Tenancy v Tenants in Common

A client asked me last week about what happens to property held under either of the two options above if one of the owners was to pass away.

A joint tenant cannot deal separately with their interest in the asset under their Will.  On the death of an owner of a jointly held asset, the principle of survivorship applies.  Under this principle, all interests in the asset automatically vest in the surviving joint tenant by law.

Tenancy in common occurs where two or more persons own separate, identifiable interests in an asset.  None of the tenants in common is entitled to exclusive possession of any part of the asset without the other(s), but each person is able to sell or dispose of their separate interest in the asset and to deal with that interest under their Will.

For example, Joe and Jim hold a property as joint tenants.  Joe has two children from a previous marriage and wishes to provide for them in his Will if he was to pass away.  Joe gets hit by a bus on his way home from work but unfortunately, due to the way that the property is owned, Jim now owns 100% of the property and Joe's children do not benefit.