This section is from the book "Popular Law Library Vol7 Equity Jurisprudence, Trusts, Equity Pleading", by Albert H. Putney. Also available from Amazon: Popular Law-Dictionary.
It is necessary here to explain the meaning of the rule against perpetuities. The purpose of this rule is to prevent any person from controlling the disposition of his property for longer than a certain period after his death. The rule is that all future estates must vest within a particular life or lives in being at the death of the testator and twenty-one years and a fraction (nine months, the period of gestation) thereafter. If the estate is created or limited by deed inter vivos, the lives in being must be those of persons who are living at the execution of the deed and not merely at the death of the grantor or settlor.9
This rule only applies to equitable estates and executory devises, it does not apply to contingent remainders. Section 27. The Rule Against Accumulations.
At first the testator or settlor was allowed to provide for the accumulation of his estate (i. e., the continued adding of the interest to the principal) for the whole period allowed by the rule against perpetuities. This period was later found to be too long,10
8 Eaton on Equity, Sec. 183, citing Lord Eldon in Moggridge vs. Thockwall, 7 Ves., 56.
9 Merwin on Equity, Sec. 273.
10 This result was mainly brought about by the agitation growing out of the will of one Thellusson which is described by Merwin as follows: "Such being the common law, one Thellusson made a will leaving all his property to trustees, directing that it should be converted into one to permit accumulations to be allowed, and by statute (40 Geo. III, c. 98), it was provided "that accumulations shall not be made except during one of three periods, as the testator or settlor may select, as follows: (1) The life of the settlor himself. (2) Twenty-one years from his own death. (3) During the minority of any particular person, living at the time of the settlor's death, who would be entitled to the rents and profits under the deed or will if of full age." " fund, and that the rents and profits should accumulate during the lives of all his sons, and of all his grandsons living at the time of his own death, and then, upon the death of the last survivor, that the whole estate should go to the third generation in a certain specified manner. He died in 1797 leaving three sons, three daughters, and £50,000. Accumulations might go on under this will for seventy-five years more, and thus the whole fund might amount in the end to £100,000,000, or $500,000,000. However, the will followed the rule, and it was held valid." 11 Merwin on Equity, Sec. 366.