Co-ownership Flashcards
Owning property is made more complicated when there is more than one owner. In legal speak, we classify co-ownership as either:
(i) a tenancy in common (TIC); or (ii) joint tenancy (JT). Co-owners act collectively in their rights and responsibilities. Each co-owner is entitled to use and occupy the property in question. In Ireland, you can have as many co-owners as possible, whereas in the UK this is restricted to 4 people.
Joint tenancy (JT) JT refers to the case where 2 or more people hold equal (joint) shares in a property.
JT further attracts the right of survivorship (jus accrescendi) i.e. when one JT dies, their interest passes to the rest of the other JT’s (last person standing rule) rather than being passed to an outsider.
JT Requirements:
(i) unity of possession (each has an equal right to possession);
(ii) unity of interest (same estate i.e. either freehold or leasehold);
(iii) unity of title (i.e. from the same deed, usually a deed of transfer); and
(iv) unity of time (this is usually deduced from the deed of title).
TIC =
unequal owners in a prop and their interests can pass at death to a person outside the TIC i.e. by will or intestacy. There is no requirement for the 4 unities and also, no right of survivorship. While the common law prefers JT’s as it seeks to avoid the division of land, equity favours TIC’s. Therefore, it is possible to be legal JT’s but equitable TIC’s (e.g. trustees are JT’s but the beneficiaries hold their shares in common).
There is a general presumption of a TIC where purchase monies were provided in unequal shares. The presumption can be displaced where it can be presumed that one party intended to benefit the other e.g. where a married couple purchased property together, or where there is a prior relationship between the parties. Where in a partnership, it is presumed that the property is held as a TIC to reflect the commercial arrangement i.e. the partnership agreement or under the Partnership Act 1890 (where there is no agreement) i.e. one person holding the legal title as partnership property. On the severance of a JT, the JT cannot be re-granted.
Malayan Credit:
lease of a building by 2 people, and the rent was proportionate to the floor space they had, no lump sum paid. Ct held that the tenants were a JT in law but were also JT in equity, and that equity is not restricted to unequal shares. Equity will therefore intervene to give effect to the parties’ intention.
Another way to convert a JT into a TIC, is commorientes (simultaneous death)
This doctrine is invoked when it is unclear who died first in a given situation. Section 5 Succession Act 1965 notes that for the purposes of distribution of the estate, those who have died shall be deemed to have died simultaneously as amended by Section 68 Civil law (miscellaneous provisions) Act 2008 which severs the JT into equal shares.
Re Kennedy Estates: married couple who drowned in a lake. The coroner could not say for certain who died first.
Statutory intervention:
LCLRA 2009
Section 30 LCLRA09: Unilateral severance of a joint tenancy:
Section 31 LCRLA09: Court orders:
Section 30 LCLRA09: Unilateral severance of a joint tenancy:
by one or more of the JT is not permitted. If you want severance i.e. you want out, you have to apply to the cts under Section 31 (see below). Consent means the prior written consent of all JT’s. In the case of involuntary severance i.e. a mortgage being enforced and thereby the unity of title being eroded, LCLRA09 makes clear that a judgment mortgage is not included in these circumstances. Section 30 also does not affect a mutual agreement by the parties who by their conduct have severed the JT in equity i.e. equity may imply a severance on the basis of a “course of dealing” (Wilson v Bell).
Section 31 LCRLA09: Court orders:
useful for a JT who needs to effect the consent requirement in Section 30 and wants to convert the JT into a TIC. Further, if one of the co-owners has unduly benefitted, the others can apply to the cts to account to her fellow co-owners for the amount received. This section allows for a partition order i.e. the division of property to terminate co-ownership. One co-owner cannot force a sale without the consent of all the others (Section 30). In lieu of partition, there is also an option for order of sale. Cts have the discretion to refuse to grant the order. Historically cts could not refuse to do that. If third party consent is required, ct may adjourn the proceedings to see if consent is forthcoming. Partition should not be ordered when it would prejudice a third party’s interest in the prop and this may be a bar to partition, where third party consent is not available. If the mortgagee (bank) does not consent, the property must be redeemed (repay the mortgage) or may be ordered to be sold (to repay the mortgage). Interested third parties therefore include: trustees, mortgagees, secured creditors and a judgment mortgagee having an interest or estate in land which is co-owned.
