Co-ownership - Severance Flashcards
(25 cards)
What is severance?
the process through which a beneficial joint tenancy is converted into a tenancy in common
When is severance possible?
statute
- in equity
- joint tenancy cannot be severed at law -> s.36(2) LPA 1925
What are the 5 consequences of severance?
- severing joint tenant obtains an undivided share (tenant in common)
- size is proportionate to the total number of joint tenants
- status of remaining joint tenants is unchanged
- no survivorship
- severance is irreversible -> it cannot be undone
Which case discusses the consequence that the severing joint tenant obtains an undivided share?
- Harris v Goddard [1983]
- ‘Severance…is the process of separating off the share of a joint tenant, so that the concurrent ownership will continue but the right of survivorship will no longer apply. The parties will hold separate shares as tenants in common’
Which case discusses that size is proportionate to the total number of joint tenants?
- Bedson v Bedson [1965]
- “If there be two beneficial joint tenants, severance produces a beneficial tenancy in common in two equal shares”
What does the consequence of no survivorship mean?
- share will pass on will or intestacy on death
- severance takes place immediately
- cannot be arranged to take place in the future / by will
What leans in favour of severance?
Why?
case
- equity
- notion of shares and being able to pass them on
Burgess v Rawnsley [1975]
How does a joint tenant effect severance?
- s.36(2) LPA 1925
- provides 2 methods of severance
1. notice in writing
2. other acts that effectively sever tenancy in equity
Why is the statutory provision important for severance?
- provides first method of severance -> by written notice -> also known as statutory severance -> unilateral
- preserves the operation of other methods of severance recognised by common law
What are the 3 methods of severance recognised by common law?
case
- act of a joint tenant on his or her own share (unilateral)
- mutual agreement (all joint tenants)
- mutual course of dealing (all joint tenants)
Williams v Hensman [1861]
What are the 2 types of unilateral severance?
What does this mean?
- written notice
- act of a joint tenant on his own share
- no consent / cooperation needed from the other joint tenants
What are the 2 types of universal severance?
What is the requirement?
What is the rationale for this?
- mutual agreement
- mutual conduct
- severance must involve ALL joint tenants
- common intention of the parties
What are the conditions of statutory severance?
- must be notice of an intention to sever immediately
- must be served on all co-owners
- requirements for service of notice
Case law for condition that a statutory severance must have notice of an intention to sever immediately
- Intention must be to sever immediately
-> re Draper’s Conveyance [1969]
-> confirmed in Harris v Goddard [1983] - no requirement that notice must be irrevocable
-> Harris v Goddard [1983]
-> confirmed in Burgess v Rawnsley [1975]
key clarifications for condition for statutory severance that notice must be served to all other joint tenants
- notice to some / most is NOT enough
- from the moment the notice is validly served, survivorship no longer applies
What are the statutory requirements for serving notive for statutory severance?
case law?
- s.196(3) LPA 1925 -> notice is considered served if it’s in the last known address
- s.196(4) LPA 1925 -> notice is considered served if it’s posted and not returned undelivered
s.196(3) LPA applied in Kinch v Bullard [1991]
What are the features of ‘act operating on a share’?
for common law severance
- unilateral act of disposition
- one of the joint tenants operating upon their own share
- may be able to sever without the other joint tenants knowing about it
- The act itself is treated as causing severance -> the joint tenant becomes tenant in common [so joint tenant can effectively act upon a share they don’t have]
Is the act voluntary or involuntary?
Act operating on a share for common law severance
can be either
Examples of voluntary acts + case law
severance - act operating on a share
- ‘partial’ dispositions:
- transferring joint tenant retains an interest in the property / transfer with only temporal effects e.g. joint tenant mortgaging or granting a lease
- Bedson v Bedson [1965]
- First National Security v Hegerty [1985]
Examples of involuntary acts + case law & statute
severance -> act operating on a share
- bankruptcy causes severance -> joint tenant’s share becomes vested in the trustee in bankruptcy
- Re Palmer [1994]
-> insolvency severs on date of declaration of bankruptcy
-> declaration backdate to date of death if bankrupt dies before declaration
-> survivorship takes effect first on date of death - s.421A Insolvency Acts 1986
-> mitigated consequences for creditors
-> survivor may be required to pay trustee in bankruptcy a sum up to that lost by operation of survivorship
For the mutual severance options, are they clearly defined?
case law
severance
- No, unclear boundary
- not unusual for both to satisfiy the facts e.g. Dunbabin v Dunbabin [2022]
- BUT they are different -> Burgess v Rawnsley [1975]
Features of Mutual agreement
case law
common law severance
- difficult -> more relaxed than act operating on a share BUT stricter than mutual conduct
- needs all joint tenants to agree to sever
- Burgess v Rawnsley -> leading case -> difficult case
Features of Course of dealing
Case law
severance
- Williams v Hensman sets it out
- conduct of all joint tenants shows that they treated themselves as tenants in common
- can be really similar to mutual agreement
-> Burgess v Rawnsley
-> Hunter v Babbage [1995]
What are the 2 general ways to terminate co-ownership?
- union of property in one joint tenant
-> operation of doctrine of survivorship
-> when one co-owner acquires interests of all others - unity of possession lost
-> partition
-> trustees have powers under s.7 TOLATA
