According to federal theology, the whole system of Christian doctrine hangs on the two federal (representative) heads of Adam and Christ. Biblical history is structured around the covenant with Adam, or the covenant of works, and the covenant with Christ, or the covenant of grace. Each individual's experience is only properly understood with reference to whether he is "in Adam" or "in Christ." So, I want to begin laying out this "federal scheme" by describing what is meant by the "covenant of works." Future posts may deal with the "covenant of grace."
God made a covenant with Adam in which He promised Adam justification and eternal life for perfectly fulfilling the law. Had Adam kept the law perfectly, as a federal head, He would have merited justification and eternal life for all of his posterity because they were federally united to him. I don't say that Adam was created in a state of justification and adoption, since God the judge never revokes the life-blessing of justification and because God the Father always preserves His sons and never casts them off, but Adam fell; so, he couldn't have been in a state of justification from the beginning. Therefore, it is better to say that Adam was created with the possibility of meriting justification and eternal life, but not in a state of justification or eternal life.
We're not told explicitly, but it makes sense to say that there was some period of trial or probation through which Adam had to pass in order to merit justification and eternal life. If there were no trial period, after which he would be rewarded with justification and eternal life, then he could never have functioned as "federal" or "representative" head for those who were "in him." He would be forever working to maintain present blessings, never actually able to purchase and secure any final benefits for his constituents. Thus, it is logical to conclude that there was some probationary period, the length of which is unknown, after which Adam would have merited and secured the right to justification for his posterity.
Had Adam successfully completed this probationary period, all of his posterity, who were "in him," would have been given all the benefits purchased by his merits. His children and their children after them would have had the right to justification before they were even conceived based on Adam's righteousness, and this would have guaranteed and required that God bring each of Adam's constituents into physical existence so that they could experience actual justification and eternal life. The right to justification necessarily issues in actual justification. Upon conception, they would have been immediately granted actual justification and eternal life and based on Adam's righteousness, God would have preserved those united to Adam in justification and eternal life by working perfect holiness in them forever.
However, as you know, none of this took place. Instead, the exact opposite happened. Adam sinned against the law of God. There is no need for a probationary period in which Adam would have to sin consistently over a period of time to demerit condemnation, since even a single sin against God's holy law demerits condemnation and eternal death. Adam's sin resulted in the immediate condemnation of Adam and his sin demerited the liability to condemnation and eternal death for all who are united to him as their federal head.
Therefore, upon physical conception, all of Adam's posterity is immediately cursed with actual condemnation based upon Adam's first sin (unrighteousness). Their liability to condemnation becomes actual condemnation as soon as they are conceived. This liability to condemnation legally guarantees and obligates God to bring into existence all who are represented by Adam so that they might be called to account for their act in their representative head. Though they did not act subjectively in their own existences, they acted really by virtue of Adam's legal representation on their behalf. Finally, because all who are born "in Adam" are immediately cursed with actual condemnation, they must suffer the penalty of that condemnation, which involves God cursing them by giving them over to more and more sin and to totally depraved natures which grow wise in evil and do no good whatsoever. Those who go to their graves "in Adam" and who were never transfered to the headship of Christ during this life will suffer under the penalty of eternal death in hell, which is the final consequence of Adam's first sin, of condemnation in him, and of their own actual transgressions which flow from that first sin.