Joint Ownership of Land | You and the Law

By Dr. William Para Riviere

March 5, 2014

Suppose a man and his lawful wife, Thomas and Ernestine Fortune, pool their money together and buy a parcel of land called "High Rise", and both of their names are recorded as the registered proprietors on the Certificate of Title. They both have a right to occupy the property. If the property were leased, each of them would be entitled to a share of the rent. And if the property were sold each would be entitled to a share of the proceeds of sale. So far, so good. But suppose Mr. Fortune were to die. Bear in mind that there are no children by this marriage, but each of them has a child by a previous marriage. Mr. Fortune might have wished his share of the property to pass on his death to his wife, by which she would become sole owner of the whole property. Or, he might have wished his share to pass to his child by his previous marriage. Under the laws of Dominica either solution is possible depending on how the Fortunes owned the land. Where more than one person own land together, they are called co-owners; and the principle by which land is so owned is called co-ownership.

There are two forms of co-ownership here. One is called joint tenancy, and the co-owners are referred to as joint tenants. The other is called tenancy in common, and the co-owners are called tenants-in-common. Any number of persons may own land as joint tenants or as tenants-in-common.

The most important feature of land owned on the basis of joint tenancy is what in the language of the law is called the right of survivorship. This means that on the death of one joint tenant, his or her interest passes to the others until there is only one surviving joint tenant. That survivor will become the sole owner of the property and he or she can do whatever he or she pleases with it. This right arises from the fact that a joint tenancy is an undivided legal interest in land whereby the co-owners hold the interest together rather than separately. A co-owner's share is a "potential", instead of an actual, share. Each joint tenant owns nothing by himself or herself, but holds the whole property along with his or her fellow co-owners. For this reason it is stated that a joint tenant may hold all or nothing. He or she holds nothing while the joint tenancy continues, and all, when he or she, as the last survivor, becomes sole owner.

As to tenancy-in-common, there is no right of survivorship. Each tenant-in-common holds individual and distinct actual shares. For example, the Certificate of Title would state the percentage of the whole land owned by each tenant-in-common. The whole land, although not yet divided into shares, may be divided any time a co-owner so wishes. Hence, a co-owner's separate and distinct share passes on his or her death by Will or, where there is no Will, according to the Intestates' Estates Act. Further, unlike the case of joint tenancy, the size of the shares of tenants in common need not be equal. Rather, it would depend on the amount each co-owner has contributed to the purchase price of the property.

Thus, persons purchasing land together should be careful as to the legal basis on which the land is held. In the case of "High Rise", if the wish of either spouse is that the last survivor obtains sole ownership, joint tenancy is the basis on which to hold the land. Joint Tenancy is a convenient way for a husband and wife to hold the matrimonial home, that is to say, the house they live in. When one of them dies, the other one automatically gets the house. It is to be noted, however, that the last surviving joint tenant has sole and absolute discretion as to how the property is disposed of. More specifically, if Mr. and Mrs. Fortune are joint tenants and the lady survives her husband, she is under no legal compulsion, when making her Will, to devise part of the property to her husband's child by his first marriage. And if she dies intestate, her husband's child will have no legal claim to property even though it was at one time jointly owned by the child's father.

In effect, in making their individual Wills, neither Mr. Fortune nor his wife is entitled to leave their interest in "High Rise" for whomsoever. That is so because neither of them has a separate actual share of the property. And you can only pass by Will what you own absolutely. All that each can do is to look down the road leading to sole survivorship and state something like: "if my husband (or my wife) dies before me, I give and devise High Rise Estate to" whomsoever.

If, however, the intention of Mr. And Mrs. Fortune in buying High Rise together is that each would pass on their share to their own children, the most convenient thing to do would be to register the land as tenants-in- common. In that event their individual Wills may read: " I give and devise my share of High Rise Estate ….to my child, Lucky Fortune" or, as the case may be.

There is another good practical everyday reason why it is important to understand the differences between joint tenancy and tenancy-in-common. It is the matter of obtaining a loan using the co-owned land as security. Here, no restrictions are placed on a tenant-in-common. He or she is sole owner of a separate share and can at his or her sole and own discretion offer a bank the Duplicate Certificate of Title. But as you may have concluded, to obtain a mortgage on a joint tenancy, the consent of fellow co-owners will be required.

It is possible, however, to overcome the limitation placed on a joint tenancy by converting it into a tenancy-in-common. In the language of the law this is done by severance. A joint tenancy may be severed by mutual agreement of the co-owners. Or, one or more joint tenants may inter vivos, that is to say, during their lifetime, dispose of their own interest as, for example, by sale or gift to another, or partially dispose of it as, for example, by mortgage, lease or by granting it to another for life. When this happens the person who acquired the interest holds it as a tenant-in-common. In effect, where the land is held by two joint tenants only, and the interest of one of them is disposed of inter vivos, both owners now become tenants-in- common. But where there are, for example, three joint tenants and one interest is disposed of, the person who acquired that interest holds as a tenant-in-common, while the other two co-owners continue to hold as joint tenants. This means that it is possible for land to be held at one and the same time as a joint tenancy as well as a tenancy-in-common. Severance may also occur by what is called a "course of dealing". Here, although there is no actual agreement, the way in which the co-owners have dealt with the land suggests an intention on their part to treat the tenancy as a tenancy-in- common. In that event, the courts will treat the joint tenancy as having been severed.

Further, a joint tenancy may be terminated during the lifetime of a joint tenant by, for example, sale to one owner or by partition under the Partition Act. Partition involves physically dividing the land among the co-owners so that each becomes absolutely entitled to a separate plot. This is usually done by deed.

A final point. Beneficiaries under a Will, especially where there are many family members, should carefully read the Will to ascertain exactly how the land devised is to be held. Where the words "in equal shares" or "equally" or "amongst" appear, a tenancy-in-common is, as a general rule, held to have been intended. Where the words "as joint tenants" appear, the Courts will treat the joint ownership as a joint tenancy.

(William Para Riviere is an Attorney-at-Law)