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Joint Tenancy and Severance

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    • Thread Starter

    I have a question about severance that I can't seem to find an answer to.

    Suppose there are three co-owners who hold as joint tenants in equity: A, B and C. A decides to sell his share to B.

    What is the new position in equity?

    Does B hold as a tenant in common with 1/3 share and as a joint tenant with C for the remaining 2/3?
    Does B hold as a tenant in common with 2/3 share, thereby severing the whole of the joint tenancy and leaving C as a tenant in common as well?
    I have a second question, on which there seems to be quite a few decisions but no definitive answer concerning inconclusive negotiations (Williams v Hensman; Burgess v Rawnsly).

    How important is agreement as to price when determining whether severance has occurred. What I mean is: what if joint tenants A and B have agreed among themselves - at least in principle - that A will sell to B, but before they can arrive at a precise decision as to the purchase price, A passes away? This will have significant impact on the operation of survivorship, so I would like to know whether the court is likely to find that severance has occurred or not. In my opinion, on a generous reading of Davis v Smith, Hunter v Babbage and Burgess v Rawnsly, severance has occurred, but I'd like to know from someone better informed.

    It is not possible to have a 'mix' of equitable ownership, and so B and C would be TiCs in your first question. C would need to have knowledge of and accept that the sale from A to B, and so all the JTs would be acting on their own shares.

    I think the answer to the second question depends on what C knew about matters between A and B before their death. It's been a while since I looked at this....

    Posted from TSR Mobile
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