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| Property law |
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| Part of the common law series |
| Acquisition of property |
| Gift · Adverse possession · Deed |
| Lost, mislaid, or abandoned |
| Alienation · Bailment · License |
| Estates in land |
| Allodial title · Fee simple · Fee tail |
| Life estate · Defeasible estate |
| Future interest · Concurrent estate |
| Leasehold estate · Condominiums |
| Conveyancing of interests in land |
| Bona fide purchaser |
| Torrens title · Strata title |
| Estoppel by deed · Quitclaim deed |
| Mortgage · Equitable conversion |
| Action to quiet title |
| Limiting control over future use |
| Restraint on alienation |
| Rule against perpetuities |
| Rule in Shelley\'s Case |
| Doctrine of worthier title |
| Nonpossessory interest in land |
| Easement · Profit |
| Covenant running with the land |
| Equitable servitude |
| Related topics |
| Fixtures · Waste · Partition |
| Riparian water rights |
| Lateral and subjacent support |
| Assignment · Nemo dat |
| Other areas of the common law |
| Contract law · Tort law |
| Wills and trusts |
| Criminal Law · Evidence |
A concurrent estate or co-tenancy is a concept in property law, particularly derived from the common law of real property, which describes the various ways in which property can be owned by more than one person at a given time. The parties who own property jointly are referred to as co-tenants or joint tenants. Most common-law jurisdictions recognize three kinds of concurrent estate: tenancy in common, joint tenancy with right of survivorship, and tenancy by the entirety. Many jurisdictions simply refer to a joint tenancy with right of survivorship as a joint tenancy, but a few U.S. States treat the phrase joint tenancy as synonymous with a tenancy in common.
The type of ownership determines the rights of the parties to convey their interest in the property to others, to will the property to their devisees, or to sever their joint ownership of the property. Just as each of these affords a different set of rights and responsibilities to the joint owners of property, each requires a different set of conditions in order to exist.
It should be borne in mind that the law can vary from place to place, and that the following general discussion will not be applicable in its entirety to all jurisdictions.
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Co-tenants, irrespective of the type of tenancy, share certain rights relative to each other and to the property, except to the extent they have modified these rights through an agreement among themselves:
Co-tenants do not have any obligation to contribute to any costs of repairing or improving the property. If one co-tenant adds a feature that enhances the value of the property, that co-tenant has no right to demand that any others share the cost of adding that feature - even if other co-tenants reap greater profits from the property because of it. However, at partition, a co-tenant is entitled to recover the value added by his or her improvements of the property. Conversely, if the co-tenant\'s "improvements" decrease the value of the property, the co-tenant is responsible for those decreases as well.
Furthermore, each co-tenant can independently encumber the co-tenant\'s own share in the property by taking out a mortgage on that share (although this may effectively convert a joint tenancy to a tenancy in common, as described below); other co-tenants have no obligation to help pay a mortgage that only runs to another tenant\'s share of the property, and the mortgagee can only foreclose on that mortgagor\'s share. Bank loans secured by mortgages on individual shares of co-owned property is one of the most rapidly expanding areas in the mortgage lending industry.
Finally, co-tenants owe one another a duty of fair dealing. Because of this, any co-tenant who acquires a mortgage claim against the property must give his co-tenants a reasonable opportunity to purchase proportionate shares in that claim.
Tenancy in common is the default form of concurrent estate, in which each owner, referred to as a tenant in common, is regarded by the law as owning separate and distinct shares, which may differ in size. This form of ownership is most common where the co-owners are not married or have contributed different amounts to the acquisition of the property. The assets of a commercial partnership are normally owned on a tenancy in common basis. Also, if the joint owners had attempted to use a form of joint ownership, such as a joint tenancy with right of survivorship or a tenancy by the entirety, and the effort was for some reason invalid, the joint owners would by default be classed as tenants in common. If conclusive evidence is not available of the desire to create a tenancy with rights of survivorship or a tenancy by the entirety, a court will normally determine that a tenancy in common has in fact been created.
Tenants in common have no right of survivorship, meaning that if one joint owner dies, that owner\'s interest in the property will be part of his or her estate and pass by inheritance to that owner\'s devisees or heirs, either by will, or by intestate succession. Also, as each joint owner has an interest in the property, they may, in the absence of any restriction agreed to between the joint owners, sell or otherwise deal with the interest in the property (e.g. mortgage it) during their lifetime, like any other personal interest.
Where any party to a tenancy in common wishes to terminate (usually termed "destroy") the joint interest, he or she may obtain a partition of the property. This is a division of the land into distinctly owned lots, if such division is legally permitted under zoning and other local land use restrictions. Where such division is not permitted, a forced sale of the property is the only alternative, followed by a division of the proceeds.
If the parties are unable to agree to a partition, any or all of them may seek the ruling of a court to determine how the land should be divided - physically division between the joint owners (partition in kind), leaving each with ownership of a portion of the property representing their share. Courts may also order a partition by sale in which the property is sold and the proceeds are distributed to the owners. Where local law does not permit physical division, the court must order a partition by sale.
Each co-owner is entitled to partition as a matter of right, meaning that the court will order a partition at the request of any of the co-owners. The only exception to this general rule is where the co-owners have agreed, either expressly or impliedly, to waive the right of partition. The right may be waived either permanently, for a specific period of time, or under certain conditions.
A joint tenancy with right of survivorship or JTWROS is a type of concurrent estate in which the joint owners have a right of survivorship, meaning that if one owner dies, that owner\'s interest in the property will automatically pass to the remaining owner or owners. On the death of one of the tenants, the whole of the property passes to remaining tenant(s); this is the "right of survivorship." The deceased tenant\'s property interest simply evaporates by operation of law, and cannot be inherited by his heirs (which means it avoids going through probate). Under this type of ownership, the last owner living takes all.
It is important to note, however, that creditors\' claims against the deceased tenant\'s estate may, under certain circumstances, be satisfied by the portion of ownership previously owned by the deceased, but now owned by the survivor or survivors. In other words, the deceased\'s liabilities can sometimes remain attached to the property.
This form of ownership is common between husband and wife, and parent and child, and in any other situation where parties want absolute ownership to immediately pass to the survivor. For bank and brokerage accounts held in this fashion, the acronym JTWROS is commonly appended to the account name as evidence of the owners\' intent.
In order to create this type joint ownership, the party or parties seeking to create it must use specific language indicating that intent. For example, if Joey wishes to convey property for Kelly and Lisa to share as joint tenants with right of survivorship, Joey must state in the deed that the property is being conveyed "to Kelly and Lisa as joint tenants with right of survivorship, and not as tenants in common."
In order for a JTWROS to be created, the co-owners must share the "four unities":
If any one of the four unities is missing, the JTWROS is invalid, and becomes a tenancy in common.
The tenant in property owned by a JTWROS can break the JTWROS as to their interest in the property at any time by conveying their interest in the property to another person. Under the old common law, this required an actual exchange with a straw man - another person who would buy the property from the co-tenant for some nominal consideration, then sell it back to the co-tenant at the same low price. Some jurisdictions now permit a joint tenant to break the JTWROS without a straw man, simply by executing a document to that effect - even if that owner does not inform the other owners. In either case, the JTWROS will, again, revert to a tenancy in common as to that owner\'s interest in the property.
There is a big problem that is possible with the simple document execution method. In the straw man approach, there are witnesses to the transfer. With the document, there may not be witnesses. With either method, as soon as the break occurs, it works both ways. Because there may not be witnesses, the party with the document could take advantage of that fact and hide the document when the other party dies.
It is important to note, however, that if there are three or more owners, and only one of the owners breaks the JTWROS, the other owners remain in the JTWROS as to each other. For example, suppose Joey, Kelly, and Lisa own a piece of property as joint tenants with right of survivorship, but then Joey conveys his share in the property to Ryan. If Ryan dies, his 1/3 share will go to his heirs. But if Kelly dies, her 1/3 share will go to Lisa, because they still owned their total 2/3 share in JTWROS.
Where one party takes out a mortgage on the jointly owned property, this may break the JTWROS, depending on the law of the state. Some states use a lien theory, which posits that the taking of a mortgage merely places a lien on the property, leaving the joint tenancy undisturbed. However, other states that use a title theory, contending that a mortgage actually conveys title from the mortgagor [co-tenant] to the mortgagee [lender] until the mortgage is paid. In such states, the taking of a mortgage by one owner breaks the joint tenancy as to that owner.
A creditor\'s judgment lien is not enough, no severance, if debtor dies before creditor sues, the creditor has no interest in the property left to collect against.
Tenancy by the entirety is a type of concurrent estate available only to married couples, wherein ownership of the property is treated as though the couple are a single legal person. Like a JTWROS, the tenancy by the entirety also encompasses a right of survivorship, so if one spouse dies, the entire interest in the property passes to the surviving spouse, without going through probate.
In order for a tenancy by the entirety to be created, in some jurisdictions the party or parties seeking to create it must specify in the deed that the property is being conveyed to the couple "as tenants by the entirety". Also, the parties must share the four unities necessary to create a joint tenancy with right of survivorship - time, title, interest, and possession - plus a fifth unity, marriage. However, unlike a JTWROS, neither party in a tenancy by the entirety has a unilateral right to sever the tenancy by the entirety - if it is to be undone, or if any part of the property is to be conveyed to another person, this must be carried out by both spouses. A divorce breaks the unity of marriage, leaving the default tenancy, which may be a tenancy in common. Many US jurisdictions no longer recognize tenancy by the entirety. Where it is recognized, benefits can include the ability to shield entireties property from creditors of only one spouse, as well as the ability to partially shield entireties property where only one spouse is filing a petition for bankruptcy relief.
In some treatises and cases, the term uses the plural, tenancy by the entireties.
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This article needs additional citations for verification. Please help improve this article by adding reliable references. Unsourced material may be challenged and removed. (March 2008) |
Note that every country and every state in the United States has at least minor variations on the law as applied to joint ownership of property. These links generally discuss the law as applied in the state from which they originate:
This outline discusses the general common law of joint ownership of property:
IRS Revenue Procedure 2002-20, which covers the finer details controlling what constitutes a Tenant in Common for federal tax purposes.
Tenant in Common Association
Comprehensive Tenancy in Common Resource Database
Detailed Info on San Francisco Tenancy in Common Rules
Tenancy By the Entirety in Massachusetts.
For a good discussion on this misunderstood estate see Coraccio v. Lowell Five Cents Savings Bank, 415 Mass. 145, 612 N.E. 2d 650.
There is nothing in the laws of Massachusetts, or New York as stated in Coraccio, to prevent one co-tenant from conveying her own or his own interest in the property, subject to the continuing rights of the other. While it is generally believed that one tenant by the entirety cannot convey their interest because the tenancy cannot be severed, rather it is the survivorship rights of the other that cannot be severed. Thus, if a husband conveyed his interest in the property held as tenants by the entirety to his brother, the husband no longer owns an interest in the property. The brother takes his (the husband\'s) place within the tenancy. Here is the tricky part: if the wife dies then the husband\'s brother acquires all interest in the real estate. If the husband dies before the wife then it all goes to her free and clear and the husband\'s brother has nothing. Some conveyancers have treated deeds by one tenant by the entirety as null. However, such a deed conveys the interest of the grantor in the property subject to the survivorship rights of the other co-tenant. KLussier
Tenancy By the Entirety at Common Law/effect of a conveyance by one:
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