Co-Ownership - Severance Flashcards
Legal title can only be held by Joint Tenancy
s. 1(6) LPA 1925
Legal title cannot be severed to create a tenancy in common
s. 36(2) LPA 1925
Maximum number of legal owners is 4; if more than that, only first 4 will be named as legal joint-tenants
s. 34(2)(a) TA 1925.
No limit on equitable title
Equitable title can be held under joint tenancy or tenancy in common
An express declaration of type of co-ownership is conclusive within the limits of the law
Goodman v Gallant, Pankhania v Chandegra
Express Trust can be overridden by proprietary estoppel
Clarke v Meadus
For a Joint Tenancy, 4 unities must be present
- Possession - co-owners entitled to possess whole property
- Interest - co-owners are all equally entitled under same type of interest
- Title - interests of the co-owners are derived from the same conveyance or transfer
- Time- the interests vest at the same time
There can be no joint tenancy if conveyance uses words of severance:
- In equal shares
- To be divided between
- In individual shares
- Martin v Martin
2. Fisher v Wigg
Joint tenants benefit from survivorship:
Joint-tenants inherit the interest of a join-tenant who dies; their interest cannot be disposed through a will
Gould v Kemp
Tenancy in common requirement
Only unity of possession
Equity presumes a tenancy in common where there is the intention, but also when purchase price is provided in unequal shares (1), but this presumption does not necessarily apply in domestic situations (2)
- Bull v Bull
2. Stack v Dowden, Jones v Kernott
Acts of severance
Only possible with tenancy in common, if a joint tenant severs they become tenancy in common
Act of severance through written notice (s. 36(2) LPA 1925):
- Consent of other joint-tenants not required
- Notice must be served to other joint tenants
- If posted, rules in ss. 196(3) and 196(4) LPA 1925 apply.
- If posted and delivered, notice may still be effective even if not read.
- Harris v Goddard
- s. 196 LPA 1925
- Re 88 Berkley Road
Valid notice of serverance cannot be revoked
Per Neuberger J in Kinch v Bullard
An expression in an application form that other joint-tenant was treating the joint tenancy as being severed was sufficient to constitute notice to sever
Quigley v Masterson
Act of joint-tenant “operating on his own share” (1)
(2) Voluntary transfer
(3) Involuntary transfer - (bankruptcy can sever joint-tenancy)
(4) Commencement of litigation - (obtaining divorce)
- William v Hensman
- Disposition of land under s. 53(1)(c) LPA 1925
- Re Dennis
An oral declaration to sever is not enough
Burgess v Rawnsely
Mutual Agreement (1)
Negotiation to sell (2): parties negotiate price where one buys out the other
Agreement to sell (3): agreement, with evidence that parties agreed to treat shares as separate was enough
- comes from William v Hensman
- Burgess v Rawnsley
- Davis v Smith
There will be a severance when the parties have acted over a long period of time on the assumption that each owns a share as tenancy in common - i.e. course of dealing
Burgess v Rawnsley - Lord Denning found that course of dealing had led to severance
Course of dealing sometimes not enough:
- No severance with separate capital accounts
- No severance when couple separated but no divorce
- Barton v Morris
2. Gore & Snell v Carpenter
If a joint tenant kills another joint tenant, they do not benefit from survivorship and they are severed:
- Murder
- manslaughter.
- Suicide Pact
- Re Crippen
- Re Hall
3, Dunbar v Plant
After severance of joint-tenancy, the tenants-in-common hold in equal share, this is so, even if they contributed unequally to the purchase price
Goodman v Gallant
It may be possible to declare in writing that different share should flow from the severance
Suggested in Finch v Baker
Rights and duties of trustees set out under ss. 6-9 TOLATA 1996, but also note:
(1) beneficiary with an interest in possession has an express right to occupy
(2) trustee has right to reasonably exclude or restrict beneficiaries, but this may not be done unreasonably, per s. 13(7), they cannot exclude a beneficiary already in occupation, unless beneficiary consents or there is a court order.
- s. 12 TOLATA 1996
2. s. 13 TOLATA 1996
(1) Any person who is a trustee or has interest in land subject to a trust of land can apply to court, court can make an order declaring the nature of an interest or relating to the exercise of any of the trustee’s functions as it thinks fit.
(2) factors court consider when deciding s. 14 applications
- s. 14 TOLATA 1996
2. s. 15 TOLATA 1996
In disputes between co-owners under s.14 TOLATA, courts may postpone sale and make other order, such as partitioning property
Chun v Ho, but examples of sales being ordered, i.e. Begum v Issa.
Disputes between co-owner and secured creditor:
Only apply if sale foes not have priority (mortgage bound by overriding interest); s. 14 gives court discretion to award sale in favour of non-priority creditor, but (1) case law suggests that sale is more often ordered
Mortgage Corp v Shaire
Disputes between co-owner and trustee in bankruptcy:
Where one of the co-owners goes bankrupt, Courts consider factors under s. 335A Insolvency Act 1986.
(1) after 1 year, the interests of the creditors are deemed to outweigh those of resisting co-owners, unless circumstances are “exceptional”
Harrington v Bennet
Disputes between co-owner and trustee in bankruptcy, “exceptional circumstances”:
- Child had educational difficulties and family could not afford property in another area - postponed for 6 months
- Child had special needs but postponement would require creditors to wait 3 years - sale ordered
- Bankrupt’s elderly mother lived in the house - postponed till after death
- Bankrupt had terminal cancer - postponed until 3 months after death
- Bankrupt’s spouse had schizophrenia - sale postponed
- Re Citro
- Barca v Mears
- Re Mott
- Re Bremner
- Re Raval
Purchaser: Sale by two trustees overreaches any equitable interests
City of London BS v Flegg
Sale by single trustee where there is beneficial co-ownership:
Lack of 2 legal owners means there is no overreaching
Williams & Glyn’s Bank v Boland
Purchase of property by single legal owner where there is beneficial co-ownership & mortgage is used to finance property purchase:
No overreach in favour of lender, since only one legal owner, lender therefore seems to lose priority.
(1) But no “shiver of time” between completion of purchase & registration of charge
(2) A beneficial co-owner may be deem to consent to rights being subject to those of the mortgagee where he knows that purchase of property has been made with aid of acquisition mortgage
- Abbey National v Cann
2. Paddington v Mendelsohn
Sale by single surviving joint-tenant
Conveyance same as with one Registered Proprietor
