Tag Archives: joint tenancy

Severance of joint tenancy

People often own property in some form of co-ownership with another person. The most common situation is a husband and wife, although there can be a number of reasons why persons who are family members or investors register their names together on title. This can sometimes create major legal and financial issues.

There are different forms of co-ownership – the most common being “joint tenancy with right of survivorship” and “tenancy in common.” Joint tenancy with right of survivorship means that upon death of one owner, the survivor automatically assumes ownership of the entire property by what lawyers call ”operation of law”. The deceased’s share does not go into his or her estate but rather passes directly to the survivor. This means that the beneficiaries or heirs will not be entitled to the deceased’s interest in the property. 

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A POA can be used to sever a joint tenancy

You may have seen my article in Your Estate Matters earlier this week on how a joint a tenancy can be severed by a “course of dealings”.  In that same vein, the BC Court of Appeal recently confirmed in Houston v. Houston that the holder of a Power of Attorney can sever joint tenancy so long as the terms of the Power of Attorney don’t contain any restriction that would prevent that from being performed.  The party attacking the acts of the holder of the Power of Attorney argued that severance of a joint tenancy was basically akin to making a new Will (or, as a lawyer would say, “tantamount to a testamentary act”) and therefore beyond the authority of the attorney.  The Court rejected that argument, noting that severance of a joint tenancy, unlike some other acts (like designation of a beneficiary of a life insurance policy), can be done unilaterally and isn’t connected to or dependant on the donor’s death.  So, in the case of Houston anyway, the POA didn’t do anything he wasn’t allowed to do.

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Failure to Launch

In the recent case of Fraik v. Pilon (BC Supreme Court), a daughter lived in her mother’s home for over 30 years. During that time, the daughter carried out some renovations but paid no rent and contributed little in the way of household expenses. During the period they lived together, mother and daughter had various discussions concerning the division of the property. At some point, the mother transferred an interest in the property to her daughter and eventually created a joint tenancy of the property. After this transfer, the mother severed the joint tenancy and left part of her share of the property to another child.

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