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CO-OWNERSHIP

1. Joint Tenants

Each JT owns WHOLE of Prop (thus, JT cannot convey Prop to other JT).
All JTs have right to share ALL Prop no individual right to a share of the Prop.

Characteristics:
1. Unity of Title: all JT take interest under the same instrument.
A ---- B (JT)
THUS: A and C are NOT JT (not same instrument), but TIC
| conveys
C
2. Unity of Interest: interest must be of same nature, extent, duration.
3. Unity of Possession: each T entitled to possess WHOLE Prop.
Thus, if 1JT leases to 3rd party, JT severed. JT revives when L expires.
4. Unity of Time interests of all JT vested at the same point in time.
If any Us broken JT is severed converts to TIC

Right of survivorship:

When 1 JT dies, their interest in land surviving JT.


Cannot be contracted/willed out of.
Corp cannot be JT (cannot die) but under s25(1) Corp Act, corps can be JT.
Hickman v Peacey (1945)
4 people make will benefiting others. All killed in bomb. Order of death unknown.
HELD: death determined in order of seniority, unless evidence to the contrary. Thus, youngest inherited
Prop (their estate). This is s35 CA.
NOTE: doesnt need to be a common disaster just where order of deaths is indeterminable.
Halbert v Mynar (1981):
Husband JT with Wife disappeared for over 7 yrs. CL presumption that W dead.
HELD: s35 CA did NOT apply, where circumstances/reality of death is unknown. Only use if ORDER
of death is unknown.

2. Tenants In Common

Each TIC has discrete interest (undivided share) in land.


TIC owns certain parts in terms of value (fractions).
Diff from JT: NO right of survivorship, only has U of Possession.
Can do with land as they wish create LT, L, RM etc.

Creation of Co-ownership
S26 CA: in absence to clear words to contrary PRESUMPTION that it is TIC.
Eg. instruments says to A and B presumed to mean to A and B as TIC.
Delehunt v Carmody (1986)
Prop bought in name of A but paid for by A and B.
HELD: A held Prop in Trust for A and B. No intention for ROS in instrument s26 TIC.

Converting JT TIC
1. SALE

Sale severs U of Title, U of Time


2 JTs example: A + B (JT). B conveys to C. A + C become TIC.
2 JTs example: A + B + C (JT). A conveys his 1/3 to D. D is TIC with B and C. BUT B and C still JT
(4U still exist).

Wright v Gibbons (1949):


A + B + C (JT). A and B try to sever JT without Cs knowledge. A transfer 1/3 to B (As JT with C and B
is severed). B transfer 1/3 interest to A (Bs JT with C is severed) destroy U of Title/Time.
Transfer did not need to be registered (so long as enforceable contract with valuable consideration)
severed at equity. If DID reg, then also severed at law.
Corin v Paton (1990):
Look below.

2. MORTGAGE
Re Pollards Estate
JTs (Mgor) with Mgee. 1 JT gets 2nd Mgee JT severed.
OST Mg by 1 JT severs JT because it acts as conveyance.
Lyons v Lyons [1967]
Under RP Mg is NOT sufficient to sever JT (only charge, not a conveyance).
If sole Mgor/JT dies before other JT Mgee loses security. If sole Mgor/JT outlives other JT Mgee
has inflated security.

3. LEASE: Frieze v Unger [1960]

Severs U of Possession but is a TEMPORARY fracture.


Lessee becomes temp JT with remaining JTs and JT reverts after L ends.

4. AGREEMENT/CONDUCT

Equity: agreement must be specifically enforceable


OST: must be valid eg. by deed
RP: must be reg.
Agreement for sale by all JT does NOT sever until all proceeds received. If 1 JT dies between
exchange/settlement other JT receives all proceeds: Re Allingham [1932]
JT severed by agreement and transfer by all JT to themselves: s99 RP and s45A CA: Williams v
Hensman (1861)
Eng law: Oral agreement to sever is sufficient: Burgess v Rawnsley [1975]
BUT this expressly rejected in Aus HC in Corin v Paton (1990)
Corin v Paton (1990):
W + H (JT) of marital home. Estranged. H had CT at all times. W get cancer. Before die, want to convert
to TIC without H knowing. W sold to brother. Brother execute Trust for W.
Conduct sufficient to sever JT?
o Eng: conduct with clear intention to sever JT and ROS YES. Burgess v Rawnsley [1975]
o Aus: rejected cannot sever via oral/conduct.
Effective Transfer of land?
o Equity: NO. Brother did not pay valuable consideration And trust meant that brother had no
interest in equity.
o Law: NO. Not reg. as H had CT.

5. MERGER

JT severed if 1 JT acquires FURTHER interest in land no longer U of Interest.


Eg. A (LT) for B + C (JT/RM). A sells to B. B interest merged with A. JT with C is severed.

6. MURDER

JT who murder another JT cannot inherit benefit from crime.


Is not severed at law, but by EQUITY imposes trust on Murderer JT: Rasmanis v Jerewitsch (1969)
Eg. A + B + C (JTs) A kills B.
o A cannot remain JT with C (get benefit).

o C cannot have increased interest (if C dies before A, then A gets B+C benefit).
Forfeiture Act 1995 (NSW) criminals must forfeit benefits of crime.
Leneghan-Britton v Taylor (1998): granddaughter take care of abusive grandmother for years. Killed
her.
o Held: not excluded from will just reduced for sake of justice.

Ending Co-ownership (JT or TIC)


1. Agreement to sell between parties

Co-owners sell their co-owned Prop. Ends when all proceeds received: Re Allingham (1932)

2. Resumption

State can resume (take) Prop for public purpose (eg. road etc). Co-owners compensated.

3. Court order s66G CA

CO can get court order for sale or partition of Prop.


Partition terminate co-ownership CO becomes sole owner of specific parts of land.
CL: no power to partition.
Equity: available.
S66G CA: court appoint Trustee and vest in them Trust for Sale (Trustee must sell Prop and hold
proceeds in trust) or Trust for Partition.
Pannizotti v Trask (1987)
Courts discretion to make s66G order is limited.
If co-owner (1/2 + interest) court likely order.
If co-owner (less than ) only make order if satisfied in all circumstances it is just to do so.

Right of Co-Owners Inter Se


During co-ownership, CO have:
Rights under the enforceable contract between COs
Right (s560 Local Gov Act 1993 NSW) to recover from other CO their share of rates paid by 1 CO.
Cannot recover for:
Comp for improvement on Prop;
Occupation rent from a CO who is exclusively occupying the Prop.
BUT one ended, E court will (on appl. form ex-CO) to take accounts between COs:
Any comp for improvement on Prop carried out by CO
Any occupation rent owed by CO exclusively occupying the Prop.

Comp for Improvements by Occupying CO:

CL: no remedy for CO to be comp for cost of improvement (made without assent of other CO): Leigh v
Dickeson (1884)
E: comp allowed where other Co would benefit unfairly if no adjustment made: Squire v Rogers (1979)
This right can become a lien in CO runs with land thus occup COs inheritor can sue.
BUT overturned by bonafide Purchaser for value, who takes without notice or who reg under TT (thus,
occup. CO should caveat).

Extent to which Occ OC can get comp:


Brickwood v Young (1905)
Cost of improve > value added to CO land.
HELD: only get lesser amount thus the comp only for value added to land.
McMahon v Public Curator [1952]
Cost of painting the Prop.
Followed Brickwood.

HELD: distinction between maintenance and improvement former, there is NO comp.


NB: but if value of prop is increased by repairs (ie. Maintenance) seen as improvement: Ryan v Dries
(2002)
Ryan v Dries [2002]
R and D rel bought house together. R live there all time and conduct computer sale business. D stay for
wkd. D stay less and rel broke. R paid all Mg payments.
HELD: Mg payments ARE improvements on land (increases value by taking away debt).
Profits of computer sale business NOT accounted profits from personal services of CO.
NOTE: D could (as set off) seek rent.

Exclusive Occupation by 1 CO:


Each CO is entitled to use/own Prop.
If 1 CO chooses NOT to cannot get rent from other CO that DOES: Luke v Luke (1936)
Exceptions
Occupying CO has agreed to pay rent (separate enforceable contract): Leigh v Dickeson (1884)
Occupying CO has wrongfully excluded other CO from the Prop (incl by domestic violence): Dennis v
McDonald (1982)
Occupying CO has sought comp from non-occupying CO for improvements on Prop which Occupying
CO has made.
o This right is a SET OFF claim from a claim for comp for improvement: Equity THUS,
CO seeking comp for improvement must do equity by setting off against such compensation,
the value of any exclusive occupation that they have undertaken.
o Re Jones; Farrington v Forrester (1893)
Forgeard v Shanahan (1995)
If rent owed > comp for improvements no comp paid to occupying CO who made improvements.
BUT no rent in excess of comp will be paid to non occupying CO either.
Eg. Rent value is 10K and comp is 5K. Occupying CO will not get his 5K comp. And non-occupying Co
will only get 5K rent value (difference).

Account for profits?


Rent

CL: CO cant get portion of any rent collected by other COs.


Hutchins v Hutchins (1999):
Held: any rent collected by 1CO was held in trust for all CO in their proportionate shares.
Affirmed in `

Business
Squire v Rogers (1979):
Man occupy and woman live in US. Cyclone tracey and in aftermath, builders need temp accom. M built
many temp accom on land profit. CO end and M seek comp for improve. W as set off seek rent.
HELD:
o Occup CO does not have to account (split) profits from their labour EXCEPT where profits
received from 3rd parties on account of USE of the Prop (eg. Rent from Tenants).
o Occup CO does not have to account for improvement on capital (but sub. to cost v value test).
o Occup CO does not have to account for 3rd party profit that is spent in way consented to by other
CO (eg. Profits are to build common bathrooms).
NOTE: Occup Co is compensated first (lesser value that was added) and then the profits split.