Co-Ownership

Co-Ownership

1. Co-ownership = estate in land is owned by 2+ people

2. 2 types of co-ownership

   • 1. Joint tenancy
     • No shares
       • Each co-owner owns the whole property entirely
     • Must have 4 unities
       • 1. unity of Title
         • Every co-owner acquired their interests under the same DOC/ACT
       • 2. unity of TIME
         • Must acquire interests at the same time
       • 3. unity of Interest
         • Same interest - duration, nature, extent
           • All must agree + be party to any transaction
             • Unless Periodic tenancy --> a JT can give NOTICE TO QUIT
               • Unless agreement to contrary
               • Hammersmith
                 • JT (in PT) gave notice to quit
                   • Unity of ownership, but can't keep someone as a tenant against their will
       • 4. unity of Possession
         • Each co-owner is entitled to possession of the whole
           • cannot exclude co-owner from property
             • Unless sole occupier pays occupation rent
             • unless Ouster
               • Deny co-owner's right to possession --> bring action in trespass
                 • Test: the fact that one co-owner enjoyed possession to the exclusion of the other = ouster?
           • Must account to other co-owners for taking more than just share of profits from the co-owned land
     • Right of survivorship
       • JT die --> his interest accrues to surviving JT (does not pass according to his will)
         • UNLESS last surviving JT
         • If unsure who died last, presume younger
   • 2. Tenant in common
     • each co-owner has a SEPARATE share in the property
       • Rebuts presumption of JT
         • need express declaration for splitting up the interests
           • If unclear
             • Contractual interpretation
             • invoke constructive trusts (resulting/common intention)
           • i.e. words of severance in instrument --> imply intention to hold as TICs
       • interest forms part of his estate on death --> pass by will
   • JT or TIC?
     • 1. 4 unities all present?
     • 2. express declaration?
     • 3. Presumptions at law
       • Common law presumes a joint tenancy
       • CPO s.9 rebuttably presumes tenancy in common
     • 4. Presumptions in equity
       • Presume TIC if:
         • purchase price was paid in unequal shares, relationship is commercial, money was lent on mortgage
     • Equitable accounting
       • repairs
         • incur expenditure on property --> joint benefit of co-owners
           • IF sell property: entitled to insist on contribution from others (even if no agreement)
             • BUT contribution < increase in property's value (from the repair) at time of sale
       • mortgage contributions
       • oust without agreement
         • entitled to seek account
       • Relationship breakdown in family home
         • consider: contributions to mortgage, rent by party solely benefiting from all the property, intention, etc
           • Wilcox v Tait
             • co-habitees bought a family home
               • Relationship broke up --> P sought declaration for her beneficial entitlement
                 • D argued for equitable accounting (he’d made most of MORTGAGE payments) --> extinguish P’s share of the proceeds of sale.
                   • D failed
                     • No rule that there must be equitable accounting
                       • Depends on INTENTION of parties as to how the expenditure should be treated – look at FACTS
           • Chen Lily v Yip Tsun Wah Alvan
             • Unmarried cohabitees bought family home (title in joint names).
               • Split up --> D left, P alone repaid mortgage principal/interest onwards, refused to let D contribute half of mortgage payments or to let out the property.
                 • Yes equitable accounting (mortgage, repayments of principal, interest payments, credit card debts)
                   • Presumption of equality --> D's offer = equitable severance of JT --> yes equitable accounting

3. There can be a JT at law + TIC in equity

   • i.e. if the land were subject to a trust, severance, etc
     • JT in legal title, but unequal contributions to purchase price
     • JT in legal title, but detrimental reliance + agreement about shares

4. Severance

   • convert JT into TIC @equity (presume equal shares)
     • A. Severance at LAW
       • JT serve NOTICE on fellow JT (s.8(1)(a-b))
       • instrument in writing (no need to sign)
         • express desire to sever + immediate effect + irrevocable
       • register for priority
         • Otherwise, 3P not affected (written but unregistered notice of severance/instrument)
         • Unless equitable unwritten severance - cannot be registered
           • binds everyone except equity's darling
     • B. Severance in EQUITY
       • <-- Sever JT in common law
         • need Notice OR Equitable method
           • 1. act operating on JT’s share (alienation)
             • i.e. share --> sell, mortgage, (contract to) transfer, bankrupt, etc
             • act MUST have: final + irrevocable character
           • 2. mutual agreement
             • Must show common intention to sever
               • doesn't need to be specifically enforceable
               • UNLESS parties are merely negotiating
                 • Agreement OR
                 • a course of dealing that evinced intention by both that property should be held in common
                 • Burgess v Rawnsley
                   • Man thought relationship was romantic. Bought property, thought it would be family home.
                     • Apparently not. She agreed to sell her half interest to him. Not formalized, hadn’t agreed on price, etc.
                       • He dies. Does she keep the property or does it go to his daughter?
                         • agreement = equitable severance of JT. No JT = goes to daughter
                           • As long as there was common intention to sever
           • 3. a course of dealing sufficient to intimate a consensus that everyone’s interests were mutually treated as = TIC
             • "Consensus" = pattern of dealings --> long-term assumption exists about the nature of the co-ownership arrangements
               • Re Wilford's estate
                 • Two sisters held property as joint tenants
                   • Agreed to make MUTUAL WILLS concerning their shares in the property
                     • JT was severed
         • 3P purchasers are affected, unless equity's darling
     • legal and equitable joint tenancy is severed --> the parties take in EQUAL shares
     • Death --> succession to property
       • severance breaks right of survivorship
         • UNLESS 3+ JT (only the sever-or's share becomes TIC)

5. Partition

   • transaction (sale) --> each co-owner gets his own DISTINCT TITLE to a part of the property
     • by deed
     • PO s.3 - Court has power to:
       • 1. Make partition order
         • UNLESS the order leaves part of the building on partitioned land
           • UNLESS the building is self-contained/not connected to the rest of the building (s.4(2))
       • 2. Make Order for Sale
         • only IF: partition isn't beneficial to all persons interested (s.6(1))
           • i.e. because of nature of land, number of co-owners, absence/disability of persons interested, etc
         • Persons interested can also apply (s.6(3a)) --> court make order
           • UNLESS other persons interested undertake to buy the applicant’s interest --> court order valuation of interests
       • 3. Refuse to make order
       • etc
         • allocate rights, obligations, liabilities related to the property – s/5/1a
         • create easements between partitioned parts – s.5/1b
     • destroys unity of possession