Session 11 Notes

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I. Co-Tenancies - Creation

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A. Joint Tenancy Creation

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Common Law Requirements

• Four Unities Required: Time, Title, Interest, and Possession
• Presumption: Favored joint tenancy over tenants in common
• Straw Person Requirement: When one person already owned property, must convey to third party, then re-convey back to create joint tenancy

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Modern Law

• Specific Language Required: Must show grantor’s intent to create joint tenancy
• Presumption REVERSED: Modern law presumes tenants in common if ambiguous
• Survivorship Language: Some states require express provision (e.g., “to A and B as joint tenants with the right of survivorship”)
• Ambiguous Language: “to A and B jointly” might or might not create joint tenancy - must argue both sides
• State Variations: A few states have abolished joint tenancy entirely
• No Straw Person: Modern law allows individual to create joint tenancy through single deed without straw person

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Key Principles

• Right of Survivorship: Last remaining survivor succeeds to 100% ownership interest
• Will is Void: If joint tenant dies, their will is void as to the property interest - nothing passes to heirs

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B. Tenancy by the Entirety

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Requirements

• Joint tenancy PLUS marriage
• Must be a legally recognized marriage
• “Dating for a long time” or “married in spirit” is insufficient

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Severance

• More difficult to sever than joint tenancy
• Methods:
  • Divorce
  • Mutual agreement
  • Death of one spouse
  • Creditor reach issues (covered in community property/family law)

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C. Tenants in Common

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Modern Presumption

• Default presumption when language is hopelessly ambiguous
• In practice: exam questions will always have enough facts to argue creation

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II. Joint Tenancy - Severance

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A. Methods of Severance

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1. Transfer to Another Person

• Joint tenant can transfer interest to third party
• Severs the joint tenancy
• Creates tenancy in common between remaining original tenant and transferee

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2. Transfer to Oneself

Riddle v. Harmon (California, 1980) Facts: Married couple owned property as joint tenants. Wife executed deed transferring property to herself to sever joint tenancy without husband’s knowledge. Common Law Rule: Required “straw person” - must convey to third party, then re-convey back. Modern Rule (California): Individual can create joint tenancy through single deed without straw person. Holding: Logical extension - if can create joint tenancy by deed to oneself and another, can also SEVER by deed to oneself. Key Principles:

• Co-tenant can reconvey deed to themselves, naming other tenant as tenants in common
• No notice required - other tenant doesn’t need to know
• Secret severance is permitted

Distinction:

• Common Law: CANNOT sever by transferring to yourself; must transfer to someone else
• Modern Law: CAN sever by transferring to yourself

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B. Mortgage as Potential Severance

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Lien Theory (MAJORITY VIEW)

Harms v. Sprague (Illinois Supreme Court, 1984) Facts: Brothers William and John owned property as joint tenants. John mortgaged his interest without William’s knowledge. John died while still making payments. Mortgage recorded after death. Issues:

1. Does mortgage sever joint tenancy?
2. Does mortgage lien survive death?

Holding:

• Mortgage does NOT sever joint tenancy
• Mortgage creates only a LIEN, not transfer of title
• Bank holds conditional/security interest only
• When mortgaging tenant dies, their interest disappears
• Bank gets NOTHING (lien dies with the interest)
• Surviving tenant succeeds to 100% ownership free and clear

Key Principles:

• “Lien theory” - bank never takes title, only has security interest
• Bank’s interest limited to whatever the mortgaging tenant has
• Exception: If bank forecloses BEFORE death, bank takes title and becomes tenant in common

California: Follows lien theory (majority view)

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Title Theory (MINORITY VIEW)

Rule: Bank actually takes TITLE when mortgage executed Consequences:

• SEVERS the joint tenancy immediately
• Bank becomes tenant in common with other tenant
• If mortgaging tenant pays back in full:
  • Bank re-transfers title back to mortgaging tenant
  • Tenants remain as TENANTS IN COMMON (NOT joint tenancy)
• If mortgaging tenant dies while payments ongoing:
  • Bank remains tenant in common with surviving tenant

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No Notice Requirement

• Joint tenant can mortgage interest without telling other tenant
• Other tenant’s consent not required

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III. Co-Tenancy Rights and Obligations

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A. Ouster

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Definition

• Excluding another co-tenant from ownership or interest in property
• Physically stopping them from entering
• Failing to recognize co-tenant’s right or access to property

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Requirements for Ouster

Spiller v. Mackareth (Alabama Supreme Court) Facts: Spiller and Mackareth owned building as tenants in common. Lessee vacated. Spiller entered and used as warehouse. Mackareth sent letter demanding Spiller vacate half or pay half rental value. Spiller did neither. Spiller put locks on building. Issue: Whether demand to vacate or pay rent + changing locks = ouster Holding: NO ouster occurred Reasoning:

• Letter demanding “vacate or pay rent” insufficient to establish ouster
• Changing locks alone does not constitute ouster (locks were to protect merchandise)
• No evidence Mackareth ever requested keys or tried to enter
• No evidence Spiller denied access or told Mackareth they had no interest

Key Principle: Must have actual denial of access or express statement excluding co-tenant

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What CONSTITUTES Ouster

• Direct/express statement of exclusive ownership (but need more than just this)
• Physical prevention from entering
• Letter from attorney threatening arrest for trespass if co-tenant enters
• Note: Co-tenant doesn’t have to actually TRY to enter if clearly warned off

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What Does NOT Constitute Ouster

• Simply using the entire property
• Placing “no trespassing” signs (ambiguous - could mean “no one but us co-tenants”)
• Changing locks without denying access
• Letter demanding rent or vacate (without actual denial of use)

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Consequences of Ouster

• Ousting tenant owes money to ousted tenant
• Adverse possession clock starts ticking
• CRITICAL: CANNOT claim adverse possession unless ouster occurred
• Co-tenant cannot adversely possess against co-tenant without ouster

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B. Leasing by Co-Tenant

Schwartzbaugh v. Sampson (California 4th District Court of Appeal) Facts: Husband and wife owned land as joint tenants with right of survivorship. Husband leased part to Sampson for boxing pavilion (with liquor and entertainment) against wife’s wishes. Wife sued to void lease. Holding: Co-tenant can lease their interest to third party WITHOUT severance Wife’s Argument (REJECTED): Feared losing interest by adverse possession Court’s Response:

• No ouster occurred
• Wife never denied access
• Claim was premature

Key Principles:

• Lease by one co-tenant does NOT sever joint tenancy
• Lessee cannot adversely possess without ouster of other co-tenant
• This case contains many important rules not found elsewhere in casebook

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C. Sharing Responsibilities

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Repairs, Upgrades, and Improvements

• Without agreement: NO obligation to contribute
• Tenant making improvements can seek reimbursement LATER if property sold
• Important exam issue that students regularly miss

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Rents and Profits

• Co-tenant profiting from land use may need to share proceeds
• Example: If growing plants/crops from the earth, must share those proceeds
• See casebook Note 1 on page 434

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Taxes, Mortgage Payments, Other Carrying Charges

• See casebook notes on page 434

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IV. Partition

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A. Types of Partition

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1. Partition in Kind

• Physical division of property
• Court awards specific portions to each co-tenant

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2. Partition for Sale

• Court orders property sold
• Proceeds divided among co-tenants

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B. Standard for Choosing Partition Type

Delfino v. Vealencis (Connecticut Supreme Court) Facts: Angelo, William (plaintiffs), and Helen Vealencis (defendant) owned 20.5-acre parcel as tenants in common. Defendant lived on property and operated rubbish/garbage removal business. Plaintiff (residential developer) proposed developing into 45 residential lots. Issue: Partition in kind or partition for sale? Holding: Reversed trial court; partition in kind more appropriate Reasoning - Balancing Test:

• Defendant’s livelihood connected to land (business + residence)
• Defendant would lose livelihood if forced to sell
• Plaintiff didn’t reside on or operate business on property
• Economic/financial benefit alone NOT dispositive
• Must balance equities of ALL parties

Court Action: Remanded to trial court to conduct balancing test and consider equities

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Legal Standard

• Court rules in “best interests of the parties”
• Balancing test measuring equities of parties

Factors to Consider:

• Does someone live on the property?
• Does someone earn living from property?
• What is reason for selling?
• Physical characteristics of property (can it be fairly divided?)
• Economic incentives vs. personal/livelihood interests

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Exam Approach

• Discuss BOTH types of partition
• Analyze facts supporting each side
• Make commitment to one conclusion
• Must measure equities of each party’s interest
• Professor wants all important facts discussed, doesn’t care which way you conclude

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Testing Frequency

• Tested twice on final exams (maybe 2 years in a row)
• Not tested on California Bar essays (to professor’s knowledge)
• Appropriate for essays because it’s an arguable issue

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V. Partition - Unavailable

Important: Partition is unavailable to tenants by the entirety

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VI. Exam Tips

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General Principles

• If exam says “valid deed” - prevents questioning validity (2nd semester issue)
• “Without informing” another party - usually legally insignificant
• Read fact pattern TWICE before writing
• Chronological indicators important (“thereafter,” “in 2003,” “years later”)
• Numbers/measurements included for reason (10 acres, 20 years, etc.)
• Look for highlighted or emphasized facts - usually important

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Essay Writing

• Organization not critical (substance over form)
• No need for headers like “Alice’s interest,” “Bob’s interest”
• Just need to follow logical progression of issues
• Commitment to conclusion matters - pick a side

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Testing History

• Partition: tested twice (maybe 2 years in a row)
• Harms case (mortgage/lien theory): tested twice in 12 years
• Schwartzbaugh: contains many rules not found elsewhere in casebook - re-read carefully

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VII. Important Case Summary

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Must Know Cases

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VIII. Key Distinctions

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Common Law vs. Modern Law

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Lien Theory vs. Title Theory