Introduction

Section 16 of the Transfer of Property Act, 1882 (TPA) contains provision in relation to the transfer which is to take effect on failure of prior interest.

Section 16 of TPA

• This Section states that where, by reason of any of the rules contained in Sections 13 and 14 of TPA, an interest created for the benefit of a person or of a class of persons fails in regard to such person or the whole of such class, any interest created in the same transaction and intended to take effect after or upon failure of such prior interest also fails.
• The principle underlying this section is that a condition following a void condition, or a transfer dependent upon a void transfer is in itself void, even though if seen independently, it may be valid.
• The rule embodied in this section is a rule of English Law that a limitation following upon a limitation void for remoteness is itself void.

Illustration

• If a gift is made to A for life and then to A’s son (unborn) when he reaches the age of 25 years, and if A died without any son the property would revert to the testator.
• Thus, in this illustration, the transfer in favor of A for life is valid and the benefit of transfer would stop with the death of A. After A’s death the property would revert to the testator.

Case Law:

In Girjesh Dutta v. Data Din (1934), A made a gift to his nephew’s daughter B for life and subsequently to the descendants of B absolutely. However, B died childless. Here the gift was held to be void and the property was transferred to the legal heirs of the donee as Section 16 of TPA provides that if in a transfer of property, the prior interest fails, the subsequent interest also fails.