Property Law: B. Co-Tenancy

Question 1

What is a tenancy in Common

Feb 2009, Essay 4

Answer 1

Tenancy in common is the default estate created by a conveyance or bequest of real property to two or more people. Unless there is language the creates a survivorship or tenancy by the entirety.

Question 2

How to create a tenancy in common?

Answer 2

To create a tenancy in common, the grantor does not need to use explicit language.

Question 3

What does each tenant own?

Answer 3

Each tenant in common owns an undivided interest in the property, and has the right to use and enjoy the entire property.

Question 4

Is there survivorship rights in a tenancy in common?

Answer 4

No. There is no survivorship rights with a tenancy in common, and upon death the tenant’s interest passes to their estate.

Question 5

Joint tenancy: Formation
How do you Form a joint tenancy?
Feb 2009, Essay 4

Answer 5

A joint tenancy is a conveyance of real property to two or more persons. It’s formed when the four unities are present

Question 6

What are the four unities of a joint tenancy?

Answer 6

1. Unity of time
2. Unity of title
3. Unity of interest
4. Unity of possession
   TTIP

Question 7

What is Unity of time?

Answer 7

Unity of time means all interests were acquired at the same time.

Question 8

What is Unity of title?

Answer 8

Unity of title means all interest were required by the same instrument.

Question 9

What is Unity of interest?

Answer 9

Unity of interest means all ownership interests are equal.

Question 10

What is Unity of possession?

Answer 10

Unity of possession means all interests have equal rights of possession.

Question 11

What must be clear to create a joint tenancy?

Answer 11

There MUST be clear EXPRESS INTENT to create a joint tenancy, which may be satisfied by including such terms as “ joint tenants”, “ right of survivorship”, “ joint tenants with right of survivorship”, or even “jointly” (if intent is proven).

Question 12

What does right of survivorship means?

Answer 12

A right of survivorship means that when one joint tenant dies his interest in the land is automatically transferred to the other joint tenant (s).

Question 13

Joint tenancy: Severance
How do you severe a joint tenancy?
Feb 2020, Essay 2
Feb 2009, Essay 4

Answer 13

1. You can severe by transferring ownership interest.
2. Convey interest to a third-party.
3. Takes out a mortgage on her interest
4. One joint tenant leases the property

Question 14

What happens when one joint tenant transfers ownership interest?

Answer 14

Generally, when one joint tenant unilaterally transfers his ownership interest in the real property, the joint tenancy is severed and the tenants will then hold the property as tenants in common.

Question 15

What happens when one joint tenant conveys interest to a third-party?

Answer 15

When a joint tenant conveys his interest in a joint tenancy to a third-party, that party takes the property as tenants in common.

Question 16

What happens if there’s only two joint tenants?

Answer 16

If there are only two joint tenants, the joint tenancy is severed.

Question 17

What if there are more than two joint tenants?

Answer 17

If there are more than two joint tenants, the joint tenancy remains, but only among the other joint tenants.

Question 18

What happens when one joint tenant takes out a mortgage on her interest?

Answer 18

When a joint tenant takes out a mortgage on her interest, the mortgage’ effect on the joint tenancy will depend on the jurisdiction.

Question 19

What are the two jurisdictions where a mortgage can effect the joint tenancy or not?

Answer 19

1. Lien theory jurisdiction

2. Title theory jurisdiction

Question 20

What does Lien theory jurisdiction means and how it effects the joint tenancy when there’s a mortgage?

Answer 20

In a lien theory jurisdiction, the mortgage will NOT sever the joint tenancy.

Question 21

What does Title theory jurisdiction means and how it effects the joint tenancy when there’s a mortgage?

Answer 21

In a title theory jurisdiction, the mortgage WILL sever the joint tenancy.

Question 22

What happens when the joint tenancy in a title theory jurisdiction is severed?

Answer 22

Once the joint tenancy is severed under a title theory jurisdiction, the tenants will then hold the property as tenants in common.

Question 23

What happens when one joint tenant leases the property?

Answer 23

When one joint tenant leases the property, the lease’s effect on the joint tenancy ill depend on the jurisdiction.

Question 24

What is the common law rule in most states regarding a joint tenant leasing property?

Answer 24

Most states follow the common law rule that a lease by one joint tenant severs the joint tenancy, wherein it is converted to a tenancy in common.

Question 25

Joint tenancy: lease by one joint tenant.

Feb 2020, Essay 2

Answer 25

When one joint tenant leases the property, the lease’s effect on the joint tenancy will depend on the jurisdiction.

Question 26

What is the common law rule in MOST states regarding a joint tenant leasing property?

Answer 26

Most states follow the common law rule that a lease by one joint tenant severs the joint tenancy.

Question 27

What is the common law rule in OTHER states regarding a joint tenant leasing property?

Answer 27

Other states hold that such a lease does not sever the joint tenancy.

Question 28

What are the middle ground that some courts follow when leasing joint tenant dies before the end of the lease term?

Answer 28

Some courts follow a middle ground approach where the joint tenancy is severed only if the leasing joint tenant dies before the end of the lease term; otherwise the leasing joint tenant owns the whole property by right of survivorship if he survives the other tenants.

Question 29

What happens if the joint tenancy is severed?

Answer 29

If the joint tenancy is severed, then the co-tenants will own the property as tenants in common.

Question 30

What happens with the remaining lease?

Answer 30

A lease by one joint tenant will still remain in effect and will be valid against that leasing joint tenant’s undivided interest (even if the leasing joint tenant dies first).

Question 31

In such a situation will both the lessee and the non-leasing joint tenant have right to occupy the property?

Answer 31

In such situation, both the lessee and the non-leasing joint tenant will have the right to occupy the property, and either the lessee not the non-leasing joint tenant can exclude each other.

Question 32

What happens if the joint tenancy is not severed?

Answer 32

If the joint tenancy is not severed, then whether the lease terminates depends on which joint tenant dies first.

Question 33

What happens if the leasing joint tenant dies first?

Answer 33

If the the leasing joint tenant dies first, then the lease terminates because the property passes to the non-leasing joint tenant by survivorship.

Question 34

What happens if the non-leasing joint tenant dies first?

Answer 34

If the non-leasing joint tenant dies first, the lease remains in effect because the property passes to the leasing joint tenant by survivorship.

Question 35

What are the 4 Co-tenant’s Entitlement to rent?

Answer 35

1. Rent from co-tenant
2. Rent from a third party
3. Reimbursement for repairs
4. Reimbursement for improvements

Question 36

Does an out-of-possession co-tenant have a right to receive rent from in-possession co-tenant?

Answer 36

No. An out-of-possession co-tenant DOES NOT have the right to receive rent from the in-possession co-tenant, unless the in-possession co-tenant wrongfully ousted the out-of-possession co-tenant from the property.

Question 37

What happens when one co-tenant voluntarily quits (or simply does not use) the property?

Answer 37

When one co-tenant voluntarily quits (or simply does not use) the property, the other co-tenant is not liable for rent for his use of the entire property.

Question 38

Can a co-tenant who voluntarily quits or simply does not use the property collect rent from another co-tenant who is in exclusive possession of the premises>

Answer 38

No. A co-tenant cannot collect rents from another co-tenant who is in exclusive possession of the premises.

Question 39

How can the co-tenant who voluntarily quits or not using the property bypass the rule and collect rent from another co-tenant in exclusive possession of the property?

Answer 39

The co-tenant can bypass this rule if: There is an agreement to the contrary; OR the co-tenant seeking rent was wrongfully ousted.

Question 40

What happens when an in-possession co-tenant Rents to a third-party?

Answer 40

If an in-possession co-tenant rents property to a third-party, the out-of-possession co-tenant is entitled to his fair share of the rent paid by the third-party.

Question 41

Is a co-tenant who makes improvements to the property entitled to reimbursement from the other Co-tenants?

Answer 41

No. A co-tenant who makes improvement tot he property is NOT entitled to reimbursement from the other co-tenant(s), UNLESS there is a separate agreement tot he contrary.

Question 42

What will happen at the end of the co-tenancy (where there’s a partition or sale of the property)?

Answer 42

At the end of the co-tenancy, the improving co-tenant bears all the downside risk of the improvements, but also has all the upside gain.

Question 43

What happens if the property appreciated because of the improvements?

Answer 43

If the property appreciated because of the improvements, ONLY the improving co-tenant is entitled to that increase in value.