Term
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Definition
| If a single party owns the fee or life estate, the ownership is a tenancy in severalty. Synonyms are sole ownership, ownership in severalty, and estate in severalty. The root of this word is “SEVER,” meaning to “cut off” everyone else’s interests. |
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Term
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Definition
If more than one person, or a legal entity such as a corporation, owns an estate in land, the estate is held in some form of co-ownership. Co-owners are also called co-tenants.
There are three main forms of co-ownership:
Tenants in Common
Joint Tenancy
Tenancy By the Entireties |
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Term
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Definition
The tenancy in common, also known as the estate in common, is the most common form of co-ownership when the owners are not married. The defining characteristics are:
two or more owners, identical rights (indivisible interest),
Interests individually owned: All tenants in common have distinct and separable ownership of their respective interests. Co-tenants may sell, encumber, or transfer their interests without obstruction or consent from the other owners. (A co-tenant may not, however, encumber the entire property.) |
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Term
| tenancy in common: Electable ownership shares |
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Definition
| Tenants in common determine among themselves what share of the estate each party will own. For example, three co-tenants may own 40 percent, 35 percent, and 25 percent interests in a property, respectively. In the absence of stated ownership shares, it is assumed that each has a share equal to that of the others. |
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Term
| tenancy in common: no survivorship |
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Definition
| A deceased co-tenant’s estate passes by probate to the decedent’s heirs and devisees rather than to the other tenants in common. Any number of heirs can share in the ownership of the willed tenancy. |
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Term
| tenancy in common: no unity of time |
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Definition
| It is not necessary for tenants in common to acquire their interests at the same time. A new co-tenant may enter into a pre-existing tenancy in common. |
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Term
| tenancy in common: partition suit |
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Definition
| If other shareholders will not buy the interests of a shareholder who wants to sell out, and no one can be found to buy the shares, an individual shareholder can request that the courts sell either their shares (seek an equitable distribution) or the whole property. |
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Term
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Definition
| In a joint tenancy, two or more persons collectively own a property as if they were a single person. Rights and interests are indivisible and equal: each has a shared interest in the whole property, which cannot be divided up. Joint tenants may only convey their interests to outside parties as tenant-in-common interests. One cannot convey a joint tenant interest. |
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Term
| joint tenancy: unity of ownership |
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Definition
| Whereas tenants in common hold separate title to their individual interests, joint tenants together hold a single title to the property. |
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Term
| joint tenancy: equal ownership |
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Definition
| Joint tenants own equal shares in the property, without exception. If there are four co-tenants, each owns 25 percent of the property. If there are ten co-tenants, each owns 10 percent. |
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Term
| joint tenancy: transfer of interest |
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Definition
| A joint tenant may transfer their interest in the property to an outside party, but only as a tenancy in common interest. Whoever acquires the interest co-owns the property as a tenant in common with the other joint tenants. The remaining joint tenants continue to own an undivided interest in the property, less the new cotenant’s share. |
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Term
| joint tenancy: survivorship |
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Definition
In most states, joint tenants enjoy rights of survivorship: if a joint tenant dies, all interests and rights pass to the surviving joint tenants free from any claims of creditors or heirs.
When only one joint tenant survives, the survivor’s interest becomes an estate in severalty, and the joint tenancy is terminated. The estate will then be probated upon the severalty owner’s death.
The survivorship feature of joint tenancy presents an advantage to tenancy in common, in that interests pass without probate proceedings. However, joint tenants relinquish any ability to will their interest to parties outside of the tenancy. |
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Term
| Creation of Joint Tenancy |
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Definition
To create a joint tenancy, all owners must acquire the property at the same time, use the same deed, acquire equal interests, and share in equal rights of possession. These are referred to as the four unities.
Unity of time: All parties must acquire the joint interest at the same time.
Unity of title: All parties must acquire the property in the same deed of conveyance.
Unity of interest: All parties must receive equal undivided interests.
Unity of possession: All parties must receive the same rights of possession. |
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Term
| joint tenancy termination |
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Definition
A joint tenancy is terminated when any of the four unities is broken.
Sale of an interest: If there are three joint tenants and one sells their interest to a fourth party, this fourth party becomes a tenant in common with the remaining two joint tenants.
Bankruptcy of any of the joint tenants.
Foreclosure of the property
Partition suit: as stated above under Tenants in Common |
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Term
| Who decides how title to real estate will be held (what type of ownership)? |
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Definition
| The grantee or buyer decides. The seller decides the type of estate transferred. |
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Term
| What are the primary differences between tenancy in severalty and co-ownership? |
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Definition
| The primary difference is the number of owners—one versus two or more. Secondarily, the treatment of the estate on the death of an owner. In a severalty, the estate passes to heirs by probate. In a co-ownership, the estate may pass to heirs (tenancy in common) or to surviving co-owners (joint tenancy, tenancy by the entireties, tenancy in partnership) or to a combination (community property). |
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Term
| What are the primary differences between tenancy in common and joint tenancy? |
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Definition
| Title—only one title in a joint tenancy, multiple titles in tenancy in common; ownership share—equal shares in joint tenancy, electable in tenancy in common; transferability—tenant in common may sell, encumber, etc., their share, but the joint tenant’s interest becomes a tenancy in common interest if sold; survivorship—the joint tenant’s interest goes to other joint tenants on death, but tenant in common’s interest goes to heirs; creation—joint tenancy requires the four unities, otherwise a tenancy in common results. |
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