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What is joint ownership?

This content applies to England & Wales

A definition of joint ownership.

Overview

Joint ownership means that two or more people are the legal owners of the property. Usually, joint owners are liable for the whole of the payments for any joint loans secured on the property, and decisions about the property are made by all the joint owners.

Historically, the legal owner of the property is shown on the title deeds, but this is now only true of 'unregistered land'. If this is the case, the title deeds will normally be held by the lender (if there is a loan on the property), by the solicitor involved in the conveyance or by the owner her/himself. Most residential property is now registered, and information about ownership is included in the proprietorship register held at the Land Registry. A copy of this can be obtained from the Land Registry for a small fee.

Cohabitants who are joint owners are referred to in legal terms as 'joint tenants at law' (the use in this context of the word 'tenant' has nothing to do with rented property). This means that they are each entitled to possession of the whole of the land and the right to occupy it.[1] They are said to hold the property as trustees under a 'trust for sale'.

Cohabitants who are joint legal owners do not necessarily have the same beneficial interests (also known as equitable interests), which are the interests that they would be entitled to receive if the property were sold. They are either beneficial joint tenants (also called 'joint tenants in equity'), or tenants in common (also called 'equitable' or 'beneficial' tenants in common).

Beneficial joint tenants

If the cohabitants are beneficial joint tenants, then this means that they are both entitled to equal shares of the value of the property. If one of them dies, the whole of the beneficial interest will be owned by the survivor.

The transfer document of the property (ie form TR1) should contain an express declaration of interests by the join owners as to how they intend to hold the property. A statement to the effect that they hold the property 'in trust for themselves as joint tenants' (ie as beneficial joint tenants in equal share) will be binding if properly executed by way of written signature by each of the joint tenant.[2] If not, the respective interests of each joint owner will need to be determined under principles of constructive trust.

The House of Lords held that when resolving disputes about the beneficial interest of each join tenant in domestic cases, the starting point is a presumption that a property jointly purchased by the cohabitants as their family home is beneficially owned by each of them in equal shares.[3] In such cases, the presumption arises because in domestic cases purchasing property in joint names indicates an emotional and economic commitment to a joint enterprise, and because of the practical difficulty of analysing respective contributions to the property over long periods of cohabitation. Instead, the presumption does not arise in cases of investment purchases of buy-to-let properties by, for example, a mother and daughter who do not live together at the property.[4]

The presumption can only be rebutted if it can be shown that the joint tenants' common intention was in fact different, either when they purchased the property or at a later stage.[5] In such cases, the common intention of the joint tenants will be objectively deduced (inferred) from the conduct and dealings between them. Courts will take a range of matters into account and may consider matters such as the couple's financial arrangements generally and the division of their other assets. Financial contributions are relevant but other factors are also important. There is no exhaustive list of matters that the courts will consider as each case will turn on its own facts.

Where it is clear that the beneficial joint tenants had a different intention at the outset of their joint purchase, or changed their original intention over time, so no common intention as to their respective beneficial shares can be deduced by the court, then the court can impute to the joint tenants an intention (resulting or implied trust) that they are tenants in common and each of them is entitled to a fair and reasonable share as it thinks fit, again having regard to all the circumstances of the case.[6]

Tenants in common

If the cohabitants are tenants in common, it means that they have separate and distinct legal shares in the property. These shares may or may not be equal. To determine each tenant's share of the beneficial interest, it is necessary to look at contributions made and any deed or agreement as to the beneficial interest. Where the contributions of the cohabitants are unequal and there is no express declaration of beneficial interests, then it will normally be presumed that the cohabitants are tenants in common.

For more information about what type of ownership is held, and establishing shares in the property, see the page on Establishing each joint owner's interest.

Freehold and leasehold ownership

Ownership of a property may be freehold or leasehold. Freehold ownership is unlimited in time, while leasehold properties are let on a long lease for a fixed term. For more information about home ownership, see the Home ownership section. This section applies equally to freehold and leasehold property, but it does not apply to short-term leases or tenancies, for example for one or two years, or weekly or monthly - these are discussed in the section on Married/civil partner: joint tenant and the section on Cohabiting couples: joint tenants.

[1] Section 36 Law of Property Act 1925.

[2] s. 53(1)(b) Law of Property Act 1925; Insol Funding Ltd v (1) Cowlam (2) Cowey (3) Insol Funding Ltd [2017] EWHC 1822 (Ch).

[3] Stack v Dowden [2007] UKHL 17.

[4] Laskar v Laskar [2008] EWCA Civ 347.

[5] Jones v Kernott [2011] UKSC 53.

[6] Jones v Kernott [2011] UKSC 53; Barnes v Phillips [2015] EWCA Civ 1056; Insol Funding Ltd v (1) Cowlam (2) Cowey (3) Insol Funding Ltd [2017] EWHC 1822 (Ch).

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