Co-ownership Flashcards
Concurrent co-ownership?
Concurrent co-ownership – arises where two or more people together own the same estate in the same piece of land at same time.
Trusts of land and appointment of trustee’s act 1996 governs this.
Imposition of a trust
Whenever land is owned jointly, a trust of land is automatically imposed.
Imposition of a trust separates legal title to land which is held by trustees from equitable title held by beneficiaries.
Types of trust?
Types of trust – express trust
- Can be expressly created
- There are formalities that must be followed
- Evidenced in writing and signed by declarant
Implied trust
- Can be created impliedly in certain cases
- No formalities
- It will be either a constructive trust or resulting trust
Resulting trust – may be implied if a property is bought in A’s name and B makes a financial contribution. Might recognise a percentage in Bs name. Resulting trust can NO LONGER take place in family home.
- Constructive trust - unconscionability
Two types of co-ownership?
Joint tenancy
- Constitute one single entity
- Own whole property as collective entity
- The right of survivorship applies
Tenancy in common
- Not viewed as single entity, each has distinct but undivided share
- Right of survivorship does not apply
4 unities of title? FOR A JOINT TENANCY?
Unity of possession –
- Each co-owner is as much entitled to possession of any part of the land as the others. No co-owner can be excluded from any part of the land.
Unity of title
- All co-owners must acquire their title from same document. This will be satisfied if obtained from same transfer deed or lease.
Unity of interest
- Interest in land held by each co-owner must be of the same nature and duration.
Unity of time
- Interest of each co-owner must vest at same time. The interest of each co-owner must take effect at the same time.
ALL 4 FOR A JOINT TENANCY
UNITY OF POSSESSION FOR TENANCY IN COMMON
Legal title?
- Public face of co-ownership
- Trustees are names as registered proprietors on proprietorship register on land registry and are people who deal with buyers and lenders.
- Limit on number of people who can hold the legal title.
- Maximum of 4 legal owners
- Trustees must be sui juris – of full age and sound mind
- Must hold property as joint tenant
- Right of survivorship always operate and interest accrues to surviving joint tenant.
Equitable title?
- Private face of co-ownership
- No limit
- No requirement to be sui juris
- Can be held as tenants in common or joint tenants
- Good and proper practice to make an express declaration that it held as joint tenant. + 4 unities must also be present.
- When no express declaration – equitable title will be held as joint tenancy unless a rebuttable presumption of a tenancy in common applies.
- The rebuttable presumption applies in business asset or purchase of non-domestic property paid in unequal shares.
Severance?
Process of converting an equitable interest held as joint tenancy into an interest held as tenancy in common. It does not bring co-ownership to an end; it simply changes the basis on which equitable co-owners will continue to hold the legal title.
Law of property act s36
- Severance is granted by this provision – not possible to sever a legal joint tenancy only an equitable one.
- Severed by 2 ways. DURING BOTH PERSONS LIFETIMES
- Notice in writing
- Other acts or things – deliberately vague in Williams v Hensman – 3 ways.
Effect of severance
- If it serves the equitable joint tenancy, they will hold a tenancy in common which is an equal share – not based on initial contribution.
- Not possible for a to continue as joint tenant by themselves
Severance by notice in writing?
Form and intention of the notice
- No particular formalities to be observed for the notice
- Does not even need to be signed
- MUST DEMONSTARTE and unequivocal and irrevocable intention to sever the equitable joint tenancy immediately.
Must be served on all of the other equitable joint tenants
Deemed to be served if left in last known place of abode or business
Severance by other acts?
In Williams v Hensman
3 possible ways
- A unilateral act by a joint tenant operating on its own share
o No requirement for other joint tenants to know or consent to act of severance
o Can be subdivided into total alienation – where severing owner disposes of interest by way of sale or gift, partial alienation – disposes of interest by way of mortgage or lease – because when lease expires the holder will take the interest back unencumbered, and involuntary alienation. - where declared as bankrupt.
o Mortgage as an act of partial alienation - applies to their slice
- Mutual agreement of joint tenants
o When ALL equitable joint tenants agree that one person’s interest is served, thereby creating a tenancy in common
o Burgess v Rawnsley – can be done but mutual oral agreement. Enough to show the parties intended to sever the joint tenancy
o Look at intent not whether its finalised
- Any course of dealing which indicates the interests were mutually treated as constituting a tenancy in common
o Mutual conduct
o Course of dealing which indicate it
o Negotiations and discussions are helpful
o Making of wills is indicative
Resolution of disputes relating to land?
Resolution of disputes
- Anyone with an interest in the land can apply to court for an order relating to it
- Applicants can be trustees, beneficiaries, mortgagees
- Court may order trustees to do something – cannot order one beneficiary to buy out the other
- Order which can be made may be sale or orders as to who occupies
How does a court make its decision
- Must apply all factors IN TOLATA s15 in reaching its decision to s14 applications.
- Intentions of persons who created trusts – DON’T NEED TO BE CONCERNED WITH THIS FOR CO-OWNERSHIP ONLY FOR EXPRESSLY CREATED LIFETIME TRUSTS, OR WILL TRUSTS
- Purposes for which property subject to trust is held
o Whether that purpose was continuing
o If purpose is still continuing it will weigh against an order for sale being made
- Welfare of any minor who occupies or might reasonably be expected to occupy
- Interests of any creditor of any beneficiary –
o No longer primary factor now just a considerations.
- The circumstances and wishes of any beneficiaries of full age of majority
