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Davis v Smith [2011] EWCA Civ 1603

Joint Tenancy – Severance of Joint Tenancy by solicitor’s correspondence – Methods of Severance

Facts

A husband and wife married in 1988, after which they moved into a property which Mrs Smith had already been a tenant of for some time.  In 1989, they purchased the property as joint tenants.  The relationship broke down and Mr Smith moved out of the property in 2009 and a divorce petition served.  As part of the divorce settlement negotiations, solicitor’s correspondence between the parties showed that there was an agreement to put the property on the market with the proceeds to be divided between them. Mr Smith was to take the couples endowment policy whilst Mrs Smith was to be compensated with a balancing payment from the sale of the property.  Both parties had been advised to serve a notice ending the joint tenancy on the other party, but they had not yet done so when Mrs Smith died suddenly.

Issues

Whether the joint tenancy had been severed.  Whether or not the solicitor’s correspondence was sufficient to show mutual agreement to severing the joint tenancy.

Held

The Court of Appeal, upholding the decision of the County Court held that the tenancy had been properly severed.  The parties had agreed to sell the property and equally divide the proceeds between them as shown by the solicitor’s correspondence on the matter.  This amounted to a severance of the joint tenancy as set down in Williams v Hensman (1861) 70 E.R. 862.  The mutual agreement could be inferred from the solicitor’s correspondence, but also from the fact that this had been expressly agreed in a meeting between the parties, that the parties had been advised as to the likely split of the proceeds, and because the parties had cashed in their endowment policy with a clear understanding that the balancing payment to Mrs Smith would be made from this. 


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