Reversionary

Relating to or involving a reversion; of the nature of a reversion. Specifically, it describes a right or interest in property that will return to a previous owner or their heirs after a specified event, such as the death of a life tenant or the fulfillment of a condition. The term often applies to legal and financial contexts, indicating an expectation or entitlement of future possession or ownership. This entitlement is usually deferred, contingent upon the occurrence of some future event or the passage of time. The value of a reversionary interest is calculated based on factors like the likelihood of the reversion occurring and the present-day value of the property or asset.

Reversionary meaning with examples

• The trust document stipulated that the property would become subject to a reversionary interest to the original grantor upon the death of the primary beneficiary. This ensured that the grantor's heirs would eventually regain control. This legal clause was included to provide a degree of control over the asset, even after its initial conveyance and to ensure its eventual return.
• Investing in the company was seen as having a potentially reversionary interest after the sale. Many investors saw this sale as a way to regain their original investment as well as additional funds through this eventual return, allowing the investor to control the market value. This interest in potential returns made this market a highly sought after investment.
• During the negotiations, the city council discussed the possibility of including a reversionary clause in the lease agreement. This would allow the city to reclaim ownership if the developer failed to meet certain project milestones. This stipulation was designed to protect the city's interests. This provision had a positive impact on the process of planning and building.
• The will outlined a reversionary gift, indicating that the property would return to the estate if the named heir predeceased the testator. This provision was designed to control future distributions. This arrangement was made to ensure the property was never left with unknown heirs. The interest held by the testator was intended to be secure.