By Law Teacher
THE LAW ESSAY PROFESSIONAL
6.2.1 Severance – Introduction
Welcome to the second lesson of the sixth chapter in this module guide – Severance.Severance is the name given to the process of converting a joint tenancy into a tenancy in common. Severance tends to be used for one of two purposes: excluding the future operation of survivorship, or ending the perpetuating existence of the so-called unities of interest and title.
At the end of this section, you should be comfortable understanding the effects of severance as well as the various ways in which it may come about.
This chapter will first discuss the background of severance insofar as it is a process that changes joint tenancies into tenancies in common. The chapter will then discuss the various means by which severance can be undertaken. They include: severance by written notice; severance by an act of a joint tenant ‘operating upon his own share’; severance by mutual agreement; severance by mutual conduct; severance in consequence of unlawful killing; severance by merger of interests; and old archaic means of severance. The chapter will examine how severance impacts on, and is impacted by, family breakdowns. Finally, as with all other chapters, several hands-on examples are provided.
Goals for this Section
- To understand what severance is
- To understand how it may come about
Objectives for this Section
- To be able to define severance
- To be able to differentiate and apply the various ways in which severance
- To understand how family breakdown affects severance
6.2.2 Severance Lecture
Holding a legal interest means to be responsible for the administrative responsibilities and duties inherent in the land. A trust of land is essential for the purpose of legal co-ownership (Williams & Glyn’s Bank Ltd v Boland  A.C. 487; Trusts of Land and Appointment of Trustees Act 1996 s.1). Likewise, equitable ownership of the land requires a trust in land (Law of Property Act 1925, ss.34 and 36).
Of particular importance to joint tenancies are the doctrines of survivorship and the four unities. Survivorship is the process by which one joint tenant takes the interest of another joint tenant wholly upon the death of that other joint tenant. The opposing process is where a tenant (a tenant in common) is able to pass on their interest to another by means of a will. The four unities are the so-called unities of possession, interest, title, and time. Joint tenancies feature all of these unities, whilst tenancies in common are only required to have unity of possession.
Severance tends to be used for one of two purposes: excluding the future operation of survivorship, or ending the perpetuating existence of the so-called unities of interest and title.
The act of severance produces among the former joint tenants a share in the property that is equal to the shares of all other tenants in common – (Nielson-Jones v Fedden  Ch 222. Unless there are only two joint tenants, the severance will affect only the severing tenant(s).
Limits on severance
Firstly, it cannot be effected by a will. It must be effected during the lifetime of the person intending to sever the interest. Second, it cannot be brought about for legal estates; it can only be effected for equitable shares in an estate (Law of Property Act 1925, s.36(2)). As to the latter limitation, it means that co-ownership will automatically and irreversibly take the form of joint tenancy. Alternatively, it can be ended upon disposal of the estate (Law of Property Act 1925, ss. 36(2)-(3)).
There is an exception to the rule that severance cannot be effected by will, namely an execution of mutual wills by joint tenants intending to bring about a severance. Such a position arises where the course of dealing between the parties gives rise to the inference that both parties mutually considered their interests as tenancies in common and were prepared to put that inference forward in writing (Williams v Hensman70 E.R). Such a mutual intention must be unambiguous.
SeeGreenfield v Greenfield(1979) 38 P & CR 570, ChD & Harris v Goddard  1 WLR 1203, CA.
HOW TO SEVER
Re Denny  L.J.R. 1029 – Severance can be effected by one of several methods:
a)Severance by written notice (Law of Property Act 1925, s.36(2))
Under this method, a tenant gives a ‘notice in writing’ to the other tenants of their own ‘desire’ to sever the tenancy (Law of Property Act 1925, s.36(2)). There are several advantages and limitations
·No consent is required from the other joint tenants (Harris v Goddard ). Further, it is not necessary for the notice to be signed and can even be undertaken via an application to the court for a declaration of the rights for each tenant (Re Draper’s Conveyance  1 Ch 486, ChD).
·However, for the written notice to be effective, it must be served on all existing tenants. It must express an intention to sever with immediate effect, and not at some time in the future (Harris v Goddard ).
·Additionally, it might be argued that this method of notice does not apply where the names on the legal title are not identical to the beneficiaries behind the trust.
·Re Heys (deceased) 
b)Severance by an act of a joint tenant ‘operating upon his own share’
There are three methods of severance dating back from the Law of Property Act 1925, s.36(2), that reflect the categories laid down by Page Wood V-C in Williams v Hensman. The first category of the three is any ‘act’ by a joint tenant ‘operating upon his own share.’ This method of severance is a unilateral act (Harris v Goddard ) and when the joint tenant acting to sever their interest does so, they can effectively conceal that alienation from the other joint tenant(s) (Mortgage Corporation Ltd v Shaire  Ch 743, ChD). The person so acting must have intended the act to be final and irrevocable, particularly as it prevents any claim for survivorship for themselves. There are different types of ‘acts’ which could apply:
·Transfer inter vivos – given that joint tenancies do not have shares, it is to be inferred that if a joint tenant wishes to act on their ‘share’, they must be presuming that they no longer wish to be regarded as a joint tenant. It must be performed by written disposition or via a constructive trust (Law of Property Act 1925, ss. 53(1)(c), 53(2)).
·Alienation by mortgage – If one joint tenant acts to charge or mortgage the jointly held entitlement, that charge attaches solely to the interest of that joint tenant as if there had been an outright transfer of that tenant’s “share” (First National Securities Ltd v Hegerty  QB 850, CA). The severance takes effect in equity, whilst their legal interest remains unaffected by the severance.
·Involuntary alienation – There are various types of acts which have the effect of severing, even where the alienation is involuntary. E.g. bankruptcy (Re Pavlou (A Bankrupt)  1 WLR 1046, ChD). Imposing a charging order in respect of a money judgment against one of the joint tenants will also act to sever the interests (Charging Orders Act 1979 ss.2(1)-(2) and 3(4), Midland Bank Plc v Pike  2 All E.R. 434).
Acts which are ‘insufficient’ for the purposes of severance
Usually, a testamentary disposition is not in itself sufficient where the testator is still alive. Furthermore, where there is a declaration of an intention to sever, that intention is ineffective if there is no written notice (Corin v Patton(1990) 169 CLR 540 (HC of Australia).
c)Severance by mutual agreement
In Williams v Hensman, Page severance might not just be effected unilaterally, but could also come about by way of mutual agreement. This would require the agreement of all the existing joint tenants that the interests should thereafter be severed. Unlike with unilateral severance, there is no requirement for an enforceable contract, and there may not even need to be anything put in writing (Law of Property (Miscellaneous Provisions) Act 1989, s.2(1)). If in the course of discussions the parties only reach an ‘agreement in principle’ to the idea, then without further evidence of the parties actively consenting to the severance, such agreement in principle would be taken to mean the parties have reserved their right to the joint tenancy, and therefore there is no severance (Gore and Snell v Carpenter(1990)).
Exclusion of survivorship
For severance by mutual agreement to be valid, the parties must have contemplated that they would thereafter be dealing with the property as tenants in common, no longer as joint tenants (Burgess v Rawnsley  Ch 429, CA). Alternatively, an agreement that the proceeds of sale of the given property are to be divided between the tenants in specified proportions will give rise to an act of severance by mutual agreement (Crooke v De Vandes(1805) 11 Ves 330). However, in such a situation, the shares between the parties will actually, by operation of law, be in equal shares rather than in whatever portions the parties had agreed (Hunter v Babbage  2 FLR 806, ChD).
d)Severance by mutual conduct
Consists of ‘any course of dealing sufficient to intimate that the interests of all were mutually treated as constituting a tenancy in common’ (Williams v Hensman 70 E.R.). The key phrases in that passage are:
i)Sufficient to intimate
ii)Interests of all
iv)Constituting a tenancy in common.
‘Sufficient to intimate’ suggests that there is some threshold to satisfy. The word ‘intimate’ means that the circumstances effectively imply a tenancy in common. Second, the ‘interests of all’ demonstrates that all of the tenants must have their interests affected by the severance. Third, ‘mutually treated’ means all the tenants treat both their own interests and all the other interests as severed; no joint tenancy remains. Finally, all of these together point to a ‘tenancy in common.’
The conduct must be such that the pattern of dealing between all of the parties is, though not quite unambiguous and explicit enough to constitute a mutual agreement to sever, nevertheless evince a clear common intention to sever the joint tenancy. As with above, it must be clear that the parties to preclude the further operation of survivorship (the key component of joint tenancies. Ultimately, there must be a consensus between all the joint tenants, as disclosed by a pattern of dealings with the co-owned property, which would in effect exclude the future operation of the right of survivorship (Quigley v Masterson  EWHC 2529 (Ch)).
With all that said, mutual conduct is not evidenced by the following:
·Physical conversion of jointly-owned premises into separate and self-contained units (Greenfield v Greenfield (1979)).
·Negotiations between the parties to divide the interest in the property into shares that are inconclusive (Harris v Goddard ).
·Where one party ‘offers to buy out the other for X and the other makes a counter-offer for Y’ (Burgess v Rawnsley  per Sir John Pennycuick).
·Finally, it is not enough that each joint tenant had independently treated the joint tenancy as severed; there has to be a mutual understanding.
e)Severance in consequence of unlawful killing
A joint tenant, criminally implicated in the death of another joint tenant, should not be able to benefit via survivorship from receiving the interest of the deceased (Re K, decd  Ch 85, Ch D).
In cases other than those involving murder, the court has a statutory discretion, though it is limited (Forfeiture Act 1982, s.2(2)) to modify the operation of the forfeiture rule.
f)Severance by merger of interests
·This is a rare scenario, but not impossible. It applies where the four unities inherent in joint tenancies are abolished by a so-called “merger” of interests.
g)Old forms of ownership
Prior to 1 January 1926 there was a form of co-ownership in England known as tenancy by entireties. This type of co-ownership was a type of joint tenancy between husband and wife that could not be severed. In 1926 all such tenancies were rendered by operation of law as joint tenancies (Law of Property Act 1925, Schedule 1, Part VI).
Firstly, a legal joint tenancy of the periodic lease can be problematic because it requires unanimous action by joint tenants. One of the joint tenants can effectively frustrate the process and bring the lease of the family-owned home to an end by simply refusing to enter into a further term (Hammersmith and Fulham LBC v Monk  1 A.C. 478).
Following this case of Monk, further cases under the Human Rights Act 1998 sought to challenge that problem, because it meant service of a notice to quit by a joint tenant of the periodic lease would bring the lease to an end without any judicial review of the merits of the argument that this refusal disproportionately infringed on loss of property and occupation rights (Articles 1 and 8 of the European Human Rights Convention 1956, as argued in Qazi v Harrow LBC  UKHL 43).
Manchester City Council v Pinnock  UKSC 45 considerations.
For co-habitation etc. the starting point is that equity follows the law and the equitable interests would mirror the joint legal interests.
The cases brought about an idea of equal division – meaning each husband/wife/civil partner held a share of 50% of the land. This equal division was then subject to a process of factual scrutiny by which the court would determine whether the parties, by express agreement or by course of dealing, had established that their shares were unequal.
6.2.3 Severance Lecture – Hands on Example
The sections set out above discuss various parts of the law for severance of joint tenancies. This section provides a series of problem questions that probe different areas of the matters we have just been examining. The answers to the questions can be found at the bottom of the page, however you are encouraged to attempt to answer the questions first based on your own recall or notes of the topic before looking at the answers.
Always think about the facts, the relevant statutory provision, the cases that interpret that provision, and what the outcome will be based on how those principles and cases apply to the question. As you may have gathered the Law of Property Act 1925, particularly s.36(2) is especially important. Although you would not be expected to give the full citations of cases you cite (just the names of the parties and the year is usually sufficient, the name of the judge giving the ratio is even better!), you will be expected to accurately cite the relevant sections and subsections of the legislation. Simply reciting the name of the statute in your exam without the corresponding section and subsection will not be sufficient.
Here is a rough guide for severance questions:
1)Look to see if there is a joint tenancy. This is usually indicated by wording like ‘A and B purchased the estate C together at the same time.’
2)Next, look to see if either party is hoping to sever. It is likely they intend to sever because of family breakdown and/or they want to ensure their share of the property is passed on to their beneficiaries in their will.
3)Now look to see if any of the possible measures of severance apply. They can be unilateral (written notice/operating upon one’s own share) or mutual (agreement/conduct), or one of the other exceptions (homicide).
Q1. Alan and Bertha purchase Blackacre together as a married couple. Their relationship subsequently breaks down. Bertha, while away on holiday, posts a notice to Alan indicating that she wishes to “take my fair share of the property, 60%.” Alan does not read the notice as he is hospitalised for heart failure. He is given a terminal prognosis. When Bertha returns to Blackacre and learns of his hospitalisation, she destroys the notice. Alan never reads it. Upon Alan’s death, representatives of his estate, looking to settle his debts, learn of the notice.
Q2. Charlie and Delilah are joint tenants of Whiteacre. Delilah writes a will in which she attempts to bequeath Whiteacre “wholly and entirely” to her child, Eric. When Charlie learns of her attempts to dispose of the property he arranges for Delilah’s death. Delilah is killed by agents acting for Charlie. Eric wants to obtain the property.
Q3. Florence and Gertrude purchase Redacre together at law and in equity. They become estranged. Florence and Gertrude draw up lines throughout Redacre, and they each claim the areas within the lines as “theirs”, into which the other cannot enter. Gertrude then goes on to charge the estate to Homes Ltd, with the intent to purchase more property using her share. When Gertrude falls ill, Florence wants to know if she is liable for Gertrude’s charge.
Q4. Irene, Julian and Karen have purchased Greenacre together. Irene then informs Julian and Karen that she may want to leave the property. The three start discussing about how they would apportion their respective shares of the property. After Karen provides them both with a letter saying she intends to leave Greenacre “in the future”, there is no further discussion between them. Julian goes traveling, and sends a letter to Irene only saying that he intends to sever his interest. Karen never sees that notice or receives a notice from Julian. Irene, getting antsy about the situation, is deliberating on whether to ask the court for a determination.
A1. This is a reprisal of the situation in Kinch v Bullard. As you will recall, according to that case, a notice is immediate upon its provision, and is effectively irrevocable. So although Alan never reads the notice, severance occurred upon the notice being posted. As to the 60%, one can mention Stack v Dowden, given that the court will conduct an analysis of who is entitled to what share of the property.
A2. As we have seen, a joint tenancy and the concept of survivorship will usually frustrate efforts in a will to dispose of property in favour of the beneficiaries named there. However, because Charlie is criminally implicated in Delilah’s death, the court will look to prevent him from profiting from his criminal enterprise. Severance thus occurs and Delilah’s share passes to Eric.
A3. The two attempt to physically separate the property, however according to Greenfield v Greenfield this does not amount to severance. However, as per First National Securities Ltd v Hegerty, the charge means that Gertrude is operating upon her own share. This necessarily gives rise to severance.
A4. Following Harris v Goddard, we can discount two of the possibilities in this question immediately. Firstly, there are discussions to sever the interests, however because the discussions are inconclusive, there is no severance. Second, when Julian sends a written notice to Irene, he fails to send one to Karen. Therefore, the requirements for written notice are not satisfied because not all joint tenants are given notice. And third, because Karen writes to them saying she intends to leave “in the future” rather than immediately her notice is ineffective. However, Irene could yet succeed in severing the interest if she were to apply to court for a determination (Re Draper’s Conveyance). This is the course of action that is likeliest to succeed. Further, given the number of deliberations between them, this may amount to a course of dealing that is short of an agreement but indicates they have a shared mutual intention.