Reverter is a legal term that has the potential to be extremely intricate and often misunderstood. The most helpful way to understand the term ‘reverter’ is to look at it as an interest in land that reverts to the original holder or owner after the current title holder or owner is unable to uphold a certain condition.
In legal terms, reverter is generally assumed to have arisen out of a condition in an appointment agreement or some other legal document that grants a temporary interest in the land. Once that condition is not fulfilled, the title or ownership of the land reverts back to the original grantor.
Examples of a Reverter
Let’s say a homeowner has been granted temporary occupancy of a house by its owner, who is living abroad. The homeowner can legally occupy the property until the original owner returns. If the original owner never comes back, perhaps even many years later, the ownership of the property will revert back to him or her.
Another example can be seen in the case of an employee being given temporary ownership of an asset, like a car or boat. If the employee fails to meet the terms and conditions of their agreement, or leaves the job, the ownership of that asset could revert back to the person who originally gave it to them.
Key Takeaways
Reverter is an important legal concept, and not easily understood. It is a right or interest in a piece of land that reverts back to the original owner or title-holder, once certain conditions are not met. It is typically seen in situations where an agreement has been made that grants someone temporary occupancy or a temporary ownership of an asset.