#11265 - Concurrent Ownership - Property

Two or more owners are tenants in common where they own shares of the property with no right of survivorship; when one dies, her share passes to her heirs or devisees, who become tenants in common with the remaining tenant.

Where tenants own a property concurrently, the modern law presumes a tenancy in common.

TICs each have the right to possess the whole property.

TICs do not necessarily own equal shares in the land, but the law presumes equal shares unless proven otherwise.

TICs may occupy different types of estate. Suppose A and B are TICs; B dies and leaves his share to C as a life estate, remainder to D. C and D are now tenants in common with B.

Share are considered totally alienable.

1. Joint Tenancy

Joint tenants own shares of the property with a right of survivorship. When one tenant dies, the other succeeds to her share. Neither tenant may devise her share.

Joint tenancy must be created by deed or by will, or by joint adverse possession. It does not arise when multiple parties inherit land by intestate succession.

In order to remain in JT, the Four Unities must be sustained:

• Time: The interests in the JTs’ interests must vest at the same time.

• Title: The JTs must acquire title in the same instrument or act of AP.

  • At CL, H could not convey to H and W as JTs. He had to convey to a straw man first.

  • Modern law mostly allows this under the fiction that “H” is a separate entity from “H and W.”

• Interest: The JTs must hold the estate for the same duration. Their shares must also be equal. However, the property itself may be divided into shares, with one share being held by JTs who are collectively TICs with another tenant.

• Possession: The JTs must have the right to possession of the whole, but are free to strike agreements between each other to waive one JT’s right to possession in favor of another.

At CL, a conveyance to multiple parties was presumed to create a JT. Feudal law preferred sole ownership over multiple ownership. H and W were presumed to take as TBEs.

Under modern law, the presumption of JT has been abolished. In a few states, H and W still are presumed to take as TBEs. A JT can now be created only by express words in the conveying instrument. Usually this is done by explicitly reserving the right of survivorship in the parties. In some states, survivorship must be mentioned or a TIC is created.

A JT is severed where one tenant conveys his interest to another.

• In some jurisdictions, a mere contract to convey severs the JT.

• In some jurisdictions, a JT may sever the JT by conveying his share to himself.

• IN some jurisdictions, a JT who mortgages his share of the property severs his interest.

A JT may lease all or part of his interest in the property without severing the JT, and without the consent of the other JT. See: Swartzbaugh v. Sampson.

• At CL, a lease severed the JT, but no longer. The modern law is split whether the surviving JT takes the other share subject to the lease.

If the JTs die simultaneously, the property is divided equally between their estates.

1. Tenancy by the Entirety

Tenants by the Entirety must be husband and wife. TBEs have a right of survivorship and the tenants cannot unilaterally sever their shares.

At CL, a conveyance to H and W automatically created a TBE. Today, no state has this rule, though a few still presume a conveyance to H and W to create a TBE unless otherwise specified.

Two tenants in TBE are fictitiously considered one person.

At CL, H had the right to possess the property, the right to the profits, the right to convey possession to another, and the right of survivorship. W had only the right of survivorship, which persisted even after H conveyed his entire interest in the property. H’s creditors could reach his interest in the property to settle his debts.

In the modern era, the Married Women’s Property Acts gave married women the right to receive, hold, and dispose of real property the same as if they were single. This resulted in two approaches to the creditor problem:

• Neither spouse may convey separately. Creditors of one spouse cannot reach the estate held in TBE with the other, because neither spouse may unilaterally convey his interest in the whole. See: Sawada v. Endo.

• Both spouses may convey. Some courts hold that the MWPA simply allows both spouses to convey their interest the property, making it reachable by either spouses’ creditors (who could still not destroy the right of survivorship in the other spouse).

Most states convert a TBE to a TIC upon divorce, but some make it a JT.

1. Rights/Duties of Cotenants

   1. Possession by One Cotenant

Each cotenant is entitled to possession and enjoyment of the whole. Cotenants may agree among themselves to establish the exclusive right of possession in one of them.

A cotenant in possession is not automatically liable to the others for the fair rental value of the property (majority).

• But, in most jurisdictions, a cotenant is liable to pay shares of the fair rental value of the property if he ousts his cotenant. This rule rewards the cotenant who makes productive use of the property while his cotenants sit on their rights, making him liable to them only if they attempt to take possession as well.

• Ouster is a flexible concept which usually refers to denying a cotenant the right to possession.

• Some courts find ouster where the tenant in possession has merely refused to pay fair rental to cotenants.

• An ousted cotenant may sue for accounting of the rents due or sue for partition.

In a minority of states, the tenant in possession is liable for the reasonable rental value to his cotenants.

1. Rents Received from a Third Party

Any rents collected by one cotenant must be shared equally with the others if the income collected exceeds the collecting cotenant’s proportionate share.

The other cotenants may sue for accounting of the rents due or wait and demand an accounting upon partition of the premises. No statute of limitations runs until the cotenancy is terminated. Cotenants are considered fiduciaries.

1. Maintenance of the Property

Each cotenant has a duty to pay his share of the taxes. If one pays more than his share, he can compel the others for reimbursement immediately or wait to collect in a suit in partition.

In some states, the tenant in sole possession has the duty to pay taxes and mortgage on the property up to the fair rental value of the property.

At common law, a cotenant who makes repairs to the property may not sue to compel immediate reimbursement. Instead, she must wait for an accounting action or partition action. She is then entitled to the cost of repairs over and above her share. Some modern jurisdictions have changed this rule.

At common law, a cotenant who makes improvements to the property likewise must wait for an accounting or partition action to collect. She is then entitled to the value added from the improvements.

1. Adverse Possession

A tenant may adversely possess against his cotenants.

However, it is insufficient...