Final answer:
Earl's interest in the property as a life tenant ends upon his death and the interest reverts to Lilly's remainderman, if one is specified in the life estate agreement. Earl's heirs or estate executor do not inherit the life tenancy interest.
Step-by-step explanation:
When a life tenant such as Earl passes away, their interest in the property does not pass to their heirs or an estate executor. Instead, the interest in the property reverts back to the person who granted the life estate or to a specified remainderman. In this case, if Lilly had granted the life estate to Earl with a specified remainderman after Earl's life tenancy, the interest in the property will pass to Lilly's remainderman.
Life estates are a legal arrangement in property law where the life tenant has the right to occupy or use property during their lifetime, but they do not own the property outright. Upon the death of the life tenant, the property interest ends automatically and does not become part of the life tenant's estate; therefore, it does not pass through probate or to the life tenant's heirs.
As such, the correct answer to the question, 'Earl's interest will pass to which of the following?' is B) Lilly's remainderman, given that there is such a person specified in the life estate agreement.