Unit 2 - Co-ownership Flashcards
(32 cards)
What is the concept of co-ownership?
Where more than one person owns land at the same time (concurrent).
When there is concurrent sharing a trust of land is created.
When can trusts of land arise?
When a landowner intentionally sets up a trust of their land by transferring the title of the land to trustees for the benefit of others.
Where a person acquires an interest of land owned by another due to conduct.
The land is acquired by more than one owner jointly.
Who are trustees and who are beneficiaries?
Trustees are the legal owners of the property.
Beneficiaries are the equitable owners of the property.
Can a legal estate be held as both joint tenants and tenants in common.
No - the legal estate cannot be severed and must be held as joint tenants.
What happens if a legal estate is conveyed to a minor?
This operates as a declaration of trust where the land is held in trust for the minor.
What happens if a legal estate is conveyed to a minor and an adult?
The land is vested in the adult in trust for the minor.
If a minor is appointed as a trustee, what happens when they turn 18?
They do not automatically become trustees when they reach the age of 18.
What are the minimum and maximum requirements for the number of trustees?
Maximum = 4.
There is no minimum.
What are the powers of the trustees?
They have all the powers of an absolute owner.
They must consult the beneficiaries (where practicable).
What are the two types of co-ownership?
Joint tenancy
Tenancy in common
What are the key characteristics of a legal joint tenancy?
The right of survivorship
They are jointly entitled to the whole of the property (i.e. no shares).
What is the right of survivorship?
On the death of a joint tenant, their interest passes automatically and immediately to the surviving joint tenant.
What are the key characteristics of a legal tenancy in common?
No right of survivorship
Each owner is regarded as having a distinct share in the land - this can be equal or unequal.
How can you determine whether it is a joint tenancy or a tenancy in common in equity?
- Are all four unities present?
- Is there an express declaration of trust within the deed?
- Are there are words of severance within the deed?
- Does equity presume a tenancy in common?
What are the four unities?
Unity of possession - each co-owner has a right to possess all of the land.
Unity of interest - each owner must have identical rights over the land
Unity of title - each co-owner must have acquired their interest from the same document
Unity of time - the co-owners must receive their interests at the same time
How do you know if there is an express declaration of trust within the deed?
It would contain wording such as ‘Transferred into their joint names as express joint tenants in equity’.
What words of severance can indicate that co-owners should have distinct shares?
To A and B in equal shares’ or ‘Half to A and half to B’ both indicate tenancies in common.
The mention of distinct shares is usually the tell tale sign.
Does equity presume a tenancy in common?
There is a presumption that the co-owners will be joint tenants in equity on the basis that equity follows the law.
This can be rebutted.
How can the presumption that co-owners will be joint tenants in equity be rebutted?
When the property is acquired for business use
Unequal contributions to the purchase price
Post-acquisition money management
How can a joint tenancy in equity be severed?
Formal severance with written notice
OR
Informal severance
In terms of severing an equitable joint tenancy, how should the written notice be served?
It must use appropriate wording to state they wish to end the joint tenancy immediately
It must be received by all the other joint tenants or deemed to have been received.
Can a written notice to sever an equitable joint tenancy be sent by post?
For registered post - it is deemed sufficiently served if the letter is not returned.
For ordinary post - it is deemed sufficiently served if it is left at the last known place of abode or business in the UK of the person to be served.
How can informal severance of an equitable joint tenancy be effected?
Where one tenant disposes of their equitable interest by sale, gift, lease or mortgage (must be in writing and signed)
Mutual agreement (oral agreements can suffice)
By mutual conduct (a common intention)
Bankruptcy - involuntary assignment of the equitable interest to the joint tenant’s trustee in bankruptcy
Homicide - where one joint tenant kills another
Post-acquisition money management
What is the effect of severance on an equitable joint tenancy?
Where there are two joint tenants in equity, they both become tenants in common of equal shares.
Where there are three or more joint tenants in equity, only the co-owner who severs their joint tenancy becomes a tenant in common.
The share is proportionate to the number of joint tenants.
