Co-Ownership Flashcards
What are the three modern concurrent estates?
Tenancy in common
Joint Tenancy
Tenancy by entirety
True or false: There are no survivorship rights associated with a tenancy in common
True! The interest of each is descendible and may be conveyed by deed or will.
True or false: With tenancy in common, there is not unity of possession
False, Each tenant owns an undivided share of the whole, giving them equal use and enjoyment of the estate
Define Right of Survivorship
When one Joint Tenant dies, their interest disappears and their % of the interest increases to survivors. Interest cannot pass to heirs upon death.
What are the Four Unities required for joint tenancy?
PITT
Possession = Right to possession of the whole
Interest = Undivided equal shares and identical interests measured by duration
Time = interest must be acquired or vest at the same time
Title = All tenants must acquire title by the same instrument or by joint adverse possession
True or false: If one of the four unities required for joint tenancy is violated after the creation, it still remains a joint tenancy
False. The four unities must exist at creation and for duration. If one of the unities is violated, there is a severance and likely it’s turned into a tenancy in common.
True or false: Tenancy in entirety requires a marriage license
True. Four unities plus a legal marriage certificate.
True or false: Divorce does not terminate a tenancy in entirety
False. Marriage is a requirement for entirety.
True or false: With married couples that co-own property, courts assume that this is a tenancy in entirety unless expressly stated otherwise
True
True or false: A grant or devise to two or more persons creates a tenancy in common unless an intent to create joint tenancy is expressly declared
True, in modern courts this is the assumption. VERY explicit language must be used. Ex: “To A and B as joint tenants and not tenants in common”
H: T devises Blackacre “To A and B as joint tenants for their joint lives, remainder to the survivor.” What interests are created in the devise?
Joint tenancy because right of survivorship is articulated, as is the phrase “joint tenancy”. If it was a tenancy in common, ROS would not come into play.
The survivor would have the estate in fee simple absolute
H: O, a widower, opens a joint account with his niece, A. O tells A, “I’ll want your name on this account so that I get sick you can go and get the money for me.” O dies. Is A entitled to the money in the bank account?
Franklin v. Anna National Bank: If a person executes an instrument creating a joint tenancy, but does not intend to make a gift to the joint tenant, a joint tenancy with right of survivorship is not created.
H: O, a widower, opens a joint account with his niece, A. O tells A, “I’ll want your name on this account so that I get sick you can go and get the money for me.” O also gave A rights of access to O’s safety deposit box by adding A’s name to the signature card giving access and the lease agreement signed with the bank provides that the contents in the box are owned in joint tenancy with rights of survivorship. O dies. Is A entitled to the contents? Is A entitled to the money in the bank account?
No, according to Newton County v. Davidson: “language of the lease and Mr. Davison’s testimony insufficient to establish ownership of the contents of the lock box, we announce our intention to require an affirmative showing that the owner of a lock box intended to give the contents of the lock box to another. Such an intention cannot be demonstrated without a specific written reference to the disposition of the contents of a lock box and is not indicated by an agreement only to rent the box in two or more names with a right of survivorship.”
H: A and B have a joint savings account of $40,000. How much of the account can A’s creditor reach?
Maloy v Stuttgart: “The joint account should be garnishable only in proportion to the debtor’s ownership of the funds, as to which parol evidence is admissible to show the respective contributions of each depositor, as well as any intent of one to make a gift to the other.”
Why are JT’s popular with married couples/domestic partners?
JT is the practical equivalent of a will BUT probate upon death is avoided b/c no interest passes on the joint tenant’s death and ownership of the survivor continues
If a creditor acts during a joint tenant’s life, the creditor can seize and sell the joint tenant’s interest in property and severing the joint tenancy
If the creditor waits until after the joint tenant’s death, the decedent joint tenant’s interest has disappeared… can’t get anything
How is a JT severed?
Partition (In Kind, Sale)
Transfer (equitable conversion)
Title Theory (mortgage severs a JT) v Lein Theory (Mortgage does not sever JT)
When severed, it is a TIC
However, if two or more co tenants remain, the JT stays intact with the new grantee taking over the severing party’s share (as a tenant in common)
How do tenancies in entirety shield the concurrent owners from creditors?
Shield against creditors: creditor of an individual spouse cannot reach tenancy by entirety property
Some states allow for creditors to execute on the ROS of the debtor spouse only, other states allow creditors to sell the debtor spouse’s interest subject to the non-debtor spouse’s ROS
Can a joint tenant, without the consent of his cotenant, convey or burden his share of the property?
A joint tenant may, without the consent of his cotenant, convey or burden his share of the property only to the extent of his interest in the property
When would a cotenant in exclusive possession of property be liable for rent?
A cotenant in exclusive possession of property is not liable for rent UNLESS, the exclusive possessor denies other cotenant(s) access. The possibility of an ouster exists and AP clock begins ticking.
What is an accounting action and when does it come into play with cotenants?
Accounting Action = Equitable processing in which a cotenant seeks to obtain his share of the rents or profits generated by the property
Right to Rent and Profits: Share equivalent to share of property. Pro rata share of rent received from third person’s use of land.
What is a contribution proceeding and when does it come into play with cotenants?
Contribution Proceeding = a cotenant who pays more than his share of taxes, mortgage payments, and other charges seeks contribution from the other cotenants
Liability for Costs: Taxes or mortgages equivalent to share of the property. For the cotenant in sole possession of the property, they cannot recover for these payments unless they exceed the reasonable rental value of the property.
What is a partition? Which type do courts tend to prefer?
Partition: Equitable action to divide property between tenants in common, either by division of the land itself (partition in kind) or by a forced sale of the land and dividing profits by proportion owned (partition in sale)
Courts tend to prefer partition by division of the land. A partition by sale should be ordered only where a partition in kind is impracticable or inequitable, and when the interests of the parties would be better suited by sale.
Does refusing a cotenant’s demand for rent or to vacate half of a property constitute an ouster?
A cotenant in common, having an undivided right to the entire property, does not owe rent to his cotenant unless he agrees to, or unless he has effected the ouster of his cotenant.
What is privity of contract?
common law principle which provides that a contract cannot confer rights or impose obligations upon any person who is not a party to the contract. The premise is that only parties to contracts should be able to sue to enforce their rights or claim damages as such.
