Land Law - Coownership and the Four Unities

Land Law Cases referred to in this section:

  • Burgess v Rawnsley (1975) Ch 42
  • Greenfield v Greenfield (1979) 38 P & CR 570
  • Harris v Goddard (1983) 1 WLR 1203
  • Nielson-Jones v Fedden (1975) Ch 222
  • Palmer v Rich [1897] 1 Ch 134

Land may be held by several persons as co-owners as joint tenants (sometimes called 'beneficial joint tenants'), tenants in common or coparceners. There was also a fourth form of co-ownership known as tenancy by entireties, confined to dispositions to husband and wife during coverture, where the wife's interest was not her separate property. Of these interests, tenancy by entireties no longer exists, and tenancy in common and ownership in coparcenary can no longer exist at law but only in equity.

On a transfer of registered land to more than one transferee, a declaration of trust must now be completed as to the manner in which the transferees are to hold the property (Land Registration Rules 1925, SR & O 1925/1093, r 74(1), Sch 1, Form TR1 (respectively substituted and added by SI 1997/3037)). Similar information is required on an application for first registration (Land Registration Rules 1925, SR & O 1925/1093, r 19(1), Sch 1, Form FR1 (respectively substituted and added by SI 1997/3037)).

Joint Tenants:

For a joint tenancy to exist, each 'tenant' must have an identical interest in the whole land and every part of it. The interest of each person is the same in extent, nature and duration. In the case of freeholds, the seisin, and, in the case of leaseholds, the possession, is vested in all; none holds any part to the exclusion of the others. At common law the interest of each must vest at the same time. These are the four unities of title, interest, possession and time.

Unity of Interest:

The co-owners must each have the same interest in the land. So for example, if there is a conveyance to Bill of three quarters of the equitable interest and one quarter to Ben, in fee simple, they have the same interest in the land (although not the same size of share) - unity of interest in present.

Unity of Title:

For this to be present, all of the co-owners must receive their interest in land under the same document. Bill and Ben in the example above receive their interest under the same conveyance and so this is present.

Unity of Time:

Each co-owner's title must vest at the same time and so since Bill and Ben receive their share under the same conveyance in fee simple, this unity is present. If however, the property was left to them 'on attaining the age of 40' and they are different ages (and so will attain the age of 40 at different times), no unity of time would be present.

Unity of Possession:

All parties must be entitled to possession of the whole of the land, and may not exclude each other as co-owners - Bill and Ben would satisfy this test in our example.

Note that where the conveyance in favour of the coowners contains an express declaration of how the coowners shouldhold the equitable interest in the property, this declaration is conclusive (Goodman v Gallant (1986) Fam 106) and may rebut any presumption to the contrary (such as the presumption that property bought for a business is held as tenants in common: expressed by the maxim jus accrescendi inter mercatores locum non habet (the right of survivorship does not apply among businessmen: see Co Litt 182a; 2 Bl Com (14th Edn) 185).

Note that equity presumes a tenancy in common in several situations: partnership/business property, as above, and also where more than one person lends money to a borrower (the relationship between the lenders is tenants in common) and where unequal contributions have been made to the purchase price. These presumptions can be rebutted.

Severance of the joint tenancy
Severance may occur by any of the following means:

Severance by notice under Section 36(2) Law of Property Act 1925 - such notice must be given in writing, show the correct intention and be correctly served (see Harris v Goddard (1983) 1 WLR 1203).

Severance by an act of one tenant 'operating on his own share': each co-owner is at liberty to dispose of his own interest in such a manner as to sever it from the joint fund. An act such as the sale or gift of the equitable interest, or bankruptcy, would be such an act.

Severance by mutual agreement (see Burgess v Rawnsley (1975) Ch 42).
A course of dealing by the joint tenants showing that their interests should be treated as a tenancy in common rather than a joint tenancy: any course of dealing sufficient to intimate that the interests of all were mutually treated as constituting a tenancy in common: Palmer v Rich [1897] 1 Ch 134. See also Greenfield v Greenfield (1979) 38 P & CR 570 (conversion of house into two self-contained maisonettes did not cause severance).

An act 'operating on his own share'
In Nielson-Jones v Fedden (1975) Ch 222, Walton J considered what acts may amount to a tenant 'acting on his own share'. He felt that a unilateral declaration made by one of the co-owners did not shatter any of the unities and so did not sever the joint tenancy, since 'a wholly unconscionable amount of time and trouble' would be wasted by conveyancers in 'framing elaborate assignments for the purpose of effecting a severance when all that was required was a simple declaration'. Actual alienation or something equivalent to it would be required.

Note that where a joint tenancy is severed, it does not necessarily follow that all co-owners now hold as tenants in common. Obviously if there are just two coowners, the result is that when the tenancy is severed, they are both now tenants in common (as one cannot be a joint tenant all by themself). But let's say there are four people - Bill, Ben, Jackie and John hold a property as joint tenants. Jackie gives her share of the property to Bill. Now Bill has a dual ownership status. 75% of the property is held by Bill, Ben and John as beneficial joint tenants and 25% is held by Bill as tenant in common.

The right of survivorship
Where the property is held by co-owners as joint tenants and one co-owner dies, the remaining share would vest in the survivor or survivors by the right of survivorship and would not devolve under the will or intestacy - until of course the death of the last survivor, who can leave the whole of the property to who he pleases as sole owner.

Tenants in Common (in equity)
Where the equity of the property is held as tenants in common, each party will own a definable share which they may sell, mortgage, give away or leave in their will.

For example
Ivy Cottage is left to friends Bill, Ben and Frieda absolutely.

Bill Ben and Frieda will be legal beneficial joint tenants but as to the equity in the property they may either:

Hold the property as beneficial joint tenants - they would have no identifiable shares and would all own the whole of the property. If one co-owner dies, the property passes to the remaining two.

Hold the property as tenants in common - they would have a share of 33% each which they could deal with as they wish, and they can leave their individual share in their will.
As friends, it is unlikely that the co-owners would want their share to pass to the other two on their death and so they would be advised to hold the property as tenants in common.