Severing a Joint Tenancy
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Property can be owned by two or more people either as ‘joint tenants’ or ‘tenants in common’. This will effect what can be done with the property if your relationship with the other joint owner breaks down, or if one owner dies.
As a joint tenants the property automatically goes to the other joint tenant if you die and you cannot pass on your ownership of the property in your will You also have equal rights to the whole property. On breakdown of a marriage when the matrimonial home is held as beneficial joint tenants it is often best to sever the joint tenancy and hold as tenants in common. This guide explains with examples how this is done.
There are only two ways in which people can own land together. Land can be held jointly either as Beneficial Joint Tenants or as Tenants in Common. Neither have anything to do with tenants as in renting property. They are just legal terms describing how land is held.
Beneficial Joint Tenants
Owning property as Beneficial Joint Tenants means the property belongs to you and the other owner or owners jointly. You must all act together as a single owner, for example on a remortgage or a sale. You do not own specific shares in the property, and you cannot give away a share of the property in a will. If you die, your interest in the property passes automatically to the other owner or owners.
A beneficial joint tenancy ends when either:
– the whole property is transferred to one owner
– the tenancy is converted into a tenancy in common, whether voluntarily by serving a notice of severance or involuntarily, for example if one of the owners becomes bankrupt
– the property is sold to someone else, or
– one owner outlives all the others.
The important thing to remember therefore is that the consequence of holding property as a joint tenant is that the shares in the property are indivisible. The result of this is that if one joint owner dies, that share of the deceased in the property will pass automatically to the survivor under what is known as the right survivorship. It will not pass according to the Will of the deceased or the law of intestacy.
That may often not be what is intended especially when the relationship between two Joint Owners breaks down. It is most usual for husband-and-wife who buy property together to hold the property as Beneficial Joint Tenants. However if the marriage breaks down it is usual and most sensible to sever the joint tenancy.
Beneficial Joint Tenants 1
Tenants in Common 2
Notice of severance 3