Words and Phrases - "indefeasible vesting"

The deceased taxpayer agreed to sell shares to his three sons for $800,000, payable by a promissory note, with such sale to be completed within 30 days of the appointment of his executors. His will provided for the transfer of the assets of the residue of his estate to a spousal trust. Because at the time of the taxpayer's death the shares were subject to the agreement, the property that vested indefeasibly in the spousal trust was the promissory note and not the shares. Accordingly, the spousal rollover was not available. Robertson J.A. also quoted the statement of the trial judge that "indefeasible vesting requires that the person in whom the property is vested have the right to determine whether or not the property will be retained by him or her or disposed of to another." He went on to note that here, the agreement allowed for no discretion on the part of the vendor or the three sons.