This is when more than one person owns a property. There are two different types of co-ownership, a joint tenancy and a tenancy in common.
The Joint Tenancy
This is where the owners are not regarded as having separate shares in the property. For a joint tenancy to exist, the ‘four unities’ must be present:
Possession – owners must be equally entitled to the possession of all the land (Bull v Bull).
Interest – each owners interest must be the same, i.e. in duration nature and extent
Title - the owners must have acquired their interest through the same document
Time – the owners must have acquired their interest at the same time
If these unities exist, then the next stage is to look at whether the document creating the co-ownership included words of severance, indicating that the parties are to take the land in separate shares. This might be explicit or implicit. Words such as ‘in equal share’ (Payne v Webb) indicate a tenancy in common is created, despite the presence of the four unities.
If no words of severance are present, then a joint tenancy may exist. If so, then the right of survivorship applies. Where this happens, when one party dies, then the interest is passed equally to the other owners. The last person left alive retains the whole interest in the property, and the joint tenancy falls away. Any will a joint tenant makes is invalid, as their part of the property passes to the other joint tenants before any will takes effect.
The Tenancy In Common
At law, the parties remain joint tenants (Law of Property Act 1925 (LPA) s34(1)) up to a maximum of 4 trustees (LPA s34(2)) who must be of full age. In equity, any number of parties may hold the land as tenants in common.
Tenants in common allows the parties to have separate shares of the property in equity. This may be assumed where the parties have contributed differently to the purchase price (Bull v Bull)(and will have shares corresponding to their contribution to the purchase price), or where business is involved (Re Fullers Contract). |
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In practice, this means that where 1 party contributes half the purchase price and 4 parties the other half, then A, B, C and D may hold as joint tenants at law, on trust for A half a share as a tenant in common in equity and B, C, D and E who each own 1/8th as tenants in common in equity.
 Next: Easements Part II
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