Property Owley Spring 2016
Concurrent Ownership / Landlord Tenant / Real covenants, equitable servitudes, nuisance / Zoning, Eminent Domain, Takings
NOT in exam: Adverse Possession / Found Property / Gifts / Easements / Future Interests
I. Concurrent Ownership – Types of Concurrent Estates P376
1. Tenancy in Common: Each tenant in common has undivided, fractional interest in the whole; a transferable right (alienable, devisable, descendible); right to use and possess the whole. A tenancy in common is a concurrent estate with no right of survivorship. Each owner has a distinct, undivided interest in the property. This interest is freely alienable by inter vivos and testamentary transfer, is inheritable, and is subject to claims of the tenant’s creditors. The only “unity” involved is possession: Each tenant is entitled to possession of the whole estate. Today, by statute, multiple grantees are presumed to take as tenants in common (default presumption). The same is true where multiple transferees take by descent.
2. Joint Tenancy: O to A and B as joint tenants with right of survivorship. Joint Tenant have an undivided right to use and possess the whole property; Right of survivorship; Not devisable or descendible. A joint tenancy can be created between two or more co-tenants. Its distinguishing feature is the right of survivorship. Conceptually, when one joint tenant dies, the property is freed from his concurrent interest; the survivor or survivors retain an undivided right in the property, which is no longer subject to the interest of the deceased co-tenant. The survivors do not succeed to the decedent’s interest; they hold free of it. At common law, four unities are required to create a joint tenancy: a) Unity of time (interests vested at the same time); b) Unity of title (interests acquired by the same instrument); c) Unity of interest (interests of the same type and duration); and d) Unity of possession (interests give identical rights to enjoyment).
Under modern law, joint tenancies are disfavored. Hence, there must be a clear expression of intent to create this estate, or it will not be recognized. The usual language required is “to A and B as joint tenants with right of survivorship.” Today, when two or more persons take property by a single conveyance, a tenancy in common, not a joint tenancy, is presumed. A joint tenancy results only when an intention to create a right of survivorship is clearly expressed.
James v. Taylor, 62 Ark. App. 130: The deed in question was executed by the grantor to the three grantees “jointly and severally, and unto their heirs, assigns and successors forever,” with the grantor retaining a life estate. Two of the three grantees predeceased the grantor. The surviving grantee sought a declaration in the chancery court that the grantor intended to convey the property to the grantees as joint tenants, thereby making the surviving grantee the sole owner of the property. The descendants of the two deceased grantees argued that the deed created a tenancy in common among the grantees. Ark. Code Ann. § 18-12-603 (1987) provided that every interest in real estate granted or devised to two or more persons was a tenancy in common unless expressly declared to be a joint tenancy. The court found that the use of the words “jointly and severally” did not create a joint tenancy. There was no mention in the deed of “survivorship.” Thus, the court held that the language of the deed was insufficient to overcome the statutory presumption in Ark. Code Ann. § 18-12-603 (1987) of a tenancy in common. The court noted that evidence of the grantor's intention also could not prevail over the statute. The court reversed the chancery court's decision. The deed created a tenancy in common in the grantees.
Ending the Joint Tenancies
1. Severance: conveyance by one joint tenant of her undivided interest destroys the joint tenancy so that the transferee takes the interest as a tenant in common and not as a joint tenant. This rule applies to both voluntary and involuntary conveyances (even secret conveyances). When property is held in joint tenancy by three or more joint tenants, a conveyance by one of them destroys the joint tenancy only as to the conveyor’s interest. The other joint tenants continue to hold in joint tenancy as between themselves, while the grantee holds her interest as a tenant in common with them.
à Leases: Theoretically, when one joint tenant leases her interest in jointly held property, the lease destroys the unities of interest and possession and thereby should effect a severance (which is the view taken by some states). But other states hold that the joint tenancy is not destroyed, and is merely temporarily suspended (for the length of the lease). If the lessor/joint tenant dies before the end of the lease, some courts hold that because the lessor’s own right to possession would cease on her death, so must the right of any lessee. Others hold that the lease operates as a “temporary severance,” and the remaining joint tenant’s survivorship rights are therefore postponed until the end of the lease.
Tenhet v. Boswell: Johnson and Tenhet (P) owned a parcel of land as joint tenants with rights of survivorship. Johnson signs a lease with Boswell (D) for a period of 10-years at a rental of $150 per year with a provision granting the lessee an “option to purchase.” Johnson dies three months later without telling his wife about D. P sought to establish her possess of the property as surviving joint tenant and demanded D to leave. Then she brought a suit.
Holding: Partial alienation (the lease) of Johnson’s interest in the property did not create a severance of the joint tenancy. As the surviving owner, she may take the property and disregard the lease.
Rule: In order for a joint tenancy to be severed one of the unities must be destroyed (unity of title, time, interest, and possession). If one of the unities is destroyed then the owners hold title in tenancy in common. Unity of title may be destroyed by voluntary conveyance, by involuntary alienation under an execution, or by any other action which operates to sever the joint tenancy. Lease cannot create a severance of joint tenancy, since it’s only valid during the leaser’s life. Since joint tenancy is created with express intent then the co-owner must openly express their intent to sever the joint tenancy as well.
à In the majority of states, a mortgage is regarded as a lien on title, and one joint tenant’s execution of a mortgage on her interest does not by itself cause a severance. (You can only convey what you have, can only mortgage what you have, and give away what you have. If you don’t have future interest of the property, you cannot give it away.) If a lien is obtained against one of several joint tenants but not against the others. The majority view
Holding: The order of the trial court was reversed and remanded for further proceedings at which the son had an opportunity to present evidence related to the value of the parents' sole occupancy of the property.
Expenses for Preservation of Property—Contribution (can bring a contribution action)
1) Repairs—Contribution May Be Compelled for Necessary Repairs: A co-tenant who pays more than her pro rata share of the cost of necessary repairs is entitled to contribution from the other co-tenants in actions for accounting or partition. Although the courts are split on whether a co-tenant who makes necessary repairs can maintain an independent action for contribution against the other co-tenants, the majority view is that she can compel contribution, provided she has notiﬁed the other co-tenants of the need for repairs. Moreover, several decisions authorize contribution even without such notice. The common law view was that because no co-tenant has a duty to make necessary repairs, a co-tenant who makes such repairs cannot bring an action to compel contribution from the other co-tenants. This is now the minority view.
2) Improvements—No Contribution or Setoff: Generally, there is no right of contribution for the cost of improvements, nor can they be set off in an action for accounting. Only in an action for partition can the value of improvements be recouped.
3) Taxes and Mortgages—Contribution Can Be Compelled: Each co-tenant has a duty to pay her share of taxes and payments due on mortgages on the entire property. A tenant who is not in sole possession can pay the taxes and mortgage payments and then compel contribution from the other co-tenants. However, a co-tenant in sole possession will receive reimbursement only for the amount that exceeds the rental value of the property.
4. Ouster: Under the unity of possession, each co-tenant is entitled to possess and enjoy the whole of the property subject to the equal right of her co-tenant. If one tenant wrongfully excludes another co-tenant from possession of the whole or any part of the whole of the premises, there is an ouster. The ousted co-tenant is entitled to receive his share of the fair rental value of the property for the time he was wrongfully deprived of possession.
II. LANDLORD AND TENANT
NATURE OF LEASEHOLD: A leasehold is an estate in land. The tenant has a present possessory interest in the leased premises, and the landlord has a future interest (reversion). Certain rights and liabilities ﬂow from this property relationship between landlord and tenant. The three major types of leasehold estates are tenancies for years (Specific Term), periodic tenancies, and tenancies at will. There is a fourth category called tenancies at sufferance.