Separation Where The Property is Owned Jointly
If you co-own a property with another person or other people, there are two ways in which the property can be held, either as beneficial joint tenants or tenants in common.
If you and your partner hold the property as beneficial joint tenants you are both wholly entitled to the property. Neither of you own a specific share. On the other hand, if you hold the property as tenants in common, you each hold an individual share in the property and you are entitled to deal with that share as you wish.
If you hold the property as a ‘tenant in common’, the Doctrine of Survivorship no longer applies. This means that your beneficial interest in the property passes in accordance with your will or intestacy rules. If you fail to sever your joint tenancy, the Doctrine of Survivorship operates, meaning that your beneficial interest in the property will pass to the remaining joint tenants, even if your will states otherwise.
Severance is a process which converts a joint tenancy in to a tenancy in common. It is often a step taken by couples who are separating.
You can sever your joint tenancy in many ways but most commonly your Solicitor will write to all remaining joint tenants expressing an immediate intention to sever on your behalf. This method of severance is effective upon delivery, even if it is not acknowledged or opened by the other remaining joint tenants.
There are other methods of severance such as:
- Alienating your interest: This is can be exercised through selling or gifting your interest to someone else or by taking out a mortgage.
- Mutual Agreement: You can reach an agreement with the other joint tenants that severance is to take place. This provides effective severance as soon as the agreement is reached, it need not be exercised. For example, if another joint tenant offered to buy your beneficial interest in the property and you accepted, this would amount to effective severance, even if money was yet to change hands.
- Mutual Conduct: You can sever your interest via mutual conduct which involves physical division of the property. However, this will only amount to effective severance if it is the common intention of all the parties to sever.
- Bankruptcy: If you become bankrupt, severance takes place on the date the bankruptcy order is granted by the Court. However, your interest is then vested with the Trustee in Bankruptcy.
Once you have severed your joint tenancy, you are entitled to a share of the property which is proportionate to the number of remaining joint tenants, irrespective of how much you originally contributed towards the purchase price unless a prior agreement has been made between the respective owners.
If you are considering separation from your partner, severance ensures that your interest will not pass to your partner, should anything happen to you. Furthermore, you can control and choose what happens to your beneficial interest, for example, who you wish to inherit your share in the property.
Pepperells Solicitors can provide advice and support in relation to property and separation matters. Our team of experts will ensure that the legalities involved with your property and separation are dealt with professionally and efficiently. To regain and secure full control over your beneficial proprietary interest, contact one of our team today!
