Recent Developments in Joint Tenancy

1. Recent Developmentsin Joint Tenancy April 2, 2009 Diane B. Davies

2. What is a Joint Tenancy • Form of ownership in which each joint tenant possesses the entire estate, rather than a fractional share

3. Four Unities • Interest • Title • Time • Possession

4. Four UnitiesBlackstone • One and the same interest • Accruing by one and the same conveyance • Commencing at one and the same time • Held by one and the same possession

5. Common Law • At early common law, a conveyance to two or more persons (other than a husband and wife) presumed to create a joint tenancy. • Evolved to a presumption of tenancy in common

6. Colorado Statutes C.R.S. § 38‑31‑101 Predecessor statute adopted by the Territorial Legislature in 1861

7. Required Language • In Joint Tenancy • As Joint Tenants • JTWROS • As Joint Tenants with Right of Survivorship • In Joint Tenancy with Right of Survivorship

8. Deed to Self • “Any grantor in any such instrument of conveyance may also be one of the grantees therein.”

9. The Four Unities Interest Title Time Possession

10. Survivorship • The survivor does not take any new or additional interest on the death of his joint tenant - takes under original conveyance or devise • The death of a joint tenant does not result in a transfer of that tenant's interest to the survivor, but merely terminates any interest of the decedent • Any liens existing against the deceased joint tenant's interest are extinguished • Result of the unity of interest

11. Severance of a Joint Tenancy • Conveyance of the interest of one joint tenant • Mortgage of one joint tenant’s interest in a title theory state – not Colorado • Execution sale on one joint tenant’s interest – but not attachment of judgment lien • Contract or agreement • Destruction of one of the four unities • Modern View – Intent to terminate right of survivorship

12. Severance of Joint Tenancy • Felonious killing of a joint tenant • Dissolution of marriage, except as provided in an agreement or court order • Unilaterally executing and recording an instrument conveying his interest to himself as tenant in common?

13. Taylor v. Canterbury • Taylor conveyed ranch to himself and Canterbury as joint tenants • Taylor subsequently executed a quitclaim deed from purporting to transfer the property back to himself and Canterbury as tenants in common. The second deed stated: “It is my intention by this deed to sever the joint tenancy created by [the 1991 deed], and to create a tenancy in common.” • Taylor died

14. Taylor v. Canterbury • Who owned the property? • Canterbury claimed the deed from Taylor to himself was invalid and she owned 100% as surviving joint tenant. • Trial court and court of appeals concluded that once a joint tenancy is created, the rights of each joint tenant are “fixed and vested.” Held that Taylor couldn’t unilaterally sever.

15. Canterbury v. Taylor Supreme Court concluded: • Deed to self valid • Four unities abolished • Creation and severance of joint tenancy depend on the intent of the parties

17. 2006 Amendments toCo-Tenancy Law • Provides the exclusive method of creating a joint tenancy • Confirms that a joint tenancy may only be created between natural persons, except in the case of fiduciaries • Created a presumption that a conveyance to two fiduciaries creates a joint tenancy • Any conveyance to two or more persons which does not create a joint tenancy creates a tenancy in common • There is no Tenancy by the Entirety in Colorado

18. THE FOUR UNITIES • Interest • Title • Time • Possession

19. After Taylor v. Canterbury • Are the four unities still relevant? • Have they been abolished?

20. 2008 Amendments to CRS 38-31-101 • The doctrine of the four unities of time, title interest, and possession is continued as part of the law of this state, subject to certain modifications made by the statute • The specified sections which vary from the common law concept of the four unities, are intended to clarify, supplement, and limited to their express terms, modify the four unities

21. 2008 Amendments to CRS 38-31-101 • Clarifies and confirms that for the purposes of the statute, the doctrine of the four unities means “the common law doctrine that a joint tenancy is created by the conveyance or devise of real property to two or more persons at the same time of the same title to the same interest with the same right of possession and includes the right of survivorship.”

22. Variance from Four Unities (1) “Any grantor in any such instrument of conveyance may also be one of the grantees therein.”

23. Variance from Four Unities 5(b) The filing of a petition in bankruptcy by a joint tenant shall not sever a joint tenancy

24. Variance from Four Unities 6(a) The interests in a joint tenancy may be equal or unequal

25. Other important changes • 5(a) joint tenant may sever by unilaterally executing and recording an instrument conveying his interest to himself or herself as tenant in common. • Joint tenancy is severed upon recording • Joint tenancy continue among other joint tenants

26. Other important changes • (6) The interests in a joint tenancy may be equal or unequal • Presumed to be equal • Presumption is conclusive if unrecorded as against person relying on the record

27. Other important changes • Section does not bar claims for equitable relief among joint tenants, including partition and accounting • In other words, although interests are equal, a court in equity may allocate proceeds differently

28. Devise to A as to a 60% interest, to B as to a 20% interest, and C as to a 20% interest, as joint tenants C dies What interests do A and B have? 3 or More Joint Tenants with Unequal Shares

29. Unequal Joint Tenancy • 75% to A • 25% to B

30. A owns 75% B owns 25% A dies, what does B own? 100% Unequal Joint Tenancy

31. Unequal Joint Tenancy • A owns 75% • B owns 25% • B executes a deed to himself as tenant in common with A What are their interests?

32. A and B are tenants in common • A owns a 75% interest • B owns a 25% interest If A dies, A’s heirs inherit the 75% interest, and hold as tenants in common with B

33. Important Exception (6)(d) For purposes of the Medical Assistance Act, a joint tenancy shall be deemed to be a joint tenancy with equal interests regardless of the language in the deed or other instrument

34. Use of “magic words” required to create joint tenancy If not a joint tenancy, tenancy in common Joint tenancy may be equal or unequal Presumed to be equal – conclusive for BFP Joint tenancy may be severed by deed to self Summary

35. PROOF OF DEATH 2006 STATUTORY REVISIONS • Specifies the Contents of the Supplementary Affidavit • Recognizes Two Conditions – Death Certificate Available and Death Certificate Not Available

36. TITLE STANDARD 7.1.1 Prior Standard • Asks Whether a Death Certificate is Sufficient Without a Supplementary Affidavit Under §38-31-101 • Responds that it is Sufficient for the Purposes of §38-35-112

37. TITLE STANDARD 7.1.1 Revised • Asks Whether a Death Certificate Recorded Along with a Supplementary Affidavit Under§38-31-101 Makes Title Marketable in Survivor • Conforms to Statute • Indicates Application to Life Estate and Beneficiary Deed • Addresses the Concept of a Verification of Death • Addresses Filing of a Death Certificate and Supplementary Affidavit at Different Times

39. Recent Developmentsin Joint Tenancy April 2, 2009 Diane B. Davies