Get it right – Legal ownership

The recent High Court case of Fantini v Scrutton and Others [2020] EWCH 1552 (Ch) considered how a property was legally held by a mother and daughter as “joint tenants” or “tenants in common”.

A joint tenancy is where each owner owns the whole of the property rather than a share with the result that, should one of the joint tenants pass away, their entire share will automatically pass to the other owner(s) through the doctrine of survivorship and not under their estate. Alternatively, joint property can be held as tenants in common with each owner holding a distinct share in the property. When a tenant in common dies, the property will pass under their estate in accordance with their will or intestacy.

Here, the property was held “jointly” and the daughter was the first to die. The daughter’s executors argued that the joint tenancy had been severed. If a joint tenancy is severed, this will create a tenancy in common. The significance being that the daughters share in the property if held as a tenant in common would pass to the beneficiaries under her will not to her mother.

The law states that service of a notice of severance is deemed served on the recipient in the ordinary course of post, regardless of whether delivery is effected. In this case, the court held that as the letter enclosing notice to sever was later returned undelivered, it did not constitute service. The court also considered the fact that the daughter’s solicitors had applied to the Land Registry to place a restriction on the register after they had sent the notice to sever. The mother received a letter from the Land Registry confirming the entry of the restriction but the court found that a “reasonable recipient” would not have considered this as service of notice to sever the joint tenancy or an act of operating on the daughter’s share.

As the joint tenancy had not been effectively severed, when the daughter died, the whole of her share in the property had passed to her mother through the doctrine of survivorship. This meant that the whole of the property fell under the mother’s estate for her executors to dispose of accordingly.

This case highlights the importance of ensuring that a property is only held “jointly” if it is the intention that the survivor automatically is entitled to the entire property. It also demonstrates the importance of ensuring any notice to sever has been correctly served.