§ 1265.420.Acquired Property Subject to Life Tenancy

A life tenancy splits ownership between someone who has the right to use property for their life and someone who takes it afterward. Condemnation collapses that split into a single cash award, and this section gives the court several tools for sorting out what each side should get.

On petition of the life tenant or anyone else with an interest in the property, the court can order any of four approaches. It can apportion and distribute the award directly, based on the relative value of the life tenant's interest and the remainderman's interest. It can direct that the compensation be used to buy comparable replacement property, held subject to the same life tenancy going forward. It can put the compensation in trust, invested, with the income -- and, if the instrument creating the life tenancy permits it, some principal -- paid to the life tenant for the rest of the tenancy. Or, if none of those fits, the court can order whatever other arrangement is equitable under the circumstances.

That last option gives the court real flexibility -- the first three approaches cover the common situations, but subdivision (d) leaves room for a life tenancy that does not fit the usual mold.