Co-ownership Flashcards
What is co-ownership and how does it arise?
Co-ownership arises when land is owned by more than one person. It can be either concurrent co-ownership, where two or more people together own the same estate in the same piece of land at the same time, or co-ownership through joint purchase, where individuals jointly purchase their own homes.
What is the process of changing the form of co-ownership from a joint tenancy to a tenancy in common called?
The process of changing the form of co-ownership from a joint tenancy to a tenancy in common is called severance.
What are the requirements for co-ownership of land?
The requirements for co-ownership of land include unity of interest, unity of title, and unity of time. Unity of interest means that the interest in land held by each co-owner must be of the same nature and duration. Unity of title means that all co-owners must acquire their title from the same document. Unity of time means that the interest of each co-owner must vest at the same time.
How can a notice of severance be served to other equitable joint tenants?
A notice of severance can be served by handing it over personally or posting it. If posted, it will be deemed served if it has been left at the last known place of abode or business of the joint tenants. If sent by registered post and not returned undelivered, it will be deemed served at the time a registered item would in the ordinary course of events be delivered.
What happens if a co-owner decides to change their form of co-ownership from a joint tenancy to a tenancy in common?
If a co-owner decides to change their form of co-ownership from a joint tenancy to a tenancy in common, it is known as severance. The co-owner who severs holds an undivided share in the equitable interest, while the remaining co-owners continue to hold the remaining interest as joint tenants.
What is the practical significance of holding land as a joint tenant or as a tenant in common?
The practical significance of holding land as a joint tenant or as a tenant in common arises when one co-owner dies. Joint tenants are regarded as a single entity, and therefore when one joint tenant dies, survivorship applies and the interest of the deceased joint tenant accrues to the surviving joint tenants. On the other hand, survivorship does not apply to an interest held by a tenant in common, which will pass in accordance with the deceased’s will or under the intestacy rules if there is no will.
What is the difference between legal title and equitable title in co-ownership?
In co-ownership, the legal title to the land is held by the trustees, who have powers and duties of management. The equitable title is held by the beneficiaries, who have a proprietary right (an equitable interest) in the land subject to the trust. The legal title is registered at the Land Registry, while the equitable title does not appear on the registers.
What is the effect of severance on co-ownership?
Severance does not bring co-ownership to an end; it simply changes the basis on which the equitable co-owners continue to hold the equitable title. Before severance, three co-owners hold the equitable title as joint tenants. If one of them dies, the deceased joint tenant’s interest accrues to the remaining two co-owners. After severance, the right of survivorship does not apply to an interest that has been severed. If a co-owner has severed their interest in equity, the deceased tenant in common’s share passes under their will or by the intestacy rules if there is no will.
What is the significance of the provision stating that a notice is deemed to have been served?
The provision stating that a notice is deemed to have been served means that the notice is considered served when it has been delivered. It does not require the notice to be received or read. This has been confirmed by case law.
What are express trusts and how are they created in co-ownership?
Express trusts of land are created when a piece of land is transferred to one person to hold on trust for another. The person holding the legal title is the trustee, while the person holding the equitable interest is the beneficiary. Formalities, such as a written declaration of trust signed by the declarant(s), must be followed to create an express trust.
What are the modes of severance for an equitable joint tenancy?
The modes of severance for an equitable joint tenancy are notice in writing and other acts or things. Notice in writing involves giving a notice to all other equitable joint tenants, demonstrating an unequivocal and irrevocable intention to sever the joint tenancy. Other acts or things refer to unilateral acts by a joint tenant, mutual agreement of the joint tenants, or mutual conduct that indicates the interests are treated as constituting a tenancy in common.
What are the rules for holding the legal title in co-ownership of land?
The rules for holding the legal title in co-ownership of land are kept simple. There must be a maximum of four legal owners, who must be of full age and sound mind. The legal title holders must hold the property as joint tenants, meaning they must have unity of interest, unity of title, and unity of time. If land is transferred to more than four people, the first four named who are of full age and sound mind will be the legal title holders.
What happens if only a few of the equitable joint tenants are served with a notice of severance?
If only a few of the equitable joint tenants (not all of them) are served with a notice of severance, the notice is completely ineffective. This was established in the case of Kinch v Bullard [1999] 1 WLR 423.
What are implied trusts and how do they arise in co-ownership?
Implied trusts of land can arise informally, without any writing. They can be resulting trusts or constructive trusts. Resulting trusts may be implied when a property is bought in one person’s name but another person makes a financial contribution. Constructive trusts respond to unconscionability and are imposed when it would be unconscionable for the legal owner to deny the interest of another person.
What is the purpose of the Law of Property Act 1925 in relation to severance?
The Law of Property Act 1925, specifically section 36(2), governs the process of severance. It states that it is not possible to sever a legal joint tenancy; only an equitable one can be severed. The reason for this is to preserve the simplicity of the legal title. If legal trustees could sever the joint tenancy and leave an interest held as a tenancy in common to others, it would complicate the legal title by increasing the number of legal owners and requiring additional documents to prove proper acquisition of title.
What is the effect of severance on the legal and equitable title of a joint tenancy?
Severance does not affect the legal title, which must be held by co-owners as a joint tenancy. However, severance affects the equitable title, allowing co-owners to choose to hold it as joint tenants or tenants in common.
What is the purpose of severance in co-ownership?
Severance is the process of separating off the share of a joint tenant in co-ownership. It converts joint tenancy into tenancy in common, where the parties hold separate shares. The right of survivorship no longer applies.
What is the difference between the legal title and the equitable title in co-ownership of land?
The legal title is the public face of co-ownership, where the trustees are named as registered proprietors on the proprietorship register at the Land Registry. The legal title holders deal with buyers and lenders. On the other hand, the equitable title is the private face of co-ownership, where the names of the equitable owners do not appear on the registers of title and the way the equitable interests are held is not disclosed.
How can an equitable joint tenancy be severed by notice in writing?
An equitable joint tenancy can be severed by giving a notice in writing to all other equitable joint tenants. The notice does not need to be signed but must demonstrate an unequivocal and irrevocable intention to sever the joint tenancy immediately. It must also be served correctly, given to all other joint tenants, and can be handed over or left at their last known place of abode or business.
What was the outcome of the case Re 88 Berkeley Road [1971] Ch 648?
In the case of Re 88 Berkeley Road [1971] Ch 648, the court ruled that there was no distinction between giving and serving notice. The notice was effectively served under LPA 1925, s 196(4) by registered post as it had been signed for and had not been returned undelivered.
How does severance affect the shares of former joint tenants?
If a joint tenant successfully severs the equitable joint tenancy, they will hold a tenancy in common, which is an equal share based on the number of former joint tenants, not on the proportion of contributions made to the initial price. The remaining equitable joint tenants will continue to hold the equitable title as joint tenants. However, if there are only two joint tenants, severance will affect both of them.
How does co-ownership through joint purchase work?
Co-ownership through joint purchase occurs when individuals jointly purchase their own homes. They share the ownership of the property concurrently, with both the legal and equitable titles held by the co-owners.
What is the process of severing an equitable joint tenancy?
Severance is the process of converting an equitable interest held as a joint tenancy into an interest held as a tenancy in common. It can be done by any joint tenant. An express declaration that the owners hold as tenants in common will prevail, but falling short of an express declaration, words such as ‘in equal shares’ or ‘equally’ may indicate an intention to have separate shares.
What are the three types of unilateral acts that can result in severance of a joint tenancy?
The three types of unilateral acts that can result in severance of a joint tenancy are acts of total alienation, acts of partial alienation, and involuntary alienation. Acts of total alienation occur when the severing owner disposes of the interest permanently, such as through sale or gift. Acts of partial alienation occur when the severing owner temporarily disposes of the interest, such as through mortgage or lease. Involuntary alienation occurs when a joint tenant is declared bankrupt by the court.
What are the different types of trust of land?
The different types of trust of land are express trusts and implied trusts. Express trusts are created through formalities, while implied trusts can arise informally. Implied trusts can be resulting trusts or constructive trusts.
What are the three ways identified by Page-Wood VC in Williams v Hensman (1861) 1 J & H 546 to sever a joint tenancy?
Page-Wood VC identified three possible ways to sever a joint tenancy: a unilateral act by a joint tenant operating on its own share, mutual agreement of the joint tenants, and any course of dealing that indicates the interests were mutually treated as constituting a tenancy in common.
What is the effect of severance on the legal and equitable titles?
Severance is the process by which a joint tenant can convert an interest into a separate share held as a tenant in common. The legal owners will remain as joint tenants, and the equitable joint tenancy can be severed. If the severance is done by one of the methods recognized in section 36(2) of the Law of Property Act 1925, the joint tenant who instigates the severance will have a separate equitable share as a tenant in common. The remaining equitable joint tenants will continue to hold the equitable title as joint tenants.
What is the role of trustees in co-ownership?
In co-ownership, the trustees hold the legal title to the land and carry out administrative functions. They sign documents such as mortgage and transfer deeds. The trustees have powers and duties of management.
What is the requirement for severance by mutual agreement of joint tenants?
Severance by mutual agreement of joint tenants occurs when all equitable joint tenants agree that one person’s interest is severed, creating a tenancy in common. The agreement does not need to be a specifically enforceable contract to sell the interest, but it must amount to an agreement that one person’s interest is separate or severed.
What is the distinction between total alienation and partial alienation as acts of severance?
Total alienation refers to acts of total alienation where the severing owner disposes of the interest permanently, such as through a sale or gift. Partial alienation refers to acts where the severing owner temporarily disposes of the interest, such as through a mortgage or lease.
What is the role of beneficiaries in co-ownership?
In co-ownership, the beneficiaries hold the equitable title to the land. They are the true owners of the property and have a proprietary right (an equitable interest) in the land subject to the trust. The names of beneficiaries are kept private and do not appear on the registers.
What are the two ways in which severance can occur according to the Law of Property Act 1925?
Severance of an equitable joint tenancy can take place by either notice in writing or ‘other acts or things.’ The latter is deliberately vague and was intended to continue recognizing the modes of severance identified in Williams v Hensman (1861).
How can severance occur through mutual conduct?
Severance can occur through mutual conduct when the co-owners treat their interests as constituting a tenancy in common. This can be demonstrated by prolonged negotiations or conduct that suggests recognition and treatment of one person’s interest as separate. However, severance through mutual conduct is dependent on the facts of the case and can be hard to prove.
What happens when an equitable joint tenant mortgages their equitable interest?
When an equitable joint tenant mortgages their equitable interest, it is considered an act of severance, resulting in a tenancy in common. This is different from when all legal joint tenants create a legal mortgage or charge over the property, which does not result in severance.
How are express trusts of land created?
Express trusts of land are created when a piece of land is transferred to one person to hold on trust for another. The trust must be evidenced in writing and signed by the declarant(s).
What are resulting trusts and how do they arise in co-ownership?
Resulting trusts may be implied in co-ownership when a property is bought in one person’s name but another person makes a financial contribution. The person holding the legal title holds the property on trust for both parties in proportion to their contributions.
What is the effect of severance on the size of shares?
If a joint tenant successfully severs the equitable joint tenancy, they will hold a tenancy in common, which is an equal share depending on how many equitable joint tenants there were before severance. If there were only two equitable joint tenants before severance, both will hold as tenants in common. Severance only affects the owner who instigates the severance; the remaining equitable joint tenants will continue to hold their shares as joint tenants.
What is the effect of severance on the interests of co-owners in an equitable joint tenancy?
Severance results in the co-owner who severs holding an undivided share in the equitable interest. The remaining co-owners continue to hold the remaining interest as joint tenants.
