Law of Real Property I

Law of Real Property I

Concurrent Interests

Where 2 or more persons become entitled to possession of land simultaneously, they are said to hold concurrent interests in the land, or to be co-owners.

In the modern law there are 2 types of co-ownership: -

1.  Joint Tenancy (J/T)

2.  Tenancy in Common (T/C)

Joint Tenancy (J/T)

v  J/T occurs where land is conveyed to 2 or more persons without ‘words of severance’, i.e. without words to show that they are to take separate and distinct shares.

v  The essence of J/T is that from the outside there is one title and the joint tenants are collectively regarded as a single owner, but as between themselves they have separate and equal rights:

Panton v. Roulstone (1976) 24 WIR 462 per Watkins JA, “…in beneficial J/T each joint tenant holds nothing by himself but holds the whole together with his fellows.”

The intimate nature of joint tenancy is shown by its 2 principle features: -

1.  Right of Survivorship/ Ius Accrescendi

2.  The 4 Unities – Title, Time, Interest, Possession

v  Right of Survivorship/ Ius Accrescendi

v  On the death of one joint tenant, his interest automatically accrues to the surviving joint tenants, so that he has no interest to transfer via will or intestacy. This is the effect of the maxim ‘totum tenet et nihill tenet’:

Palmer v. Treasurer – Because he did not have any share of his own, on his death the estate is “simply…freed from participation by him”.

v  A/c to Megarry & Wade – “on the death of one joint tenant, his interest in the land passes to the other joint tenants by the right of survivorship (jus accrescendi). This process continues until there is one survivor, who then holds the land as the sole owner.”

v  At C/L, if there could be no right of survivorship there could be no J/T, e.g. a corporation could not therefore be a joint tenant because it could never die. H/e, it is important to note the effect of the Bodies Corporate (J/T) Act 1899 – banks and other corporations now act as trustees.

v  Where the circumstances of the death of the joint tenants make it difficult to determine who died first, e.g. where all the joint tenants die in an accident, at C/L there could no right of survivorship; the respective heirs of the deceased joint tenants would inherit the estate as joint tenants – Bradshaw v. Toulmin.

v  H/e, in some jurisdictions Statute resolves the question as to who is deemed the survivor – LPA 1925 – Succession Act 1981 s.2 (2) Trinidad & Tobago – Succession Act 1985 B’dos Cap. 239 s.105 – provides that, in the event of uncertainty as to who predeceased the other, the younger is deemed to have survived the elder except where the Court decides otherwise, t/fore the J/T continues with the heirs of the younger person.

v  A joint tenant can avoid the incidence of ius accrescendi by destroying the J/T and converting it into a Tenancy in Common (T/C), i.e. by disposing of his share in the joint estate in an inter vivos transaction. Ius accrescendi does not apply to a T/C.

v  The 4 Unities

v  The 4 Unities of J/T are: - possession, interest, title and time.

v  The 4 Unities must be present for a J/T to exist, thus anything which accords a distinctive and exclusive claim to property destroys the J/T and makes it a T/C.

v  Unity of Possession

-  common to all forms of co-ownership;

-  each joint tenant is entitled to physical possession of the whole land;

-  no tenant can point to any part of the land as his own, to the exclusion of the others;

-  each tenant is entitled to enjoy the fruits of possession, such as rents and other profits.

v  Unity of Interest

-  each joint tenant’s interest in the property must be of the same extent, nature and duration, e.g. a freeholder and a leaseholder cannot be joint tenants;

-  the unity of interest requires that any transaction involving a 3rd party affecting the estate can only be effected if all the joint tenants concur and execute it:

Singh v. Mortimer (1967) 10 WIR 65 – the Ct. App. Guyana held by a majority that, since the intention was to sell and convey the whole estate, the contract was not effective as it was not signed by the sister (the deceased co-tenant).

Joseph v. Joseph (1961) 3 WIR 78 – in Guyana, a co-tenant whose interest has not been quantified is entitled to oppose transport of a property of which he is a joint tenant or tenant in common whether in equity or at law.

v  Unity of Title

-  each joint tenant’s interest must be derived from the same instrument, i.e. the same conveyance or will, or where they claim title by Adverse Possession, they must have taken possession simultaneously.

v  Unity of Time

-  the interest of each tenant must vest at the same time;

-  Unity of Time differs from Unity of Title, for the parties may derive their interest from the same document but have their respective estates vested in interest at different dates;

-  The exception to this requirement is in respect to Wills and Trusts, e.g. if there is a Trust for the benefit of several persons, and some are not yet born or ascertained, the existing beneficiaries will hold jointly with the others when they are born or ascertained – Mutton’s Case

-  A conveyance by a bachelor to the use of himself and the wife he might marry will operate to create a J/T on his marriage.

Tenancy in Common (T/C)

v  T/C differs significantly from J/T in that: -

1.  There is no Right of Survivorship

-  On the death of a tenant in common his estate passes to his devisee or heir. It does not merge into and enlarge the estate of the surviving co-tenant.

2.  The tenants hold in undivided shares

-  Each tenant has a distinct fixed share in the property, but the property is treated as a single unit.

-  The Unity of Possession Doctrine explains the fact that though the share of a tenant in common is precisely allocated, he cannot lay an exclusive claim to any portion of the property.

-  The share of a tenant in common is so distinct and recognized that on his death it cannot be altered; it is inheritable and devisable.

-  Other than Unity of Possession the other 3 unities need not be present for a T/C.

Methods of Creation

Joint Tenancy

J/T is created where land is granted to 2 or more persons with: -

(a)  Words of severance, e.g. in equal shares; equally; to be divided amongst; shares respectively.

Christian v. Mitchell Lee (1969) 13 WIR 302 – the wording of the devisee presented a problem of interpretation. On the death of Adeline Edwards, the administrator of her estate contended that the words “the shares respectively” referred to the separate and distinct shares of Edwards (deceased) and Mitchell-Lee, and t/fore, the grant created a T/C with the result that, on the death of Edwards, her share passed to her estate. This argument was rejected by the trial judge, who considered the word share as indicating the property devised and not a part of it. The Ct. App. Overruled the decision on the ground that, “the words bear their usual connotation of division and distribution. They indicate the intention of the grantor was that each of his daughters was to have a share in the properties conveyed, and that the interests conveyed to them in the premises were to be taken by them separately; in effect, that they were to hold as tenants in common.”

(b)  where equity treats a J/T at law as a T/C.

(c)  Where a joint tenant severs his J/T by alienation of a greater interest, agreement or course of dealing – Williams v. Hensman.

(d)  One of the 4 Unities is missing.

(e)  Where equity presumes a T/C, equity will prevail to impose a T/C on the tenants who will retain the legal title as joint tenants, but hold the legal J/T subject to their interests, which will be held under a T/C.

Tenancy in Common

T/C arises where a J/T does not exist for one or more of the following reasons: -

(a)  There are words of severance, e.g. where the property is conveyed or devised “to share and share alike”

(b)  Any one of the Unities is missing;

(c)  Where equity presumes a T/C;

(d)  Where Statute presumes T/C, e.g. Antigua, Real Property Ordinance 1873, Cap. 289 s.15 – Dominica Real Property Act, 1873 Cap. 219 s.14.

Equitable Presumption of Tenancy in Common

-  Whereas the C/L favored J/T, equity has always leaned in favor of T/C, as equity preferred the certainty and equality of a T/C to the element of chance, which the ius accrescendi of a J/T introduced.

Equity’s abhorrence for J/T is manifested in the following situations where equity would treat persons who are joint tenants at law as tenants in common of the beneficial interest: -

1.  Purchase money provided in unequal shares

-where 2 or more persons together purchase land in unequal shares a T/C of the property is presumed in equity, and the purchasers take shares proportionate to the amounts advanced by each – Lake v. Gibson (1729) 21 ER 1052

-on the death of one of the persons, the survivor will become entitled at law to the whole property, but in the eyes of equity he will hold the deceased share in trust for the deceased personal representatives.

Per Robinson P in Panton v. Roulstone, “It is where money is subscribed in unequal shares, that equity tends to infer a T/C.”

-where there are equal contributions the purchasers would hold the property as joint tenants. Upon the death of one of the parties the survivor would become entitled to the whole property beneficially, both at law and equity, for where purchase money is advanced equally, equity will presume that the parties intended the ius accrescendi to apply.

2.  Loan on Mortgage

-Where 2 or more persons advance money on mortgage, whether in equal or unequal shares, equity presumes a T/C.

Morley v. Bird (1798) 3 Ves. 628 – “If 2 people join in lending money upon a mortgage, equity says it could not be the intention that the interest in that should survive. Though they take a joint security, each means to lend his own and take back his own.”

- In the event of the death of one of the mortgagees, the survivor becomes a trustee for the Pers. Rep of the deceased mortgagee to the extent of the deceased mortgagee’s share of the loan.

-This rule is unaffected by the practice of inserting a joint account clause in mortgages where 2 or more persons lend money.

-The Joint Account Clause is merely a conveyancing device, which affects the position as between the mortgagees and mortgagor; it does not affect the presumption of a T/C as between the mortgages inter se.

3.  Partnership Assets

-Ius accrescendi inter mercatores locum non habet – the right of survivorship has no place among merchants.

-Where business partners purchase land as part of their partnership assets they are presumed to hold as beneficial tenants in common.

- Although the legal estate may be held on a J/T, in equity the surviving partners hold a deceased partners share on Trust for his estate;

Lake v. Craddock (1732) 24 ER 1011 – Where 5 persons joined in buying some waterlogged land with a view to its improvement by drainage, it was held that they must be presumed to have acquired the land as tenants in common, as the right of survivorship was incompatible with a commercial undertaking.

-The presumption extends to where there is no formal partnership agreement between the parties;

Panton v. Roulstone (1976) 24 WIR 462 – Two ladies had purchased 6 parcels of land, taking conveyances in both their names. There was no evidence as to the extent of their respective contributions to the purchase price, but a majority of the Jamaican Ct. App. inferred that the women were business associates and were t/fore tenants in common of the beneficial interest, and on the death of one, the property did not devolve on the survivor under the ius accrescendi. In this case, since the parties had acquired the properties as joint tenants, and in the absence of any evidence that they had used the land in the way of trade or business, Robinson P was unable to agree that they held the beneficial interests as tenants in common.

Severance of Joint Tenancy

Severance includes any act, which has the effect of destroying the J/T, and this may involve partition.

-It is the process whereby a J/T is converted into a T/C; avoidance of the incident of survivorship.

-Where Unity of Possession is destroyed there will be partition, whereby the parties will take their individual shares and there will be no co-ownership.

-A joint tenant cannot have a separate and distinct share in the land which is co-owned. He is, h/e, potentially entitled to an equal share in the property with his co-owners.

-In the leading case of Williams v. Hensman Page-Wood VC identified 3 types of circumstances which will amount to severance: -

1.  an act of a joint tenant ‘operating upon his own share’;

2.  mutual agreement;

3.  course of dealing.

1.) Act of a joint tenant operating under his own share

-In order to bring about severance, the act of the joint tenant must be of a final and irrevocable character, which effectively estops him from claiming any interest in the subject matter of the property – Re Wilks [1891] 3 Ch. 59

(a) Alienation

-Total or partial alienation of his interest by a joint tenant is the clearest type of act within this head.