have to end before twenty-one years after a named person dies. If it applies, it stops the sale or gift of property. This rule is followed using logic to see if the requirement might still be on the property twenty-one years after someone named in the sale or gift has died. If there is even the slightest chance the requirement might last longer than that, however strange this is, the sale or gift has no effect.

Arkansas has been using some version of the Rule Against Perpetuities since at least 1840. The Arkansas Supreme Court ruled in 1840, in Moody v. Walker, that it would be better for people’s children to waste their inheritance than for property to be tangled up with perpetuities. The idea behind the rule was even put into Arkansas’s constitution: “Perpetuities and monopolies are contrary to the genius of a republic, and shall not be allowed.” The Arkansas Supreme Court said in 1988, in Otter Creek Development Company v. Friesenhahn, that Arkansas’s constitution made the Rule Against Perpetuities a permanent part of Arkansas law.

However, in 2007, the Arkansas General Assembly passed a law that changed the original rule. The 2007 rule (HB 1130, sponsored by Representative Steve Harrelson) followed many other states’ efforts to make the rule simpler and less harsh. Instead of following confusing logic, the 2007 rule counted ninety years after the sale or gift to see if the requirement was still there. If the requirement had already lasted ninety years, then the rule would stop the effect of the sale or gift. Scholars pointed out how this change was similar to the old rule because ninety years was similar to a natural human life span. The Arkansas General Assembly passed a law, of which Representative Robin Lundstrum served as lead sponsor, to change the rule again in 2023. This time, instead of counting to ninety years, the rule counts to 365 years. The latest change has been controversial.

Some people seek to get rid of the Rule Against Perpetuities in Arkansas because they want to attract business from other states. They want people to put their money in Arkansas banks so that accountants, lawyers, and other professionals can make money by managing those funds. Wealthy people want to put their money in states without the Rule Against Perpetuities because they want greater control of their wealth after they die. Several states are competing with each other to attract this wealth, and one way to compete is to have a less harsh rule or no rule at all. It might be difficult or impossible to get rid of the Rule Against Perpetuities in Arkansas, however, because it is in Arkansas’s constitution. But by counting to 365 years before applying the rule, the new rule is similar to no rule at all.

There are a few states other than Arkansas that also have state constitutions that ban perpetuities. Some of these states have similarly increased the timeline, or they have gotten rid of the rule. Some scholars think that a rule that waits for many years longer than a natural human lifespan breaks the law of their state constitutions and goes against the original purposes of the rule.

The 365-year Rule Against Perpetuities in Arkansas means that requirements on property can last a long time, which could tie up property by making it harder to sell. The 365-year rule lets people control their property so that many generations of their children have to do what their ancestor told them to do if they want to keep the property. The 365-year rule also means some wealthy families can gather more wealth than before because it is harder for the family members to sell or give away their property.

The Arkansas General Assembly thought that these outcomes (and the potential problems that accompanied them) were worth bringing in more business for Arkansas. Some critics, however, do not think that business is worth it. When the Arkansas state representatives were debating the proposed new rule in 2023, some worried about changing such an old rule in the state, thinking that there might not be a good reason to choose 365 years over any other number and worrying that the rule would do little to help people in rural Arkansas. In the end, almost all of the representatives decided to vote for this change, and the 365-year rule was enshrined in state law.

For additional information:
Goss, Kay C. The Arkansas State Constitution: A Reference Guide. Westport, CT: Greenwood Press, 1993.

HB 1130 of 2007. Arkansas State Legislature. https://arkleg.state.ar.us/Bills/Detail?id=HB1130&ddBienniumSession=2007%2FR (accessed October 29, 2026).

HB 1339 of 2023. https://arkleg.state.ar.us/Bills/Detail?id=HB1339&ddBienniumSession=2023%2F2023R (accessed October 29, 2026).

Jacobs, Steven H. “Eighteen Generations of Uncertainty: Arkansas’s New Perpetuity Law is ‘Contrary to the Genius of a Republic.’” Arkansas Law Review 79 (Spring 2026): 81–116. Online at https://scholarworks.uark.edu/alr/vol79/iss1/5/ (accessed October 29, 2026).

Steven H. Jacobs
University of Arkansas School of Law